Using Discretion Over Specific Rules

Each morning I go through the usual preparation rituals. I'll glance at the charts, but I won't actually get in the market unless I see enough range or pace. It doesn't matter if I see patterns. Otherwise, I risk getting in and getting chopped up. I Prioritize volatility over structure accepting a setup or two might be missed - whatever it takes till I am convinced to risk my money.

I never agreed with the saying: "Trade each instance of your method". It sounds like the thing to do in the pursuit of behaving casino-like. Unfortunately, the markets do not steadily pay what we think are setups with an edge. Let's say you trade pullback setups when the structure is HH and HL. When there are HH and HL does buying always work?

I don't think so!

The markets make HH and HL all over the charts, but you would argue it's not always in a trending state. Ever notice ranges also have HH and HL? The books don't point that out. This is why the general definition of what constitutes an uptrend is too vague, actually quite useless - all it is good for is to teach beginners the basics of identifying a trend.

If this was the World Series of Poker you wouldn't hear anybody explain which hand beats which - everyone competing should already know the basics! Yet with Trading we often see people cling on to such rudimentary concepts as though they matter, as though they retain an edge.

Yes, it is good to be a buyer in an uptrend, but you have to be aware of the time of day, the range and whether it makes sense to be trading in it. Then there's also the method you employ to enter. Some traders buy as new highs are created, while some buy on retracements. There are all kinds of variables which can affect how your trades will do compared to someone else even though you're both trading the same uptrend.

Asian session often dies ahead of the London Open. This makes London appear like a sudden burst of activity. If they try to break to new highs I won't buy a breakout pullback (bpb) or short a breakout failure (bof). I don't care about patterns, but the reaction. If it just sits there it means all they did was try to trigger stops with no intention of taking it anywhere after that. So why should I get in? To make money I need to know it will MOVE AWAY. I don't know which way, but I need to see clues there was a purpose to the initial push.

I wish I could begin my day at 3pm, trade for 3 hours and count my winnings. The problem is they don't always start at the same time, nor is the volatility predictable. It is empowering to know trading has a lot of uncertainty and I have the ability to figure it out. Otherwise it would all seem so random. It kinda is, but there are moments of logic out there.

Letting them show their hand first means I will often miss the initial explosive move. But from there I trust I can read the reaction and which way to trade. Does it collapse right back into the range? Or does it pull back orderly and hold? The former tells me to play reversal style and the latter is for trend continuation. Throw in a partner pair and the puzzle becomes clearer. All I can do is piece in the clues until I have a picture in my mind. It will never be perfect. The charts will always look slightly different, but the key is to use all of my experience to know where the edge is. There is freedom in not needing to be accountable to anyone for my choices. In the end what I have deduced will be reflected in my results.