Sim Training: Day #6

I mostly watched the market move this morning, not putting in a lot of paper trades. Trying to get a sense of price action and how stocks react at certain RSI(2) levels.

CBG -.16 SHORT ~ As I said in my post yesterday as was my recent pattern, I entered a little early again and the was stopped out by a two-penny wick before the stock moved .40 cents down. I entered with RSI(2) was only 40ish on a typically gap-down dead-cat bounce that you can just as easily play as a long with the right timing. If I had simply waited for RSI(2) to near 90, I would of had a better entry. On this one, the opening price acted as resistance and this is where it peaked in the morning and sank all the way to close. One solution is to give myself wider stops and/or since it’s paper trading, not use them at all. Or I could enter half positions, and then double down if the price moves a little against me. However, the ideal solution is that I need to have sharper discipline and wait for a cleaner, safer entry (e.g. on shorts when the RSI is way higher). The wider stop / no stop / half position – doubling down strategy will now and then completely backfire and create large loses. So I need to do more precise entries.

DDR -.05 SHORT ~ This was a quick scalp; DDR had bounced over $4.00 and had an RSI over 99 – while the whole market was legging down (futures, DJI & SPY, and $TICK). I had a nice exit as it didn’t fail as fast I thought it may and then all these indicators went positive again, and I left with a small profit. DDR bounced a little more until peaking and collapsing at a bit at EOD.