Some days the markets are just messy. Choppy price action which does it’s best to whip you out of a trade before it moves on without you.
The best way I’ve found to manage this (apart from just standing aside) is to accept the chop and work WITH it through focusing and finding a re-entry point. PROVIDED you assess the edge to still be present.
It’s no surprise to long-time readers of YTC that I’m a fan of re-entry.
Some articles from the past –
- https://yourtradingcoach.com/trading-process-and-strategy/would-re-entry-improve-your-edge/
- https://yourtradingcoach.com/trading-process-and-strategy/the-psychology-of-re-entry/
- https://yourtradingcoach.com/trading-process-and-strategy/proving-your-edge-in-re-entry/
- https://yourtradingcoach.com/trading-process-and-strategy/the-mindset-required-for-re-entry/
- And dozens more with trades that required re-entry, if you want to search the archives. These were just the ones with “re-entry” in the title.
And yet I constantly come across people who struggle to do this.
It requires a change of mindset.
And I get that this is hard to do.
But let’s see if we can make it easier, through REFRAMING the situation.
Let’s trade…
At this point I’m sick of the chop. I’ve clearly not read this well in that my expectations of continuation were never playing out.
STAND ASIDE. Box off the area. And wait for price to break clear.
The current state of play: Re-entry of trades one and three offered small additional profits. Nothing significant in that neither ran beyond current structure.
The next trade though, number four… it’s the one that shows the value of maintaining a re-entry mindset.
That’s a nice way to finish a rather scrappy day. Finally, a trade that runs. Only caught because I did not allow myself to wallow in frustration after the failed trade from S to U.
A flat position is NOT trade over.
If you struggle with re-entry, try reframing trade exit to something more effective.
A flat position is a REASSESS POINT.
A time to focus. A time to look again at the price action, with a clearer mind that has no risk exposure.
Is the premise still valid? Great, get back in.
And if not, NOW the trade is over.
Review the links at the top of this article for more on the concept.
And consider whether or not re-entry might have a place in your trading.
Happy Trading,
Lance Beggs