Another BIG Day....
One of the most difficult things most traders try to do is look for turning points in the market. With crude today I was able to see all the stop hunt areas and then position myself for easy pickings.
Most traders use key supports and resistances along with volume to take trades. This to me is a huge mistake. If you do that you are not allowing the market to breathe. If you don't allow the market to breathe you will be constantly stopped out before the market makes its move.
With every turning point there is what is called a "Shake Out". This is a deliberate move by the market makers or Liquidity Providers to shake out the weak longs or shorts.
Don't believe me?
Watch the markets on any turning point. With a market like the SP emini you will be chopped to pieces unless you give it room to breathe. There are some markets where this sort of volatility is good, like say CL. However the key mistakes trades make is they either chase tops or chase bottoms. With the leverage that is in the markets (far too much for the average trader) you can't handle any sort of drawdown. You think a 10-20 tick move is a big move. It isn't. Volume doesn't mean diddly squat either as you are generally NOT trading the major volume areas.
I have mentioned this in the past but you need to take note that volume areas for the big guys can be hundreds of ticks wide. In most cases you are almost always trading market noise. Market noise is simply one trader taking advantage of other traders. Nothing more. If you can see the stop hunt area you have a chance. If you can't well, "you are it".
The other big mistake traders make is they fail to identify when the market has changed directions. There is nothing to inform them that this has happened and they get caught time and time again bottom fishing or top fishing which is a suckers game. When I trade I have indicators that tell me when this has happened. I listen to them because most of the time they know more than I do. They are not always right but most of the time they are.
If you are getting chopped to pieces or are alway leaving money on the table then you owe it to yourself to start learning right and trading right. Today was another 1K day from last nights trades to today's index traders. I have made close to 20% on my small account in two days of trading.
Now the next question might be, "so what now".
Well from here on in you sit on your hands until you are dam sure of a trade area. You can continue to trade if you have a lot of faith in your ability but why would you? Did you hit your goal for the day, week or month?
Do you even have these? Most traders don't.
This is what I do when I hit my goals. I study my trades. I see where I could have made more and where I could have minimized risk even more.
Ya I know not many traders can make these sorts of returns, so why both second guessing yourself.
The answer is you always need to improve your discipline and execution. Study the moves the market makers and LP's make. Know them as they generally repeat over and over. Then you will constantly get into trades like you see below.
Most traders use key supports and resistances along with volume to take trades. This to me is a huge mistake. If you do that you are not allowing the market to breathe. If you don't allow the market to breathe you will be constantly stopped out before the market makes its move.
With every turning point there is what is called a "Shake Out". This is a deliberate move by the market makers or Liquidity Providers to shake out the weak longs or shorts.
Don't believe me?
Watch the markets on any turning point. With a market like the SP emini you will be chopped to pieces unless you give it room to breathe. There are some markets where this sort of volatility is good, like say CL. However the key mistakes trades make is they either chase tops or chase bottoms. With the leverage that is in the markets (far too much for the average trader) you can't handle any sort of drawdown. You think a 10-20 tick move is a big move. It isn't. Volume doesn't mean diddly squat either as you are generally NOT trading the major volume areas.
I have mentioned this in the past but you need to take note that volume areas for the big guys can be hundreds of ticks wide. In most cases you are almost always trading market noise. Market noise is simply one trader taking advantage of other traders. Nothing more. If you can see the stop hunt area you have a chance. If you can't well, "you are it".
The other big mistake traders make is they fail to identify when the market has changed directions. There is nothing to inform them that this has happened and they get caught time and time again bottom fishing or top fishing which is a suckers game. When I trade I have indicators that tell me when this has happened. I listen to them because most of the time they know more than I do. They are not always right but most of the time they are.
If you are getting chopped to pieces or are alway leaving money on the table then you owe it to yourself to start learning right and trading right. Today was another 1K day from last nights trades to today's index traders. I have made close to 20% on my small account in two days of trading.
Now the next question might be, "so what now".
Well from here on in you sit on your hands until you are dam sure of a trade area. You can continue to trade if you have a lot of faith in your ability but why would you? Did you hit your goal for the day, week or month?
Do you even have these? Most traders don't.
This is what I do when I hit my goals. I study my trades. I see where I could have made more and where I could have minimized risk even more.
Ya I know not many traders can make these sorts of returns, so why both second guessing yourself.
The answer is you always need to improve your discipline and execution. Study the moves the market makers and LP's make. Know them as they generally repeat over and over. Then you will constantly get into trades like you see below.
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