Well to say the least, it has been a rough two weeks for trading for me. Lost a good bit, some of y'all may even have some of my money (haha). Anyways, I am writing this to help me more than to help you, sorry. I need to be able to look back and review what I did wrong in these two weeks and be able to specifically point out how to do better. So let's get started. 

Bought - $LEN 39.98 (1/3/13) Sold 40.98 (1/7/13) 

Very good trade. This was my ONLY good trade of the past two weeks and for good reason. I did well. Basically what I saw was a solid basing formation with break out of the base then consolidation that look like it wanted higher. It did, and it did go higher. Where I went wrong here though, there is almost always something, I did not let the swing "swing". I sold it too soon (again). However, I did sell it for good reason. At the time I bought it I did not look at the weekly chart (my mistake), and on the weekly chart it was obvious there was significant resistance upcoming. I knew this so I got out ASAP with some OK profits. 

Bought - $DE 88.69 (1/7/13) Sold - 87.59 (1/8/13) - 

YUCK! Here is where it gets ugly for me. I bought $DE for the second time in the past month because I really like the chart and I think it is going higher. The first time it look like it wanted higher, and it fell dramatically before I got out with minimal profit (I was scared out, to be honest). The second time, more recently I bought it because it was consolidating nicely and it looked like it wanted higher, it did... But I was out before it did go higher (happens a lot to me). My reasoning was that it was hovering right at resistance closed relatively strong for the day. What I did NOT consider (which I should have), was the fact that it was extended, and at resistance (I was anticipating the breakout). Therefore, since it was extended I should have realized that and paired that with the fact that it was at resistance and NOT taken the trade and waiting for it to pullback... Which it did the next day, and I was stopped out. I had obviously had my stop WAY too close for the move I was anticipating. Recently it has formed a topping tail and look like it wants to come in some, back to the breakout zone - so it can be back on y'alls radar (this was typed on 1/11/13.

Bought - $FAZ 13.47 (1/7/13) Sold - 13.57 (1/8/13) - 

This trade had the potential to be a good trade but I had some careless physiological errors that inhibited that from happening. If you remember the last trade, the $DE one... Well, basically I thought that I needed to "cover my losses" from the past trade (the $DE one) in this trade so I would break even. This was purely a case of greed. I knew I should have sold when I had the chance, I even tweeted it. But.. I chose not too, and I basically broke even. Going forward, I need to be able to disconnect trades and look at each one of them the same, that would have saved me a lot more money this time around. Also, shorting the market leaders is also a tricky idea I learned this week -- Unless you have a VERY potent signal, I would not recommend it -- That is why rule now. 

Bought - $SDS 51.64 (1/9/13) Sold - 50.86 (1/10/13) -

Obviously you always know what in hindsight what was wrong with a trade and it stick out like a sore thumb to you after you loose but a lot times you do not see that obvious signal or do not think about that one last scenario when you are hitting the BUY button. This is what happened to me this time. I believe I forced a trade. I have been trying to short this rally THREE times, and only break even ONCE. That should tell me something, and that something is that I need to follow the trend more. I am trying to pick tops when in fact I would be much better off if I just followed the trend up, and followed it down. Yes, every so often I would be following the trend and the trend will have changed directions, but most of the time I would make money. Or, if I did want to short counter trend (like I said in the my last journal), I need to have a POTENT reversal signal or something very definable to trade against  No more of this "guessing the top" junk. I need to FOLLOW THE TREND. Also, the other thing I need to be more careful about is NOT following others on Twitter, StockTwits, etc calls for fact. I know how to read a chart very well and therefore when I am reading other's posts on Twitter etc I need to be more careful of that NOT influencing my trade decisions. By doing these things I can minimize distractions, and stay with the TREND more. It is all about following where the market wants to go, not trying to be the "smart guy" who tries to pick a top blindly (me, this week - bu ONLY this week).

At this time, if you read all of this... Congratulations. I am very impressed. If you learned something, even better, if you would like to ask me questions or leave me any comments please comment on this or email me (visit Contact page for EMAIL address). I would welcome your thoughts on these trades, and technique changes but as I said in the last journal - I can read the chart well, and I just need to disconnect from the people on Twitter more, therefore do not think you will be influencing my charting abilities/techniques. (I did NOT proofread this, it is almost 11:00 PM and I am very tired so I am sorry if you find spelling errors - I am no English teacher). 
Ron Matuz
1/12/2013 03:05:05

Hi Ben!

Thanks for posting the "truth" in your journal. Your a stand up guy and will go far in life. What you have seen in the last two weeks is pretty typical, it is the "January Effect" and is usually preceded by a "Santa Claus" rally. Due to politics, Santa was delayed this year. But wait, there's more. Bond fund investors missed out on a pretty good stock market last year and are now coming in, and in record proportions.


From your journal entry, I think we're starting to see that 52 week highs, picking tops, PE ratios and short-selling is out the window now, at least for a while. A bull market works for both short-term and long-term investors. "The trend is your friend, until the trend ends."
There will be pullbacks, and they are painful, but they are part of a healthy trend. For example, check the 5-year chart on AAPL and see if you can spot a trend. I got on the Apple train last January at right around $500 and man, what a ride - 200 points, and no pullbacks!
I wish they wouldn't, but I think investors are about to send Apple parabolic again. Good news, no pullbacks, bad news, cannot pick the top. I'm thinking that I'll try "scaling" out this time. Something like 25% at $600, $650, $700, and $750.
Anyways, thanks again for sharing. And I hope some of this, in some way, helps you as well.

-Ron Matuz

Ben C Banks
1/12/2013 07:36:25

Thank you for your kind words. I agree, pullbacks are needed but in general, if you follow the trend - you will make money.

1/12/2013 10:38:40

The website is where I hang out, Bought my first stocks in the 70's
and Traded heavily since '07. It's refreshing to see (and remember) a new trader. Best of Luck to you
James aka Carzz

1/14/2013 02:03:30

What do you think is going to happen next week when $MSFT announces earnings? I'm going to be betting they exceed and looking for a target of around $28, to fill the gap.

Do you know of a website that has past earnings history with reactions to stock prices before and after?

I like what you have going on here, keep up the good work!


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