Taking Loss Religiously

Today I tried to take losses religiously, trying to make many smaller losses for a bigger win.  While I did that right, I make another wrong — going against the trend.  The SPY had a closing spike into Obama’s State of the Union speech last night.  The oscillators were overbought.  And we got a green gap at the open.  So I shorted.  Now I got a little break as today the market didn’t go striaight up.  It did break the down trend line.   Another small break was that my stop loss (I tried NOT to take protective profit like yesterday) shown by the short blue dash line escaped being triggered.  I then took a proactive profit near the 50% FIB retracement.  The SPY subsequently retraced to near the FIB 23.6% line but this is a small  progress I made in not taking profit too early.  It turned out to be not so bad an exit because SPY then broke the down trend line and tagged the FIB 61.2% line.

Another observation was that I was still overtrading.   Instead of patiently waiting for the chart to go to my target, I front-ran it and layered in instead to amass 300 shares near the top.  This is not necessarily a bad thing by itself, but it shows my lack of patience and not willing to miss a trade.

Got another one of those jinx later in the afternoon:  after holding an uneventful short position, I exited the trade and the stock duely dipped and hitting my intended target 😦

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