I was stalking LVS for a breakout early this morning, the 5 minute chart will show you exactly how I screwed up this trade.
In essence I was too clever for my own good, trying to preempt the market, and got burned. Fortunately for me, I was too stubborn to sell and ended up being bailed out by some late day strength. Nevertheless I could have gotten a much better price with a little bit of patience – the test of the 5dma for example. This could have been a disaster for me as I bought calls – a full position at once – and could have easily ended up taking a 10%-20% loss.
The trade ended up working well, and assuming we go higher I expect it to run. Nevertheless, this is NOT how you should trade. Pick your spots carefully and don’t over commit especially on choppy days.
One final note, I have found the 12631 chat to be extraordinarily helpful in my trading, as any time you throw an idea out there you get feedback from the other traders. I’m not saying you should trade based on what other people say, but an extra set of eyes never hurts.