This is a VERY useful question to ask yourself as a trade is setting up:
-
If I could only take one trade this hour, would I be happy to make it this one?
Of course, adjust the time to suit your style of trading. One trade per half-hour, per 4 hours, per day, per week… whatever suits your trade frequency is fine!
This question forces you to step back away from the excitement of the price action and the nervous tension associated with entry, and to briefly consider the quality of the trade.
If I could only take one trade this hour, would I be happy to make it this one?
If the answer is an obvious YES… take the entry.
But if there is any doubt… consider passing or waiting for more information.
You don't have to take every trade. A question like this can be useful in filtering out the lower quality trades. Give it a try!
YTC Price Action Trader references:
So would I take this trade?
If I could only take one trade this hour, would I be happy to make it this one?
ABSOLUTELY YES… EVERY TIME!!!
It's important to note the following:
- I am NOT actually limiting myself to only one trade hour. There is no restriction to the quantity of trades. What I'm trying to do is restrict my trading to the higher quality opportunities. Those of a high enough quality that… were I limiting myself to one per hour… I'd be happy to make it this one.
- I am NOT suggesting that they will always be winners. I get a lot of losers. But every one of them is also a trade I'd have been happy to take, were I limiting myself to one trade per hour.
- I am NOT suggesting that these trades should always be held for multiple-R returns, as achieved above. Certainly when the price action and market structure suggests potential for follow-through, you should target it. But if the environment suggests a more rangebound market with only 1R potential, and you have a trade setup offering a high degree of certainty, then take it. Assuming of course that it's one of such high quality, that were you to limit yourself to only one trade this hour, you'd be happy to make it this one. Enter… and adjust your trade management and trade exit plan to suit the conditions.
So… give it a try and see if this helps you.
As the potential entry is approaching, as yourself:
If I could only take one trade this hour, would I be happy to make it this one?
Let's aim for quality trading rather than quantity!
Happy trading,
Lance Beggs
Hi Lance,
The 1st image in this post was quiet eye opening. Can you please shed some light as to why on Oct 1st, you picked the highs from Sept 25 and Sept 23 and not the Highs and Low’s in between Sept 25th and Oct 1st?
Reason I ask is a couple of my challenges are:
Not sure which Highs and Lows to pick for S/R
Thank you,
Nick,
There are no other highs in this area. The highs from 24/8, 28/8, ,29/8 were all further down below the prior day’s high (30/9) and played no part. I’m not sure what levels you are referring to.
If you’re seeing something different, please feel free to mark up a chart with comments to show what you’re seeing, and email it to me at support (at) yourtradingcoach.com
Cheers,
Lance
Yes, sorry. I looked up the chart myself after I posted.
My question was more in a generic sense though – Do you typically mark up 2-3 highs’ and lows from the past outside the current price as areas to watch for S/R and then price on smaller timeframes?
Thank you
YTC Price Action Trader goes into detail. But this is essentially correct. They’re selected from higher timeframe swing high points, or session high/low if just using the pit session charts.