Last week was one of my best reminders that Short Selling is great but can screw you over if you don't follow a strict set of rules. The loss on URI was a replica of my RRC loss! I wasn't following rules and held the position after 11:00am. I should have known better. After 11am if a stock doesn't start its descent back to where it came from, it means that your Short thesis is wrong for the Top Reversal set up. I don't want to dwell on that Loss as it was down to two things;
- Not Respecting my Stops
- Fighting Relative Strength after 11:00am
Moving forward, I will be Paper Trading for the next couple of months until I prove to myself that I'm PROFITABLE and can be DISCIPLINED.
I reviewed my recent trades with Ed and we decided that I need to trade two strategys
- Opening Range - Break Outs / Downs
- Reversals - Top/Bottom
Ed also helped me fine tune my Trade Ideas filters. So I now run two Scanners.
- Pre-Market Movers Up / Down $1
- Reversal Scanner
Yesterday I paper traded based on my scans and was able to close the day green. It's amazing how paper trading feels like the real thing! I now realise that I should have started with paper trading.
Anyhow, I will keep documenting my trades on this blog.Despite my frustration with US equities, I still have confidence that I will succeed at this in the next couple f months.
Trading is simple but not easy!