Carlos Danger's Trading Journal

C

CarlosDanger

Hi all - I've been trading seriously for a few months and have been keeping a journal at tradinglogblog.wordpress.com. I thought it might be nice to hear from other traders, both rookies and experts, as I struggle to develop some expertise in trading.

I started my journal on July 1 with $38k in my brokerage account (Interactive Brokers). I've since added another $50k. I've been trading mainly tech stocks (AAPL, AMZN, FB, NFLX, GOOGL, TSLA) and a pipeline stock (ETE), and occasionally ES and CL.

Ten days ago I would have said my first few months had been successful. I was up +1,352 in July and +6,892 in August. But I bought a huge position in ETE for a quick scalp right at the moment the market tanked, and now I'm waiting out a 27k drawdown. So far I'm down -4,259 in realized losses in September.

Up to that moment 10 days ago, I had been having great success trading ETE in a sideways market. I was making a modest loss with the tech stocks, and doing rather poorly with ES and CL.

I've been trading very basic patterns but am reading Bob Volman and Al Brooks, aiming to make the transition to price action trading. My preference is to day trade, although I'll occasionally swing, sometimes intentionally and other times for a day trade to recover. Ideally I'd like to focus on ES and CL. But I haven't had much success to date with either. I've forbidden myself from trading futures again until I can put in a successful week or two of paper trades.

You can read my prior journal at the blog, and I'll start copying my blog entries here as well.
 
September 20, 2016


After last week’s terrible trading, I decided to paper trade futures until I racked up some profits. But before the market opened, I made +1,300 on the simulator and decided to go ahead and live trade in the most cautious way possible. It worked. I made five trades in CL (+55, -76, +55, +85, +145), catching a nice opening bull trend.

As soon as I entered each trade, I put in a hard stop at the next technical level down. This approach got me stopped out once. The rest of the trades were almost immediately profitable, and I moved my stops to break-even as soon as the profit was 1x the distance between the buy price and the stop. Then when the profit reached 2x, I moved the stop to 1x above breakeven. A few trades stopped out this way. On the last trade, I sold when I saw the speed slow down and the price start to retreat. Then I stopped trading.

Usually I write my blog entries a few hours after I stop trading, or the next day. Today I’m writing it 75 minutes into the trading session to distract myself from attempting further trades. I have a tendency to try one last trade that gets me into trouble. So this is a sneaky way to retain the +267 profit I just made. A good start to the week.

Date Ticker Type Quantity Enter Exit PnL
20/09/16 CL Futures 1 44.45 44.60 145.38
20/09/16 CL Futures 1 44.26 44.35 85.38
20/09/16 CL Futures 1 44.19 44.25 55.38
20/09/16 CL Futures 1 44.21 44.14 -74.62
20/09/16 CL Futures 1 44.04 44.10 55.38
Total: 266.90
 
September 21, 2016

I made 16 trades today, all in CL, for +368 profit, which is a very nice result for me. But how I got there was pretty ugly.

Several hours before the market opened I was paper trading and doing well. So I thought I would switch over to my live account for a quick scalp as the London markets opened. That trade almost immediately went the wrong way, and to exacerbate things, the hard stop I entered didn’t trigger. I asked Interactive Brokers about this but couldn’t get a response from customer service. Later the price recovered and I was able to exit with +51 profit.

A few hours later after the US markets opened, CL was forming a big bull flag, and I traded in anticipation of a second leg up. But I set my stop too close (0.12 below) and got kicked out with a ‑95 loss. I re-entered the trade with a more reasonable stop and caught a piece of the second leg for a +75 profit.

That leg turned out to have a lot of momentum, and I got back into the trade quickly. But I did something wrong – after I had entered the order and putting in a hard stop, my account showed I had bought 8 contracts instead of one. I’ve never traded more than two contracts before, and 8 contracts is way too much exposure for me. Normally if a trade sours right after my order fills, I’ll wait to see if it recovers. But in this case CL went down by six cents, and the numbers in my P&L started exploding. I immediately got out with a -517 loss. This all took place over the course of about 45 seconds.

I make a lot of execution errors, probably because it’s the middle of the night for me in Australia. I go to sleep early, wake up in time for the US market open, then go back to sleep a few hours later when I’m done trading. Sometimes it takes a while to shake off the sleep.

After that -517 loss, the trading adrenalin jolted me awake. I went back to the chart and started seeing trades. I coldly made 11 successful trades in a row. There was a strong bull trend, and I mostly traded long, but I also shorted as well. It was probably the finest streak of trading I’ve ever had. After 10 trades I was profitable again for the day.

The 11th trade initially went against me – at one point putting me down more than ‑1,000 – but after rechecking the hourly chart I decided to let the trade continue with a wide stop at the LOD and an achievable sell limit order. I went back to sleep and woke at my normal time, after the US markets closed. The trade had recovered nicely, and I quickly closed out of the position for a +549 profit.

