Trading Journal: Nov 6–10

John F Carter
18 min readNov 6, 2023

Monday, November 6, 2023

I’m grateful for: Time with the kids this weekend, hanging with the animals. Hard workouts and long walks.

I’m excited about: Figuring out an ideal daily routine and “How I Want To Live My Life” in 2024. So many distractions at the moment. Maria and I went to a charity auction last week for Hospice. Very sobering in that we can be fine one day and something unexpected can happen and we are living our last few days with Hospice. I don’t want to find myself in that situation and be generally pissed off that I didn’t put my foot down while I had the chance.

Priorities: Hydration, protein, positive thoughts — and truly that recording for Mimi.

I’m back to a full trading week. Last week the markets had their biggest weekly up move of the year, and I was basically traveling the whole time. I’ve gotten used to that by now, but it is still amazingly annoying. While a lot of trading is learning how to grind it out, there are days where you can make your month, your quarter or even your year if you are positioned for it and have the ability to hold on for the ride.

Over the weekend, I continue to dial in on having a daily cash flow account. My personality is better suited for swing trading — holding through the ups and downs for a potentially larger move over several weeks. One thing I realized over the weekend is that I apply some of this mentality to my day trades. Meaning, I’m willing to hold on through some big wiggles, when in reality I should just catch the move and be done with it. I wrote down, “It is just a trade.” It doesn’t have to be a journey of self discovery.

For this morning, the markets gapped up about 8 SPX points. A gap fill will be the no brainer trade today — just looking for the markets to fill that overnight gap. I immediately start shorting the ES futures, up to 65 contracts, and then sell a 50 lots 4380/4400 SPX put credit spread.

The trade goes in my favor almost right away and then it is just slow going. I end up being in the trade for about 30 minutes. Even though the $TICK is very negative, stocks just won’t sell off. Every time the ES hits 4379.50 buyers step in. I start placing limit orders to exit around that area. We truly should break and fill the gap. But now I’m up about 20K in my trades and I’m not willing to let this turn into a loss.

I exit the rest before a gap fill hits. Although I think today will be a quiet range bound day, I wouldn’t be surprised to see the SPX rally 25 or 30 points to test upper resistance levels. I am unwilling to hold my positions through that.

I shorted ES from 4388 down to 4385. I covered 4378, 4379.50 and 4380.50. The SPX call credit spread really needed more of a down move to work and I didn’t get much theta decay.

Moments after I closed out the last of these trades, the SPX dropped a quick 4 points and filled its gap. That’s fine — I got out a little early but I grabbed the “easy money” and went flat. I think there is something to be said for setting up some basic QH signals on something like Ninja trader that could be traded mechanically. (For ES futures).

I’m going to chill a bit. It’s only 9:30am central — too early to throw on an iron fly, and I don’t see anything directionally interesting here. I did a hard workout yesterday with my trainer instead of today. I scheduled a deep tissue massage during my workout time today, and that is sounding great at the moment.

10:25am

While waiting for the masseuse to show up (I get how that sounds, but it is way easier than driving to a place, and it is the same price), I try to pick up some NQ futures at support. There is a 5M squeeze forming and I’m looking for a little pop. Well, that moves happens without me. I scale in and grab some on the breakout. It stops — shockingly — at the 2 SD VWAP band and starts to retreat back to VWAP. I add the 2nd half of the position there, and then scale out at point #2 as it approached 2SD VWAP again. With a range of 35 points, I booked 10. A poorly executed trade. On chop days like this, you need to place your limit orders and they either get hit or not. You forced it a bit since you knew you had an appointment approaching.

I’m at +24K on the day. This is close to my daily goal. The NQ trade, though profitable, was piss poor execution on the 1st half of your position, though the 2nd half of your position add was solid. This is why I’m a huge fan of scaling into full size vs. going in full size immediately.

At this point, I would normally put on an at the money iron fly on SPX, 25 points wide and hold it for a few hours to collect premium decay. I’m going to pass and just focus on the massage and see what is setting up after I’m done. Why pass? I could definitely do a smaller trade and set it up so if it goes to max loss, I only lose a portion of today’s gains. And as I’m writing that it makes a lot of sense. On the other hand, positions can be so small that it can begs the question, “What’s the point?”

The eternal question. Something to ponder during my massage.

1pm central

Back from the massage. Super intense. This person specializes in extremely dip “get under the rib cage” type of pressure and it is painful, but feels amazing after.

