EIA DAY!!!

QN/ER2

Background:

Today was a big day due to the EIA natural gas report that came out at 9:30. As you can see by the chart above, the larger than expected draw in natural gas caused a 30 cent price spike. The rest of the day pretty much sold off slowly back to pre-eia levels however, the initial caused a staggering move above the 8.00 level. The russell went down pretty consistently over the day. The first 30 minutes were very choppy and then it continued to fall for the rest of the day. Note that yesterday Democrats took control of both the house and the senate.

Trades:

There's really only one trade I want to mention and I believe it was a bad trade yet it was my largest risk/reward winner ever. I broke my rules which is why I believe it was a bad trade and I was lucky to walk away a winner but what I saw made me realize that had the EIA gone the other direction I could be down a great deal. I went into the eia with a 1 lot long. The MACD showed a buy signal and I thought, I'll put it on and place my stop 5 cents back. At most I was risking 125 bucks. When the EIA hit the market literally jumped about 15 ticks up immediately without trading. There was gaps in the market so big you could drive a truck through them. It continued it's run up and I am proud to say I captured 24 cents out of the possible 28. What I didn't like about this trade and the reason I will not do that again is the gapping and jumping that occured to the upside could've easily happened to the downside causing me to lose more than the 125 I had planned. There's a lot of risk involved in holding a trade into something like that and if I ever deside that it would be an okay proposition to do that again, I would say to do it the same as I did with an actual stop loss placed in the market so that you get out asap if it goes against you. In the mean time, I'm not going to be doing that again.

Positives:

I am currently reading a book called Trade Your Way To Financial Freedom, and it is explaining how goal setting and objective setting is extremely important. I am currently working on those goals and will make a report of them once they are complete.

Negatives:

It wasn't smart to break the rules like that, and it's too bad that it worked out in my favor but I know now that it's not worth the risk it could've produced.

Conclusion:

Decent job today, up .5%. The MACD showed all kinds of good trades today and I'm currently working on building a backtester to analyze my trading strategy and determine if it is viable.

Good Luck and Namaste