Akamai Technologies Inc. (AKAM)
I can really swear up a storm while trading. It is kind of like watching the game - when your team is losing, you bitch them out - and when they are winning you cheer them on. I swear both ways, up or down. Even sideways. Sometimes I surprise myself with some of the phrases or terms that I can whip out. When you use a word or phrase often, it can lose its edge and sometimes you have to dig deep to find something that can vent your true fury in a justifiable manner. That is another reason I like trading without anyone around - I wouldn't feel comfortable acting like that even in front of other harsh traders.
Today I had a nice trade going on AKAM and then I doubled my position when it broke over $35 with volume for a new high.
It was a picture perfect chart and I would have made a killing if it had worked out. Unfortunately it turned and I was stopped out of my entire position at $34.74 for a small profit. If I would not have doubled up, I would not have raised my stop and would not have been stopped out until closing the position at the end of the day. In other words, it would have been a great trade if I hadn't doubled up and moved up my stop.
This has made me think a lot about adding to a position. Maybe it is something I should not do. Or, if it is done perhaps it should be treated as a separate trade (a separate stop for the new trade).
Comments
Thanks for the thoughts.
It has always been my understanding that pyramid trades are intended for intermediate to longer term accounts. Trying to pyramid into a stock that you intend to daytrade carries inherent risk due to the relative small nature of the expected move for that particular trading day.
Even if you treat a pyramid buy as a separate "2nd purchase", at the end of the day you'll still likely lump the two trades together and average them out.
The one exception to this would be if you get into a stock in the morning hours and it moves dramatically in your favor, forms another intraday consolidation, then breaks out again. I think pyramiding on a stock that can move 10-20 points in one day is justifiable. High priced stocks like GOOG and CME come to mind.