When you’re right & wrong at the same time

It’s was wednesday at 12:58pm, 2 minutes before the close when I first saw the $RAD chart. A violent breakdown with the market & a low volume drift back up into resistance. Immediately I pulled the trigger short. No fundies, nothing other then price, action & volume on this trade. One of those “know that you know” scenarios. Being able to recognize & act immediately becomes very important years into a trading career. Here’s what I saw 2 min before the close on a 30 min chart (which for me stays linked to the same name on a 6 month daily chart & a 3 year weekly chart for perspective)

I risked .10 on this trade.

Entry 8.6 stop 8.7

Screen Shot 2015-09-18 at 6.28.51 AM

I woke up the next morning to a 8%+ gap down in $RAD and achieved a gain of 10r that day

The problem is my risk really wasn’t ten cents as I planned for it to be. I didn’t check EPS which happened to be that morning. I was along for the earnings ride. A complete failure to manage risk effectively by overlooking EPS as I rushed to put the trade on with a minute before the close.

The lesson to take away is that making money doesn’t mean you acted appropriately or within the scope of your system and equally true, losing money does not mean you did anything wrong!

Here was $RAD at the close the very next day.

Screen Shot 2015-09-18 at 6.29.06 AM

One more interesting note I can add here is that $RAD was the last LONG setup I posted before the market correction. Stay flexible & be willing to change directions with the tide at a moments notice. Here was the potential long I saw in $RAD weeks ago.


Disclosure: scaled 20% intraday & holding the remainder short for the time being.


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