Mechanical + Mental Strength = Proper trading
Today is a nice turnaround in my trading from yesterday.I was a bit off when starting out and didn’t hold onto a nice short in ITW (Ill Tool Works Inc.) Realizing the same feelings I was having yesterday about taking trades off that should have worked,I got my composure together and stuck to my strategies that work for me.I used the Trailing stops on the next couple of trades and made a nice gain in both CNH and DE. I decided to leave ITW alone,and move on to the next opportunities.Basically one good trade where I followed my strategy is where the bulk of my day has been made up.I did get stopped out as DE pulled back,but I am completely ok with that because it was my choice of exit as I placed the trailing stop.I think I’ll rename the stop order/or trailing stop,and begin calling it my “precautionary exit”.Why? The word stop I think is so harsh and the way it is used for example someone might say “I was stopped out”, or “They ran my stop,and made me get out”. No,I like the word Precautionary Exit better,because after all a stop is an exit,because we the trader place that order to minimize our risk and to capture our profits.The best trading comes from accepting responsibility for every aspect of trading.Sure there is the occassional event that may cause an unknown consequence,but trading is also a game of not knowing the outcome.We can only use strategies to apply what we know and protect against the unknown.I am ok with not knowing where a stock is going or what the outcome of my trade will be as long as I follow my strategies.That is the way good trading should feel.If you are feeling a need to be right or know something for sure,you will be let down again and again when things do not go in your favor.That can be a very frustrating game.A good trader doesn’t need to know what will be the outcome,a good trader has a plan,knows when to bend the rules of that plan,but also when to adhere strictly to that plan.With that said I will be monitoring the market for setups,but if I do not see anything then my trading is done for the day.