Today was rather interesting to say the least. I don't have pics of the charts of my trades today as I was rather busy playing catch up shortly after 10 this morning. I had some tech issues that virtually sidelined me today; well except for my quick trades in PVG, ZLCS and PRAN. As I mentioned in my post yesterday, I've decided to invest in my trading education. A part of my trading education involved creating watch lists for the next trading day. When I first started trading (many, many moons ago-and even up to the day before I decided to undertake the education, I always wondered how traders came up with these watch lists.. I tried to do it, but if you've never been shown how to properly do it, you'll never know. I would simply come in the office in the morning and look at the top list and look for something to trade.. You can make money that way, however, when you want to be consistent, you have to come to the market prepared everyday with a list of potential stocks to trade.
I did my first real watch list last night and indicated to myself what I thought each stock would do. My scan left me with 10 stocks. I really liked three of them based on their chart and the move I expected them to take: PVG, ZLCS and PRAN.
My first choice was PVG. My thoughts on the stock was that it had to break through 6.50 in order to continue its upward trend. I tested twice at the end of the yesterday's trading session. If it didn't break, then I was prepared to go short once the stock broke the upward momentum. PVG did exactly what I figured it would do (remember I had two options on the trade; one long and one short). It broke the upward momentum and faded down nicely. I shorted at 6.40 I got out on the first bounce at 6.29
PRAN was an interesting trade. I caught it a little late. I saw it gapped up. Not sure how to play it, I left it alone. My review of the chart led me to develop the following hypotheses; the stock broke to new highs yesterday on strong volume. I believed that a break of yesterday's high would lead to another strong day; also, if the stock tests yesterday's high on light volume, the stock may simply trade in a tight range all day. It did trade in a tight range. I got in but quickly got out at 8.63 (same as my entry price) after the stock tested yesterday's high and quickly pulled back.
ZLCS was another interesting trade as I like it simply because it gapped up. I incorporated techniques that I normally use in gap trading simply because the stock gapped up. My view from last night was rather simple-if ZLCS broke 2.10, then 2.75 looked like a real possibility today. Funny enough, I didn't look for the other side of the trade if the stock didn't move. I got in at 2.07 and held to 2.23. I scaled out my last few trade out at 2.17 after the stock quickly dropped. Movements in these lower priced stocks are tricky. Moreover, the sharp move the stock made after is sold off in the opening minutes of the trading session was an indication that if you were in long, then you have to vigilant as a snap back could be imminent.
Minutes after those trades, i developed some tech issues and I my internet connection was lost. I wasn't able to continue paper trading. Nonetheless, I finished the day with a profit and I was more relieved at the fact that for the most part, I stuck to my trading plan coming into the day. At this point, I am really happy at my progress with my trading education. I know that after thoroughly reviewing the course a few more times, my progress and understanding of the market dynamics will exponentially improve.
On another note, this post is a fist for me as I am wrote this while waiting at the gate for my flight to Florida!!!! (I'm done now.......my flight leaves at 6:30 pm eastern time this evening).