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Develop and follow a written trading plan
- Thread starter Chuck Krug
- Start date
Just to clarify I am a 100% discretionary trader and my focus is ES and NQ. Occasionally, may trade YM. I think it best to learn one or two instruments like the front and back of you hand. Learn the nuances thoroughly. Learn to focus on what your are doing. Practice and practice and practice honing execution skills. They must become second nature. Learn to detach yourselve from the money, and the trade, and concentrate on the process and the market action. And above all, remember, the market is always right. Our plans may be thus and thus but whatever happens is what is right, not our plans.
I have my strategies and tactics or techniques that I use but I let the market action write my plan for the day. I pay close attention to the overnight session in terms of what it did and it’s patterns, the open of RTH as compared to close of the previous RTH session (as that is the begining “tone” of the day), the first 1.5 hours of PA, and what happens i.e. “how” first 15 to 20 minutes evolves...volatility...trending..ranging...etc.., then PA 8:45 to 9:15 reversal..PB’s...continuation..etc . 9:15 to 10:30 can be good for trading. 12:45 to 1:30 stalling...reversals...1:30 to market close...morning trend resumption or established trend reversal. (All times central).
I try to determine early what kind of day we will LIKELY have. Trading range day? Small pb bull trend? Small pb bear trend? Medium pb bull/bear trends? Opening range BO? High volatility? Low volatility? Bull channel..bear channel? Broad? Tight? Occasional BO’s or successive BO’s..etc These and other patterns help me decide what things of a tactical nature I will employ as I trade the day. Nothing is set in stone for me and I will change my mind or tactic on the fly if the market PA indicates to me I have misjudged and am probally using the wrong technique. I try to make an estimated and informed guess on the best strategy and tactic(s) to use for the day (based upon the PA that has transpired early on in the session) but I also realize I can be wrong 40% of the time and may need to shelve the present tactic and use another.
I am not a multi-tasker. I tend to have a one track mind. I just try to do my best to stay on the right track. I am not a gambler nor a high roller.
I have my strategies and tactics or techniques that I use but I let the market action write my plan for the day. I pay close attention to the overnight session in terms of what it did and it’s patterns, the open of RTH as compared to close of the previous RTH session (as that is the begining “tone” of the day), the first 1.5 hours of PA, and what happens i.e. “how” first 15 to 20 minutes evolves...volatility...trending..ranging...etc.., then PA 8:45 to 9:15 reversal..PB’s...continuation..etc . 9:15 to 10:30 can be good for trading. 12:45 to 1:30 stalling...reversals...1:30 to market close...morning trend resumption or established trend reversal. (All times central).
I try to determine early what kind of day we will LIKELY have. Trading range day? Small pb bull trend? Small pb bear trend? Medium pb bull/bear trends? Opening range BO? High volatility? Low volatility? Bull channel..bear channel? Broad? Tight? Occasional BO’s or successive BO’s..etc These and other patterns help me decide what things of a tactical nature I will employ as I trade the day. Nothing is set in stone for me and I will change my mind or tactic on the fly if the market PA indicates to me I have misjudged and am probally using the wrong technique. I try to make an estimated and informed guess on the best strategy and tactic(s) to use for the day (based upon the PA that has transpired early on in the session) but I also realize I can be wrong 40% of the time and may need to shelve the present tactic and use another.
I am not a multi-tasker. I tend to have a one track mind. I just try to do my best to stay on the right track. I am not a gambler nor a high roller.
ROFLMAO. That IS my rule.To me discretionary means you sometimes don't follow your own rules. So I guess your rules just aren't good enough.
ROFLMAO. That IS my rule.
So your rule is to not follow your own rules? Or any rules? Except for that one of course, don't follow rules?
Salty the market rules. That is the rule I follow. I have my tool box of techniques and tactics but I do not try to box in the market to my rules rather I use the tool that is appropiate to what the market is doing. Any rules I could make up ..well they don’t change the market to my favor. Rules are for the trader not the market. Rules are to protect the trader from hinself. Once a trader learns to follow the market then he can focus on that and not rules to follow. Because the market RULES! Nothing else matters. NOTHING ELSE MATTERS!
Salty the market rules. That is the rule I follow. I have my tool box of techniques and tactics but I do not try to box in the market to my rules rather I use the tool that is appropiate to what the market is doing. Any rules I could make up ..well they don’t change the market to my favor. Rules are for the trader not the market. Rules are to protect the trader from hinself. Once a trader learns to follow the market then he can focus on that and not rules to follow. Because the market RULES! Nothing else matters. NOTHING ELSE MATTERS!
So you observe what the market does and respond to what you see. How is this discretionary?
I make my own judgement as to whether i will or want to take a particular trade setup, or not, depending on what the market is doing (context) and the tools I have at my disposal. I do not take every setup that appears like in a mechanical or automated system.So you observe what the market does and respond to what you see. How is this discretionary?
I make my own judgement as to whether i will or want to take a particular trade setup, or not, depending on what the market is doing (context) and the tools I have at my disposal. I do not take every setup that appears like in a mechanical or automated system.
So you have rules that define a particular set-up and rules that cancel the set-up's entry indication.
Two setups can physically look alike (i.e.) grafically seem identical but render two different results because as the setups were forming the dynamics of the market action was different. Just because sonething looks good doesn’t mean it is good. I pay close attention to the dynamics as opposed to the picture drawn. The picture gives me the potential setup. The dynamic informs me of the probability of the setup working. Then I decide. I make a discretionary decision to take the setup or not. Unlike other trading (wisdom) that says “take all your setups” ROFLMAO. Well a trader can but it will affect win rate.