12/16/16 Recap – AKAO – Strategy adjustment

+$1350 today on DRYS and EVOK.  Ending a bad week though after another stubborn hold on AKAO.

DRYS I went in short on the rebound after the morning wash with HOD as my risk.  I am particularly proud of this trade because I added into my winner.  I got one add and then did not fill on a second add, but that add order was in which is what was important.  I covered the last piece at almost dead bottom for the morning.  I did not re-short mid day because it was holding the lows so well.  It was 50/50 imo on if it would pop back green or continue down further.

EVOK I shorted on the morning pop with HOD as risk.  It broke that HOD and I covered–big accomplishment for me lately!  I then attacked it short again once it failed at the new HOD.  I shorted another time on the test and reject of HOD.

This week I got into a stubborn hold trade on Monday with AKAO.  I exited that trade yesterday.  This trade whipped out this entire months gains and then some.  I wanted to re-cap a few things with that trade for my future reference.  The day I started to short, I waited all day to get in, but when I did finally start to get in I went in with Guns blazing.  I had no risk level, no stop point.  I did not care where my unrealized loss was.  I just started attacking short.  For some reason I was convinced it would crash and I wanted to bank.  I saw $$$ signs.  Second, I did not get out when I had the chance pre-market the next day for a small +/- 1K gain.  I let $$$ influence me again and kept adding.  Third, I did not really have a trading plan so I got stubborn and held.  I made many mistakes on this trade, but these are the highlights.

Strategy Changes:

As a result of this big loss I am making a few adjustments to my trading strategy.  One, I will start to use hard stop losses for my planned stops.  I will continue to do this until I can trust myself to exit a trade when I should.  Second, no more front side shorts without some sort of pre-determined stop based on resistance levels.  Preferably my stop will be a HOD or close resistance point (Just like my two shorts today, I waited for a top to be put in before shorting and used that as my stop).  No more max $ stop losses as my stop for front side shorts. Third, no unplanned adds until trade is confirmed or already a winner.

My consistency is great!  But my risk management is poor due to my weaknesses here.  This is keeping me from maintaining profitability.  I let one trade get away from me and I wipe out weeks of hard work.  I tried to fix these things on my own all year, but to no avail.  So now, I am removing the emotions by using hard stops.  I will document and track any trade where I do not  follow these new rules until I can feel comfortable I have eradicated the issue.  I will report on those at the end of each week.

AKAO

DRYS

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