This has been a disastrous week of trading loss wise, but it's felt different than losing streaks in the past. Things don't feel worse now than before, but they actually feel better, even though I still feel like crap for throwing away $3700 on a single day, when that was about what I lost in my first year of trading. This month is my 1st month after my first year of trading, so yea, not good to a good start of my 2nd year of trading. But, you can't appreciate or understand success without big failure, so maybe it was just one of those things destined to happen regardless, and it just happened sooner rather than later and I have to deal with it.

Today, I would finally have been profitable on my early $VSTM short. As of writing, for about $675, and it looks like it can drop more, but the short to hit was past few days. That's how bad it was. Rather than having an amazing average $8.50+ and being able to ride it down, I had to cut a $3700 loss, as if I had held and prayed, I would have been down almost $6k yesterday morning, and since I was in with my entire account, I don't think I could have survived that with overnighting and margin given the short margin rate.

I can't dwell on it anymore though, forget spilling a glass of milk, I spilt 100 gallons of milk, and gotta live with it, but I'll be keeping that loss in mind as motivation for turning things around. I've spent this week really looking at what I'm missing when I plan out trades and commit to something, as I really do think I am missing something, and I managed to notice one big thing I've not paid attention to that really stands out when I go back and look at charts of things I've been watching.

Trend

I don't draw trendlines when I trade or on charts I'm watching. I'm so caught up on support and resistance, horizontal lines, that I've totally overlooked the equally important diagonal lines that really help show where a stock is going.

This is after the fact of course, but look at this trend on $VSTM on the day I lost big. Of course I made the mistake of shorting a 2nd potential green day gap and go, entirely my fault, because I got so caught up in the moment and lost all perspective, and then didn't cut losses, but the trend is clearly seen.

Aside from the fact I shouldn't have been shorting in the first place, I would never have thought to go long, but this is a clear long setup until it's not anymore. I was focusing on resistance lines and how it struggled and dipped under PM highs enough to think it'd just go down, but each time it ran and then dipped, it was just chipping away resistance above, then support kept on rising as it never broke trend and died like I was thinking it would, so while level 2 I didn't see scary signs, I was literally slow cooked like a frog in water until it was too late and I was dead.

I should have cut losses sooner of course, but even then, they still would have been big losses, because my thought process and approach was just fundamentally flawed, and that's what I want to correct. I don't mind losing money on good setups that don't work out, but I hate losing money from just having the wrong thought process and not knowing what I don't know.

I've learned a lot about $NEPT as well, missing all my trades on it on what I thought was a clear winner, and I also linked it to trend. Today for example, I wasn't looking to dip buy or even trade it again, but look at this perfect trend change.

Forget the bottom line, since you can't draw it until after the fact, but a very clear trend was established, that I need to be identifying, and then when it breaks that trend and starts to go, set my risk tight to the bottom of the trend, get in and just see what it does. If I got in at $3.95ish on the start of the reversal, and just held, I could have hit a nice 25c trade or so on something I'd usually never trade.

Then, watching it more, when you see the trend reverse again, you know you need to get out.

It seems too easy, but once it starts to crack that right most trend, just bail and avoid the potential dump that is setting up.

Trend isn't exact though, and there's cases where a clear trend breakdown leads you to get out of a trade, and then the trade pulls off another reversal. Take this for example, yesterday:

That looked like the setup of a clear trend break, and it rode under the trend line in a way that you might just not want to risk, but it bounced over and then held and resumed. So it's not a gimmie, as I lost on trades that were perfect setups I thought, but the sharp violent pullbacks stopped me out, and there's no way to avoid those really unless you just stick to your guns and be willing to have more risk.

It could have gone either way though, a lot of afternoon trend breaks off long time resistance can lead to huge dumps. I forgot which one I just saw this happen with, but it's not uncommon at all.

Here's another trade yesterday that I started to apply my thinking too, but I didn't quite have the confidence yet, and was microseconds away from submitting my order at $8.28 looking for a curl + squeeze going into the afternoon. I didn't identify this as a trend reversal, but was thinking about it from a short perspective of how $8 didn't crack, all the consolidation shorts were building into means the potential for a squeeze as they cover if the stock starts to go back up again.

I missed about a 30c trade on that, as I was thinking the move was possible, but I didn't quite have enough confidence to give it a try. Now that I can clearly associate it with something, I should be able to catch this in the future better.

Anyways, I wanted to blog about how I'm seemingly heading deeper into the red zone, and things feel frustrating losing, but I don't feel lost or like I can't get better. I feel like I've actually made real progress this week, the catalyst being losing so much on Monday and the frustrations that come with never being able to have the right bias on things.

Past few days I've been red trading, but I was totally on the right track and could have had some amazing winners if I knew what I was really doing wrong. I feel like not paying attention to trend when I take a trade is one big thing that I need to start doing if I want to get things turned around and identify setups that offer real opportunity that I otherwise wouldn't take because the chart just looks bad from a support/resistance standpoint.

I lost today on $MYSZ, trading error actually as to why my first entry was so high, but it would have been a loser regardless of when I started my position. I felt totally fine with that loss, and am looking to get back in the afternoon most likely, because there's certain stocks like this that offer good opportunity for very well defined risk, and there's no reason not to risk a little for a lot of reward given their history. It just didn't work out today, I was looking for a 2nd round of volume or a well defined ABCD move and it just crapped out under C so I cut losses. It could have easily spiked into HoD and I could have hit a $200+ trade if I didn't want to see if it could really run. The goal would have been for a lot more though.

So, it's back to the drawing board as to coming up with the criteria for why I take certain trades now, and trend is going to be a very strong consideration moving forward. If it has a well defined trend, I probably should be looking to trade it, but if it has no trend, unless it's a special setup, I probably shouldn't be trading it. Also, I realized I need to invest a ton of time into chart and pattern examples to refer to when I'm looking to take a trade.

Having started shorting more now, I'm starting to see amazing long setups just from the perspective of not wanting to be short into a certain type of chart pattern, so while trend is a big part of that, I'm noticing recurring things now that I just haven't been able to identify before. It'll take some time, so I do foresee myself going a bit more red this month as I try to find my edge and correct my mistakes, but I can honestly say I still feel very motivated to do better, I can overcome my losses in time, and I'm nowhere close to wanting to give up for lack of not being able to figure out what can work for me.

It's a marathon, not a sprint, or morning jog, or a casual walk in the park, and I'm only on month 13 of a journey that will most likely require high double or low triple digits of time investment to get good.

Thanks for reading, trade safe!