Good morning wonderful hivers. Despite the FED mucking things up, this could end up being a great week. (I'm talking just account growth, not that it has that much deciding power in overall life.)
I've decided that 3% gain is the sweet spot when it comes to my preferred style of trading. I could probably squeeze out and extra 1-2%, but at the cost of way more stress, more white hairs, and definitely more risk too.. no thanks to every one of those!
OK, here's how the market looked on the hourly this morning..
Da bulls!
and the 15m..
Da bulls!
The current candle was also green (da bulls!) on the 5m, so it was off to the option chain to just decide how exactly I wanted to enter..
It doesn't always work out this way, but for whatever reason, I was offered just what I wanted on only 2 contracts, vs. the 3 that I normally need to use. (btw, each contract cost me about $5 in commish+fees, so I am happy to use as few as needed.)
I did enter my order at the the delta 16 strike price, but price moved in my direction, so by the time I got a snap..
Now, things started off good, pnl jumped upto about $20 for the first five minutes of the trade.. but then it DROPPED down.. not fun at all.. but the worst open drawdown was within non-freakout territory..
Here's a snap showing the drawdown I had to endure until the trade started UP again..
I thought I would explain/show the pnl a little bit better..
the open p/l and the day p/l is the same for me since I only trade 1 option per day. The BP (buying power) is the deposit, or money that is held by the broker in order to trade the particular option. In this case, I traded 2 contracts of a 10-wide option.. that option costs a BP of $1000, so 2 contracts had the broker safekeeping $2k for me.
when p/l goes underwater, it looks like this..
It got down to -$80 p/l this trade, but my total risk on this trade was -$240.. so seeing -$80 didn't worry me too much.
At 8:33am the trade reached my semi-relax delta..
Ten minutes later..
Here's a screenshot of my mobile platform right after the trade closed..
I like how it shows the % p/l as well as the $ p/l. In my experience this year, a gain of 3% is realistic, and price will often move up to about this point, then turn and retrace or even head down for good.. either way, the profit never gets higher or maybe just a little, but IMHO, it's not worth it to watch money already won, fly away for about an hour..
So, in my previous trades this year, I had a target of about 4%.. that would usually see price go my way until I just barely hit 3% gain, then it would fall down from there. I'd often close at a smaller gain than I should've had, and in a few cases, it even LOST money! :(
So I did some math and added up all the profit/loss from all my trades so far this year, and compared it to what would have been the result IF I had always close at 3%.. It was close, but the 3% was the clear winner! It means MORE gain, with LESS trade time. (less stress for me) So, from now on, I will just use that new target on my future trades. 馃槈馃
