October 26 2009 Overlay, Trades, and Commentary

Lots of traffic today. Thanks for sticking around for a later (or earlier) post depending on where you are at.

There have been a number of new readers from Australia this week. I welcome you.

Read was good and execution was respectable today.

I am trading only 1 contract temporarily while working on sequence. My goal is to force myself in and out of trades and gauging PNL on the overall sequence instead of hanging my hat on individual trades as I have been.

The smaller size make it much easier for me to enter setups that I otherwise would not take. It does not mean I am taking worse setups, just some that I previously would have treated differently.

I need these on order to accomplish my goals. I need to constantly put points in the board and produce outliers.

I think I am at a point in my trading where my gut knows what is going on and I need to do everything I can to just trade it.

This goes the same for passing on good technical setups that I have no conviction about as well. This is a slippery slope for me as I do not like skipping trades.

I started the day with good rhythm and had a decent sequence going. I built off that and even placed the order to catch the big sell off today.

I cancelled the order after sitting through 6-7 bars of micro congestion.

Why? It was clear to me that the market would likely sell off if 1083.00 did not hold. However, the sell stop short I was trying to take looked less and less attractive as the congestion continued.

The short side was just plain overextended of the initial lower high at 11:09 EST and I believed there would be a more significant pullback prior to the move down.

I though I would be exposing myself to 4-6 points heat if the market pulled back. Instead, it just sold from right there.

It was not too bad of a decision and the read was correct. I did the right thing. If anything, I should have had more gamble there, especially since I was up for the day.

I am not going to dwell on it.

I felt good about my trading and sequence today after a couple of slow weeks.

It is important that I listen to my gut. My intuition is as sharp as it has ever been.