Decision Point trading method is in public domain for more than two years now. I am very happy to note that many people are trading the method very consistently and profitably. But still a lot of readers are struggling and not getting the desired results.
In an earlier article titled “Slippery Slopes”, I have written about the process of trader development. It includes defining a structure, finding tactics to trade the defined structure and deliberate practice to gain execution mastery. Here we have a well defined structure and effective tactics to trade that structure. For the time being do not tamper with these.
Almost two third of the work is over. Now you need to work on execution consistency. To execute the method consistently without hesitation three things are needed.These are knowledge of concepts, belief in the method and, trust in our own ability to execute. These will not come easily. It may take some time and you need to survive in the market till it clicks.
If you proceed systematically, you can cut short this learning curve without serious damage to your capital, financial as well as emotional. Let me explain how to go about this.
- Read all the important posts repeatedly so that you will have a thorough knowledge of the concepts. Go through the past trades posted to know how the concepts are applied in real trading situations. Do not skip the comment section
- Go through the historical charts and mark the trades on them on your own. Do it slowly and write down the reasons for your action and inaction. Do it at least on hundred charts. More the better
- Simulate the trades with a software analyzing bar by bar replay. Do the simulation on at least a year’s data. More the better.
- Watch the market live and identify the trades. Entries and exits. Do not trade for a month with real money. Do it till you get a feel of the price action as it unfolds.
- Go live with a single lot. Focus on execution rather than on money. Your aim is to perfect your execution.
- Focus on a single pattern first. I will recommend the BOF. For a month do not touch anything other than BOF
- You need to wait patiently till a good setup appears. The “Itch” to trade should go.
- In trading quality is more important than quantity. Trade less and win more. Skip low probability trades because losses can add up quickly in day trading.
- Cut your losses quickly. When in doubt get out. Preserving the capital to fight another day is the first priority.
- Finally do not mix and match any other concepts with this initially. Once you gain experience you will know what goes well with this. You can have whiskey on the rock or with water, soda, and cola. But never with buttermilk. .
Slow down and always under trade. This is purely a discretionary method. You need to train your brain. It will not happen in a day. Please do allow enough time for it to get hard wired and develop “Schemas”. Remember this is a skill with life long utility and be willing to go through a little hardship.