Patience is a Must for Successful Trading!
By Cliff Clark
How patient are you? Are you patient enough to be a successful trader? Do you have the patience to allow for high odds opportunities to emerge before risking your hard earned money on them? Do you have the patience to time your entries with the appropriate environment to increase the odds? Do you have the patience to allow your positions to develop their potential when things are working well?
Some traders are far too impatient. They feel that any moment not spent managing a position is a wasted moment. These traders feel like they're missing out. Perhaps it's the nature of this game. All the flashing and movement on a trading platform mimic the ambiance found in a casino. An ambiance that draws the trader and pushes him to be active. After all that's what we call ourselves. We are active traders.
There is a difference in being active and hyper-active. Being called active is just a way to differentiate ourselves from the longer term investors. It doesn't mean we need to enter into dumb trades because we feel like we're missing out on something!
Trading is about finding high odds events and trading then based on a trading plan. This requires the patience to wait for that event to emerge.
2 trades for me today with +1.5R total
1st Trade QCOM +2R
148.39/149.97 exit 143.25
12% gap down under pivot support and 50ma after a strong daily double top rejection,. I took it on a congestion breakdown with a fairly wide stop, leaving my 2R target 50c over its ATR, slow but consistent move down with great RW, hit my target on the penny before it bounced.
2nd Trade AQB -0.5R
9.40/9.70 exit 9.56
I rarely trade stocks under $10 and even more rarely short them. I liked this daily chart as it broke its uptrend channel and stayed under a strong 9.50 support line enough room to its daily 50ma. I entered after a pullback with a fairly wide stop but only 1/3 of its ATR used at the time. It failed to break down with the strong market open and stayed in a narrow range.
I actually broke my plan with this trade as I lowered my stop to a pivot where price made a big bounce earlier at 11am with a large seller sitting there. My thought was that if it breaks that level again then it will likely...
1 trade for (-1R)
I took a BD on QCOM. I was worried about the target being close to the daily range, so I took a tighter stop on the 2 min chart. I am looking through PTS right now, most of the examples have 2 options for where to put your stop. It looks to me like one of the stops would be at the bottom of the main consolidation area, and the other at the bottom of where there has been a shakeout or turnaround bar (if there has been one). Due to the daily range I took the tighter one on this. In hindsight it seems obvious to take the wider stop, but in the moment it looked ok.
I was then looking at the 15 min 3BP on QCOM, but the reason I used a tighter stop in the first place was because of the range. The 15 min 3BP would have needed to have gone even further than the wider stop on the 2 min BD, so I didn't take it.
