Today I closed out my short position in SVN this morning @ $9.35 for a profit of about $440.00 after commissions when I thought the markets were going to bounce big. I basically nailed this trade as I pocketed about 3R's.
I also entered SSRX short this morning and I am still holding onto this position looking for a move down to the $10.00 support level.
All was fine until my mind went crazy seeing the markets bouncing and thought that I had to get long the best stocks in my watchlist or else if I wait till just before the market close or till tommorrow morning they will get away from me.
So I went long of 200 shares of CRUS @ $12.18 with a stop loss below the day's low risking about $100.00 + commissions and 800 shares of LSCC @ $5.40 with a stop below the day's low risking a whopping $240.00 + commissions. Then I started hating myself. Because yet again I did not have the discipline to wait for confirmation before entry ( price trading at or near the day's high just before the close of trade or a break above the previous day's high). Even worse I could not have simply closed the positions and then go back to waiting because of the stupid pattern day trader rule.
However and luckily so, I closed out my position in CRUS as it appeared to be extremely weak around $11.97 for a loss of $52.00 including commissions (which is not bad but was very much avoidable and adds up in the long run). I then added a further 400 shares to my LSCC position at a price of $5.30. Although I still did not have confirmation at this point, I liked and still like the LSCC set up alot and believe that it will move higher tommorrow. I am risking about $350.00 including commissions of some $50.00 or so on this trade.
So in addition to the SSRX position my portfolio heat is some $520.00 dollars ( my comfort zone is a maximum 0f $300.00 - $350.00). So I stand to wipe out all of my SVN profits and then some if positions do not work out. This is called OVER TRADING!
I know what I am supposed to do but when I think of the profits to be made I do two things:
1) Enter positions spontaneously against the rules of my trading plan and 2) Put on position sizes that are way too large interms of risk. Although I am uncomfortable about my risk exposure my hands were tied by the PDT rule for one and secondly I am very confident about the positions I have put on.
So despite the huge chunk of my account at risk I will stick to my guns and hope my trades work out!