At that point I was up +709 for the day. But having just woken up, I was pretty groggy and neglected to cancel all of the still-live stops and limit orders. I was making coffee and eggs when a sell limit order was triggered by a rising CL. As I was heading out of the house to my day job, I glanced over at my computer and saw in horror that I had shorted CL and was down -329. I immediately closed it out, cancelled all live orders, and shut down completely.

I can’t complain about a +368 day, but this one in particular was a lot of work.

Date Ticker Type Quantity Enter Exit PnL
21/09/16 CL Futures 2 44.41 44.57 -329.24
21/09/16 CL Futures 2 44.20 44.49 549.76
21/09/16 CL Futures 2 44.08 44.26 110.76
21/09/16 CL Futures 2 44.30 44.31 10.76
21/09/16 CL Futures 2 44.28 44.30 30.76
21/09/16 CL Futures 2 44.17 44.19 30.76
21/09/16 CL Futures 2 44.15 44.20 90.76
21/09/16 CL Futures/short 2 44.12 44.09 50.76
21/09/16 CL Futures 2 44.23 44.31 150.76
21/09/16 CL Futures 3 44.07 44.10 76.14
21/09/16 CL Futures 2 43.86 43.88 30.76
21/09/16 CL Futures 2 43.84 43.87 50.76
21/09/16 CL Futures 8 43.90 43.84 -516.96
21/09/16 CL Futures 1 43.60 43.68 75.38
21/09/16 CL Futures 1 43.59 43.50 -94.62
21/09/16 CL Futures 2 43.57 43.60 50.76
Total: 368.06
 
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Apologies for the messy presentation. I haven't figured out how to copy and paste Excel tables in a way that retains the formatting. If you want to see the numbers in a better format, they're on my blog - tradinglogblog.wordpress.com
 
The big event today was the FOMC announcement at 2pm EDT. I didn't expect much to happen before then, so I skipped trading the morning session except for some practice on the simulator and a small premarket scalp in CL (+35).

At 2pm the Fed announced no change to rates. The market's initial reaction was positive. ES and CL made strong bullish surges. But then both retraced almost completely. They the changed direction again, starting big bull breakouts that continued until the close.

Due to the volatility I tried to get in and out quickly without hanging my neck out too far. I traded one contract each in ES and CL. I made a lot of trades, and most of them were profitable. On ES, I made +208 (initial surge), -229 (retracement), -217, +533 (2nd surge), +133, +33. On CL I made +85, -135, -134, +45, +25. Altogether I made +385 for the day.

The last few days I've traded futures exclusively. Not a deliberate decision or anything, I just didn't see any of the equities I usually trade with more compelling charts. Given last week (awful) and my history with futures in general (dismal), I'm relieved to have a few profitable days in a row.

PNL 21-09-16.PNG
 
Today I started live trading in the premarket and made +83 on ES. What a great way to start the day. I also placed an early trade in ES that I closed out shortly after the US markets opened for +271. I could have shut down and gone to sleep happy at that point.

But I didn't.

Instead I began a long series of trades (21 in total, my most ever) that got worse and worse until I ended up in a big hole with ES that took hours to recover. I eventually squeaked out of the session with +39.

I'm not sure what happened but at some point I started over-trading and relying on intuition and gut feel rather than strict price action setups. This was a real breakdown in discipline. I recall at one point I made a "bottom reversal" trade after a small bull bar followed by a doji (the doji should have been a signal to wait), and the price fell within seconds of my placing the trade. At least I was good a placing stops, several of which saved my sorry arse.

I stayed at my monitor through the entire session and was exhausted at the end. I'm not happy with +39 for that kind of effort. But at the same time I could have been punished more harshly for dumb mistakes.

PNL 22-19-16.PNG
 
The past few days I've been dabbling in the premarket with some modest success. Today I did spectacularly well, at least with CL.

I made my first trade when I saw CL starting to break out from a four-hour trading range. That got me a quick +85.

I placed another trade quickly, hoping to get a second leg up. Instead, CL dived nearly 0.60, and once again my pre-market stop did not trigger (what's going on, IB?). When I saw my unrealized P&L an hour later, it was pretty ugly. But then CL took off. I'm not sure what happened, but at about 5:45am (EDT), CL went up by a full point in less than an hour. This time I caught the first leg up (+321), made scalp when it took a breather (+51), and then caught most of the second leg up (+175). In total I was up +602 in the premarket.

When the US market finally did open, I made a few trades in ES, expecting a bull breakout from a trading range. But today ES had different ideas and declined for the rest of the day, stopping me out of three trades that nearly halved my profit (-33, -158, -108). After three losses in a row I'm supposed to stop trading, so I stopped. The end result of +333 still made it a good day.

PNL 23-09-16.PNG
 
Hi everyone - just as an update, I'm still posting a journal entry every trading day at tradinglogblog.wordpress.com.

These days I'm trading ES and CL, and after a dreadful month or so, I'm finally starting to get more consistently profitable.

I didn't get much feedback here, and the copy-and-paste routine was taking up too much time. So I'm sticking with the blog. Please feel free to leave a comment here or at the blog - I'd be thrilled to chat with other traders.

Cheers,
Carlos Danger
 
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