TerryS's Blog

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TerryS

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My methodology

My trading journey has taken many twist and turns. At present I have settled on a simple methodology with rules that are designed to eliminate the biggest problem in my trading (myself!).
I trade US stocks. I identify a high probablility retracement pattern and enter 5 to 10 minutes after the open. I then set a 2% stop and leave the trade for two days exiting with a MOC (Market on Close) order. I never risk more than 1.5% of my account on any one trade.
My paper trading so far has been encouraging so I have started trading this method. . I will use this journal to increase my discipline.
I have an open trade: ABCO @ $39.50. (Stop $38.71) I will close this trade at the close of market Monday if not stopped out.
I intend to enter GNSS on Monday morning.
So here goes!!
 
Monday Close 7 March

ABCO(200) trade closed @ $39.27 for -$76
GNSS(600) trade open @ $14.87 for +$198
As per system I will close GNSS at close of market March 8
For tomorrow I will go long SNRR (500) soon after open.

Portfolio update: since 6/03/05 +0.97% (+$112)
 
Tuesday open March8

Long 500 SNRR @ $16.00 (stop 15.68)
Tempted to sell GNSS as it seems to have hit resistance. I will stick to plan and I have entered a MOC order to close the position at the end of the day
 
Tuesday Close March 9

GNSS trade closed @ 14.22 -$192
SNRR (500) @ $16.18 +$85

After being in profit yesterday GNSS turned into a loser, still the system calls for a 2 day hold. Backtesting has shown that the occassional big winner makes up for the losers like today.
Tomorrow I will go long COSI (1200)
Portfolio since 6/03/05 -$193 , -1.67%
 
Wednesday Open March 9

Entered Long 1200 COSI @ $6.83 (Stop 6.69)
SNRR changed to MOC order
 
Wednesday close March 9

SNRR trade closed @ $16.26 +$125
COSI trade stopped out @ $6.69 -$180

Tomorrow I will go long 1200 ESLR soon after market open.

Portfolio update since 6/03/05 -$333 -2.88%

A slow start to public trading. Still backtesting has been positive so I will persevere and stick to the system.
 
Thursday Close March 10

ESLR trade stopped out @ $6.57 -$168

Another trade stopped out, the second day running. Stick to the plan. It is not how often you win but how big your loses are.

I will go long 300 MCHP after the open

Portfolio update since 6/03/05 -$501, -4.33%
 
Friday Close March 11

I went long 300 MCHP @ $27.20 . It finished at $27.21 so no gain for the day. I will close the trade on market close on Monday.
I will also enter long 700 THOR soon after open.

Portfolio update: -$501, -4.33%
 
Hi TerryS,
very good journal - keep it up.
A question about the wins and losses - Are you including the commissions and brokerage fees in your wins and losses ?
I was just thinking, what proportion of your 4% loss is due to commissions. In the long-run, you expect to make money, but it may be helpful to find out if the drawdown is due to expensive broker, or due to the system. ( might make you feel better )
 
Weekend Thoughts

Well I'm down 4% one week, not what I expected!!. My papertrading had produced +23% in 2 months with a max drawdown of -5.2% (5 straight losers). I papertraded 25 trades over a period of 2 months and it produced a 60% win rate with average win nearly twice the size of the losers. A simple number games. Still when your first live trades are mostly losers you do question the validity of the system you are trading. Either I am in the middle of an expected drawdown or the system is suspect. What to do? I have to keep trading for another 5 or 6 trades and see if things change. If I continue to lose then it is back to the sytem drawing board . Lets see what happens in the week ahead.

Trendie: re your question. Yes commissions are included in the calculations. Thanks for the words of encouragement.
 
Monday close March14

MCHP trade closed @ #27.29, +$24
THOR entered @ $11.35 and stopped out @ $11.15, - $168.

I will go long 800 PLXT soon after the open tomorrow.

Portolio update since 6/03/05 -$645, -5.57%
 
Tuesday close March 15

Entered long 900 PLTX @ $10.55 and stopped out @ $10.33.. The trade was a loser, -$161.
Tomorrow I will go long 300 IDXC

Portfolio update since 6/03/05 -$806, -6.96%

Hard to go long in a down market. A steep learning curve at the moment.
 
Wednesday close March 16

IDXC trade (200 x $33.75) still open (+$118)
I have gone long 200 MLHR @ $30

Portfolio update since 6/03/05 -$688
 
Thursday close March 17

IDXC trade closed out @ $35.40, +$328
MLHR trade is still open, +$76
I will buy 300 ATPG tomorrow soon after the open

Portfolio update since 6/03/05 -$402, -3.47%
Nice to have some success today after the string of loses, still a way to go yet. Focus on the trading process.
 
Friday close March 18

MLHR trade closed +$64
ATPG trade is open +$33 (23.01/Stop 22.55 )
I will go long 400 ALDA on Monday's open

Portfolio update since 6/03/05 -$381, -3.29%

Well a slight improvement this week, enough to persist even though I am still in a losing position overall. A bigger sample of trades is needed to give more conclusive evidence on the system. One thing I do like about the system I am trading is it doesn't require a great deal of time. and the risk is limited through stoploss orders. The success of the system will depend on the occasional big winner. If the system can put me in the position to get that winner every now and then, then that should make up for the small losses. The small winners will keep me in the game. Patience and discipline is my responsiblilty. That's the theory, time will produce the reality.
 
Monday close March 21

ATPG trade stopped out @ $22.43, -$177
ALDA entered @n$18.12 still open, +$8
Tomorrow I will go long 700 SYNM near the open

Portfolio update -$583, -5.03%
 
Curious to know why you have consistently persisted in going long in a bearish phase of the market ?

Glenn
 
Tuesday close March 22

bought 700 SYNM @ $11.32 and it closed the day square. I will sell tomorrow at the close.
The ALDA trade closed @ $18.14, +$4
The market looks sick at the moment so I am reviewing my policy of going long in a falling market. Even when I get a winner for the day they seem to turn into a loser the folllowing day. There seems to be no follow through. My charts show no reasonable setups for tomorrow so I will let the SYNM trade run its course and sit on my hands for the day. I don't know how others are faring , but it seems a difficult market at the moment. Survival is the wise strategy.
Portfolio update -$594, -5.13%
 
Terry

fwiw I learnt quite painfully not to buck the market. Will take the odd half position against the market if the stock is showing itself to be bucking the trend and the set up looks good, but almost always want a following wind nowadays.

good trading

jon
 
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