April 6, 2013
-
Trading Update 040213 – 040513
Had a good week, but it should have been a great week. I like trades where I feel I’ve maximized my returns, and while I know I can’t be perfect, if I exit a trade too early based on continued market movement, I feel like I should have done better.
The main issues this week, or I would say, any week depends on the quality of the trade map. The map is my analyzed chart where I figure out the market’s potential movement for the week ahead. Now the fact that the market movement is variable is what makes it a challenge.
You’d like to be able to organize it to make a map orderly and precise, like this:
This would be great!
Unfortunately, the market has no fixed landmarks other than past movement, so I have to essentially create maps from scratch based on market stats and support/resistance areas. So oftentimes the map winds up looking like this based on a “best guess”:
Meh, not as impressive, and plenty of assumptions that prove to be false….kind of like the “New World” maps of yesteryear.
But, you have to start somewhere. The more accurate the map, the better my trade entries and exits will be.How accurate was I this week? The video sums it up nicely:
I missed a few “key turns” which caused me to enter too early in some trades and too late in others, resulting in reduced profits. I wind up confusing myself with my maps if I draw too many update lines and start losing the bigger picture.
Since I’m working a hedge by trading both sides, the errors get doubled as well.
On the positive side, my plan of putting in my hedge trades in advance is working well. Even though my “directional” side is still a bit uncomfortable, I’m getting used to trading ranges now instead of only at the perceived maximum lows and highs. The new methods should clean house over my older direction centered methods once I’m fully adept.
I also made some good improvements to my mapping to help in making and keeping it accurate, so I can avoid those “off road” ventures.
The market had great volatility and movement this week. It tanked big time of the weak jobs report on Friday, but recovered nicely. Hopefully market movement will continue to be robust next week. I have some catching up to do to make up for a sub par quarter.
