My play today in FE was to short against 43.80 for a move to 43.00, then ultimately 42.30 if it held lower and really worked. Here is my review.

What was working in my favor:

– Hard down move on the open on volume

– Very In Play on the Radar

– Top 5 Weak Today name for most of the day

– Clear level to trade off of and define my risk

– Conservative target was more than 5:1 reward to risk ratio

– FE was relatively weak compared to the market

What was working against me:

– FE was holding above vwap

– 43.00 was a long term support level with more support areas below

– 43.55 did a lot of buying and it was holding above

What I did right:

– I chose to take on the trade and find a good risk/reward area. I thought as close to 80c as possible would work. I shorted 80c.

– I covered my risk at vwap / in front of the previous buyer

– I gave up on the short above 82c

What I did wrong:

– I didn’t follow my plan for what to do when it got below vwap. Instead of waiting for it to hold below the 55c buyer, I added to my position when it got below vwap. Then, I didn’t really think through where I would put a stop for that add. I ended up with too much risk. I got stopped above 80c for everything. I have no problem taking that stop. Based on what was going against me (from above) – this was not a very high probability play, however the loss should have been 2c, not 22c. I let a low risk play turn high risk.

Remember, having tools like the Radar can be very helpful. But it won’t do all of the work. The trader needs to 1. understand the set up / play / context 2. control risk.