Red Day Recap

What's up, everyone? All right, well, today is a red day. I'm a little discouraged. You know, Friday was a small green day, Monday a no trade day, uh you know, and now here today I'm in the red. So, it's been in the last decent green day was was last Wednesday where I was up $56,000, and Thursday was like an $8,000 green day, which is good, but not anything crazy. So, now it's been a few days since my last really nice day, and I'm feeling a little bit bummed out to be sitting in the red. This morning, we had a stock that squeezed up over a 100%. It makes a huge move. It's our leading gainer, and the thing just unwound. It just rolled over. It it didn't hold up. And you know, there was probably a couple of warning signs I should have paid more close attention to, and we'll talk about those as we get into the recap. But, there was another issue today, which is that there was a market-wide data outage. So, in the middle of this trade, all of a sudden, all the quotes at a lot of brokers were frozen, and this was creating a major problem. So, this was not an issue that affected Lightspeed, which is the broker that I use, fortunately, but I did see members reporting that it was affecting DAS Trader. DAS Trader's used by dozens of different brokers as the data vendor and the platform that you would use. It was affecting WeBull, Charles Schwab, and so the result was and I'll give you an example. So, um so, the quote got stuck. And when the quote gets stuck on the level two, then if you're pressing your button to buy, your hot key is based on the quote. So, now your hot key is going to go through at a price different from what the actual price is, meaning your order's probably going to get skipped. What's worse is that a lot of these brokers actually have restrictions that you cannot execute orders that are more than 10% outside the current quote. So, now if the current quote is super stale, like the stock just went up 100% but the quote is still showing the original price, you can't add. But if you did get in before the data issue happened, you also can't get out. This is a serious problem and it will hopefully be a wake-up call to these brokers and data vendors um and probably it's it's probably the market data uh vendors that was really the the culprit here, which they might point their fingers at an Amazon Workstation or whatever the case might be, but it doesn't really matter. At the end of the day, there were some data outages and well, somebody has to figure out who is ultimately to blame so they can rectify it so it doesn't happen again. I think there is a possibility that as we see increased trading volume going into this PDT rule change and we may already be seeing that a little bit, that these brokers are going to be their systems are going to be getting kind of a uh live stress test, right? And it's in production and it has very real consequences when they fail. Now, maybe it's not the increased volume that was the result of today's issue, but um you know, this was something that we definitely saw during the pandemic and I hadn't really thought about it until you know, just today, but during the pandemic, there were weeks when some of the commission-free brokers were completely unusable. Uh thinkorswim had major issues during the pandemic, data lag, the platform just not working and it's like, "What what are we doing here?" I mean, you know, at certain point, people just switch to a different broker. You know, you you can only hang on for so long on a a platform that doesn't work before you need to have a backup and then you're using the backup every day. Well, what am I doing over there? And so, this was an issue not just with thinkorswim, but with and this was when they were still owned by Ameritrade, but with dozens of different brokers during the pandemic. So, will we see a repeat of that? I hope not. I hope that they've learned from that experience, but since it was 5 years ago, they They forgot about it. They probably think they're totally fine and we probably will see some um you know some some pressure points um reveal some some weaknesses in some of these platforms as we saw today. So, because in the middle of this trade we had this market-wide outage essentially, that naturally reduced the amount of volume that we were going to see in the stock because people couldn't trade it. So, that hurt its ability to continue going higher. Now, on the other hand you could say, "Well, it also hurt the ability for shorts to take positions." Which is true, but um in any case, the result was that the stock rolled over. And so, if we jump onto the screen share, you can see my P&L for the day. I'm down um it's a red day as you could see. And uh you know, it's a little bit discouraging, but uh the stock that I traded was um NEXR. So, there were a couple issues. One was the market data issue. Um another issue is that I jumped in it quickly. I saw this news headline right here. So, if we go back, kind of roll back time to when I took this trade, all of a sudden at 7:40, right here, which is an unusual time for news to come out, this thing rips up 270, 270, 290, 290. It's popping up. It's moving quickly. 337, then four, then up to 564, right? It's squeezing really fast. And within like 2 minutes it basically hit its high right here. And that was the high of day. So, we got a little algo spike right there. The news comes out and it rips from a low of 220 all the way up to $5.60. That's an awesome move. Now, we've seen some other moves like that. And even if you missed the first candle, cuz or the first couple candles, cuz it's so fast, we had good opportunities in the last couple weeks where we got a curl back up. So, I sort of thought maybe here, maybe here, and maybe here, but none of these curls actually ended up working. And then as you can see, finally, it unwound and came back down quite a bit. So, one of the first things I noticed when I pulled up the stock was that the level two was strangely heavy. There were like 10 sellers on the ask when it was at 265 or 275, whatever that was, which surprised me considering how light the volume was. And I was like, this is weird. It's heavy. I said it out loud. I said, this is weird. And the next thing you know, it's three, 325, 350, and as it started to, you know, pull away, I jumped in. And so, I jumped in as it broke through 350, getting in at 366. That was my lowest entry, my best entry. And so, that was in the middle of this um squeeze right here. I got in on basically the break of the half dollar whole dollar. So, right here initially was where it was a little heavy, and then all of a sudden it pulls away, and it pops and dips, pops and dips, and I got in basically right here, and then was adding, adding, adding, adding for the squeeze up. So, as it goes up, I take half or half and then another half off the table, take profit. And I was actually green $20,000. Wow. All