April 21 2010 Overlay and Trades

I adjusted my read at about 9:45 AM EST this morning and aggressively executed some painful trades today.

It was some of the best sequencing I have done to date. However, the exits were not up to par with the read and execution. This has been a common theme in the past couple weeks.

I was looking for inside support at 1201.50 this morning. When the price made a grind up then back down, I took a shot at a short and had a small loss.

I am phasing this type of low probability - high reward play out of my plan so will not discuss it any further.

Just after that, I plotted the channel which turned out to be a precise blueprint for the price action for the rest of the day.

Instead of plotting the channel and trying to trade around it I executed through it today. The second trade was a long right into a powerful thrust down. This was one of my better trades ever I think and sets the bar for what I want to do moving forward.

I bought the fear and pain pretty close to a low tick. This trade loses bad if the price continues to sell. However, that kind of move is rare and improbable. The odds were in my favor.

It was a tough trade to take and hold but as soon as it moved a few ticks in my direction I felt it was good.

I targeted the top of the channel I had plotted but exited 1/2 way looking for a re entry. I did not get it.

Then I took a tough short at almost the high tick of a powerful move up. It looked so much like it was going break that I scratched it. That was the wrong move. I then bought the low after a heavy selling move down but scalped it because it was tough to hold.

All the trades after the first trade today where executed at the extremes of the price action. It was excellent tempo and placement but the exits were fumbled.

When am I going to learn to stop scratching trades?

It never works in my favor. I had an opportunity to hit a big home run today and missed it because I did not want to lose or give back my gains.

When I fail to capitalize when I am right, it ends up causing me to scratch most of my winners and take my usual losses.

The best way to avoid it is to hit my trades and hold them. I should get in a cycle of running up 6-12 points, then give 1/2 back, and repeat.

I would like to discuss more about this cycle over the next week. I have made some good strides in understanding how it works.

I have had 4 winning days in a row which is a strong showing. I need to continue to press.