Yesterday was a hard day for me. I performed well, though I traded lightly and found it difficult to trade the market in the middle of the day. I am normally the type of trader that can sit there and trade profitably all day long. I make my adjustments so I can trade profitably during the middle of the day while I’m gathering information that I can use for the last hour of trading. But yesterday was different.

I traded quite well C in premarket and the Open. And contemporaneously I was watching the SPYs as a market indicator. Around 11:30 am C stopped moving enough for me so I turned my full attention to the SPYs. The market was very strong so I was trying to play the long side more aggressively than the short side. But the heavy lifting of the offers and bid stepping up I watched on the open was a bit different. I could tell there was a lot more selling on the offer, the pullbacks were still pretty shallow but the up moves were not sustained after a held offer lifted. I got caught a few times playing a breakout that never materialized.

I got ripped up so many times that I gave up playing breakouts in the middle of the day. But was very skeptical of getting short because every 20-30 cent downtick was met with offers getting sprayed aggressively to a price higher than that of the previous held offer. Yet while waiting for the bigger pullback the SPYs cracked the previous support level of 83.4 and I thought there was some risk of a reversal given the selling I had witnessed in the mid 84s. So my best play was to wait for the market to breakout aggressively through the highs so I could actually buy its pullback. Essentially putting me on the sidelines for most of the day.

I generally find this consolidation pattern with a not-so-tight range hard to trade for the reasons described above (I find the consolidation pattern with a tighter range much easier to trade as it allows me to manage my risk better). I know other stocks offered better opportunities in the middle of the day so there was some opportunity cost on my part. But waiting patiently for my set up to play out kept me from getting killed trying to play the long side on a strong day… because that is just upsetting!

Today I will be watching the financials and the SPYs. Some good news just hit the wires so the market is ticking up some. Yet, most of my 15 mins charts are at resistance levels. I will consider playing the short side aggressively if the market shows me weakness right on the open off these resistance levels. Happy Trading.