Today is Wednesday January 13th, with the market closing towards the high of the day.
That is always a good sign, when the market can close at or near its high for the day, plus 53 on the Dow Jones and plus 9.50 on the S&P 500 futures. The day started off giving traders two good opportunities to go short. If you could have stayed with the move, you would have been rewarded nicely, as there was 4-5 points in that one move alone.
After that, support came in around the 1130 area and traders quickly moved the price up. Normally, you would see a little pull back after the first move up, but it was strong and did not want to give up any ground. As the prices got going again, it was up, up and away for the rest of the day. The market slowed down for about 2 hours and almost on que, it started to take off again at 11:30 West Coast time. That is the best time to start-up again after the morning trading session if you ask me, 11:30 a.m. to 12:45 p.m.
Many institutional traders look at 60 and 30 minute charts. After there return from lunch, they have 1 new bar to interpret. After that, they often will place orders to go long, short or get out. The point is, that is a time large volume is going to come back into the ring and that is what is going to move the market, one way or another. The last 15 minutes, everyone is trying to settle out there day and position traders are looking to do just that, position themselves for a move into the next trading day.
So if anyone was wondering, the best times to day trade are the first 90 minutes and the times I mentioned above. That is where the volume is its highest and the moves their greatest.
In todays trading, I started just after the good moves short, around 7:30 and was then looking for the bottom of the move, I did find it, but I was a little to hasty in putting the trade on. I got in to early and with only a 4 tick safety net stop, I got hit for -3 ticks and again -3 ticks. I did not get filled on a three tick target and quickly had my second small stop.
It did get better after that, as the next 10 trades we all gainers.
The blogs that I write often times are just as much for me to re-enforce what I already know, but we are all human and need reminding. Which reminds me, I need to work on my first trade of the day. I often do not give myself enough time to get set up before I start trading. That is something I need to work on. The days I do my pre-market preparation, I start out fine. But the days I tend to rush it, because I think I am going to miss something, is when I don’t give myself enough time to look at where we were, where we are and where we are likely going. (This is a form of Fear, fear of missing the trade). There is a progression that really should take place, getting your mind where it should be, is essential.
When writting about it, it exposes my weakness and now I can do something about it. This is and should be true for you. Look at your trading objectively and ask yourself, where are you the weakest and where are you the strongest. Continue to re-enforce the strong points of your trading, so that you don’t slip in that, but you will need to work on the weakest link first. How is your trade management after you put on an order? That is just as important as your entry. How is your money management? If you trade multiple contracts, are you increasing your size if you are getting stopped out, to recover more quickly?
There are answers to these questions and you will only be able to get the answers if you write down the questions. If you never write it out, guess what, nothing happens, because you are not doing all that you can to meet your trading goals.
I wanted to continue yesterday where I left off, but I see time and room is short. Yesterday, we talked about Greed and how it can negatively affect your trading. There are other emotions that can hurt your efforts as well. You guessed it, FEAR. That is a killer. I will have to start earlier in the post to more adequately talk about these two, from my perspective.
Everyone has their own story and idea’s of what these two emotions are as it relates to trading, but I will give you mine. I promise, to make a special note to continue on these two topic’s. They are so important, to long-term trading success. I can only talk about it, because of all of my own experiences. So, come back tomorrow to here, “The Rest of The Story”.
http://www.youtube.com/watch?v=SOZr9tRpzi8
http://www.youtube.com/watch?v=tmklqINxwR4
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