The only way to complete a learning cycle is to practice it, acknowledge the outcome, learn from the outcome (mostly failure, if you got it right, you are just plain lucky) and repeat the cycle again. Cognition is defined by encoding, restoring and retrieving information. Most people with average or above intelligence can do first 2 steps with ease but the last step, usually tested an individual confidence level and I found that a lot of people are stuck at this phase because it involves something so dear to them (e.g. money).
experience mixing with people who took up a financial workshop or
tutorial, especially those catered on investment, a lot of people took
months to begin to start their first step even though they actually have
nothing to lose except for their time (because you can practice your
learned skills with virtual money or we called it paper trading). This
will somehow define are you a person with high or low confidence and I
will leave this for some other days.
I am one of the 6th batch of Pattern Trader Tutorial (Penang).
I have graduated from the course and our real trading journey begins
since the historical high hours of classes (yes, even the sensei aka
teacher himself agreed about this!). It is by a very humble trader named
Conrad Alvin Lim who is running his business under his company
Having complete the tutelage last
week, I decided to test one of the safest technique among our sensei's
arsenal on the instrument which I had not touched before, Options.
Looking at my Stock Trader's Almanac,
I found that I can take my Buy Call entry on SPY (SPDR S&P 500
ETF) by 26 September because it was a day with 40+% bull followed by 2
higher average bullish days (we always buy on the low/dip) and I was
swing trading this position, I did not want to hold this over a week,
thus I started my position by the entry point as labelled in yellow
circle as depicted on above chart.
It went down to
touch the first support of that day (S1). Since I have planned my trade
and laid my stop target, I decided to call it a day and went to sleep
(after it was a nice rainy night and I had just coming back from my stall).
The next morning, I woke up from my first surplus in option trade and
of course, it helped to enlighten my day. I continued to monitor the
position to make sure the position went at least hitting my profit
target. By the 2pm (EST) when it went parabolic and broke the resistance
level (S2) which served as a new support for next day, I closed half of
my position to secure parts of the profit and raised by stop target to
entry point. You guess, our stall is closed on Thursday so that means I
was working on Wednesday night so tiredness kicked in and knocked me to
bed. No surprise as you can see, it forms another new high which formed
the resistance (R1) as of the point this article is published, but it
was well supported on S2. It broke the last diagonal support,
though...Back then, the market was quite chaotic and I actually planned
to close remaining contracts before today market open because it is
quite bearish according to the Almanac and I remember there is October Effect.
forget to put a stop on the ideal profit target on the blue circle (as
in the chart) and went for this local made movie instead...
JinnyBoy TV. I will just review it in another post and let's just get back to our position, shall we?
after 2 hours off from the screen the movement of the position was
quite clear that it was unable to brake R1 and began to slump with
divergent patterns. In order to keep Greed and Fear in check, I decide
to close all position as showed in chart and here is the summary of
whole process since Tuesday,
Should you wanna learn more about what I am
learning, why not meeting up with my sensei? Next preview session:
Otherwise, you can always keep an eye on Pattern Trader Facebook for further info about next preview session and course date.
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