I am wired to be a bear…….as a new trader it was difficult for me to want to be long in a stock, and I would often fight the trend trying to find an early short. The money lost and the frustration of being wrong was often a drain on my mental capital……and it also meant I would watch something continue to move higher and make a very nice move without me. As traders most of us are wired one way or the other, bull or bear. One thing that has helped me tremendously over the years is working on being flexible in my thought process on setups….Asking myself “What is the bullish case here? What is the bearish case here?” Not all setups work. Being able to see the other side of the trade allows you to quickly shift gears either direction if the original thesis you had on the setup fails and it allows you to still be able to capitalize on the move.
- Using Multiple Time Frames
Whether you are day trading or swing trading, using more than one-time frame can help you get a better overall picture of what the price is doing. Watching one-time frame may not give you the whole story. For myself, backing out to a larger timeframe helps reduce the noise from the smaller time frames………. I can also see where bigger support or resistance may be coming into play. For example, if you day trade on a 1-minute timeframe, try also looking at a 5- or 15-minute chart. That gives you more price history on the left side of the chart to help you make decisions about where the right side of the chart may be going and may also help you sit still in the trade for larger gains. In my swing trading I always start out with the daily chart and then move to a 60 min or 15 min chart to help with fine tuning the entry.
How frustrating is it when you wait for your setup and then miss your entry, or the stock you are sitting in is not moving and everything else you are watching seems to be moving? Everyday there are often stocks that have some crazy move on news, up 100 % on the day and you just sit and watch. The frustration sets in, FOMO (fear of missing out), chasing, bad entries and losses usually follow. All something as traders we struggle with……. I still have times that I feel frustrated with missing moves……. but today, in general, I am much more at peace with missing moves. I know it’s not realistic to think that I will catch them all, I know that there will be times I am in the zone and times I ride the struggle bus. But what has brought me the most peace about missing moves is one of the best things about the markets……..THERE WILL ALWAYS BE MORE SETUPS……..everyday there are new opportunities, we just have to be patient for the ones that fit our trade plan.
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