Highlighted Trades - 03/20/2024
We saw 12 trades today - 6 long and 6 short - across 7 unique tickers.
Our most profitable ticker today was HST. We made 1 trade on it, with no re-entries. We made 0.13% here - not huge for our biggest winner, but with quieter days for the system, that’s going to happen occasionally. The only real red flag with this entry is that the Kijun-Sen line is completely flat, but the strong bullish momentum helps to mitigate that. This is a bit of a unique case since the Kijun-Sen isn’t flat because HST is stagnant. It’s flat because the stock gapped down overnight - meaning that the 26-period high was effectively a fixed number for the morning. Combine that with the bullish momentum, we get a situation where there’s strong momentum, but the Kijun-Sen is flat regardless.
I’d say the biggest lesson here is that there are no hard rules in trading. This trade was visibly a strong entry, and upon examination, we can see why something that’s normally a red flag is virtually irrelevant here.
Our biggest loser today was SRE, losing 0.26% between 2 short trades. The entry is mostly kosher here, no major red flags. The only thing that would have somewhat concerned me was the lagging line. It was below price action, but had been getting steadily closer over the few candles preceding our entry. This can be a hint that the momentum is dying down, but in my opinion, it’s not a significant reason to disagree with the entry.
The main reason we took a loss here is that we got stopped out a bit too early. If you had stuck with the position from the initial entry to final exit, you would have seen a slight profit (~0.19%). Again, we’re seeing a trade that’s a loser if followed blindly, but if used by a skilled trader, can be turned into a success. On some level, our signal was accurate here - the stock trended downwards between our initial cross and reverse. It’s unfortunate that our rules on exiting and re-entering cost us the profit on here.
The last trade I want to examine is this long position on KDP, for largely the same reasons as the previous trade. It’s a slight loser for us, but the signal is correct. Had you bought in when the initial cross occurred, and held, you would have made a very solid profit here. The reason our system didn’t re-enter is that the cross technically saw a reversal around 14:25. But the reversal is so weak here, that I think there’s a solid cause to have ignored it. This is something more skilled traders than I will need to ruminate on, but this trade coupled with the previous makes me wonder if we should be stricter about our exit conditions, or similarly, have a higher propensity to keep positions until there’s a strong sign not to. This is something I’m going to add to our backlog to do some research on.
That’s all I have for you tonight. Thank you for reading - and happy trading!