right. So, awesome move, you know, all the way up to 560, and then it drops all the way down to 420. So, I buy the dip. I'm thinking, all right, you know, this is maybe first pullback. It pops back up, and then flushes down, and right there I gave back five grand. So, now I'm up 15, and I was like, All right, not great. Then it dips down again, and I tried to do the dip off of the volume weight average price. I thought, okay, I'm going to do a quick bounce right down here, half dollar whole dollar. This will probably work. 20,000 shares, was already being a little aggressive. Flushes lower. I stop out again. So, now I'm like, all right, this is not good. And I think at that point, I gave I was um up only about 7,000. So, now I'd given back more than half. And then it pulls back, pulls back, and then it comes back up, and I added back right here. I was like, "Okay, here we go. Looking for that curl, break over VWAP." And I stopped out again. And then it comes back up again, and I tried it one more time, and then I stopped out again. And I was like, "All right, what's going on here? This is ridiculous. It's not curling." And um I knew that some traders were having at that point market data issues. I didn't realize how widespread they were. I wasn't having any issues myself, so I was like, "I don't know. I it's not an issue for me. I I think it's probably fine." Um and so, I I kept trading it, and I kept eroding the profit. And it all happened very quickly. You know, usually I stop if I give back half, but I felt like we finally had one on the hook. You know, we had this huge move, the pullback, and in the last couple weeks we've gotten really nice curls back up. So, even though I kind of fumbled this area a little bit, I really thought we were going to get a curl back up. I really did. But we didn't. Uh and so, I'm disappointed, and in hindsight coulda woulda shoulda stopped sooner and this and that. Or maybe even not taking that trade in the first place. Because if you look down, you see Jeff's Brands. I didn't notice that. Why is Jeff's Brands a stock notorious for being really hard to trade? Uh a company that does a lot of secondary offerings. Why is this headline tied into the stock? Well, this company was Jeff Brands. They changed their name, and they changed the symbol, but they're the still still the same company. They just did a name change and a symbol change. Kind of trying to throw people off their trail. Um and it worked. They got me. They got me. It worked. Uh cuz I thought that I didn't think this was If I knew this was Jeff's Brands, uh JFBR, I would not have traded it. Uh and this is the reality with day trading. You're making quick decisions, and um you make decisions based on the information you have at the moment, uh, but lacking, you know, a critical piece of information can seriously change, uh, you know, what you would have decided, and I just didn't see that at that time. I saw it later. And so, at that point, um, you know, the damage was already done. And so, that that's disappointing. Um, you know, I mean, there's there's no way around it. It's disappointing. Um, I find that companies changing their name and doing these name changes, you know, are annoying, but um, it happens. I mean, look, Facebook changed to Meta. So, I mean, it happens even on a very big scale. They're allowed to do it, uh, but in this case, yeah, I'm annoyed about it. So, anyways, it is what it is. Um, we weren't able to curl, it rolled over, and, um, now it seems like the data issues are resolved, but, you know, by this point, whatever. So, this was the leading gainer. Um, B Y A, this one has taken, uh, the top spot. Lower priced, not really something I would be that interested in. S B L X, um, this one, you know, curling back up. So, a nice curl on this, right? This one worked for the curl. Um, I don't know why this one worked. Well, Jeff Brandsis at the why it didn't work most likely, because that stock is notorious for not working. Because I think the company or underwriters are probably selling shares, um, into the move, but regardless of ultimately what causes its choppiness, um, we did have a bigger move yesterday, H T C O, and this was during regular trading hours. This went from 12 all the way up to $56 a share, uh, but it was not super easy to trade. Big spreads, lots of halts. It would be nice to see a move like that during pre-market where there's no halts, and you can actually cleanly trade it on the move up and get out before it halts down. But, uh, that didn't really translate into more momentum this morning. Maybe it does translate into more momentum you know after the um uh opening bell today. Um but in any case, I'm um I'm not going to I'm not going to push my luck. Uh you know, it look it is what it is. A $3,500 red day here in my IRA is tolerable. It's been I've had a nice little stretch here the last couple weeks. You know, I obviously had a couple bigger losses earlier in the month, but was able to recover them um rally back and so I'm grateful for that and you know, taking a little loss here is um it's just part of the deal. So it's important to take my foot off the gas quickly, not to lean in when things aren't going well, you know, just to walk away and accept it and live to trade another day. So, you know, this is kind of the last 30 days here. Would have be would be a lot nicer if I stopped right there, but you know, today's red day will be like boop. It'll be so small. These This is This is a $6,700 red day. That was for $6,400. So, you know, $3,500? Yeah, it's no big deal. It's fine. Um I just you know, I I want to make sure I just keep these days really small and maybe the green day small, too until things start opening up again because it seems like it goes pretty quickly from hot cold and then from you know, cold back to hot. And so you got to be able to get aggressive quickly, but you also have to slow down quickly and that sometimes is hard uh for me, for other traders as well, I'm sure, to go from being really aggressive to all of a sudden, you know, taking your foot off the gas, but uh yeah, right now I need to be uh a bit more cautious. So, that's that's where I'm at here. Um I'll be back at it tomorrow morning. I hope that we see some better news catalyst, but um you know, at this point, it's Tuesday. It feels like sentiment has cooled off a little bit, so might have to um might have to wait this out, but I can do that. Done it before. And at least right now I'm not in, you know, um a huge drawdown. So, I can I can sit and I can be patient. All right. So, with that, I'll see you guys streaming bright and early tomorrow morning. Reminder as always that trading is risky and my results aren't typical. Uh so, you always should trade in a simulator before putting real money on the line. I've got a couple recent uploads that'll be posted here that you guys can check out. And I'll see you tomorrow morning at 7:00 a.m.