Today is Wednesday and the markets are continuing their move.
We did continue the up move as I posted in yesterday’s blog. Hopefully you were able to take advantage of the up trades as they were presented. If your timing was good on your entries you probably had some nice gains. Getting the direction right is half the battle, then the timing is your next focal point.
Most days you get moves in both directions, but when you see the trend clearly up and move after move adding to gains, don’t fight the trend. If the market does reverse it’s overall direction, you will know about it, but until then, it pays to stay with the dominant trend.
Trying to tell yourself that this market has to back down and being proven wrong is not the right mind set. Stay with the overall move until it no longer provides opportunities. I have another chart below with a 4 trades on it, 3 were good for gains and 1 was a break even.
Would you have placed orders where I have it marked? The last one was short, but there was no follow through there. The market did then reverse back to long side and it continued for the rest of the day to close substantially higher. There were a lot more trades to the upside. Once the market showed that there was no follow through on the down side break, you cut your gain or loss short and see what the price action is telling you.
In this case, after the last trade, it was telling you it wants to go higher. The question is, will you have the resolve to listen or will you try and impose your will on the market. This is again where biases come into the picture. Don’t let your opinion or ego get in the way of what the market is telling you. It can be hard, but that is why I point it out. You or any trader needs to be aware of it, so you have the ability to counter balance yourself and stay grounded. Listen to yourself think and try and talk it out. If you listen to yourself and balance your reasoning with what is actually happening, you can catch yourself forming directional biases and “Stop It”. I think that is good advice, but to each his own. Trading is not easy and I plan on talking a lot about the part of the game that is between your ears.
Still not back trading yet, but soon. I dislocated my shoulder on Sunday and I have been in a lot of pain. I had planned to get things going this week, but have not had the ability to focus off of the pain. It’s my right arm and I use the mouse with that arm, a bit difficult.
Stay tuned, I am going to continue to discuss the potential hold ups traders face while trying to bring their trading into the black. This is an ongoing venture for all traders, you do not have the ability to let your guard down and get cocky. You are really trading against yourself. Many think they are trading against other traders and in reality they are, but when it comes down to it, you are really trading against yourself. Reason being, if you follow base trade setups as outlined in your trading plan, you will be doing what you are supposed to be doing and that is great. But when you venture off and take trades that you have no business taking, who do you have to blame and who are you trading against then? You cannot expect the desired outcome when you do the wrong thing and if in fact that trade does work out when you go beyond your planned set up, you will only be re-enforcing negative behavior and setting yourself up for only more problems down the road. Stick to your plan, hopefully you have one, and take only those high percentage trades and hit your profit target for the day and give it a rest. Food for thought.
Talk to everyone tomorrow, until then.
http://www.screencast.com/t/kzm744pdhkL A few potential trades after the open
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