âThe only thing that is as it seems is the chart. If you cannot figure out what it is telling you, do not trade. Wait for clarity. It will always come. But once it is there, you must place the trade and assume the risk and follow your plan.â - Al Brooks
The discretionary day trader looking to extract profits from intraday price swings is required to maintain focus for several hours each day and be prepared to act without hesitation when a setup appears.
It's critical to be able to stay focused during "noise" such as back-to-back dojis, narrow range consolidation, and triangle pattern formation. Out of these boring times come the strong and profitable moves.
âIf you want to compete, you must minimize all distractions and all inputs other than what is on the chart in front of you, and trust that if you do, you will make a lot of money. It will seem unreal but it is very real. Never question it. Just keep things simple and follow your rules. It is extremely difficult to consistently do something simple, but in my opinion, it is the best way to trade.â - Al Brooks
Missing a strong price move because a stretch of boredom leads to distraction can quickly throw you off your game. You can easily become tempted to trade the next stretch of noise instead of waiting for clarity. This can lead to "death by a thousand cuts" as you trade right into one extreme of a range, get stopped out, then chase entry into the other range extreme. The resulting frustration can even lead to an abandonment of your trading plan altogether, which almost always leads to a losing day.
During times of price indecision, take time to focus on what's in front of you. If price is taking a breather in a trend with reasonable strength, continuation is the statistical probability. If you're bored during consolidation, trade value entries to position yourself for the next push. For example, in a prevailing uptrend, look to enter long on dips to the lower line of a flat or down-drifting channel (bull flag formation). You may scratch a couple trades or take tiny losses if price continues to channel down, but when the continuation breakout occurs, you'll be positioned, rather than left in the dust.
If price is narrowing considerably (triangle formations) prepare orders in advance to take advantage of the breakout either way.
If price retraces to the point that a key trend line is about to break, again prepare orders to take either side, letting price take you with it, no matter what your opinion is of where it "should" go.
"Donât trade what you believe should be happening. Only trade what is happening, even if it seems impossible.â - Al Brooks
If you're undergoing brain surgery, you don't want your neurosurgeon losing focus during a tedious process leading to the main procedure.
Your trading account doesn't want you losing focus during the tedious price action that precedes a strong profitable move
The discretionary day trader looking to extract profits from intraday price swings is required to maintain focus for several hours each day and be prepared to act without hesitation when a setup appears.
It's critical to be able to stay focused during "noise" such as back-to-back dojis, narrow range consolidation, and triangle pattern formation. Out of these boring times come the strong and profitable moves.
âIf you want to compete, you must minimize all distractions and all inputs other than what is on the chart in front of you, and trust that if you do, you will make a lot of money. It will seem unreal but it is very real. Never question it. Just keep things simple and follow your rules. It is extremely difficult to consistently do something simple, but in my opinion, it is the best way to trade.â - Al Brooks
Missing a strong price move because a stretch of boredom leads to distraction can quickly throw you off your game. You can easily become tempted to trade the next stretch of noise instead of waiting for clarity. This can lead to "death by a thousand cuts" as you trade right into one extreme of a range, get stopped out, then chase entry into the other range extreme. The resulting frustration can even lead to an abandonment of your trading plan altogether, which almost always leads to a losing day.
During times of price indecision, take time to focus on what's in front of you. If price is taking a breather in a trend with reasonable strength, continuation is the statistical probability. If you're bored during consolidation, trade value entries to position yourself for the next push. For example, in a prevailing uptrend, look to enter long on dips to the lower line of a flat or down-drifting channel (bull flag formation). You may scratch a couple trades or take tiny losses if price continues to channel down, but when the continuation breakout occurs, you'll be positioned, rather than left in the dust.
If price is narrowing considerably (triangle formations) prepare orders in advance to take advantage of the breakout either way.
If price retraces to the point that a key trend line is about to break, again prepare orders to take either side, letting price take you with it, no matter what your opinion is of where it "should" go.
"Donât trade what you believe should be happening. Only trade what is happening, even if it seems impossible.â - Al Brooks
If you're undergoing brain surgery, you don't want your neurosurgeon losing focus during a tedious process leading to the main procedure.
Your trading account doesn't want you losing focus during the tedious price action that precedes a strong profitable move
