I can do anything.

We sure do cover the /ES_F often over here on the Raul blog, discussing its…implications, if you will.  Building the contextual cake helps me to identify abnormalities, flinches, and hand tips by the big money.   The E-mini S&P is the most liquid financial instrument in the world.  It makes sense to pay attention to it.

But trading it has become a slow and painful grind.  It is like going years without a dish washer even though you love to cook.  You get by, but your soul dies a little every day.

I needed some change (No Obama) so I traded the /NQ.  I like the NQ…peep today’s stats:

Thoughts:

• today had a large range
• /NQ is thinner
• smaller contract size suits my size a bit nicer
• I trade lots of Nasdaq and Russell stocks so I may be concentrating my eggs
• It offers more trading opportunities (at least lately)

/ES has been brain numbing, while I go ‘big pimpin’ on these wiry stocks.  Speaking of which, my book was up a percent today.  That is a result of stock prowess and hanging out with traders much more seasoned then me.  Mainly my gains today were a result of being on the right end of a technology revolution.  So while sour bastards get their kicks shorting Tesla, which is fine, I am embracing the future and finding opportunities to invest in it.

In short: CREE and RVLT what what?

I started buying ONVO too, right about at these levels.  You can’t keep me out of this name.  When my pickled organs give out I want robots around to print new ones.  Seems like a no brainer at five fifty.  I consider it an investment in myself.

I sold YGE.  It felt like when I sold VIPS yesterday…too soon-ish.  However, dwelling on these thoughts prohibits the mind from seeking opportunity elsewhere.  I sold RBCN too, for a loss, because it sort of just fell out after mainlining hot money.  I do not want to be around when the Apple WWDC crowd goes running for the doors, should they do so.

ADHD is a ticker which by design frustrates me, ripping higher like a freshman jacked up on Mountain Dew and Ripped Fuel.  Ah high school…when ephedra was still legal.  I have wanted a long on this one for a few weeks but my attention keeps darting away from it.  Instead I want to Snapchat and play ping pong in the futures.

I do not really love the way we are setting up into the weekend.  The market looks like the headless horseman.  Sentiment sucks but the crowd isn’t always wrong.  I have concentrated by book down to the following positions listed largest to smallest:

RVLT, CREE, USO, LO, BALT, AMBA, FB, ONVO, F, IMMR, MJNA, O

That jackass MJNA stock can burn up and go to zero for all I care.  What a garbage stock.  I am -20% on that field play.  I thought about cutting O about 100 times, but I figure keep it and collect the yield.  My basis is a tad below here.

Everything else I hold close to chest.  As a matter of fact, I need more CREE and RVLT but I am exercising patience.  Together the stocks represent almost 30% of my risk capital.

I will let Q4 play out a bit before getting more risk into those two names.  In the mean time I can increase my LED exposure via VECO, RBCN, GTAT, OESX, and LYTS.

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For most of my tenure as a trader stocks have been treated like a singular asset class and thus tightly correlated to other macro instruments like bonds, the US dollar, gold, and oil.  The binary nature drove me to studying futures because if all stocks were hell-bent on moving as one, I might as well trade them all simultaneously with an ass load of leverage.

I love the futures markets.  They are pure order flow with no dependence on a company and their decisions.  But seeing good companies and more importantly good charts succeed even while the market chops around is exciting.

It makes me want to concentrate more funds into stock trading.

I got caught on the wrong side (the long side) of the quick drop this morning.  Even though I preach plan adherence, I deviated and had to take a ton of heat on my trade.  The poor entry, paired with a non-market related event which shall not be mentioned but which has officially created a rule, caused me to shake out of my long—I shit you not—one tick off the morning swing low (about 11am).  No less than five minutes later, what I had expected—a bit of a bounce to cut my loss into—occurred.

This was a huge setback to my futures trading, huge.  I am so sick of setbacks incurred from plan deviation.  They are huge drains on emotional capital.

I went and had some tacos with a friend.  We talked about hunting mushrooms and it was quite the stimulating conversation and helped clear my mind to assess everything.  Trading structure will be restored for tomorrow’s action and it is good to make these mistakes while trading small, believe me.

Focusing so much energy on work and trading futures allows me to think much more slowly about stocks.  The more I learn from the excellent traders and stock pickers here at iBankCoin the better this approach feels.  My book is up 2.5% today while the Big Board chops the UNCH.

RVLT is a big part of the green portfolio, but it is getting plenty of help from IMMR, MHR, YGE, BALT, and FB.  My account is straight crack rock and ripping.

I see a huge consolidation occurring, as if we are waiting for news flow to get this party started.  Bull or bear, a party is near—I can hear the bass rumbles in the distance.  Until this decision is clearly made, I will hold the line, 90% long.

