As I am writing this, it is already June. This means that we are already halfway through the year 2023! Time flies, doesn't it?
At the point of writing, it is now 1 Jun 23 - so as usual, it is time to take stock of how much cash flow we have collected in May 23.
In the month of May'23, I collected a total of $647.00 (these are all closed trades, so its all realised profits here).
Here's a snapshot of the trades which were closed.
Reflection
I closed a total of 6 trades in the month of May'23 and 5 out of 6 was profitable.
As always, I like to think back and see what I could have done well and continue to duplicate this success. Hopefully, if you are reading this, you gain some insights from my sharing as well.
What Works Well
In the previous month, I implemented the "double-support strategy" - and continued to do so for this month. This means that I am trading lesser, but with higher probability - which accounts for many of the above successful trades.
Lesson Learnt
There is an interesting lesson which I learnt with MED.
If you see the chart below, I entered the BCS at the green arrow on 14 Apr 23. This was a good entry as it was at the resistance level. In fact, this was a "triple-resistance" set up.
However, in just 5 trading days, the stock broke through all the resistance.
Typically, since the stock price closed above the resistance level - I would have cut my losses. However, I had many more days till expiry. At that point of time, I still had 53 days till expiry (i.e. from 24 Apr 23 to 16 Jun 23).
This means that there really isn't a point closing my positions yet - because this is a vertical spread. My losses are pretty much limited no matter how much the stock continues to move up.
My decision?
I decided to hold on to the trade and continue to monitor it.
Indeed, the price was overextended and it eventually faced the upward pressure and drop as a result.
Did I predicted this? Nope.
But, if I had so many days of expiry left - there really isn't much harm holding onto the position first.
Conclusion
I find it worthwhile to always review your trades on a monthly basis - so that I can keep discovering patterns that works well and keep doing it.
Success leave clues. Do more of what works for you and eventually that positive results compound into something larger.
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