GDX Trade – Trumped by Fear

The informedtrader service has GDX currently on buy alert.  Per my current trading plan, I want to day trade GDX on the long bias.

This morning GDX broke the 2 day DT line on the 5 minute chart.  I tricked in with 2 entries.   So far so good.  However, I exited as soon as the RSI hit 70 (see the vertical line).  Look what I have missed: 3.8% with the 20 ma still in tact !!    My then twisted psychology even further caused me to sell my core 50 shares later on.  Finally I had to chase with a 10 share Band-Aid for psycho-therapy.   Quite pathetic.

Of course, I’m not as brainless as it may seem.  The overall market has been overbought and clinging near the top for a few days by now. On the daily chart, where I sold was where the DT line was, and yesterday’s daily candle was a head fake breakout and ended up with the shooting star.  So I was too fearful of the DT line on the daily chart.  Combined with the 5 minute RSI > 70 caused my position to be shaken out.  I should have at least wait for a reversal candle or other kind of failure on the price before I bailed out my positions.  But I could tell my fear of losing my profits, however small.

Here’s the daily chart for GDX:

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