Home > Beginner education, Lessons from the trading floor > Knowing when to trade… Being Patient

Knowing when to trade… Being Patient

Today was a great example of keeping your powder dry during slow periods so you can take full advantage of the markets when the obvious order flow start kicking in. Through our mentoring program we are looking to maximize everybody’s potential. That included telling traders when to sit on their hands; lunch time is a classic example of a time frame where trading expectations should be low. It’s a perfect time to actually have lunch or go for walk, instead of looking for trades that are not there. Getting into a position for the sake of being in a position is an easy way to part with your money. Pete here in the office seriously said that it’s almost the same as getting $100 from the bank and burning it. The bottom line, find a better time to get involved.

This afternoon, commodities and the financial sector starting to push the market higher and we started to look for stocks breaking out of intra-day ranges. When we found them you need to jump on them. If you have been to aggressive during the period of time when you are doing low probability trades, you might not have the buying power to take advantage of higher probability set ups.

A lesson that every trader needs to learn, and find the discipline to stay away from is those low probability situations. Look at the chart this afternoon of XLF, CSCO, MSFT, ERTS, and many other stocks that we are consistently stalking; and you would notice how much easier the order flow was to read in the afternoon vs. the lunch time period.

We will continue to repeat this over and over, simply because it’s a basic characteristic that must be learned in order to be a successful intra day trader.


  1. No comments yet.
  1. No trackbacks yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: