{"id":19577,"date":"2012-06-18T13:34:36","date_gmt":"2012-06-18T17:34:36","guid":{"rendered":"http:\/\/www.smbtraining.com\/blog\/?p=19577"},"modified":"2012-06-18T13:39:43","modified_gmt":"2012-06-18T17:39:43","slug":"i-felt-a-rip-coming","status":"publish","type":"post","link":"https:\/\/www.smbtraining.com\/blog\/i-felt-a-rip-coming","title":{"rendered":"I felt a rip coming"},"content":{"rendered":"<p>I caught a scalp for the first downmove in DSW.\u00a0 I caught the upmove from above 52.12 to near 53.\u00a0 And I caught the downmove from below 52.50 to 51.65.\u00a0 I looked at my PnL and I was barely positive.\u00a0 How is that possible?<\/p>\n<p>I was not trading DSW on the open with size as it was so early and touching a lot of prices.\u00a0 When a stock touches a lot of prices it is hard not to get stopped out.\u00a0 Before every trade I set a price or a visual for where I would exit.\u00a0 DSW&#8217;s price action, or lack of clean price action, made it too risky to get big.<\/p>\n<p>I was on the desk, right three times in DSW, with an eery feeling that a rip was around the corner.\u00a0 If you trade long enough you will start to physically feel that danger is near.\u00a0 I said on SMB Real-Time, I feel a big rip coming in DSW.\u00a0 When you are so right and up so little in a stock that is not clean, history teaches the experienced trader that a big loss is coming.<\/p>\n<p>Sensing to be careful I developed only two scenarios where I would get big:<\/p>\n<p>1) If DSW got below the intraday support level of 51.65.\u00a0 There was a stubborn buyer there.<\/p>\n<p>2. If DSW held 52 on the offer cleanly.\u00a0 Meaning if I could spot a large seller at the same price on the tape at 52.<\/p>\n<p>I downshifted to this more conservative trading approach because the stock was not acting as cleanly as I had hoped.<\/p>\n<p>DSW broke below 51.65 and I added more size.\u00a0 The uptick rule was in effect (you can only short by selling on the offer) so I put some out at 54c 57c 59c 63c, piecing into a larger short position.\u00a0 I was confident in a sharp move to the next significant long term support level of 50.<\/p>\n<p>What came next?\u00a0 A reversal and a big rip.\u00a0 But also a few good market lessons.<\/p>\n<p>a) Play defense when you add to a position as it breaks an important level.\u00a0 If the stock does not act like you had envisioned when it broke that level, then lighten up.\u00a0 When DSW got below 51.65 the only thing that could happen was not that it could only trade lower.\u00a0 A failed breakdown, reversal pattern could follow.\u00a0 Watch for that.<\/p>\n<p>b) When you feel a rip coming, learn to listen to yourself.\u00a0 As you gain screen time your body will send signals.\u00a0 Your trading brain will warn of danger.<\/p>\n<p>I hope this helps your trading.\u00a0 Keep working on your trading game.<\/p>\n<p style=\"text-align: center;\"><a href=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2012\/06\/DSW.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-19578\" title=\"DSW\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2012\/06\/DSW.png\" alt=\"\" width=\"578\" height=\"378\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2012\/06\/DSW.png 1115w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2012\/06\/DSW-300x195.png 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2012\/06\/DSW-1024x668.png 1024w\" sizes=\"auto, (max-width: 578px) 100vw, 578px\" \/><\/a><\/p>\n<p>Bella<\/p>\n<p><a href=\"http:\/\/www.amazon.com\/One-Good-Trade-Competitive-Proprietary\/dp\/0470529407\/ref=sr_1_1?ie=UTF8&amp;qid=1340038640&amp;sr=8-1&amp;keywords=one+good+trade\">One Good Trade<\/a><\/p>\n<p><a href=\"http:\/\/twitter.com\/smbcapital\"><img decoding=\"async\" src=\"http:\/\/twitter-badges.s3.amazonaws.com\/follow_me-c.png\" alt=\"\" \/><\/a><\/p>\n<p>no relevant positions<\/p>\n","protected":false},"excerpt":{"rendered":"<p>I caught a scalp for the first downmove in DSW.\u00a0 I caught the upmove from above 52.12 to near 53.\u00a0 And I caught the downmove from below 52.50 to 51.65.\u00a0 I looked at my PnL and I was barely positive.\u00a0 How is that possible? I was not trading DSW on the open with size as it was so early and &#8230; <a href=\"https:\/\/www.smbtraining.com\/blog\/i-felt-a-rip-coming\" class=\"more-link\">Read More<\/a><\/p>\n","protected":false},"author":144,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[4676,162,30,1828,1193,653,301,1996,1354,1989,1349],"class_list":["post-19577","post","type-post","status-publish","format-standard","hentry","category-general-comments-2","tag-day-trading","tag-day-trading-blog","tag-prop-trading","tag-smbu","tag-trader-education","tag-trader-training","tag-trading-blog","tag-trading-class","tag-trading-coach","tag-trading-course","tag-trading-mentor","no-post-thumbnail"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.1.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>I felt a rip coming | SMB Training<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.smbtraining.com\/blog\/i-felt-a-rip-coming\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"I felt a rip coming | SMB Training\" \/>\n<meta property=\"og:description\" content=\"I caught a scalp for the first downmove in DSW.\u00a0 I caught the upmove from above 52.12 to near 53.\u00a0 And I caught the downmove from below 52.50 to 51.65.\u00a0 I looked at my PnL and I was barely positive.\u00a0 How is that possible? 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