My slow money is in AIXG, LO, RVLT, MJNA, FB, O, F, and CREE

My fast money is in AMBA, IMMR, MHR, YGE, BALT, RBCN, and CLF

I still hold a sharp edge in the futures market and my win/loss ratio shows it.  The p/l however does not yet because of setbacks.  This isn’t over until I win which is simply a matter of time, not if.  This week however, my stock gains are casting a bright glow on my futures losses.

Pro Tip:  Like any business, be sure you are sufficiently capitalized.  Better yet, have other revenue streams so this learning process doesn’t come with the added stress of keeping a roof over your head.

http://youtu.be/cJT1xvDOMB0

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Blocking out the news flow is difficult but the blissful ignorance that comes from it is worth the effort.  Remember if something is important, my well curated twitter stream will tell me.  Better yet, the professionals inhabiting the many rooms of iBankCoin will tell me.  Anything local will be filtered to me via family, colleagues, and friends.  This frees my mind to focus on order flow and sustaining and growing my revenues.

Some days however, often after eating too heavy of a lunch, my attention span degrades by the minute.  For that reason I mostly do not trade futures in the afternoon.  Instead I usually read, stare out the window, or look at Tina Fey nip slip pics.  Nip slips always get my a.d.d. all worked up.

Anyhow, today I closed green by 1.25% even though I was up a rock star 3% intraday.  I scaled off a bit of YGE.  I could afford to do so because I timed my entry perfectly. The market provided me 7% gains, you see, by the time we reached swing high.  I will book that bread any day of the week.  I now have a lower cost basis and as close to a risk free trade as you can get in the markets.

How about that AMBA?  I couldn’t be happier about tossing my Zillow shares in the dumpster to fund my AMBA purchase.  The old me would still be in Zillow. The dead fish action would result in me drawing faces on lemons with a sharpie and then tossing said lemons into my Blendtec emotionlessly.  The house would smell lovely as I died on the inside.

Zillow speaks to the selective nature of our market.  ChessNwine has been keeping this thought at the forefront of our trading mindset in his Weekly Strategy Sessions.  As a matter of fact, he brought my attention back to AMBA too.  I mean, it never left my watch list, and I am a total GoPro fanboy, but the reminder was a nudge on the shoulder if you will.

This AMBA trade has taken conviction.  I am glad to see mine coming back online.

Earlier I said this is all an appetizer, so you may be asking yourself, “What’s for dinner?”  Well my friends, LEDs are for dinner…and sloppy joes.  2013 is the year of the LED, they simply took the 3^rd quarter off.  I have been financing these sleepy laggards with high level SHOMPPERY and 12631 magnificence, but it is high time they come online.  My top picks into the fourth quarter are CREE, RVLT, OESX, LYTS, RBCN, VECO, GTAT, and AIXG.

I like CREE the best as a company, RVLT the best as a young man’s speculative investment, and AIXG for their Germanic tribal nature.   I am long the trinity and will buy more of both after I spank a few more trades for stand up doubles.

I joined Le Doctour in BALT today.  I really just like the chart picture, you know me.  He does all the macro stuff.

Everyone is complaining about the way /ES traded today, but I had one of my better days.  When you have an idea of the context we are in, bobbing along the bottom with no conviction, you know to get the laser sight out and get damn good entries to allow you to get out before the things stalls and reverses.  We are learning over here and making a little bit of money while we do so.  From the high win rate comes larger position sizing and eventually scaling.  Then we make the big bucks.

Ah yes, I nearly forgot the point of this post—Everything you see is fake.  The dog and pony show in Washington over Obamacare and debt ceilings is all fake, jack ass es.  Do you really think any of this really matters, really?  I does not.  The terror threat elevation right at about 3:50pm?  Yes, fake.  Syria, real and sad, but so is every third world where cavemen kill each other for the best poppy fields.  Making noise about them is fake.  I have nightmares about a war on our land all the time because of these pundits and the terror threat bullshit. Even some nip slips are fake. I know, horrible times we live in..

Fear mongering from the glass half empty crowd is dangerous.  Avoid the losers who can’t drop it.

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There was an interesting occurrence this morning right before we printed the low of the day.  Price traded down to the overnight lows and then completely stalled.  This was right about when the POTUS took to the podium.  Then, as I had suggested may occur, we breached the overnight (yesterday) low briefly, the flow of stop losses created a temporary oversold condition, buyers reacted to seeing the weak sellers and a sharp buying tail printed on the /ES market profile. We also snapped the following trend line lower, finally:

I bought the YGE full sized amidst all this.  It was very lovely execution that brings a little sparkle to Raul’s eye.

The velocity of the move was enough to put plenty of shorts in the hole.  It should make for an interesting afternoon as value is being set higher then I expected in my scenario 1 balance hypothesis.

