Entry reasoning:

Based on the daily chart, I anticipated the stock might reach as high as 1.85 today. Motivated by this potential, I aimed for a 30 – 40 cents profit per share, choosing to enter at a reasonable price while allowing for a slightly wider stop loss.

Live trading session video:

Getting Into the Trade

Long entry: Bought in at 1.58.

Reflection: A pullback would have been the ideal entry point. My eagerness to seize the opportunity led me to jump in prematurely, especially when the stock dipped to 1.47, aligning with my stop loss area.

Thoughts during the trade:

I saw a doji candle on the 5-min chart at 1.61 and thought the price might drop to 1.50 soon. I didn’t sell though, because I wanted to stick to my plan of only cutting losses if it hit 1.46. The price did drop to 1.50, and I could’ve made a tiny profit if I reentered at 1.51.

Exit comments:

The Exit: Once the price fell through 1.46, I decided to get out. I waited a bit to avoid selling when the price was falling too fast and got out at 1.44. Right after, the price dropped to 1.33.

Key Learnings

Doji candles and shooting star candles:

The presence of a shooting star on the 5-min chart while holding a long position should serve as a warning sign of impending short-term price weakness. Exiting at breakeven or a slight profit, then waiting for a more favourable re-entry point as the price stabilises, could enhance trade outcomes.

50 period moving average on 5 min and 1 min charts:

The 50 period Moving Average on the 1-minute chart has demonstrated its significance in influencing price movement, warranting closer attention in future trading decisions.

This trade, though not profitable, taught me the importance of patience, precise timing, and how strategic use of technical indicators can apply in day trading. Each session is a learning opportunity, red or green day, we learn and take our lessons to the next trade.