I burnt my finger on a punt trade (which did not originate from a pair trade set up). Ouch! A $100 lesson learnt - don't directional trade without doing homework and sleep on it.
My current pair trade is on two strongly correlated (>0.8) stocks. It's fun to watch my how my trades are hatching daily and the tug-o-war. The two buddies looks like they are parting paths soon after a strong break out (upward) the day before. I hope they would play out nicely per my expectation e.g. don't pull a DNA helix pattern on me. I think this one needs some patience due to relatively low volatility of the counters.
In pair trade, we can either trade a convergence or trade a divergence. Although trading a divergence gives more uncertainty because if the divergence don't go far in the planned direction, then there will be little trade gain ......