Read Time: 4 Minutes

Weekly Trading Stats:

Total Trades: 12

Winning Trades: 7

Losing Trades: 5

Win Rate: 58%

Weekly P&L: $841.91

Weekly ROI: 19.10%

Beginning Balance: $4,408.72

Ending Balance: $5,250.63

Weekly Trading Recap:

This week, I finally got the breakout week that I've been waiting for. On Monday, I took home $274.32 - which actually got me to my weekly goal of 6.5% growth. Then on Wednesday, I went 4 for 4 on my trades for an additional $685.08 worth of profit.

After spending months learning how to trade and grinding through many losing/break-even weeks, it feels great to finally experience some real success. 

Takeaways & Learning Lessons This Week:

Widen Those Stop Losses

Two weeks ago, I realized that I was getting the direction right on a large percentage of my losing trades, but I was barely getting stopped out before the expected move happened. And when I say barely, I'm talking about just a few cents. So, on August 11th, I started widening my stop losses by 1-4 cents. During the 10 days prior to this change, I had 3 green days and 7 red days. In the 10 days since I've had 7 green days and 3 red days - and my win rate has more than doubled. 

The lesson: Don't be afraid to widen your stop losses. Just make sure you size down to maintain proper risk management. The other lesson is that journaling your trades and tracking your stats is critically important because it allows you to uncover these types of insights.

Wait for My Charts to Align
I talked about it last week, but good things happen when I wait for setups where the SPY chart and both options charts are all telling me to enter a trade. When I wait for those setups my win rate is over 70%. When I don't, my win rate drops to almost 30%.

The Dangers of Trading After a Big Win
I learned first hand that trading after a big green day should be done with extreme caution. Entering Thursday, I was up almost $1,000 on the week and I knew that I needed to be careful trading on Thursday and Friday. I even wrote down in my morning journal that I didn't want to give back my gains. That I would only trade my A+ setups. That I wouldn't force trades or trade out of boredom. That I wouldn't slip up with my risk management.

I knew about all of the dangers that overconfidence could bring... but I still went out and did everything I was trying to avoid. As a result, I gave back over $100 of profit - but that number could have been way worse. I let my discipline slip on Thursday and Friday and I feel extremely fortunate to have escaped without taking a big hit to my account.

Surprise Takeaway: The Thursday Scaries

I didn't plan on putting this last takeaway in here, but while I was reviewing my stats for this week's newsletter, I discovered that I've been red for 13 consecutive Thursdays. 🤯🤯🤯

I'm yet to dive in and figure out the cause of my Thursday struggles but I felt like that stat was too crazy not to mention. I'll see what I can uncover throughout this next week and I'll report back with my findings and adjustments.

Recap of Last Week's Goals:

1. Use proper risk management on every trade. Aiming for $40-$60 of risk per trade.
   
   Result: I did much better with my risk management. Took a few $66 losses but I'm generally OK with that level of risk per trade.
   
   
2. No revenge trades or overtrading.
   
   Result: I did great at this on Monday and Wednesday. I went up on both days and I didn't give any of my profits back with risky late-day trades.
   
   Then on Thursday and Friday, I went back to my old habit of overtrading. It was a complete lack of discipline that unsurprisingly led to my worst trading days of the week. The thing I've noticed about overtrading is that it is an incredibly slippery slope. All it takes is one bad trade or one rule break for me to spiral into a multi-day over-trading extravaganza. Over the next few weeks, I'm going to double down on eliminating these mental mistakes once and for all.
   
   
3. Only enter trades when the SPY chart and the options chart are telling me the same thing. And when that happens, enter with confidence and without hesitation.
   
   Result: Again, I did a great job of this on Monday and Wednesday but I let things slip on Thursday and Friday.
   
   
4. 6.5% or better on the week.
   
   Result: I absolutely crushed this goal. Did almost 3X my weekly goal.
   
   
5. 3 or more green days on the week.
   
   Result: Success. I had three green days plus a breakeven day. Very proud of the consistency that I'm starting to show.

Trading Goals for Next Week:

I'm not setting any lofty P&L goals this week because I'm heading out of town on Wednesday for a quick golf trip with the boys. Instead, I'm going to focus on maintaining good discipline and sticking to my rules. Here are my four goals for the week:

1. Use proper risk management on every trade. Aiming for $50-$70 of risk per trade. 
2. Zero rule breaks, revenge trades, or overtrading.
3. Only enter trades when the SPY chart and the options chart are telling me the same thing. And when that happens, enter with confidence and without hesitation. 
4. 60% win rate on the week.
   
   

That's it for this week. Hopefully, I've shared something that you've found valuable or inspiring. Have a great week ahead!

- Eric