Talk about bad luck

Posted by downtowntrader | 10/18/2006 04:58:00 PM | 5 comments »

I don't subscribe to conspiracy theories about market makers out there trying to screw people over (even though some would in a heart beat). They are out there fighting other MM's so it's not that easy to manipulate things. But sometimes things just burn me up. I had to post this trade just to get it out of my head, sort of a poker style, bad beat story. I shorted ANDE as a swing trade. Lower low on daily, reversing off upper band, Stochastics crossover, yada yada yada.

Things were moving along nicely when all of a sudden price spikes up from 36.28 - 38.00 in 15-20 seconds.


That is almost 2 bucks, then reverses back on the same bar. Of course, my alert was triggered at 37.11, but even worse, I was filled at 37.50. So I went from a .5R gain to a 1.5R loss in 20 seconds. Which would be fine if I got caught in a squeeze, but the price returned to normal in 20 seconds. I could even understand price gravitating towards lined up stops, but this was at the low of the day. It's amazing that this stuff happens, but it does.

Is there a lesson learned? Not sure. Maybe stick to higher volume stocks, but this isn't too low of a floater. I know some may say don't place hard stops, but I use alerts, so they are hidden. I don't use mental stops, because I prefer to have my alerts in place in case I am away for any reason. You can't predict sudden news, so I prefer to have my stops in advance.

So here I am angrily watching as AAPL, CTXS, EBAY, etc are moving around after hours and evil thoughts are creeping in my head to make up those 1.5 R's. This is the real lesson. I need to walk away and forget about exacting revenge.

See you tonight.


DT

5 comments

  1. Paul // 10:34 PM  

    yup! I have felt the pain and know that - some folks can feel the traders and have enough $$$ to push up the stock - the stops help the stock go up (on shorts) and then after they get the stock rolling up they short it down - now they have your shorts at a higher price and then resume your gain with better odds.

    As my father always told me "might over right"

  2. MT // 10:43 PM  

    Revenge....one of the most deadly of trader emotions, to be sure.

  3. brett // 11:18 PM  

    Holy SHit dude....i shorted ande also today. Shorted at 37. i was watchin it all day, cuz thats what i like to do. and i saw 60000shares were bought and the stock went from 36.70 to 38 in like a second..i almost crapped myself. It was like in a blink of an eye, i didnt know what to do. I still am short in the stock. Do u think i should get out? do u think someone knows of some good info? thanks buddy

  4. brett // 11:33 PM  

    where from florida are you from? im from Lauderdale....Also take a look at BBG and TAR..shorted it today as well. Tell me what u think..Great Blog

  5. downtowntrader // 9:05 AM  

    Thanks for the comments everyone.

    MT, that may be the trading emotion that gets punished the swiftest.

    Brett, It still looks good to me as a short looking at the chart, but you always wonder if someone hit a block because they know something and thought the risk was worth it. We'll never know if that was a mistake, manipulation, or genius move. Best I can say is to keep an eye on it. Also, I'm down South kind of near Homestead, but still in Miami.

    DT