The markets traded quiet to down while I was in the massage. SPX 4350 is a big level and we traded down to that. I almost sold a put credit spread there, but decided against it. I’m getting better that when I’m at or next my daily goal, to be very careful about trades I take in the afternoon. The trade would have worked — but the bigger point is, if my business plan is to make X amount a day, and I’m there, why take on more risk? Also, the issue with a put credit spread (ODTE) at that time of day is that if it doesn’t work, it can get very ugly, very fast. Better to do a cheap butterfly, or look at something for overnight at this point.

Into the close, I hopped on the mic in the options room and posted two trades. The first was an iron fly for tomorrow, with 4360 as the strikes. We did $40 wide for $20. The idea here is that if the markets continue to chop back and forth, we will be able to buy it back for $14 early in the session tomorrow. If it does rally strong or fall hard, there is generally plenty of time to get out with around a $2.00 loss.

We also scalped a put debit spread into the close, looking for a mini puke. We got one that was about 4 points but that was it. Made like .20 cents on it. There was some nice short covering into the market. The Mag7 are strong (AAPL, MSFT, etc)

For tomorrow, I’ll have the overnight trade to manage. There are pros and cons to this. The pros are if the market opens quiet, this turns immediately profitable. If the markets are crazy up or down tomorrow, it is a bit of a headache and a distraction.

The close has been a pain. Today was fine, but the real money making opportunities are in the first 2–3 hours of the day and overnight.

Today’s wins: Made your daily goal early then didn’t give anything back. I did 20 minutes of transcendental meditation this morning — I’ve had a lot of mind chatter and that always helps. Great massage.

How I’ll improve: Get that two mile walk in the morning. Compliment and ackowledge the people around you. Separate ego based thought loops from reality.

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Tuesday, Nov 7, 2023

Quiet market day yesterday and overnight, which is nice in a way. Although I like fast moving markets, there is something to be said for sitting on your ass and collecting overnight theta decay. It’s like you are sitting at a blackjack table and you have 19, the dealer has 20, and he (or she) pushes chips toward you instead of taking them away.

I’m sore from the death massage yesterday. Death like, I made faces and noises like I was dying. Painful — but oh so good for loosening up the body and getting it untight.

It’s been getting dark now at 5:30pm. In the summer we never watch movies — by the time it gets dark it is time to go to bed. The kids have been on a Disney binge this week, nursing their colds, and we’ve been watching with them. It’s been great. Tangled, Brave, Frozen. Keep ’em coming.

Mental chatter today is better. I used to have a more consistent practice of meditation, positive affirmations, etc., and I’ve really let that slide over the last year. It is amazing what kind of shit sneaks into your head when you aren’t looking. It’s like cockroaches. Control and manage your thoughts, or they will turn you into their little bitch.

I’m grateful for: Just being alive and getting to experience all the things.

I’m excited about: Finding a big project. I’ve been in maintenance mode for the last year or two. Maintenance mode sucks the soul out of your body.

Priorities: Positive thoughts, positive vibes. Put some affirmations on auto play and just play them throughout the day. Stay in appreciation mode even in the midst of eating a shit sandwich.

7:30am

The markets are quiet overnight. Overnight iron flies and iron condors look good so far. The tough thing about having these on overnight is they can become a distraction from new trades if the market has a crazy move up or down. That doesn’t look like it will be the case today, but keep this in mind for WHEN it does happen in the future. Continue to take trade setups even while managing. You tend to go big on iron flies, so also consider trading smaller so adverse moves aren’t as much effort to manage.

Tony Laporta (former floor trader) has a saying that goes something like, “A 1 lot? Why would I trade a 1 lot? That’s like kissing your cousin.”

Over the years I’ve been able to increase my intestinal fortitude quite a bit (meaning I can sit through adverse moves against me). The issue is the type of trade. If you sell a 25 points wide SPX 0DTE spread for $2.00, and it blows up against you — that is going to be a material loss if the position is large (risking $23 to make $2). There are no awards for intestinal fortitude in that situation. If it ain’t working, you have to cut, and cut it fast. But if you put on a $25 wide butterfly for $2.00? (Risking $2.00 to make $23.00) Yeah, hold on for the ride as the worst case scenario is already baked in with that small debit paid.

It’s all about the worst case scenario, not the best case.

Going to go knock out a walk before the open . . .

9am

The open was about perfect. Took off half the iron fly and also an iron condor from Friday. Did a quick long on the ES and got out way too early, caught about 5 points.

At this point, I had met my daily goal and just had half of my iron fly left.

As I was watching the market, I saw the NQ tag the 2H H1 levels and I shorted, looking for a quick move lower. Well, there was a quick move lower but it didn’t last long, and then the NQ exploded higher. I was half paying attention as I was focused on the iron fly. At H2, I added more short to the NQ. I placed a stop 20 points above that — and it got hit. Really a fast move that I wasn’t expecting, as the SPX was very sluggish. I spent more time watching the SPX to manage the 2nd half of my iron fly, which was a large position.

