Bear Kicked Santa Off His Sleigh 12-31-22

 The expected Santa rally didn't happen in this Christmas-shortened week. The bears are in control. The major indices closed slightly lower for the week again. They are still below their 20, 50 SMAs. We are into the seasonal pop and dump in January. Would this January be different since there was no Santa Rally?

The IB Netliq increased 6K from 183K to 189K, +3.3% for the week. The realized P/L is -$10878. There were a couple of long-term DITM rollouts to next Feb and March. The collected premiums are $10,980. Several of my BF hedges worked and expanded. The added positions from the BF expansion presented more risks. I need to reduce these positions quickly. 

I reduced trading 0 DTE for this week. The market was jumpy with less volume. TOS collected $1,250 for the week. There is $800 from one 1DTE IC. I broke the S/L rule. So it's a bad trade. There were no trades in the IB account. 

Lessons Learned: 

1. The morning meditations helped to keep me calm and focused;

2. My stop-loss rules are relaxed. I need to have a clear plan for adjustments and stop-loss rules. It should be one hedge or adjustment only. Then the stop-loss must be enforced. 

No Santa Rally Yet 12-23-22

 The majors booked another losing week in a Doji formation. We may not see a Santa Rally in the bear market this year. It may be range bound for the end of the year. The major indices are under their 20, and 50 SMAs daily and weekly. It's a bearish indication. 

The IB Netliq ended at 183K, up 3%, 5.4K for the week. The leverage is down slightly from 240 to 230 as the VIX stayed low. The realized P/L is a mere $250. It recovered from a 10K loss on Thursday's GDP selloff. The premiums are $3,988. The spread and butterfly hedges contributed to the gains. 

The 0 DTE strategy didn't perform well. Many other traders have indicated the same results in the FB group. It only collected $965 for the week. I didn't trade in IBP for 2 days because of news events and missed entries. I used hedges to void S/L. The effect is limited to low vols. I need to stick to the S/L rules. 

Lessons Learned:

1. Do not relax my self-discipline. I can't use the hedge strategies to replace the S/L rules. It could only reduce the losses to a degree. 

2. Patience is the key. I tend to change my plan because I am impatience. It often leads to poor performance. 

3. Identify the type of day for trading strategies. Analyze the trend at beginning of each day and mark the key levels.  

 

FOMC Set The Market Back 12-16-22

 The major indices gave back all of the gains of last week. FOMC reset the market sentiment back to reality. The bears are back in control again. SPX and Dow are the only two holding above their 200 WSMA. Are we going to see a seasonal Santa rally this year? We will know next week. 

IB Netliq is up 9% from 161K to 177K for the week. The leverage is down from 271 to 240. VIX is at 22.5,  not much elevated despite the selloff. The realized P/L is $4537. It is better than the loss of $2332 last week. The premium collected is only $1.1K. None of my hedges worked this week. CPI and FOMC turned out to be range bound.     

The 0 DTE didn't perform well with the current market conditions. The premium collection is only $853. There was no trade on FOMC day. I had to take partial S/L twice in TOS and spent some funds to buy hedges. The hedging strategy could work partially under normal market conditions. It should not replace my S/L roles. 

Lessons Learned:

1. I improved on my S/L orders. I am still not strictly mechanically in S/L. I often look for hedges first. It could turn out to be a disaster if the market is strongly trending in one of these days. I should be willing to take a big loss with this practice. 

2. I keep practicing meditation in the morning. It helps keep me calm during the day. 

3. I need to be more disciplined. When in doubt don't place the trade. 

The Sea-Saw Accounts 12-9-22

 The major indices gave back all of the J.Powell-induced rally gains this week. They closed the week in the red after the previous two weeks' gains.  The bears are back in control now. The market is waiting for the CPI and FOMC next week. 

The IB Netliq is up 1.4K from 160K to 161.4K for the week. The leverage is down slightly from 278 to 271. The realized P/L is down $2.3K. The collected premiums are $2125. I traded 4 1DTE IC this week. They were all $200 winners because of the steady volatility. 

The 0 DTE worked well this week. I finally closed the TOS short calls from 4 weeks ago. The trades almost choked me. TOS and IBP  collected $1862, and $1372 cash each. I made the same mistake again today. I let the winners become losers. I didn't enforce my stop-loss rules. I was hoping for the last 30 min selloff to bounce. I could have placed a stop-loss order to book 50% of the gains. I still need to work on my entry and stop losses. 

Lessons Learned:

1. Adjust stop losses to protect the profit. It's better to leave some money on the table than take losses.  

2. Self-discipline!!! What would the best traders do in a similar situation? Another disaster will happen if I don't change.        

A J. Powell Induced Rally 12-2 -22

The major indices closed another up week. The market was waiting for J. Powell's speech on Wednesday. As soon as J. Powell said the Fed might slow down the rate hike the market took off to the upside.  SPX and RUT rallied 3% and 2.8%. They both closed above their 200D SMA. NQ is the only one still below its 200D SMA. The NFP report today was better than expected. The implied inflation nature caused a selloff in the morning. The majors recovered most of their losses by the end of the day. The bulls are in control so far. The SPX Doji on Thursday is still a concern unless it gets crossed next week. 

The IB Netliq is down 3.3K from 163.55K to 160.25 K. The leverage is up 4.6% from 268 to 278. Vix is at a low 20 now. The realized P/L is -1.2K. The weekly collected cash is $4K. I hit twice 1K hedges this week. One of the hedge expansions suffered on the 3% rally Wednesday. I must not be too greedy on big market moves.   

The 0 DTE is still in the dump. I was sucked deeper into the SCs after the 3% rally on Wednesday. The two accounts collected $2.3K for the week. Thanks to two 5x hedges paid off. 

The lessons are still the same:

1. Learn what the best-disciplined traders would do. 

2. Take stops to void bigger losses.

3. Make improvement one step at a time.