One of the constant factors in business, and make no mistake trading is a business, is the potential force of external events. You can take a trade according to your plan and if someone bigger and with more resources takes the other side of the market you will be stopped out. It happens all the time.
Another external factor is news and opinion. You will be barraged with news every.single.day. Which is fine. Opinions are fine too, but you need to determine whether they matter.
Nine trading sessions back the most dependable signal inside Exodus triggered, the Historical Hybrid Oversold signal. This algorithm has 73 samples under its belt. Most of the stat guys I talk to say it takes 50 samples to be statistically significant–I agree.
So when this algo triggers, I pay attention. It triggered on Friday, June 24th aka the day BREXIT was made official. That meant your job as a trader was the gird your loins and buy the market Monday. Monday was a real bloodbath, if you recall, but there was a slight hint at the end of the day–a failed auction in the NASDAQ and an afternoon ramp across the board. It was time to buy. The result?
The best performing algo signal of the year. You throw some leverage behind this and you made upwards of 20% in less than 2-weeks.
I always tell Exodus members that if they can execute the 36-month Hybrid Oversold signal consistently, not missing a beat, they are well on their way to becoming a consistent trader. This is how you build discipline. You start with a very simple trade, you master it, then you add another to your repertoire.
It seems so easy, but it is not in practice. Trading can be simple if you let it be. At the end of every single Strategy Session (we are approaching 100 consecutive weeks) I write, “Trade simple”.
Simplify all your businesses to the point you can execute them no matter the external factors, and if you have been blown off your feet by a catastrophic event–take a step back. There will always be another trade.
Distinguished members of Exodus, it is my honor to serve up the 87th edition of Strategy Session. It is live now, go check it out!
PS – iBankCoin research suggests we could see a calm week of sideways consolidation.
If you enjoy the content at iBankCoin, please follow us on Twitter
NAILED IT!
also this song is good