Confessions of a local

trader_dante

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I've been keeping a personal journal every day for several months now.

It''s nothing like I've written on here before which usually just details trades I'm in or have taken and how much money I'm made or lost on them.

But someone read my update on Friday and seemed to find it hilariously funny and suggested I post it on here.

So I thought I would.

It will probably be my only post from it though as it's rather personal.
 
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Friday, 27th February: 13:00 P.M.

The S&P futures have been heading down all morning. Now it’s just above it’s November lows. It’s on a knife edge and everyone knows it. The dollar index is making new highs. World bond markets are rallying. The press is already running quotes from market analysts that claim a break below the November lows could result in a full blown crash scenario – a panic on the scale of 1929 or 1987. A drop of 20% is being touted by even the conservative.

And as usual, I am going against the trend. I'm heavily long.

It is, I find, somewhat ironic that I’ve been such a market bear and yet here I am, severely over extended on the long side.

My stop is just beneath the low.

The market is literally sitting on that level.

Everyone knows there are going to be a lot of stops beneath 739.

The locals are praying for a sharp spike down now so they can buy it up. I know this because I can hear them discussing it on the floor.

I’m hanging onto the last vestige of hope that this is not going to happen to me. That someone is going to step in and bid this up and that I’m not going to end up puking my position to my colleagues who are buying low.

The fact that my stop will get hit if I leave it where it is is inevitable but also unavoidable. I can’t afford to give up any more money to hold this – not when I have no idea how low we will go when price breaks.

Then at 13.20am, it happens. The tension snaps. The S&P hits 739 and drops 9 full handles instantly. I hear a sharp intake of breath on the floor. I’m one of the first filled at 738 – I thank heaven for small mercies.

A minute later the offers get hit and we reverse sharply. I can hear the other locals talking wildy and excitedly and yet there is no time to evaluate. Because I am also short European Government Bonds.

I’m short with two different brokers and my clearing house. All my positions have gone from considerable profit to an open loss since this mornings open and as the S&P breaks, Bunds run over half a point up the ladder.

And there doesn’t seem to be any light at the end of the tunnel. Now everyone is talking about the US GDP. -5.4% has been expected. Anything worse could be the death knell to the market that everyone seems to be waiting for.

As the sqwark says “10 seconds”, I'm praying for a better number. I don't even realise I'm holding my breath.

Bloomberg has it a second before. -6.2% flashes across the wires. Another gasp across the floor. The market blips to a new low then begins to reverse up.

Now the S&P is grinding higher but 739 should hold it. A colleague is over at my desk telling me to sell 739 as it upticks into it. He calls it free money. Support turned resistance. The next leg lower will surely come now. But he knows that's not how I play the game.

He goes back to his desk. I don't hear from him when a few minutes later we trade right back up through 739.

Now we’ve gone from bearish to bullish in minutes. The contrarians are out in full force just after I’ve lost my position. The bad news is out. The lows failed to hold. I’ve already heard two people on the floor suggest this is the bottom for the next few weeks.

But Bunds have gone parabolic. All I can see is one long green candle. I scroll frantically up on CQG to find the top. I’ve got a level at 125.55. It seems to be all that is standing in the way of the all time highs.

The market has already traded through it as I’m trying to contact one of my brokers to try and tell them to move my stop. But I can’t get through to them. What else can go wrong? I’m trying to calculate my potential loss by hand. I’ve got five positions all taken at different prices. I grab a pen and paper and try to work out my potential exposure. Every biro I grab fails to work. I'm wondering if I'm still solvent.

Then the next thing I know, the bunds are pulling back. I’m watching it reverse and thinking - this is just a pullback – no need to think the worst is over. But still we’re heading lower. Right back into support at 125.25. I’m thinking of covering right here. Throwing in the towel and maybe even going long but the reaction doesn’t appear to be stopping.

Hold your position, another local is telling me. It’s easy to say when you’re not doing you’re a*se in it. Why does everyone seem to take an interest in my positions? Everytime I'm in something, it seems to be the talk of the floor. Maybe it's because I don't trade very often. Yesterday everyone wanted to know where I sold Bunds. Now everyone wants to know if I am still short. They know as well as I do it's heading up. I feel like they're taking pleasure in it.

