All I want to do this week is click sharply through Friday. I’m excited to trade tomorrow!
I want to cut my losers. I don’t want to let a single position run significantly offsides. You can always hit out and get back in. Also your P&L in the trade and how far on or offsides you are is independent of the ensuing price action so I ought to be monitoring how the stock is developing in an absolute sense rather than how it is performing relative to my entry. The stock is moving according to price, order flow, volatility, and entering factors. It does not have any knowledge of my P&L in the trade. I should be wary from a risk management perspective (the genesis of this point) but NOT from anything informing my perspective of the EV of the trade as it unfolds.
I want to make sure I have proper mouse positioning when looking to hit out offsides by making sure my mouse is significantly across the spread so that I can hit out with minimal slippage. I have lost a significant amount (at least on a % basis) by trying to hit out and placing limit orders behind where price has moved past rather than executing at market, not getting a fill until 2, 3 or sometimes even FOUR times trying to hit out and moving from -0.4% to -1.2% by the time I am out of the position. So proper mouse positioning when getting ready to puke.
I want to put in four quality days of trading where I am attentive to all news releases and trade them with an open mind, trying to capture larger moves for the A+ headlines and being willing to bet on reversion from B or C tier headlines that get overreacted to by the market.
I want to actively avoid overclicking from 90 min after the open to 30 min before the close.
I want to adjust my focus according to the time and be appropriately conscious of 30,60,90 min before the open for announcements & numbers, the MOO and 6:25a PT number print, the open, 60&90 min after the open, the MOC, and all earnings/IPOs occurring that day.
I want to stay on top of which candidates I’ve prepared to pay particular attention to during the open.
I want to be monitoring what the megacaps and semis are doing, as well as the market as a whole and oil, so I can tell if it is a risk on/off day and which portions of our playbook to focus on or avoid.
I want to take sharp leans and breaks, aggressing for breaks from the favorable side of the prior consolidation allowing me to maintain longer holds.
I WANT TO LET THE TRADE WORK.
I want to avoid entries in stocks that don’t move when the order flow looks good but won’t do anything.
I want to avoid entering into positions in smallcaps or nanocaps AFTER the primary move has occurred and the stock is going into gridlock with low volume and my aggressive entry is trapped offsides painfully.
I want to generally extend my winners especially during opening drives, opening range breaks, and anytime a major level is crossed that the stock has been positioning on higher timeframes for the prior days/weeks.
I want to respect stocks experiencing an episodic pivot and avoid trying to short their breakouts running out of steam. They don’t have to fall off of highs when their catalyst earlier that day or on prior days is strong enough. Sometimes stocks will just keep their accumulated price, even if they are smaller.
I want to work on navigating my bet sizing based on quality of setup beyond the built in sizing differences for market cap, events like earnings, and volatility. Varying my position size is an additional lever that I need to introduce into my game. I am not doing this properly. It ought to be another dimension beyond my already varying sizing according to the stock’s context.
I want to work on meditating each day and visualizing what it looks like for me to execute correctly in the core spots that I have been making huge errors in over the past few weeks.
I want to avoid speculating on price dislocation or where stocks may go on a multihour timeframe; and if I still choose to do this, I need to use extreme restraint in my size.
I will not double down or average into a losing position.
I will not change my risk limits until AT LEAST the end of the week. Even though they are 1/4 of what my partner suggested, I am here to work on my process. I am here to improve.
My trading last week had SO MANY errors. I am capable of trading much more sharply. So I must focus and put in reps to get there.
I will maintain good hygiene for my tabs and I will avoid unnecessary distractions during trading hours.
I will pay attention to the intraday chart, higher timeframe positioning, volume, market cap, intraday % move potential, and contextual order flow before clicking in so that I can avoid unnecessary entries that end up getting scratched or end up as tiny losers. My ideal broker statement tomorrow has FEWER stocks traded. Each entry I take ought to be reasoned.
I will avoid tripling down on an idea and acknowledge that I may be fundamentally misunderstanding what the participants in the stock are aware of or intending to accomplish.
I will keep my existing list of sins in my mind and specifically avoid FOMO clickins or averaging into a loser. The best trades just work right off the bat.
If I am stuck I am not going to chase getting unstuck. I am at peace with whatever opportunities arise and I will trade them as best I can.
I will avoid being in too many positions at once. If there is a critical moment to focus, I will hit out of minor positions or close tabs to focus on the most important spot(s) of my day/week.
I will maintain a positive attitude and accept when the inevitable unexpected volatility impacts me negatively. It is my job to accept that it has occurred and to mitigate its impact, whether that is from hitting out quickly or letting the position recover.
It’s ironic that BOTH of my 25k & 30k losing days (of which the losing trade each day was the vast majority of that net loss) made full recoveries within the next hour or two and both of my hit-outs were basically at the stone bottom.
I will seek to be mindful of the bigger picture and try to gauge how far stocks have to run.
I will rate catalysts mentally as they occur and I will make predictions of whether price will break or bounce at major support and resistance levels, working on improving my judgment.
And finally I’m going to work on being kinder to myself when I make mistakes. I will make mistakes every day. It’s my job to work with the competency level that I have and strive to improve it regardless of how my decisions may backfire in the short term.