Swing Trading with $300 – Week Two

Empty board swing covered in lichen.

Time for a recap of my second week at playing around with swing trading. As you may recall from Swing Trading with $300, I am giving myself three hundred dollars to let it rip, play some swing trades, and maybe even dabble in a few day trades. I am having a lot of fun with it so far.

Swing trades by definition last for more than one trading session (market day) and up to several weeks or even months. I already have my fill of longer term swing trades and position trades in my Dividend Builder account. No need to duplicate that strategy. My mission with this three hundred is to make trades on a pretty rapid time frame. If I could execute it perfectly, I’d enter a position on Monday, sell it for a profit on Tuesday, and use the proceeds to start a new position before market close on Tuesday. Wednesday would be a repeat of Tuesday. By following this pattern throughout the week, I could make the maximum number of transactions without being flagged as a pattern day trader.

I do not execute perfectly, do not have all day to watch the market, and do not have full mastery of my trading psychology. So I am not going to hit that ideal cycle every week. In addition, a stock may have upward momentum over a period of several days, and in that case, I am best served letting the stock run and make gains for me. Often referred to as “letting your winners run.” I am well aware of two key areas of my trading psychology that I have yet to master. The first is to let my winners run. The second is to stop my losers from running. I need to exercise discipline and set stop losses to keep losses at a minimum when a trade goes south. Which is why I am enjoying this learning process with three hundred dollars and not three thousand dollars.

Let’s Breakdown Swing Trades for Week Two

Sold 22 shares of JBLU for $8.79. Bought the shares Thursday the week prior for $7.99. Gain of 10.04% and $17.65 in profit.

Bought 20 shares of HRZN for $9.41. Sold at $9.70. Gain of 3.08% and $5.80 in profit.

Sold 19 shares of AZUL for $8.68. Bought the shares Friday the week prior for $7.45. Gain of 16.56% and $23.43 in profit.

Summary and Analysis of Week Two

Completed three trades earning $46.88. Trading account balance now at $364.71, an increase of 21.57%. Increased account 14.75% from last week’s ending balance of $317.83.

Well this week was David Neeleman founded airlines week for me. AZUL and JetBlue continued to present good price movement with fairly predictable support and resistance levels. Both airlines saw dramatic dives in their share prices at the start of the pandemic shutdowns. They each seem to have found support at the seven dollar range. Every few days or every other week the price pops up on news, rumors, or, I don’t know, turbulence? Until now, I had been watching that pattern from the outside. This week I got to play it. It is a big confidence boost identifying a pattern and then taking advantage of it.

You may have noticed that this week was my second go-around with HRZN. My old standby. It is a consistent option for swings of three to five percent. The other comfort with HRZN is that it is a monthly dividend payer sporting a high yield should I happen to get stuck in the trade. To be honest, I should not be “getting stuck” in trades with my designated swing trading funds. If the trade goes south, I need to stop out, saving my capital for the next swing. Stay tuned for next week’s update as I will be dealing directly with this issue. I know the future as I’m writing these posts with a week of lag.

Thanks for following along as I continue to document my approach and development as a growing trader.

Leave a Reply

Your email address will not be published. Required fields are marked *