Hey Market Pilots,
“Not my trade” is a phrase I use fairly often when Moxie Subscribers ask me about stocks that have moved and why I didn’t go in. First off, there are thousands of tickers out there all moving in their own way and I can only trade about 10 of them at a time. This means I’m going to miss most of the moves that occur in the market. That’s ok and you need to be ok with it too otherwise you will drive yourself crazy.
There are names that have massive gains and when I come across them I say to myself “Wow that was a heck of a move, what can I learn from it” instead of getting angry that I couldn’t catch it or didn’t even know about it. Sometimes it’s a stock I would just never trade no matter how big the move because it is too neurotic, thinly traded, or in a sector like biotech that I don’t trust.
When you really grasp what your type of trade is and you trust it, then you should only take those that are ideal for you. This is particularly relevant to me because some well-known names had some solid moves the other day, and while I can show that they followed one set of my rules, they didn’t follow the other set which I place more importance on. Therefore, when they began to set up on lower time frames, I didn’t take them because the higher time frame conflicted.
I studied them, confirmed that they followed a portion of my rules, which gave me yet another data point in my head verifying that my method works, and then I moved on. At the time, I couldn’t emphatically say they were going to be great moves, and that’s what gives me peace of mind.
Since I didn’t distract myself with a mixed bag of trades during an awkward market phase, I was open to setups that did fit my style and rules perfectly. I was able to capture those better moves with more assurance and the rest is history. Knowing your trade is vital to being successful in the markets, and knowing what isn’t your trade will keep your account safe and your emotions in a state of zen.
Over and Out,
Your Profit Pilot.