GOOG went down again today (GOOG 280.18 -17.24 -5.80%), along with the rest of the mkt. As I saw the stock down in the morning I was somewhat relieved. Last night I had this feeling that the stock will open up high in the morning. I had accepted taking a loss in my mind. Having seen GOOG move up almost $10 in the last hr of trading yesterday, I was very sure that it will keep moving higher in the morning. There was a sense of loss by 1. not selling when I could have early in the day and 2. puts further losing value in the morning.
After missing timely sell of this put at a goof profit twice before, I was really tempted to not miss the opportunity of selling it at a higher price this time. This thinking at the back of my mind really pushed me into selling quickly. If it was not for this was not for this background, I would have waited until the last hr (as I have been doing the last few weeks) and sold it at a higher price.
In other words I was trading today based on experiences from yesterday. I thought the stock will do something much like it did yesterday. In fact, after selling the put in the morning I was waiting for the stock to bounce near the closing today and I will be buying it again at a lower price. But in fact that did not happen, the stock kept moving down and the puts increased in price value.
After my successful sell in the morning, I felt somewhat proud of myself, by not missing out this time. As being successful this time I already had another trade figured out in my mind. I looked at the 5 day chart of GOOG and assumed (with great confidence) that GOOG (always) moves higher near the end of the day and then falls back the next morning. So all I had to do was sell now wait until the last hr buy back and sell the next day. I told myself that I finally had it figure out. The stock did bounce a little (not as much I was expecting) I did not buy. It did not move up again for the rest of the day and closed making another low.
Being disappointed at myself for missing a trade I had planned and waited on since this morning, I almost did a revenge trade on GOOG. I bought 5 call contracts. It was a very unplanned, reactive and impulsive trade. I know that GOOG sometimes spikes up for no reason. If that happens tomorrow this will prove to be a good trade otherwise it was just another emotional/irrational trade decision.