Daily Recap: Lessons from Another Red Day

Today was another tough one, with losses on both of my trades. I traded the same stock twice and ended up taking two losses, though my second trade was the result of a poor setup. Even though I lost today, I did walk away with some important lessons and kept my losses relatively small thanks to solid risk management and some unexpected luck with slippage. I ended the day with a loss of $27.19, bringing my account balance down to $1,106.92. Let’s break down the trades.

Trade 1: HOTH

HOTH had a catalyst today and surged right after the market opened. I saw an opportunity to enter about 30 minutes after the open, waiting for the price to dip below my entry point before taking the trade at $1.38 with a 7-cent stop. The price initially moved in my favor, reaching around a 1.5:1 RR, but then started to decline, stopping me out at $1.31 for a $22.71 loss.

Looking back, the setup wasn’t bad, and the entry was based on good signals. However, I’ve noticed that many stocks tend to start selling off about 30 minutes after the open. This is something I need to be more mindful of in the future.

Trade 2: HOTH (Round 2)

My second trade on HOTH wasn’t as well thought out. The stock was trending down, and I was trying to catch a bounce off a premarket level—a bit of a stretch in hindsight. There were very few buy signals to justify the entry, but I went in anyway at $1.18 with a 5-cent stop. The price quickly dropped, and I got stopped out. Fortunately, I ended up with some positive slippage and sold at $1.17, reducing my loss to just $4.63.

I definitely lucked out here because this trade was not a good setup, and it reminded me to be extra cautious when stocks are trending downward.

Reflection

Today may have been another red day, but I walked away with some valuable insights. First, I need to avoid taking trades when stocks are clearly trending down or ranging without strong buy signals. Secondly, I should be more cautious with trades that occur shortly after the market opens—while stocks often spike, they tend to sell off shortly afterward. I’ll keep these lessons in mind as I move forward, and I’m confident they’ll help improve my decision-making in future trades.