8/14: Lesson Learned

For the past week, i've been holding calls on WYNN, AAPL, RIMM, IBN, and GOOG...all made good profits...but the combination of yesterday and the day before took away most of those gains...With the indexes moving up today (now its off of its highs but still up), all i could do is get pissed and find a lesson to learn from all this...and here are the fruits of my labor (and even if the market totally reverses and gives up all of its gains, all these lessons still apply, because as a swing trader, my timing was still off):

1. i used a 6 month chart instead of a year chart for the daily analysis. In doing that, the bullish rally we are having now was made to look much more overbought than it really is. On my chart, we seemed to be getting out of recession while in the 1 year chart, we are barely scraping a 33% percent retracement in the SPX. I was thrown out of context to say the least.

2. As a short term swing trader, using the combination of the 30" and daily chart for analysis (with supplemental help from the weekly time frame), i should have noticed that i was thinking too far ahead with my analysis. The analysis was good and i still stand by it, but i was analyzing the upcoming week and on...that is actually too far ahead as i am trying to scalp big moves intraday up to 2-3 days ahead usually. What i was doing was giving good areas to take profit but not exactly good areas to sell all winning long positions and turn negative. There is a big difference and today i am realizing it...Yesterday was hold day (as i preached in the analysis 2 days ago) and i sold. Yup...i definitely needed to simplify my analysis and go with the path of least resistance.

3. I let the 30" chart take precedent over the daily chart. The longer term picture holds much more weight in technical analysis than the shorter term 30" chart. Its a good early indicator but not good enough to take on the bulk of the analysis. As we were breaking down in the 30", we were actually at strong support on the daily spx. That should have been my main indicator to hold onto my positions atleast until we see an early morning bounce today.

Re-analysis: Today with huge volume on 10" up candles and weak 10" down candles, i feel that we will add onto our gains by the end of the day. Oil continues to show weakness and still has not shown signs of a possible rally in the daily chart. If the lunchtime pullback remains at low volume and gives a good entry point, i might decide to add a long into my portfolio as just picking up gains just for tomorrow is a good enough rally for me.