This was a trade I didn’t plan in advance. I was literally just waiting to close my iron fly, saw that the NQ hit a resistance zone, and shorted. Had I been watching the option flows, I would have realized a much bigger move was setting up and I wouldn’t have fought it.

The NQ short losses offset the earlier gains from the Iron Fly. Ironically, in my swing trading account we have had AVGO calls since Friday. So for a while I’m long AVGO and short NQ.

There are a few things to unpack here as it comes to day trading:

  1. It is more difficult to manage multiple positions. If you are in an iron fly, just manage the iron fly.
  2. Check option flow before stepping in front of a freight train or falling knife.
  3. With the NQ, that was a counter trend trade. If the 8EMA 15M is above the 21EMA 30M, there is nothing to do but buy pullbacks.
  4. Your risk to reward was skewed. You were looking for a 20 point scalp. Yes, the market will only break H2 6 % of the time . . . and today was one of those times.
  5. Keep it simple. Keep it simple. Keep it simple.

Sometimes, the best trades are the ones you pass on. I was looking for a quiet market today — and indeed, the SPX was quiet. I brought that mentality over to the Nasdaq, which is absolutely not quiet at this point.

On a more normal day, I would have been able to scratch the NQ trade by adding to it at H2. A good reminder that the market will do as it damn well pleases. Just as the ocean waves will do as it damn well pleases.

The close today was mostly a non event. For a while it looked like we might get short covering but the markets basically fizzled into the close. We did add a butterfly for 4400 SPX for tomorrow’s expiration.

Today’s wins: The overnight trades were great and with these you hit your daily goal (see below). Great 1 hour intense yoga session. Walked a few miles to close the rings. I was nice to the people around me.

How I’ll improve: For that NQ trade, you didn’t check all of the boxes. Sell signals, option flow, etc. Follow the checklist. Continue to smile while eating the shit sandwich.

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Wednesday, November 8, 2023 — Friday, November 10, 2023

It’s Friday and I’m doing some catch up. Maria is in Boston at a health conference with Harvard — it’s all doctors but they let her go after she filled out the application and pointed out why she needed to be there and the value she could add. Go, honey.

It’s a conference with people that have dealt with a lot of death. A consistent theme that has come out of it to live a long and healthier life? After these doctors have watched many many people suffer and die?

  1. Learn to cook healthy meals at home.
  2. Meditate or pray. Think of it as bicep curls for your brain.

Death is death. There is no escape and we are all headed toward the same embankment, one way or another. But there are different ranges of death and whether or not we have access to all of our facilities. Are we bed ridden or unable to walk up a flight of stairs? Or are we able to keep on trucking right up till the end? And, of course, that Mack Truck can come out of nowhere, so enjoy the moments as they are happening.

I’m going from my notes for the week. After Tuesday’s NQ short slap across my face, the rest of the week was great. What changed?

I stopped being a whiny little bitch.

I stopped trying to get the market to do what I wanted to do. I mean, I get it. I should know this by now. Trading is a lot like playing golf. On each and every swing, you have to empty your mind. Had 3 great shots in a row? Think you are hot shit? Next shot goes into the sand trap. Same with trading. Empty your mind. Be a beginner. Each and every trade.

And — to emphasize — this is in my day trading account. This is where this stuff comes up more often. My swing trading account is fine. AVGO this week was killer. But I still want to document and get the consistent cash flow plan going — and ultimately I want to hire an assistant to sit in front of the computer and push the buttons. I have things to do. Day trading takes up a lot of time LOL. But with the advent of 0DTE options, I love the idea of daily/weekly compounding. Base hits, not home runs.

For a swing trade this week, AVGO ticked all of the right boxes for a monster move.

This is the screenshot when it was at $921.48 on Thursday. Entered on Wednesday. First target was the 127.2% extension at $950 ish. I thought, if this was going to happen, it would be next week. I’m totally cool being wrong in that it happened earlier than I thought it would.

For Wednesday, with the day trades, the main thing I wanted to do was GO WITH THE FLOW. No more fighting freight trains. I started off looking at the 30M chart.

On this chart, I have moving averages from higher time frames (Daily chart) overlayed. If the daily 5, 8 and 21 EMAs are stacked negative, then I focus on selling the rips. If they are stacked positive, buy the dips. The mistake I made on Tuesday with the NQ is that I got excited about shorting (hey it was working SO GOOD just a few weeks ago!!) but I forgot that the path of least resistance is AT THIS MOMENT IN TIME higher. Clear your mind. Swing the club. Stop thinking.

