Thursday, December 11, 2003
I feel like I deserve an apology! The bile is right up in my throat. I hate that feeling!
In the last minute of trading the sleepiest market in the grain complex this week, the locals ran the stops into the highs of the last few days of trading in March Corn. Sneaky bastards.
I should have seen it coming. I mean the price range all for the past two weeks has been miserable and tight. My guess was that the resistance at 253 was getting too strong to penetrate. The rest of the complex has been sagging, even with the head Chinaman visiting North America. None of the rumors of Chinese buying Beans has panned out all winter, in fact the cancellation of one order recently sent the beans plumeting...but that's fundamental stuff and only good in news stories. I wonder what the reports will say about this bullshit caper this morning.
But today...everything looked good for the short positions panning out. I mean Beans down 20 cents, Wheat down a dime...all after the USDA reports this morning. But the corn held. I should have read that as strength. Of course that's hindsight after the floor creamed all the shorts in 60 seconds flat. God it was fast! Funny...money NEVER accumulates in the account that quick. If it did you'd grab it too soon and see coninuation like Cocoa has done for awhile.
I added another short at 246 1/2 just like the plan...waiting until the lows and double bottoms were taken out. When it found and held support at 245, it would have been a good time to take the $300+ profits. But here's the catch. Take the quickie (as if...this has struggled all week...first clue) or stay with it projecting the goal of 233, as worth waiting for. Well, not being a daytrader, you stay with it. Especially when it spends the entire morning on-side.
At the close...and I mean literally in the last 60 seconds, they slammed it up to 253 and my nice little profit evaporated into a $405 loss right before my eyes. The second position (called my continuation trade) didn't continue and ate profits alive from the first one . You can bet I wasn't filled at my trailing stop either but right at the high freakin' tick. I'd love to have access to a 'time and sales' run to see how many were filled right there. That's one of the reasons I miss my old 'personal touch' broker sitting at his desk. He could pull up those reports and it always made for interesting study. The he'd phone the floor for me only to be told "so sorry...fast market...too bad...not held". You know the drill. I know time and sales is still still available for those deep pocketed traders paying 'real-time' fees to the exchanges. Too rich for me. I've heard the same story too many times to need a print out for God's sake.
Then they back it off 2 cents to close at 251 after cleaning house with all the tight stopped shorts. Now comes the fun. Will they poke it through the highs tomorrow, drawing in new longs, only to slam it down next week. Or maybe it will just sag back down to support again.
This is where the rubber meets the road. The worst thing that can happen now, after a loss like that, is missing a false breakout to the upside followed by the drop. When you're in the position early on a good fill and see this kind of manipulation, it's often enough to keep you away for awhile. That spells missing the move you've been planning for all this time. The chart proves you right, your account says you were too early. What an advantage these floor traders have in this business. You've got to be really good at this game to stay in the flow. That's the second loss this month for me in Corn. Thanksfully my Cocoa and Sugar trades are keeping me ahead. Getting shook out of the Canadian $ at break-even meant I've missed some nice equity for December. Things will be getting thin soon so it's almost time to slow down. I must check the volume for today and see just how thin today was. Could be an interesting additional item. God, I hate stop running! What an advantage...to literally SEE where everybody is in the computers. Wow. No wonder all those Chicago boys live in big houses and have nice boats.
My mistake here was after putting on a nice entry at 251 1/2 last week, followed by todays continuation at 246 1/2 below the double bottom lows, there was no continuation. Read it right there, Otzi. The support at 245 held, no followthrough despite the Wheat and Beans getting soaked. My second entry stalled for three hours. That re-states the old rule. When a position stalls and doesn't move in your direction, treat it the same way as moving against you. That it did my friend...that it did. Greed gets the better of us all!