Good day traders ALWAYS talk to themselves

When you see someone talking to themselves it may look a little scary, when you see a trader doing it at his desk what you see is someone who is ready to earn money. Sometimes questions are the answers. In order to be prepared you must know what you are going to do no matter what happens.

 

I am very big on quotes/metaphors and such to give me visual images when I need to take action toward any goal, not just tradingTrade scenarios are built upon deciding what is probably going to happen next but consistent profits come from know what you are going to do definitely going to do next.

 

This will probably happen, this is what I will definitely do

 

One of the most common emails I get is “My timing is off.” Timing comes from anticipating not from reacting. You can only anticipate if you spend most of your time building if then scenarios.

 

Most new traders spend a good deal of their screen time looking for a spot to enter, looking for the next trade. In reality you should spend most of your time looking for institutional order flow, identifying an edge. If there is no obvious edge why would you look for an entry price?

 

Some questions you should be running through your head all day long:

 

• Is there an obvious edge to the market?
• Are the market internals telling a story?
• Is there obvious insitutional order flow in my list of stocks?
• If I have no edge what do I need to see for me to want to get involved? What levels would make me sit up in my seat?
• What price makes the most sense based on risk reward?
• What do I want to see on the tape AFTER I get filled?
• What don’t I want to see after I get filled? What is my plan if it moves in my favor/against me?
• Where will I add to the position? Where will I scale out?
• Is today a trend day or range bound? Am I trading the type of day unfolsing or am I trading what I want to see happen?

 

This is just a small list, but it gives you some ideas.

 

Talk to yourself and wait for the answer. Actually listen to the answer.

 

If you are simply reacting to every wiggle and jiggle in price action you will never find consistency.