My natural reaction, for some reason, is to look for the reversal and play for mean reversion. It has been so since I started practice trading. Riding the prevailing trend is not what comes to mind when I see movement. This is unfortunate on days like today. I have been really punished, expecting a turn when the market is uni-directional. Makes for a frustrating day. On any of those trades against trend, I could have waited until price hit the 7 EMA and entered short on the next candle as it started to go down and I would have been in on a spectacular winner trade. After all, my trading rules would keep me from taking early gains. Terrific on a day like today. But that requires a mental lightness and flexibility that eludes me today.
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A couple weeks ago, when I first started committing to my strict exit rules, I was finally in a mental state that allowed me to go with trend. In addition to the elation from stopping out consistently and not taking profits far too early after nice entries, I was going with trend instead of this old habit. I am clearly back to entrenched, "safe & comfortable" thinking. But safe is not successful.
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As I write this, price has popped after bottoming seven cents below my last stop out. But, any one of the losses could have been "the bottom" before the reversal. After all, with so many of them, I was bound to find the bottom eventually!
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On the bright side of the road, I hit every stop out, without hesitation. I did get one really lousy fill, but that is the market talking its language. On a day like today though, I wonder how I would have reacted if it was real money? That is where my uncertainty lies now. The fact that the last two put a twinge in my gut tells me that I am taking them seriously. But, until real cash is on the line, I won't know for sure.
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Now I must think again, like I began to do a couple weeks ago, to trade against my habit and go WITH trend.
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