Trading well means making logical decisions and not ‘what if’ decisions. The spreadsheet I give you each morning allows you to use a step by step decision process that allows you to engage with your trades in a logical flow. I suggest a minimum size of two contracts with understanding of the following:
1- For a more bullish slant on the day, the 4 hour chart is showing both a positive moving average – we use the adaptive moving average (2, 30, 10) and an upward sloping SMI (6, 20) – so focus on pullbacks being buy zones and the charts moving into near term targets.
2- For a more bearish slant on the day, the 4 hour chart is showing both a negative moving average – we use the adaptive moving average (2, 30, 10) and a downward sloping SMI (6, 20) – so focus on bounces being sell zones and the charts moving into near term targets.
YOU DO NOT HAVE TO GET EVERY TICK OUT OF THE MARKET EVERYDAY – That’s a sure fire way to end up losing money. Trading level to level will make you money every day – this is not a space to gamble but to manage your risk.
3- When you breach a target, you always have the option to remove profit. With the sizes that I trade, I will remove profit at each target if my charts are choppy or if I am sitting in congested spaces.
4- The choice to stay in the trade to the next target will always need to be weighed against your likelihood of continuation in the overall trend. See steps one and two to make sure you are sitting on the right side of the trade and don’t move to tighter time frames to assess the overall trend. It will lead you astray more times than it will assist you.