Lesson Learned 04/09/2014

Hey guys, so a lot of you guys know that I haven't been trading much because I usually get home during the lull hours of the market. I strongly advise the beginner trader NOT to trade in these hours. Usually these hours are from 11 EST to 1 EST. Not a lot of things going on during these hours. So today I got home late and decided to see if I can get any EOD (End of Day) action going. Sat around for a while looking for the right setup and looked on my finviz scan and was browsing through some stocks. I saw $DANG with the perfect ABCD Pattern going on. So I decided to put small size into it. The stock had a small breakout and I was up $15 unrealized gains. Really was looking for a green day and did not want another red day. So I sold it for a $15 dollar profit. Was I right to do so? No not at all... Here is the chart and you will see why. Green arrow is when I bought it and red arrow is when I sold it.

You can see the perfect grinding and entered right before the breakout. Beautiful entry if I may say so myself! But my exits are always horrible. The reason I tend to exit out of trades to quickly is because when I started I was putting WAY too much size into my trades. The first two weeks of trading I was putting 1k shares into every trade I went into just for a quick scalp! It turns out great if you get the trade right. But if you don't, you can end up giving up every dollar in your account. So I lost $1,500 those first two weeks. I knew I had a problem with size so I have really adjusted it accordingly. That is the reason I exit out of trades too quickly is the fear of the stock turning around and me end up losing money. That is why smaller size is crucial when first starting to trade. With the smaller size you can set your risk accordingly. I would have put my stop to $14.05 for a .10 cent per share loss. But the potential to this stock was a lot more as you can tell. And once the stock goes up, you can move your stop up, guaranteeing your profits.

Lesson that was learned?
If you have a plan, stick to it when entering a trade. I didn't go into the stock with a stop in mind, so the result was a sell when the stock pulled back. Trust me, If you have a set stop in your mind or even a physical stop it will help your trading a lot more. I could have made $100 on this trade but I was being a little bitch about it. I may be in the green for the day but I want to learn to trade better not just make a quick buck and get out. So what I am trying to say is, If you have a set stop and smaller size, It will give you more breathing room. You will hold the stock longer because you know that if it pulls back couple cents, you won't lose much. If you go in with a huge size, then you will always be watching that stock and keeping your finger on the sell button. So I hope that helped some of you guys out there!