The S&P is grinding higher but not enough to stage this kind of a reaction in the bond market. The US 10 year has gone from session highs to session lows in no time at all.

F*ck it. I decide to double up and sell some more at 125.20. This is it now. I’m pretty much all in.

I go out for a cigarette. What will happen, will happen. Stops are in, I’m at the mercy of the market.

A few minutes later I come back in. There is one huge red hourly candle. Bunds have tanked another half point straight back down and I’m saved. Despite seeing a stop of almost forty handles on the S&P get taken, I’ve just made double what I’ve lost.

As the decline continues, I manage to reach my broker. I re-enter new stops and breath a sigh of relief as the European session draws to a close. I'm holding this over the weekend. We'll see what Monday brings.

-Tom
 
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Friday, 27th February: 13:00 P.M.

The S&P futures have been heading down all morning. Now it’s just above it’s November lows. It’s on a knife edge and everyone knows it. The dollar index is making new highs. World bond markets are rallying. The press is already running quotes from market analysts that claim a break below the November lows could result in a full blown crash scenario – a panic on the scale of 1929 or 1987. A drop of 20% is being touted by even the conservative.

And as usual, I am going against the trend. I'm heavily long.

It is, I find, somewhat ironic that I’ve been such a market bear and yet here I am, severely over extended on the long side.

My stop is just beneath the low.

The market is literally sitting on that level.

Everyone knows there are going to be a lot of stops beneath 739.

The locals are praying for a sharp spike down now so they can buy it up. I know this because I can hear them discussing it on the floor.

I’m hanging onto the last vestige of hope that this is not going to happen to me. That someone is going to step in and bid this up and that I’m not going to end up puking my position to my colleagues who are buying low.

The fact that my stop will get hit if I leave it where it is is inevitable but also unavoidable. I can’t afford to give up any more money to hold this – not when I have no idea how low we will go when price breaks.

Then at 13.20am, it happens. The tension snaps. The S&P hits 739 and drops 9 full handles instantly. I hear a sharp intake of breath on the floor. I’m one of the first filled at 738 – I thank heaven for small mercies.

A minute later the offers get hit and we reverse sharply. I can hear the other locals talking wildy and excitedly and yet there is no time to evaluate. Because I am also short European Government Bonds.

I’m short with two different brokers and my clearing house. All my positions have gone from considerable profit to an open loss since this mornings open and as the S&P breaks, Bunds run over half a point up the ladder.

And there doesn’t seem to be any light at the end of the tunnel. Now everyone is talking about the US GDP. -5.4% has been expected. Anything worse could be the death knell to the market that everyone seems to be waiting for.

As the sqwark says “10 seconds”, I'm praying for a better number. I don't even realise I'm holding my breath.

Bloomberg has it a second before. -6.2% flashes across the wires. Another gasp across the floor. The market blips to a new low then begins to reverse up.

Now the S&P is grinding higher but 739 should hold it. A colleague is over at my desk telling me to sell 739 as it upticks into it. He calls it free money. Support turned resistance. The next leg lower will surely come now. But he knows that's not how I play the game.

He goes back to his desk. I don't hear from him when a few minutes later we trade right back up through 739.

Now we’ve gone from bearish to bullish in minutes. The contrarians are out in full force just after I’ve lost my position. The bad news is out. The lows failed to hold. I’ve already heard two people on the floor suggest this is the bottom for the next few weeks.

But Bunds have gone parabolic. All I can see is one long green candle. I scroll frantically up on CQG to find the top. I’ve got a level at 125.55. It seems to be all that is standing in the way of the all time highs.

The market has already traded through it as I’m trying to contact one of my brokers to try and tell them to move my stop. But I can’t get through to them. What else can go wrong? I’m trying to calculate my potential loss by hand. I’ve got five positions all taken at different prices. I grab a pen and paper and try to work out my potential exposure. Every biro I grab fails to work. I'm wondering if I'm still solvent.

