Chopped Up

I made two day trades. The good news was, they were stocks that moved. The bad news is, I lost money. I traded like a chump. I was -$1 on TNH and b/e on AMZN. I was in money early on both trades. TNH reversed, took me out, and then proceeded to march higher for the rest of the day. I moved my stop to b/e a little early on AMZN and was stopped out, then it too moved higher for the rest of the day. I should have made money in both trades.

I passed on a GOOG swing trade, which was highlighted in the Zanger Report newsletter last night. It broke out and hit an all time high, finishing strong. I may look to buy pullbacks in this stock for a swing trade.

While traveling last week, I re-read some of The New Market Wizards by Jack Schwager. If you are not familiar with this book, Schwager interviews a number of very successful traders, and asks them to share their insights and methods. Towards the end of the book, Schwager lists some principles that nearly all of these successful traders have. I found this one interesting, as it is something I have been thinking of lately as I develop a trading method suited for my own personality and schedule.

Match the Trading Method To Your Personality

It is critical to choose a method that is consistent with or own personality and comfort level. If you cant stand to give back significant profits, then a long-term trend-following approach – even a very good one – will be a disaster, because you will never be able to follow it. If you don’t want to watch the quote screen all day (or can’t), don’t try a day-trading method. If you can’t stand the emotional strain of making trading decisions, then try to develop a mechanical system for trading the markets. The approach you use must be right for you; it must feel comfortable.

If you haven’t read this book, I highly recommend it.