One Tough Lesson by Trade Aptitude

Yesterday’s results: Neither trade idea triggered, and they remain on the chart today.

Today’s Best S&P Futures Turning Points: Buy 6017.25 stop 6012.25. Short 6013.00 stop 6018.00 if price retraces up from below. 

The World Index: (+100/-100) jumps from +14 to +57 with all major world markets Bullish on increasing volatility. The S&P Futures are not participating yet. 

Catalysts: JOLTS @ 10:00. Fed’s Kugler @ 12:35, Goolsbee @ 3:45. 

Quick Tip: One Tough Lesson

If you’re a discretionary trader intuitively making entry and exit decisions and you’re successful, congratulations! You are a rare breed. It’s not that discretionary trading doesn’t work, it’s that to succeed takes years to hone your skills. 

This leaves rule-based trading as the best alternative for developing trading skills and success for the vast majority. It seems so simple. Find a proven strategy with edge. Follow the rules. What can go wrong? 

Here’s the tough lesson you need to learn: You think you know what’s going to happen, but you really don’t. 

You remember prior trades that were winners and losers in certain market conditions, and you violate the rules of a perfectly good trade plan because you think you know what’s going to happen. 

This is a natural human phenomenon. But it usually ruins your results. I don’t recall the author, but I clearly remember the quote: “The hardest trades to take usually turn out to be the best.” 

Thinking we know what’s going to happen is dangerous. It stems from our need to be “right.” 

We shouldn’t care about the outcome. Win or lose, no worries. Trading success is never the result of a single trade. It’s the entire series of trades over time and in varying market conditions. This means we should focus on trade execution and risk management, not outcome. 

Of course, you need strategies with edge. Not caring about the outcome and following losing rules will blow up your trading account. Fast.

Our trading teams focus on multiple strategies for day trading futures and high-probability candidates for swing trading options. You can try either or both risk-free.

Trade fearlessly,

Mike Siewruk