Then the next thing I know, the bunds are pulling back. I’m watching it reverse and thinking - this is just a pullback – no need to think the worst is over. But still we’re heading lower. Right back into support at 125.25. I’m thinking of covering right here. Throwing in the towel and maybe even going long but the reaction doesn’t appear to be stopping.

Hold your position, another local is telling me. It’s easy to say when you’re not doing you’re a*se in it. Why does everyone seem to take an interest in my positions? Everytime I'm in something, it seems to be the talk of the floor. Maybe it's because I don't trade very often. Yesterday everyone wanted to know where I sold Bunds. Now everyone wants to know if I am still short. They know as well as I do it's heading up. I feel like they're taking pleasure in it.

The S&P is grinding higher but not enough to stage this kind of a reaction in the bond market. The US 10 year has gone from session highs to session lows in no time at all.

F*ck it. I decide to double up and sell some more at 125.20. This is it now. I’m pretty much all in.

I go out for a cigarette. What will happen, will happen. Stops are in, I’m at the mercy of the market.

A few minutes later I come back in. There is one huge red hourly candle. Bunds have tanked another half point straight back down and I’m saved. Despite seeing a stop of almost forty handles on the S&P get taken, I’ve just made double what I’ve lost.

As the decline continues, I manage to reach my broker. I re-enter new stops and breath a sigh of relief as the European session draws to a close. I'm holding this over the weekend. We'll see what Monday brings.

-Tom

Interesting! So by writing this journal you hold yourself back from emotional decisions. GOOD!!!
It is a good sign, that people are interested in your position. They would not be, if you were not in at the right moments.
Cheers Carlos
 
Friday, 27th February: 13:00 P.M.

The S&P futures have been heading down all morning. Now it’s just above it’s November lows. It’s on a knife edge and everyone knows it. The dollar index is making new highs. World bond markets are rallying. The press is already running quotes from market analysts that claim a break below the November lows could result in a full blown crash scenario – a panic on the scale of 1929 or 1987. A drop of 20% is being touted by even the conservative.

And as usual, I am going against the trend. I'm heavily long.

It is, I find, somewhat ironic that I’ve been such a market bear and yet here I am, severely over extended on the long side.

My stop is just beneath the low.

The market is literally sitting on that level.

Everyone knows there are going to be a lot of stops beneath 739.

The locals are praying for a sharp spike down now so they can buy it up. I know this because I can hear them discussing it on the floor.

I’m hanging onto the last vestige of hope that this is not going to happen to me. That someone is going to step in and bid this up and that I’m not going to end up puking my position to my colleagues who are buying low.

The fact that my stop will get hit if I leave it where it is is inevitable but also unavoidable. I can’t afford to give up any more money to hold this – not when I have no idea how low we will go when price breaks.

Then at 13.20am, it happens. The tension snaps. The S&P hits 739 and drops 9 full handles instantly. I hear a sharp intake of breath on the floor. I’m one of the first filled at 738 – I thank heaven for small mercies.

A minute later the offers get hit and we reverse sharply. I can hear the other locals talking wildy and excitedly and yet there is no time to evaluate. Because I am also short European Government Bonds.

I’m short with two different brokers and my clearing house. All my positions have gone from considerable profit to an open loss since this mornings open and as the S&P breaks, Bunds run over half a point up the ladder.

And there doesn’t seem to be any light at the end of the tunnel. Now everyone is talking about the US GDP. -5.4% has been expected. Anything worse could be the death knell to the market that everyone seems to be waiting for.

As the sqwark says “10 seconds”, I'm praying for a better number. I don't even realise I'm holding my breath.

Bloomberg has it a second before. -6.2% flashes across the wires. Another gasp across the floor. The market blips to a new low then begins to reverse up.

Now the S&P is grinding higher but 739 should hold it. A colleague is over at my desk telling me to sell 739 as it upticks into it. He calls it free money. Support turned resistance. The next leg lower will surely come now. But he knows that's not how I play the game.

He goes back to his desk. I don't hear from him when a few minutes later we trade right back up through 739.

Now we’ve gone from bearish to bullish in minutes. The contrarians are out in full force just after I’ve lost my position. The bad news is out. The lows failed to hold. I’ve already heard two people on the floor suggest this is the bottom for the next few weeks.

