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Daily Journal Update 1/22/13: Ignorance and Finals

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Good evening everyone! Sorry that this is so late. I have been sick lately and since I took a nap right after school, my gym timing was pushed back and thus why  I am writing this at 9 p.m my time. I start finals tomorrow which is a blessing and a curse. The positive side is that I get out just before 12 p.m, but the negative side is that I have to take two finals (Econ and A.P Psychology). I will probably not be able to use my phone for most of the day which will get frustrating, but I planned my current positions as swings because I knew this time was coming. Always plan your trades accordingly if you are ever away from the market.

Now, I just popped some NyQuil so let’s get this blog post rollin’.

Let me start off by saying the stock market is a wonderful but fucked up place. You can study charts for hours upon hours, develop sound systems, and put in all the hard work.. and make only decent money (maybe not make any depending on skill set/market conditions. Then, someone who has no idea what they are doing can take on an enormous risk (without even knowing it) and it pays off HUGE. You might be thinking to yourself, “Why the heck is he even bringing this up?”.. well this exact situation appeared in my life today. I have a friend from school who has a small account ($3k) who has been mirroring my trades and making decent money. Today, he decided he wanted to go off on his own (let me remind you he knows little to nothing about trading) and he put his ENTIRE account into $AMGN $80 call options. He has never even shorted a stock before, let alone deal with the complexity of options. Well, let me tell you that after $AMGN gapped down this morning, it rallied all day until it closed up 1.21 at $83.29 (+1.47%) on the day. He nearly doubled his account, and as I call him yelling to take profits and just get out, he stubbornly refuses and is holding all the calls overnight. To my disbelief, he seemed to have hit another lucky trade while knowing absolutely nothing about the company, chart, or current market conditions. It is lucky trades like this that makes the stock market a place for dreamers (which is dangerous). I hope he actually reads this post because it is a good reminder that he needs to come back to earth. With this story, I leave you with this advice: Do not confuse luck with skill, or you will end up with ignorance.. and when you become ignorant in the market, you will blow up. The market is a humbling place, take what it gives you, be thankful and DON’T BE GREEDY.

Onto market news, the $SPY closed up .80 on the day bringing us to 149.13 (+0.54%) on the day. It was a slow grind all day, and a very nice day for bios. Commodities were mostly higher with precious metals, copper and crude oil trading higher. Gold and silver also both finished the day higher. Silver is now up more than 5% for the month. The banks rebounded again today, this run is becoming insane. I’m getting weary of an entire market pull back in the next couple months in the February / March area.

Bios were HOTTTTT today. I locked in near 40% gains in $APPA, which has been a beautiful run up. I also made other nice gains in $ATHX which was nice. However, it really pissed me off today. So much opportunity and yet management is distributing off the ask and killing momentum. Huge volume and it could only make a small move upwards? BS. The president of the company insisted that they weren’t dumping, but the dark pools told me otherwise. They were being VERY sketchy in my opinion. $FB squeezed my nuts this morning and I closed my short position in that as well. I had rolled my profits from the $31 puts into the $30′s, and took a hit when it bounced almost 4% today, but hey that’s macro options trading for ya. It wasn’t that bad anyways.

Get excited for tomorrow!! It’s a new day! This NyQuil is really hitting me now, so goodnight!!!

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