So what was the rationale for being in the trade in the first place? Aside from the fact that it broke 'support levels', was there any other variable that was affecting the price moving down?
Sometimes these trades turn around and come back a second time to let you out...some call it Kiss and say goodbye...its was your last chance..
This was a trade in NQ on Wednesday. On the Tuesday I managed to buy near the bottom and rode almost the entire move up and cashed out about an hour before the close. The daily candle closed so strong that I decided to buy into the contract again in the after hours session. For what ever reason I was looking at the daily close more then the Intra day big charts, I did not notice the fact that were actually at the leg start that gave us that low on the Tuesday which was a lower low then Friday's low. Basically I bought the test of the high that gave the low, where I should have actually be shorting according to my strategy. I did not think it will be possible to get below the Tuesday low so I added contracts as we went down. I was terribly wrong in this case and got my position liquidated.
Have you ever considered that it is your approach to trading that is costing you money rather than your trade management? I think that you will continue to be adversely selected by better informed traders so long as you're making decisions based exclusively on technical analysis.
I strongly believe my trade management is the issue. My market reads are very robust and I am right a good percentage of the time, I do also take smaller losses on trades that quickly invalidate my entry. The issue is when things happen quick and I don't react fast enough. This is why from now on HARD STOPS will be a MUST on every single trade. Now mind you, I will get taken out of good trades occasionally. I am now at peace with this. Before this fear of getting stopped out and having a trade return would make me feel very uncomfortable but I now understand that it is just the cost of doing business to be picked off once in a while. This is far better than the alternative. The price structure that I trade, if a level (zone) gets violated, its usually not a good sign for my trade idea anyway. I actually traded Thursday and Friday with hard stops (first time in MONTHS), and my psychology was a lot more calm. This is the way to go from now on. Maybe at some point in the far future I will be able to trust myself to trade again without hard stops but it is not now. Most of my futures trades last from a few hours to a day or two. I do have some longer term un-leveraged positions but no real issues there. What can I base my analysis for short term trades if not on price structure and trend analysis?
Analysis based on price structure and trends is not relevant to anything. No market participant that is actually effecting the short (algos excluded) to long term direction of the market is trading on this information and neither should you be. Rather, present values vs anticipated future values are generally where large participants are willing to stake large amounts of money. You trade the NQ... how well do you know your index?
Oh boy..... I got over this one just as soon as I managed to allow "little losses" turn into big , humongo, shake you to your core losses. I guess this is something you learn the hard way.