July 7 2010 Overlay and Trades

I did an enhanced prep overlay in attempt to demonstrate visualization vs. real life action that unfolded where I executed today.

My premise was a little off today with respect to me looking for more of an AM contraction followed by a retest of the top/bottom of the immediate range and move to form inside support.

What we had was just one big grinding squeeze all day. This is the type of day where many traders think what if they had just bought the open and held all day.

Is that a valid strategy most days? Today was a lower probability outcome and I do not expect to make a living off days like today. However, many traders who missed the early AM premium prices spend the rest of the day fading the trend in frustration.

I have learned to try to adjust as fast as I can once I realize what is happening and then pick the best possible later sequence entry with the trend.

More recently (today), I also just wanted to make an efficient exit and lay off engaging too much when the market was prone to afternoon covering (which never happened).

It is worth noting that this week I have been cutting my trades early intentionally. This is something that has consistently worked in the past and I am trying to force it until it becomes habit.

I am the opposite of most traders. I tend to hold too long and give back too many 3-4 point excursions while not catching the 8-12 point moves often enough to compensate.

Of course, as soon as I back off on the stubborn holding to targets everything hits it's target. There is something to be said for getting good results when I am not focusing too much on the perfect execution. Thus, not fighting to the death for every tick.

The complete polar opposite is definitely a proven fact...I have fought to the death for every single tick and failed many times.

The psychological aspect is fascinating. When I directly set out to accomplish a particular act or statistic with my trading, I tend to not get the results I want.

However, when I take my focus slightly off the target I think I need to hit, and zoom out a bit, the desired result tends to happen naturally.

I can not figure out how turn that mode on and off. Once I am able to do that, my edge will be unlimited.

It may be a matter taking my eye off certain aspects of my trading and feel and trying to let my natural feel take over but that can not be produced on demand so far.