The end of the last full week before Christmas typically marks a slow time in the market due to most traders heading out for the holidays for the remainder of the year. This serves as a good time to reflect on the years activities and what achievements or setbacks were encountered.
Looking back at my trading activities, this year presented a two edged sword of trading difficulty combined with high opportunity. The change in market behavior brought back trading problems of a kind such that if it weren’t for prior experience in successful trading under my belt, would have me questioning my ability to be able to day trade at all.
The key difference with this go around of problems as compared to when I had just taken the deep plunge into trying to master day trading back in 2010, is that I had now developed a methodology that although not perfect by any means, had progressed enough to generate consistent positive returns in an amount able to make a living on.
So this year’s problems weren’t about knowing how to trade, but rather how to make adjustments that would be necessary to deal with the change in market behavior from the prior year- and this is where high opportunity presents itself in being able to solve the puzzle.
Making sense of market price movement is no easy task, but at the end of the trading day you are left with the exact path the market took. This exact path is the answer key that is compared to one’s trading forecast method to determine overall accuracy of one’s trading plan. At this point one can make changes to their plan to try to increase the accuracy of their trading method.
Being able to make the correct changes is the essential key in progression in trading skills. The trading forecast model has to be general enough to allow for a fluctuating market, but specific enough to produce accurate entry and exit signals to minimize one’s risk. This is where many traders spend their time trying in vain to come up with a market model to give them favorable results. However, if one is able to accurately define and lock down a portion of market behavior, the job becomes relatively easier in that you now have part of the path mapped which limits the amount of variables to consider.
Fortunately, I had a piece of the trading puzzle solved last year and another piece was acquired this year but even with this information the answers and market pattern connections did not come easily.
A few years back, I wrote a post regarding the ability to perform high accuracy trading, which I called “The Trading Sharingan”. At the time I wrote that, it felt like I wasn’t too far from developing this level of technique. In actuality, I was nowhere close as my invested time in trading wasn’t nearly as in depth and rigorous as was needed due to other time commitments.
That said, I believe this year’s trading trials and tribulations coupled with extensive analysis have given me the answers needed to perform such high accuracy trading. I’ve back tested older data using my methods and the results are consistent with my current findings.
If my findings and conclusions are valid, this will be the next leap in my trading progress evolution. Going forward, the proof of my new accuracy will be in the level of quality of my trades.