Hedge Fund Live's  Instablog

Today was a very interesting trading day for me and a day that I wanted to forget about until about 4:30, let me explain. I was well prepared and I had my game plan all figured out. The bell rings at 9:30, I buy the stocks I want to buy, I short the stocks I want to short and by 10:15 I am up $1200 roughly. Then I decided to get “smart” and I looked at the weekly chart of the S&P emini’s to determine if any resistance was there and I saw a level on the weekly chart at 1334.

Feeling good about my day, I sold my longs, left some small shorts on and waited to see what happened. The market continued to rally and I added into CTXS short (a name I wanted to be long today according to my plan) and I shorted IWM rather aggressively. My $1200 profit quickly became a $900 loss and I was quite unhappy with myself. Not so much for the loss but as I did not stick to my plan and did not hold onto the stocks that I entered at great levels, thanks VMW!

The good news is that I was not really big in these trades so I could withstand some pain and the market started to come in and I covered at a flat P&L. Of course everything went lower from there and I decided to get long at some sweet levels and got my P&L positive again to +$1350.

I messed around the afternoon and went home with some longs, most notably 500 CLF and 1,000 X. CLF reported at 4:30 and the stock quickly jumped up 8 points and my P&L jumped accordingly.

As I was lamenting my stupid trading day during lunch, I was talking on the broadcast about still being positive and that when you put in the effort, and do the right thing very often you get rewarded. Let’s face it, how many times have we violated our trading rules and it worked out in our favor? The answer: almost never!

I have been putting in a lot of effort to my swing trading plan and doing a ton of chart reading and clearly that work is paying off. Stay within your rules, always work hard and the payoff will come.

Happy Trading!