If there are days when I get consistently beat up they are trend down days. Every single time without fail I am unable to recognize this pattern intraday and fight it every step of the way. With every single bought dip I think this is it this is the bottom which usually works on inside or range-bound days but not trend downs. These kinds of days usually catch me by surprise in an strong uptrending market because they are unexpected having been put to the back of my mind.
So one big question I wrestle with is: Why am I unable to recognize this pattern during the day?
The most painful occurrences come on Fridays and ruin my weekends manifesting in loss of sleep, nightmares repeating the bad trades and make me hesitant to do my weekly review and homework for the upcoming week.
So I've spent yet another weekend thinking how do I prevent myself from getting caught again and end the vicious cycle:
- Trade only "In Play" stocks: As SMB states stocks with fresh news typically trade independent of what the overall market is doing.
- Make my trading bias more flexible: I am bipolar when it comes to trading. I am usually hot or cold. I have a hard time switching back or forth.
- Enforce daily max pain thresholds: I have risk management built into my Lightspeed day trading account but I am going to enforce this in my IBKR accounts. I could always reset this but at least the break would force me to step back, breath and re-approach the market.
- Trade less on Fridays: I usually follow this rule but not with great consistency. So I may employ a rule to drastically cut my tier size on Fridays and under a certain amount of shares. This goes double on Opex Fridays.
- Trend checks throughout the day: Every day at 11AM I write down what I think the overall trend is in the market. Maybe I need to do this throughout the day maybe every hour or every 2 hours.
- Put the AAPL crack pipe down :-)