But Bunds have gone parabolic. All I can see is one long green candle. I scroll frantically up on CQG to find the top. I’ve got a level at 125.55. It seems to be all that is standing in the way of the all time highs.

The market has already traded through it as I’m trying to contact one of my brokers to try and tell them to move my stop. But I can’t get through to them. What else can go wrong? I’m trying to calculate my potential loss by hand. I’ve got five positions all taken at different prices. I grab a pen and paper and try to work out my potential exposure. Every biro I grab fails to work. I'm wondering if I'm still solvent.

Then the next thing I know, the bunds are pulling back. I’m watching it reverse and thinking - this is just a pullback – no need to think the worst is over. But still we’re heading lower. Right back into support at 125.25. I’m thinking of covering right here. Throwing in the towel and maybe even going long but the reaction doesn’t appear to be stopping.

Hold your position, another local is telling me. It’s easy to say when you’re not doing you’re a*se in it. Why does everyone seem to take an interest in my positions? Everytime I'm in something, it seems to be the talk of the floor. Maybe it's because I don't trade very often. Yesterday everyone wanted to know where I sold Bunds. Now everyone wants to know if I am still short. They know as well as I do it's heading up. I feel like they're taking pleasure in it.

The S&P is grinding higher but not enough to stage this kind of a reaction in the bond market. The US 10 year has gone from session highs to session lows in no time at all.

F*ck it. I decide to double up and sell some more at 125.20. This is it now. I’m pretty much all in.

I go out for a cigarette. What will happen, will happen. Stops are in, I’m at the mercy of the market.

A few minutes later I come back in. There is one huge red hourly candle. Bunds have tanked another half point straight back down and I’m saved. Despite seeing a stop of almost forty handles on the S&P get taken, I’ve just made double what I’ve lost.

As the decline continues, I manage to reach my broker. I re-enter new stops and breath a sigh of relief as the European session draws to a close. I'm holding this over the weekend. We'll see what Monday brings.

-Tom

All in and i'm off for a smoke...price(y)less!!
 
Monday, 02nd March: 05:45 A.M.

It was only when I printed a chart of the Bund yesterday and I had it in my hand and I was looking at it, that I realised that I was on the wrong side of the market.

I had no idea why I hadn't seen this earlier. Of course, overhead supply was weighing on the market but to me it looked like the chart was saying that the market didn't want to go down.

And of course, if it didn't want to go down, then it must want to go up.

Since I was short over the weekend, that naturally meant I was wrong. And as Livermore once said, if you are wrong, the only correct thing to do is to cease to be wrong, by being right.

Which meant, I had to be long.

I suppose I had this in the back of my mind, although I slept well and woke up late this morning.

After I had pulled on my jeans and run an iron over my shirt, I went into the study to check the overnight action and saw that the Dow was down 1.5%.

Well, this startled me and I grabbed my car keys and started moving as quicky as possible.

The drive to work is a long one - at least an hour and half if there is no traffic, which at this time of the morning there rarely is - but the closer I got to work, the more vehemently I began to think that the stock markets were going to collapse and the Bund was, in turn, going to head for the all time highs.

Well, by the time I got past Richmond I was punching 80, coffee in one hand, mobile in the other, advising a client of mine, to hold onto their Gold position and praying I got to the office in time for the open.

Well, I just happened to be late but as soon as I got my screens on and saw the Bunds up almost half a point, I just got out of everything. Some were in profit. Some were in a loss. But I closed every single short I had, at market and immediately went long.
 
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Fantastic thread. Really enjoyed reading the posts - all that emotion; the fear, the elation; we can all relate to this.
 
Great read T_D... When I did it in my journal it helped no end and really helped me get my head in the right mindset when trading.... sorted out the issues... good stuff
 
Monday, 02nd March: 10:51 A.M.

I'm filled at 125.20 in the Bund. I don't normally do this - just take a position - normally I like to wait. But then this is anything but a normal day to me.

I'm telling other locals that this is the day but they don't seem all that interested in what I have to say. They just nod and smile. Do they not see what I see?

If they do, they don't show it.

Bunds are ticking higher. I double up at 125.27.

