Mistakes

Similarities/Associations

The brain always looks for similar situations and associations. Yesterday was a volatile and very extreme trading day. So, today I looked for the same setups that I missed yesterday. For example, I just tried to fade the extreme even though today was a downtrend day, meaning price never came back. I would have been better served forgetting everything about yesterday and traded the trend I saw today.

Expectations

The problem with expecting price moving an in certain direction is that I will unconsciously or consciously gather information that support my thesis instead of looking for information that counters my expectation. The brain tries to avoid pain, and this is a way of avoiding pain. We block all information that would prove we are wrong.

News
If in a trade and there will be a news release, have a first target hit already or exit at 1 min prior to release.
CPI release was positive, but luckily I did not enter a long.

When not to trade
-I just started using a new indicator or setup, use practice account first -when I feel uneasy or don’t see any familiar patterns on the chart, remember, I can be ok not trading all week as long as I have one great trade

What to do before I start trading: -start up both computers, login and do one practice trade as if I am really trading. Relax and have a strategy in place.

Timeframe

This is 30-min timeframe. On this day I tried to go short. Why? Because I got lost in short timeframe movements on the 1-min timeframe.

Position Size/Stop Loss

When I trade more than one contract, make sure that I adjust my stop loss after I take off a contract or two just so I keep the stop loss at the exact amount of my open contracts. If I don’t do that, I will accidentally enter a long or short when the stop loss is triggered.

Sleep

Don’t trade after a night of bad sleep or if out of rhythm.

Volatility
Don’t trade when the candle wicks are very long in comparison to the body of the candle and also when Volume is low.

Days to avoid
don’t trade first 15 minutes after the bell, trade conservatively the first two days after long weekend (see 11/29 2 days after thanksgiving) don’t trade if in range from yesterday or if still inside or within the high and low of first 30 min candle. This could also be true in anticipation of the release of a major news release like the FOMC meetings or Powell press conference at the Brookings institute, for example. The last week of November we had a big reaction while ISM manufacturing index was released and also construction spending.