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Option Day Trading SPY and TSLA: 4/6/23

 

My Daily Process for Trading SPY and TSLA Options

DAY GOALS & RULES

  • Focus on Intraday System Pattern A-C. 
    • Pattern A: reaction zone crossovers for an RZ reject or bounce. Or a spike into RZ for an RZ reject/Panic into RZ for an RZ bounce.
    • Pattern B: key levels for a KL reject or KL bounce.
    • Pattern C: RZ breaks (only on clear long-time duration formations)
  • Do not trade anything else.
  • Keep position size small. DO NOT AVERAGE DOWN ON ENTRIES!
  • Plan for the clear setups ONLY!
  • Patience is the key to solid entries and to maintaining low-stress levels.
  • Fewer trades with more confidence.
  • Focus on SPY and TSLA options ONLY!
  • Time to simplify the process and improve/reach the next level.
  • Actively challenge my regression pattern to ONLY trade my plan.
  • Do not give in to negative triggers.
  • Do not give losers more time!
  • FOCUS ON POSITIVE TRIGGERS
  • FOCUS ON ADAPTING TO PRICE ACTION
  • FOCS ON (1) CONTRACT FOR PLAN OPTIMIZATION
  • FOCUS ON THE ONE PLAN THAT CAN PROPEL ME FORWARD DAILY
Note: I am changing my daily routine. I will not post premarket; I will only post at the end of my trading day. I have been getting up at 4am PST to start my day but will now get up at 5am daily. Making some changes to hopefully get me on a better routine. Also, I will be decreasing my position size to 1 contract ($100-$200) to better manage my trades. Quite frankly, I  am pissed with not just my performance but the circumstances surrounding when I do increase position size and that my average gains are just not good enough as I rarely capture the gains I need to propel myself forward. So going to use this new schedule to make improvements for the better. Getting more rest, doing less busy work, decreasing risk so I can be more involved in the moves I want to be. We will go from there.

PRE-MARKET PLANS

Market News

  • It looks like we have no high-impact news today.
    • Let's just see where the markets want to go today!
  • For today, I have these levels marked: 
    • Reaction Zones: 
      • 408.50ish (yellow zone)- could have a spike for possible RZ reject.
      • 407ish (yellow zone)- near the zone right now. Let's see if this will hold or have a cross-over event for an RZ reject entry.
    • Key Levels:
      • 410 (thick red dashed lines)- wait for the KL reject. 
      • 406 (thick red dashed lines)- wait for the KL bounce. 

TSLA

  • For today, I have these levels marked: 
    • Reaction Zones:
      • 187ish (yellow zone)- wait for the spike for  RZ reject.
      • 184ish (yellow zone)- cross-over event has occurred. Wait for the retest to enter for the RZ reject.
    • Key Levels:
      • 190.00 (thick red dashed lines)- wait for the KL reject. 
      • 180 (thick red dashed lines)- wait for the KL bounce.



RAW TRADING NOTES & COMMENTARY

  • As I sit waiting for the market to open, I can't help but wonder more about my situation.
    • The unique situation I am experiencing could be all in my head, or is it an opportunity to grow and excel?
    • With anything, if there is adversity, there is always room to grow and move forward; I think this is similar to that.
    • On one hand, I am tired; my body is sick with a most likely adenovirus, and yet I still can fight past the urge to call in sick today so I can at least test these unique circumstances to reveal weaknesses in my trading system. On the other hand, I want to build a robust trading system that can withstand lots of events, and I feel like I would miss a great opportunity today if I could not at least grab some data today.
  • I know going back to 1 contract size is annoying, and I know I will most likely have the best % gains when I do this and will be tempted to increase again, but I must hone in on this skill and optimize the best of my strategy. This offensive strategy will propel and be the one thing that can stave off negative or red trades. This is necessary to combat those trades.
  • I need to focus on the one thing with 1 contract size that can yield the best opportunity to fully capitalize on the day's opportunity/my plan.
  • Right now, the best play I see worth the time and energy to fully capitalize on the 1 contract is to wait for the TSLA 184 RZ retest for the rejection. And if successful, take profits close to 180 KL. If wrong, cut losses just outside the zone.
  • Got in TSLA 184 RZ reject.
  • POWERFUL!
  • NAILED THE ENTRY AND NAILED THE EXIT.
  • SUCCESSFULLY CAPTURE THE OPPORTUNITY. THE 1 OPPORTUNITY TO PROPEL ME FORWARD.
  • NO NEED TO CAPTURE ANYTHING ELSE.
  • This one trade was a 29% gain in less than 5min.
  • I am in no rush to play other plays, but the KL on TSLA and SPY are bouncing nicely.
  • I think going forward, I want to just choose one thing and only focus on that and see how my performance changes.
  • I have done this many times before, but somehow, I forget how to replicate this when I use bigger sizes or ignore this performance. Therefore, I must repeat this repeatedly and make this a new habit before I even consider upping the position size to 2 contracts. 
  • So, priorities for the following days are:
    • (1) make pre-market plans
    • (2) Find the one plan to optimize the opportunity with 1 contract.
    • (3) Win or lose, adhere to the stop or profit target the best I can.
  • If only 1 trade per day, so be it.
  • The idea is to focus on this, and this only, and see how doing this changes performance.
  • The KLs are choppy but are bouncing a little bit. Rank these as lower setups, at least on days like these.
  • Yup took time, but the KL bounces are almost to the RZs again.
    • just going to watch; not going to play anymore today.
    • but curious to see the flow of the market.
    • If I did get into the KLs needed to have a range stop loss, but the exit would be close to the RZ too. Nice to see that play out, at least.
  • The bounces up to the RZs seem pretty aggressive, so the likelihood of another reject is higher...
    • let's see if I'm right
    • Acting strong, a variable change might be in order...
  • I went to bed to rest, and the markets seemed to finally want to bounce off the KLs.

POST REVIEW

  • Finally had a trading day worthwhile.
    • even though I had the smallest size possible I am again excited to replicate this.
    • This is my next phase.
    • Let's see if things start falling into place if I focus.
      • Focus on the 1 contract for plan optimization, and with that 1 contract, focus on the one plan that can propel me forward daily. If none, then none.
      • Rinse and repeat.
      • Let's see how this adds up.





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