10/8/20 - 10/9/20
Daily P/L: -$88
Account Net Value: $715
Account Net ROI: 104%
Trade Rating: BAD
Did not take any confident trades these 2 days. In fact, I made some big mistakes! Let's go over these mistakes with my loss on a ZM trade:
Zm was on a momentum run up for the day, and I completely missed the break of the HOD level and the push up. As traders, we tend to feel FOMO. Which is an emotion we get that leaves us angry, and fearing of missing out on the money that everyone else is probably making. But here is the thing, we let our minds control us. Once you lose sense of control and let your emotions control you, you will almost always take losing trades. You know why, right? Because our emotions pick on us and actually put us down more than they lift us up. This negative emotion will lean you towards chasing trades and taking emotional, fomo, and revenge trades; and let me tell you that these trades never end well.
So, since I missed the break and push up. I was already feeling the FOMO, especially because ZM was my primary watch for the day and I woke up eager to trade it. Im sure you've felt this before; you prepare yourself the night before and are ready to trade a stock you've analyzed.. but you completely miss it. This is where we have to learn to sit on our hands, let go of our emotions, and stick to our trading plan. But trust me, I totally get that it's easier said than done. Nonetheless, after ZM had its run, I set a level in purple to keep watch of. I analyzed that if ZM was to break above and hold above this level then we will see a continuation run and push up.
I also set a mental stop loss in red. If the stock was to break and hold below this level I would take my losses.
I got into my trade when ZM broke above my purple resistance level.
Now here is where my big mistake comes in. I entered my trade at the break. The correct confirmation would have been waiting for the candle to close and hold above this level. The reason why I should have waited for a close above this level, is because this is already a very choppy zone. There is no clear direction. When there is no clear direction then you should always wait for a close above your critical level.
ZM then broke below and held below my mental stop loss level, so I exited my trade and took my losses.
Take your mistakes, study them, and learn from them.