I spent some time this weekend preparing myself psychologically for earnings season. I wanted to make sure to increase my size on stocks that had earnings. I wanted to be ultra sensitive to unusual volume at given prices, levels of huge interest/struggle and be on the lookout for plays to hold. In anticipation of Goldman’s earnings I forced myself to … Read More
AIG over FAZ
We were pretty pumped about FAZ getting back in play today. However, we were also cautious of what the liquidity, computer algorithms and moves may look like on the open. We cautioned our guys from being overly aggressive on the open with the scalps until they figured out if the old programs seemed to be back in the stock at … Read More
FAZ Party Coming Back
During Dec-Jan our desk traded almost exclusively these two triple leverage ETFs. They provided plenty of opportunity as they would move a lot, had plenty of order flow in them and traded somewhat cleanly. We stopped trading them the moment FAZ went below $8 as the volatility died down considerably and felt like we were trading $AIG below $1. Direxion … Read More
Funky Psychology
I traded HES on the short side yesterday and came in with an overnight short expecting a crack through the $54 level. It was looking pretty good in premarket as some small dopey prints went off around $52.57 and $53.01. I was hoping for a pop near the 54.60 dream short level where I wanted to lay into the position. … Read More
Second Day Play: BA
I got most of our desk in that play in BA yesterday. I traded it fairly well and managed to keep a significant core for most of the down move. However, watching back my tape and seeing how this is on my list of plays I have to load the boat in I really wussed out; this was a play … Read More
Paying For Information
Last Friday most experienced guys in our desk traded RIMM on the open. The moves where fairly violent and most of us got ripped up at first. It seemed the stock was crowded with big traders and most levels didn’t hold that cleanly. The risk in most plays ended up being about 2-3 times larger than one would have thought. … Read More
Finally the Turn?
It seems that we are finally starting to turn. The overly talked pullback may be on its way. It started with the SPYs gaping down Monday with a failed attempt at filling the gap. Yesterday we closed below the trading range we had established for a while. Today we got confirmation by cleanly taking out yesterdays low and holding for … Read More
Learning to Take Pain
In our training program we (over)emphasize finding opportunities where the risk is one unit and the reward is at least five units. Most of the setups our new traders learn (50% I would guesstimate) are opportunities where the risk is literally one to two pennies. If overly abused, these setups can progressively hinder the ability of the trader to pull … Read More