+$58 on MSDI
Good news / Reverse Merger play (riding morning momentum, in and out)
MSDI caught my attention, positive news on reverse merger agreement. Strong run in the morning, I wanted to get filled at 1.75, but my buy limit orders kept falling behind price action. I eventually filled at 2.17 for 1000 shares. I was looking for a retrace / dip to buy in, I missed the chance at about 2.07. I got lucky this time, I almost bought at the top.
Shortly after I was filled, I noticed volume was dropping off (losing steam) & I sold @ an average of 2.23 in 3 lots for a gain of $58.
- 500 @ 2.21
- 200 @ 2.26
- 300 @ 2.27
As a side note: was watching MDR on good news of a new credit agreement, morning price action did not match plan to buy dip and ride the morning rise. the news didn’t have the effect I was looking for.
Finishing reading Reminiscences of a Stock Operator, re-reading Mastering the Trade
You can find this information @ Account > Funds tab in the IB TWS mobile app.
FYI – for anyone else out there who is confused by Interactive Broker’s day trades left notation, the numbers represent number of day trades left from a T+0 to T+4 basis.
E.g. – if today is Thursday 6/29/17
(0, 0, 0, 1, 3)
- T+0, Thursday – 0 day trades available
- T+1, Friday – 0 day trades available
- T+2, Monday – 0 day trades available
- T+3, Tuesday – 1 day trade available
- T+4, Wednesday – 3 day trades available given no trades took place on T+3
- Position: Long
- Entry: 2.20
- Risk: 2.04
- Size: 500 shares
- Risk ($):
- Target: 2.35
Sizes into the morning dip with 4 x 100 shares @ 2.16 sold into strength shortly after.
Tried to buy a dip later @ 2.30 6:58, but stock crashed down, tested support at 2.20 and failed, sold for a small loss. Overall, a positive trade +17
I played this perfect until the crash. Buy the morning dip and sell into strength.
Since I had four 100 share trades & my account size < 25k, I believe I triggered the PDT rule.
Now, how to replicate this trade consistently.
- Perfect breakout after morning dip
- Daily Volume: 23.5m
- Average Volume: 3.1m
- Market Cap: 231m
- Sector: Biopharmaceuticals
- Position: Long
- Entry: 12.75
- Risk: 11.75
- Size: 150 shares
- Risk ($): 150
- Target: 14.15
Thoughts: steady fundamentals, strong long potential.
Sleepy, will continue updating post tomorrow (9:24 PM 6/27/17 – this is where I messed up…)
Stopped out for a $150 loss
- don’t place trades past midnight when you’re tired and not @ 100%
- do not trade before confirmation. Had thought positive PR was released about merger between Rite Aid & Walmart, next morning, negative news, market also finished in the red for the day.
- stopped out at risk level for a $150 loss.
Unrealized P/L: 78.45
Realized P/L: 0
Three trades, three wins.
I have not closed FOLD or IMGN because my targets have not been hit. I will cover half of my DCTH position (250 shares) to lock in profits tomorrow morning.
I plan on managing these three positions tomorrow and not jumping into anything new until Tuesday.
Part of me thinks this is beginner’s luck. The other part thinks I made the right moves and started to build some good trading habits.
What did you do well?
- sat tight and respected risk
- did not give into emotions
- prepared trade strategy the night before execution
- knew my entry, risk, target, source / catalyst & strategy for each trade
Areas for Development:
- focus on one or two strategies, be wary of “strategy hopping”
- be prepared for internet outages, like with T-mobile this week. You can’t be in the dark for any reason, it’s dangerous
- think about tightening your target / risk spread from entry
- keep watching HTMM, you’re still new, don’t let a few successful trades get to your head
- You are only as good as your last trade
- You are a retired trader, only come out of retirement for perfect plays
Size: 500 shares
Risk ($): 25
Target: 0.162 cover
Placed this trade, based on information from Tim Sykes video, DCTH is trash / a junker and is on the verge of crashing. Second half of a supernova. 5 cent risk reward spread on order.
3rd trade of the week, capped by PDT. Will close out my positions later today and do a week 1 recap.