James J. Cramer made a plea Wednesday for readers' daily trading-diary entries. Here are a few examples. If you'd like to have your voice heard, email your entries to firstname.lastname@example.org and be sure to include your full name.
Some Aug. 4 Diary Entries...
Checked the market midday. Wanted to get some calls on
before earnings. Expected weakness in the afternoon as early-morning rally lacked conviction and mostly driven by the
merger. Net still weak, will probably pull non-Net tech down with it (I know, I'm sitting on net stocks and wishing I didn't...).
Placed some limit orders for Cisco August 65 and Dell August 42 1/2 calls under their current ask price (time to go fishin'!).
Less than an hour later, both limits hit.
Now I wait...
-- Stanley Quon
Polishing the Resume
: Got up early, watched "Squawk" and was convinced that we are in for more of the same.
up early, down later. Yes, I own Internet stocks. Yes, my positions are tooooo large. Yes, I am margined. Not overly margined, but margined nonetheless.
Went for a long walk after the open, did not buy anything, did not sell anything. I just decided not to play. I confirmed a lunch appointment to get me out of the house, and then went for a long walk. Came back, got cleaned up and went to lunch.
On the way home I checked in and got quotes. Another stock got clocked today that has been holding up, happens to be my biggest holding down 5-plus. My theory is the good ones are now being sold to cover margin calls.
(which I'm barely long) is holding up above yesterday's low. Just keeping it around to see what it is doing. There are no leaders.
(which I am long) is up, or is it down? I cannot figure it out.
I saw three different closes on this stock yesterday (at AOL, Schwab, Webstreet). I am confused. Bottom line is I believe old Chuck is probably in there using some of that cash. Schwab is cheap, cheap, cheap. Ron Baron has to be tempted to buy more here. He is probably pissed he did not dump more at the top. Oh, and
is all over the place. It is acting just like
. Everybody must be mistaking this for a broker. How about using some of that cash to support your stock (not talking to Cramer here, talking to management). Cramer has enough stock.
So I get home, write a big check to Schwab, and drop it off on the way to the driving range. Schwab was empty at 2:30 Central Time. Ghost town. There are usually old geezers in there daytrading. Nobody. I could have had my pick of brokers. They were all walking around with their hands in their pockets. No phones ringing, nothing. Ugly, Ugly, Ugly.
And what happens now? I become a buy-and-hold guy. I will play golf tomorrow, Friday, Monday, Tuesday. (Saturdays and Sundays are family time.) I need a "real" uptrend to get me back to the screens. Won't happen for a while. Looks like I get the rest of the summer off. I might even dust the old resume off. I hear the job market is hot, maybe I can play in there for a while.
When I got back from the driving range I checked in and yep, I was right, more of the same. We have not even come close to the bottom. If you're margined, cover, cover, cover, cover. It is going to get uglier.
When all is said and done strong hands will own all these stocks. For me, I will choose not to play. I will still own, but I will not play. I will be up very early every morning checking things out, but my day will be full of long walks (too old to run anymore), long drives, bad chips and long putts. I might throw a job interview in here and there to keep things interesting.
-- Steve Anderson
, Overland Park, Kan.
2 p.m. and the Nasdaq is down 20 (20 more? Only 20? 20 again?). The only thing up is Union Carbide, and pulp. Nothing has worked over the last two weeks except the overextended oil drillers and some chips. And that tree-trimming crew next door is driving me nuts with their chain saws, blowers and chipper. Has the air been turned up to 85 degrees?
And what? Is Ted David trying to smart-mouth his way out of a job? The guy has been way too smug since his two-month vacation.
Golf this afternoon or keep looking for a train (
?) to jump in front of? Hmmmm...
-- Brent Bigsby
... And the Confessions of a Tape-Fighter
I Fought the Law:
I decided to short Dell Jan. 9, 1998. The price was 82.68 and I thought it was going lower along with the market. I was working full-time at a community college then and one of my close friends who was an investor/ accounting teacher looked at the Dell chart for me. I don't think Dave really liked the idea of me going short Dell, but he told me if I had to short Dell, then at least put in a stop-loss to cover at 90, because looking at the chart if Dell hits 90 it could run to 110 or higher. I said fine, no problem. I have discipline, so I thought.
Well it wasn't long after I shorted that Dell was on a run to higher grounds. I felt sick every day I saw Dell go higher. I remember one day right after looking at Dell, someone walked into the office, took a look at me and asked me if I was feeling all right. The question sort of surprised me at the time, but thinking back I probably did look sick. The trade was not only hurting me financially but emotionally as well. I couldn't concentrate on the other possible good trades, only could think about the terrible dell trade. Each day the price was going higher. It hit 91.68 and what did I do? Lo and behold, I shorted another 100 shares. I eventually covered on Jan. 29 at 100.75. Dell continued to go higher and I at least gave myself a little credit for getting out when I did. Anyway, I lost about $2,700, all because I would not acknowledge that I was wrong.
The reason this trade stands out in my mind is, the market had proven me wrong, I knew I was wrong, but I would not change my mind about covering until I had taken enough. I got whipped! Should have known better. This strategy or persistence would probably have worked at my day job, but the opposite strategy would be true for trading: You can't fight the market.
Simply put, I was fighting the market and was for sure going to lose.
I have since improved my trading and vow never to fight something that I know will eventually beat me.
-- Larry Shelor