The siege of Chang An has been lifted. In a most unfavourable manner.
My 36k positions got stopped out 2 nights ago whilst I was sleeping (and snoring really loudly, as Mrs RetailTrader claims). I woke up at 6am in the morning, checked my phone for the market movements first thing, and heaved a sigh of relief because while the market had gone down, it rebounded later in the trading session, and my stop loss did not appear to have been hit.
But it did... Because of enlarged spreads. Lesson learnt - when setting stop losses, if you have brokers who somehow very mysteriously like to widen spreads to hit your stop losses, please account for larger spreads. Thought of disputing this with my broker actually, but don't think I will get anything out of them except for some stock response that spreads can widen like Madonna the virgin in times of volatility yada yada scooby dooby..
So my positions which I have pyramided over some time are lost. But fault is mine alone, because my stop loss levels were also set based on Elliot wave levels that had, at least one day before my positions got closed out, shifted to a lower level. If I am trading rightly in a disciplined way, what I should have done was to shift my stop loss lower in accordance with the new levels, and close out the required number of positions in order to maintain the same amount of risk capital I want to take on for this trade, which was 8k.
So I'm left with 8k realised losses, and lost unrealised gains on these positions of over 20k. Ouch. That's what you get for bad trading. Less than disciplined risk management. Don't blame the broker! Don't hate the markets!
But last night I have opened 5k+ new long positions with another 8k of capital at risk, so here we go again.
Bullish till the 2467 low on SPX is broken.
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