With today’s YGE purchase, I am about 85% long, mostly crack rock stocks—stocks like CREE, RVLT, YGE, AMBA, MHR, FB, RBCN, and CLF.

Can you believe I am nearly up 100% on my FB common?  I’m holding steady until at least $100.

The weak-to-strong closing type would be a change of character in the recent market activity and we may be looking at an inflection point.  It is a bit early to tell, but I like my aggressive positioning here.

I intend to use my winnings to finance the purchase of a Tesla Model S, the greatest automobile currently in production.

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We could get together around a campfire and complain about the stock assassins and their research.  We could heat up a pot of baked beans while we jeer about the move in precious metals in the fifteen minutes leading up to the #NoTaper Fed announcement Wednesday.  Then we could sleep next to each other on the dirt staring up at the cosmos and cursing algorithms.

But that’s all loser talk, and I only like small doses of nature.

Instead, let us focus directly on what we can do.  Solutions if you will.

We can manage risk.  MHR is a different approach to entering stocks, I bought weakness.  Normally I enter alongside strength.  Traditionally I would have MHR on my watch list like it was, but I would wait for pricing greater than the last two days to show strength and momentum.  Then it would stall out like it did today and I would sit through a drawdown.  That method still works for me, but I’m working on anticipating the move a step earlier.  I could have already taken a profit in the name, but I am moving purposely slower on these stocks.

Zillow caught me off guard.  I saw it break my range, but I prefer to give stocks the benefit of the doubt meaning let’s see where it closes.  The volume profile below was very thin, we cut right through it.  I did not cut my loss.   Perhaps I will regret this but the stock behaved constructively after the panic abated.  I have managed myself out of uglier head fakes, and I have fumbled losing trades.  That experience helps.  As it stands, I am -6.43 % on a 10% position size.  Oh the humanity.

Zillow and CLF did however knock me off my high water mark.  CLF has not done me wrong yet.  Is the trade wrong?  No, it is only taking heat.  I will take my loss when it is wrong.  I lost my vision on this trade for a bit, but RaginCajun reaffirmed my vision.

There is gap supply coming into CREE.  You have to imagine all of those underwater folks are eager to cash in now that they are being made (partially) whole.  I put some trading capital into this name that needs to be separately managed from my investment.

A trade like RBCN makes up for 3 or 4 losers, this has been a forgiving market for longs.

I was green trading the ES this week, holding my own through some big waves.  This is the most exciting part of my week.  I cannot wait to build upon it next week and also to review my trades over the weekend.

I shut El Roi off before the Fed and have not turned him back on since.  I would imagine he is chomping at the bit to get his grubby algo hands back on the tape but first I must go through the ceremonial revamp of optimizing and chanting and such.

Overall I am just happy to be here, banking coin alongside some of the most insightful minds in trading.  If you have any tickers of interest or general trading/algo questions ga’head, ask me…I will answer them as best I can.

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The market has been unable to compel me into action today.  Instead I have sat here drinking coffee and watching my peers rip the faces off of shorts with supreme ultra-violence.  My goodness, RaginCajun extracts a solid win off of EGLE, passes the baton to Le Fly and here we are, winning the relay.

One of my twitter buds was all over the shippers move too, well done @Apoms24 on the DRYS.

The day after a huge move, overnight or RTH, tends to be tricky intraday.  Therefore, I sat in the bleachers and enjoyed the view.

Book largest-to-smallest: CREE, RVLT, RBCN, AIXG, Z, MHR, FB, CLF, LO, F, IMMR, MJNA, and O

Cash: 20%

Tickers of interest: YGE, FSLR, ONVO, ZNGA, FRO, END, and GMCR

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As per the usual modus operandi (extra redundancy) I navigated today’s trade without media outlets like the teevee and with very little twitter exposure.  Instead the news came through the filter of a well curated group of elite traders in the 12631 trading room.   “No taper” they said, the exploding /ES and /6E charts told me the rest—risk rush on.

Reacting is a dangerous beast unless your reactions are decisions contemplated hours and days in advance from the war room (home office).  I took SKF off first, as I rehearsed in my mind last night.  Then I took a wish list of stocks and picked two: CLF and Z.  Zillow was an obvious buy because I love the company and housing will quickly become the catch up play as we dash to Xmas. CLF was a pure chart buy that could play catch up. Then I dove back into the big wave riding competition in the green lit halls of globex.  Futures good friends, I held my own with the big kahunas.

I’ve had 2k days on sessions like this.  Today was much more modest, but much less stressful and a hell of a lot more precise.  When November rolls around and I’m trading the size I want to deploy my scaling system, these will be 2k days again.  I ran before walking, fell quite a bit, decided to start walking, and soon I will run again.

6 trades: 5 long – 1 short, 6 winners.

