This is a collectors item. As you know I don’t shy away from showing you that I am not some sort of amazing super trader that never gets it wrong. I do. Just as i suspect you all do from time to time. I like to post up videos that mean something. That way you get to learn and I can show you things that are relevant.
Now although this isn’t my finest hour, there are a couple of good parts to the trade that show up well market behaviour. When I watched it back it became apparent where I made my mistakes. I am having a decent run of things at the minute and my confidence is higher than usual. This affects how I view my trades. When confidence is high you can feel invinvable. But that’s alway short lived and life has a habit of clipping your wings. Although this trade isn’t a complete disaster, it shows you that taking a loss is ok. It’s about being in control.
Watch the video and then read my breakdown.
00:00 This is a 5 runner race, 2 shorter priced runners and 3 in double figures. My initial assessment is that I think that Auden may not break through the cross over point at 2.0. I was struggling to find it’s definable trading range.
01:37 I make a comment that when there are 2 runners both with a positive trend I find this a good signal. One will usually steam, and it’s often the favourite.
02:15 I make reference to my stop loss or exit position. It begins to look likely that it will be reached.
02:30 I like this bit 🙂 I wanted to be in this trade, and was willing to take the risk of a small loss, as if the steam did happen it could be a big one and a good profit. I am balancing out the risk v reward, so this is stacked in my favour. This is essential to making long term profits.
02:38 As if by magic, exactly that happens. It bounces slightly but in general the trend has strengthened. What actually happened was the slack in the book had been taken up. The back side percentage went from 101.5% to 100.1% So 1.4% of the book. The price on the 2nd fav didn’t budge initially.
03:24 At this point I thought I was home and dry. I was thinking this is going to go 1.8 or lower/
03:47 Every runner has a positive trend, except for the favourite. The book was pretty slack and much ebb & flow
04:22 I do the right thing and exit, It was becoming a mess.
05:30 At this point there is some momentum and WOM building on the Lay side of the fav, it’s obviously going to stream. The same thing is happening on the back side of the 2nd fav – that is about to drift. I am on the wrong side and oblivious.
06:52 It’s only 32 seconds from the race going In Play and I could have closed the trade for a £5 loss. I outstayed my welcome.
All the way through this trade, the 2nd fav didn’t go above 3.5 or below 3.25. In that 5 tick range over 100k was matched in those 5 ticks. Anyone with a brain cell could have filled their boots. Unfortunately I left my brain cell somewhere else today. Even after watching it back a couple of times. I don’t think i did too much wrong. Another time would would be watching this with a £100 green book. Trading in the style I do, sometimes you have to take a loss. But it has to be controlled.
Like I said “How did that happen?