I'm watching the ladder like a hawk. I decide to pull half for ten ticks at 37 when the initial momentum stalls. The market pauses but then continues on up. I'm not worried, I secured some profit. I pull up Excel to update the data on the positions I have taken.

A local walks past me, muttering "it doesn't go down". He is talking about the FTSE.

I call him over. "Don't worry", I tell him "we're going down today. You're going to get the opportunity to make a lot of money. This could do 10%".

But minutes later after a few more trades, he is back, walking past me again and repeating: "it just doesn't go down".

I've got Excel up. Now another colleague comes over to my desk. Everyone seems to finds it highly amusing that I add up figures manually and then input them into Excel. Don't I realise, they tell me, laughing, that the whole point of the package is that it does it automatically?

What do I want to do, he asks?

I'm back watching the Bund.

He starts trying to input formulas for me to save me time.

I'm really not all that bothered about it. I always found something satisfying about doing the calculations by hand.

He insists on trying to show me what he is doing.

I'm offering the other half of my Bund position at 125.50. I've got a big level up here.

"It's easy", he says. "Look, when you add in a new negative or positive figure..."

Bunds can't seem to get to 50. They're being offered 49 and keep coming off a couple of ticks. Am I really waiting for a tick here? If there is a resistance then I should be hitting market.

"You just highlight the box the data is in and go into the input line at the top..."

Are Bunds going to trade 50? What will happen if they do? Perhaps I should pull my offer and just move my stop up. But the Dax and the Dow are trying to rally here.

"And then click and enter a..."

I'm not listening to a word he is saying. Bunds are at 49 and they can't uptick the high. Why do I care? I'm supposed to be a swing trader. But then, I play the game slightly differently here. As bullish as I am, this is a level and I'm not taking any chances.

49 trades. Now 48. 47 and then 46 naturally follows.

I hit market at 45.
 
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Monday, 02nd March: 10:51 A.M.

Bund can't seem to get to 50. They're being offered 49 and keep coming off a couple of ticks. Am I really waiting for a tick here? If there is a resistance then I should be hitting market.

QUOTE]

We all do it, but , the old saying is still true..."don't be a dick for a tick!"

not meant as a dig at Tom, just a general observation of how we all end up trading sometimes
 
You should wright a book. I find trading extremely interesting, but reading this thread you make it sound even more so.
 
You should wright a book. I find trading extremely interesting, but reading this thread you make it sound even more so.

The book title and film (starring Tom Cruise)coming to a cinema near you.....

"Dante's Inferno"

Below to be read with low gravelly voiceover voice......(RIP & alla Don LaFontaine)

The tale of one trader's struggle to stay alive while the rest of the world faced financial meltdown.
 
The book title and film (starring Tom Cruise)coming to a cinema near you.....

"Dante's Inferno"

Below to be read with low gravelly voiceover voice......(RIP & alla Don LaFontaine)

The tale of one trader's struggle to stay alive while the rest of the world faced financial meltdown.




All i can say is this Rolls, he used to be a journalist, if there was no news he had to make news. TD could make a 2 tick move seem like a financial disaster:)


Bloody Journalists!:p



"....it's on a knife edge...":LOL:
 
All i can say is this Rolls, he used to be a journalist, if there was no news he had to make news. TD could make a 2 tick move seem like a financial disaster:)


Bloody Journalists!:p



"....it's on a knife edge...":LOL:

I thought i had detected a literary bent. Anybocy who can sting a sentance together without txt spelling and abysmanl gramma, and punctiation stanz out a mile on this not the finest forum noted for quatily of the ritten word......

I like this para especially....

Monday, 02nd March: 05:45 A.M.

Well, by the time I got past Richmond I was punching 80, coffee in one hand, mobile in the other, advising a client of mine, to hold onto their Gold position and praying I got to the office in time for the open.

In fact the structure of the piece is well spaced. With the slow build up in tension told with the wry wit and dry observation of a Vonnegut this is one of the few threads where I shall eagerly await the next post.

May I suggest the serialisation be placed in a locked thread where the reader can enjoy the drama unfolding without having to negotiate their way through spurious postings?
 
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