Seeing as RBCN was my largest position going into today’s tape, yes, I did have a good day…thank you.  What would have made it only better but without it I still high watermarked would have been holding onto EXK which I regretfully cut this morning.  Regrets, I’ve had a few as Sinatra says.  It ripped the tits off and looks ready to continue ripping the tits off this week.  Now I feel like I am missing the action, therefore I am.  I will revisit the miners this weekend.

Oddly yet amusingly enough, RVLT paired up with IMMR, smoked entirely too much MJNA and enrolled in Clown College. Due to their heavy course load, 7 credit hours, they will be too busy to participate in this ramp up. They will instead focus on balloon animals, banana cream pies, and terrifying children.

The question that should be at the front of each of your minds is, “Is this euphoria?”  Because, I can tell you I feel a bit euphoric.  I will be breaking down the days leading up to this moment, all the blogs, all the behind the scenes homework, and psychoanalyzing this win ship to find repeatable strengths.

The work load only increases when you are winning, you must love the process as much (if not more) than the outcome.

Get some rest and come back early tomorrow, for today is only Wednesday.

http://youtu.be/nhflmIbyHbg

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I couldn’t pull the trigger on anything today, not to sell existing shares, not to buy new shares, and I have SKF already which feel like a bit much in this tape.

I stalked CREE today, it is setting up perhaps.  I wanted to buy shares much lower, so if this setup does trigger I may just trade a piece and go back into my core size (3/4).

Current longs, by size: RBCN, SKF, RVLT, AIXG, CREE, FB, LO, EXK, F, IMMR, MJNA, and O.

Cash around 25 percent.

The O was very strong at the open.  That is a nasty little fade right there.

I lost some money in the futures today when I was shaken out of my short by the clown show in my brain.  I called the head and shoulders this AM to the tick.  But instead of capitalizing on it, I sat in traffic listening to Traffic.  The clown ring leader is Gary Busey.

I’m holding out for my favorite setups before I put any more cash to work.

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I came into the day completely unprepared for all the volume to roll into December contracts.  As a result, I spent the morning getting all of my charts built.  By the time I completed this task the only opportunities of the day had come and gone.  After watching the tape for a bit, I ordered an oversized lunch and stared out the window while eating it.

There just isn’t much for me to do today.

RBCN caught an upgrade but some the bounce if being faded off.  I get the sense this stock is setting up to offer long speculators another correction, but I’m struggling to justify selling my shares for any other reason. I will stick around for the flop Monday.

I can’t justify selling SKF either.  Aside from the Goldman Dow inauguration, financials have sucked wind all week while tech goes on a no holds cocaine bender.  Look at WFC, BRK/B, C, BAC, and the butt grabbers at AIG.  They all performed rather lame.

It helps me carry high beta through the weekend, too.

I will stick with EXK into the weekend.  It could either carve another 6-7% off me or rip tits higher.  I like that type of binary situation.

Enjoy the final throws of summer this weekend.

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My apologies for being a bit light on the pen today and yesterday, I have simply not had the time to properly address you, kind people of the interwebs.

You may be familiar with the Sold Too Soon club and its proud members, but I’ve become a certified member of the Bought Too Soon club.

Dips, I’ve been buying them too soon.  The problem with buying too soon, good people, is YOU HAVE TO TAKE HEAT, lots and lots of heat.

Then, you pay quite a bit of money to see your trade through.  Such is the case with my new stud picks SKF, RBCN, and EXK.

These are all trades to me, nothing more. I literally have a few cents more patience in all three.  You know what that means right?  I risk getting a larger loss via an overnight gap.  It’s hard for me to overly concern myself with such things though.  It seems silly to live a life of worry at such a tender age.  I still like these trades.

LED is working this week and I want a fund of LED firms.  So far, I have it owning CREE, AIXG, and RVLT.  I want more of all of them and a side of LYTS and OESX.

Stocks were mixed today, but overall down.  The same goes with my swing portfolio.

But your boy RAUL did work today, regaining all of the Bossram losses from last week.  As you may have noticed, the /ES has been a snoozer.  Seeing in advance the need to recoup my losses and suspecting the /ES may offer insufficient opportunities to do so, I pegged out the i7s all weekend to build a high probability trading picture in the /6e aka the Euro dollar.  I used to trade this instrument three years ago and I remember why—it’s a wiry SOB.  Chalk it up as beginners luck if you’d like, but I pulled another 0.0040 out of the /6e today, putting me back on track to increase my position size by the end of October.

This very much pleases me.  I’m not taking excessive risk either.  The gains have come faster because the /6e is on the move and setting up more often.

In summary, the /ES rolled over a bit today after taking out a trend line I drew on my chart.  That’s some advanced analysis.  Value migrated higher, we printed a neutral day which tends to show up near inflection points and tomorrow is Friday the 13^th.  Hide your wife.

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