I want to write about this trade a bit differently than the last few, because this one isn’t really about a setup that failed. It’s about me.
Mazagon Dock had one of those runs that makes every trader a little restless watching from the sidelines. Earlier in the year it was trading under 900. By the middle of August 2023 it had pushed past 1900, close to doubling in a handful of months, barely pausing along the way. If you weren’t in this stock already, watching it climb day after day starts to mess with your head a little.
By mid August, price had reached the 2000 mark and started coiling into a tight triangle, contracting range right under that resistance. I had a rule for this kind of setup. Wait for a close above the resistance line. Not a touch, not a wick, a close.
I didn’t wait for it.
I marked two points on my chart afterward, A for where I entered on 16th August and B for where I exited two days later, and next to them I wrote something I don’t love admitting but I think is worth sharing anyway: FOMO, plus late entry. My own notes say the breakout candle didn’t close above the line I was watching. I entered on the second candle after that, still without a close above resistance, because the stock had been running so hard that waiting felt like it meant missing out.
Here’s the part I didn’t fully appreciate until I went back through this chart properly. It wasn’t just the price action telling me to wait. The MACD was already crossing below its signal line right around this same entry, with the histogram shrinking and flipping negative. That’s a momentum warning showing up at almost the exact moment I was getting in. I wasn’t just entering without price confirmation, I was entering while a separate indicator was actively telling me the move was losing steam underneath the surface.
Two signals, not one, and I overrode both of them because the stock’s overall run made we want to believe there was more left in it.
The trade lost 2.25 percent. Not a big number in the scheme of things. I’ve taken bigger losses on trades where I did everything right and the market just went the other way. What makes this one different, and honestly a little more uncomfortable to write about, is that this loss had two separate warnings attached to it before I ever clicked buy, and I still went ahead.
I think this is worth talking about because I don’t think I’m unusual here. Everyone who’s traded for any length of time has a version of this story. You build a checklist when you’re calm, thinking clearly, not in the middle of watching a stock you don’t own run away from you. Then a situation like Mazagon Dock shows up, and all that calm planning gets tested against actual pressure, actual FOMO, actual fear of missing a move that’s clearly already happening. And sometimes the plan loses, even when there are two different signals telling you it’s about to.
What I keep coming back to with this one is that the fix isn’t complicated. It’s not a new indicator or a smarter pattern, I already had the indicator, I just didn’t listen to it. It’s waiting for the close above resistance, and it’s actually looking at momentum indicators like MACD when they’re rolling over instead of only watching price. If the candle doesn’t close above the line, and the MACD is crossing down at the same time, that’s not a coincidence worth ignoring. That’s two separate parts of my own process agreeing with each other, and I overrode both because the recent run made my gut louder than my checklist.
There’s also something in here about how extended moves change your risk tolerance without you noticing. A stock that’s already run this far and this fast should probably need a cleaner, stricter signal before you chase it further, not a looser one. But that’s not how it feels in the moment. In the moment, the run makes you want to lower your bar, not raise it, even when the indicators sitting right there on the same chart are quietly telling you the opposite.
I don’t think this trade taught me anything I didn’t already technically know. I think it taught me how it actually feels to break two rules I’d already written down at the same time, and that’s a different kind of lesson than reading about discipline in the abstract. Next time I’m watching something run, and the close hasn’t confirmed, and the MACD is already turning, I’m hoping this is the memory that keeps me in my seat.