So, instead of shorting the SPX (buying puts or selling call credit spreads) I sold put credit spreads when I saw a small upturn. It was early — Fed Governor stuff — but ultimately it played out fine. In the room I did this 10 points wide and I always give it a 2 point stop. Unfortuantely the stop hit. In my large account I’ll do 20 points wide with more room and it was fine. This is a battle I sometimes don’t know how to fight. “This is what I’m doing in my large account” vs. setting specific parameters in a smaller account so any traders following the trade understand risk control. I’ve talked about my large account and traders with smaller accounts will load up with zero risk control and I’m like, guys, come on. I think ultimately I need to just do my thing. There is no need to appeal to everyone or try to be a jack of all trades. This is what I’m doing. FYI bitches.

For Thursday, I was teaching a class on the Quick Hits and Quant Pivots strategy. While I’m teaching, I find doing big trades on my own at the same time to be distracting. On this day, we ended up doing 1 put credit spread on SPX 0DTE, and then I continued to ride the AVGO trade which was breaking out to new all time highs.

For Friday, I woke up with some AVGO and NVDA overnight, and I also picked up some NQ futures. Long of course. No shorts this time. Normally I would trade 20 contracts, but I went with 2 contracts. Baby steps back into NQ. Of course, the two contracts were up over 100 points. The advantage of small size is you don’t stress it and let the market play out.

Friday End of Day

Friday was a monster day, and while I came in with some overnight long calls on AVGO and NVDA, I exited those about an hour into the session and then went into hurry up and wait mode. I have been waiting for a test of SPX 4400 for SO LONG now and I’ve seen it fail so many times — and it was a Friday, where the motto that reigns is, “Don’t lose your ass on a Friday.” So I played it lightly instead of aggressive. Solid day where I exceeded my daily goal. But had I been dialed in it could have been a huge day.

This is just trading. Sometimes you are positioned perfectly for monster days and you just ride the horse. It is the markets job to fake as many people out before that monster move happens.

With the week over, and having more than recovered from Tuesday’s foray into the NQ short slap upside the head, I jotted down a few “rules of clarity” for my day trades that go like this.

My main issue is that I have confidence in my market outlook. I can be highly confident that SPX is going to reach 4400. But I do know for a fact that I don’t know exactly when that will happen. With swing trades, you can give it a few weeks and sit through the gyrations.

With day trades, when you try to be right “today” the market often can and will let you know that “you’re not the boss of me.”

SPX 4400? Yeah baby, we are pinning today. Nope. Ok, today! Nope. Today? Maybe. Friday? Yes.

Swing trades can sit through that and catch the move.

Day trades — it is so much more important to just go with the flow vs. having a pesky things like “targets” get in the way.

Here are my flow rules for day trades. This is typically with SPX 0DTE but can also include ES, NQ, NDX as well as 1DTE or a little longer to minize theta decay on more directional trades.

  1. Wait for a Quant Pivot Level AND a Quick Hits Entry Signal before taking action. This represents a high probability moment in time and also prevents trying to catch freight trains or falling pianos. This forces discipline and fewer trades.
  2. Check the 30M chart for overall flow “right now.” Is the path of least resistance higher or lower? Are we extended or back to the mean?
  3. On the 5M chart, you have the 8EMA 15M and the 21 EMA 30M imported in. This is a zoomed in version of the 30M chart. When these two are aligned you will get your cleanest moves.
  4. With the Quick Hits, remember the DBADA rule (Don’t Be A Dumb Ass). If the 20M momentum (thick line) is below zero and red, there is no reason to be long. If it is below zero and has turned higher — fine to go long as long as the 8EMA 15M and 21 EMA 30M are crossed higher. Ideally the 30M is also pointing higher. And vice versa.
  5. Credit spreads have the highest probability of success but also the biggest potential risk if shit goes sideways. In the first hour especially, there isn’t much theta decay. It’s fine to utilize OTM calls and puts for directional trades. Just know that the markets will have to move and move quickly for those to work. Also of course ES and NQ futures.

Here are some charts to show the above.

Rule #1 Wait for QP and QH.
Rule #2 The 30M Chart Is The Most Dialed In Path Of Least Resistance For Day Trading
Rule #3, Check the 8EMA 15M and 21 EMA 30M for the “right now” action.
Rule #4 Don’t Be A Dumb Ass (Below Zero)
Rule #4 Don’t Be A Dumb Ass (Above Zero)

I find that the more I’m dialed into this, the less I trade and, more importantly, the less I fight the markets.

We can be right or we can make money.

Have a great weekend.

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John F Carter

INC 500 Founder, Simpler Trading. Member: EO, YPO. Husband & father of 3. Options trader. Rare coins, home schooler, zebra breeder. Author, Mastering the Trade.