Am I ahead of this trade or playing catch-up?

Something I consciously consider at the point of each trade entry is ASSS. That’s somewhat the point—easy to remember. The ASS part (always-in, structure and setup) is understandable to most traders, and I will cover them in a future post. The final ‘S’ is my consideration here and stands for speed.

Speed in this context is getting out ahead of the market. I don’t mean prediction, as that can often lead down the wrong path. I mean being in the moment, focused and seeing and reacting to the signals as they occur. How often do we stumble across an ideal setup (which wasn’t anything a few moments ago) and are now late to the game playing catch-up?

The trouble with catch-up is that often it puts us in the wrong frame of mind. For example, I want the price to return to my desired entry-level if I play catch-up. However, in the same situation, I may exit the trade if I entered already and got a reversal.

But speed has considerations further down the trader’s line too. It involves everything. Probably unnecessary in this day and age, but I’ve dedicated a computer entirely to trading—both for speed and distance from unwanted distractions and clutter. The charts I use and how I organise them for ease and speed of access help define my success (enormously), as is my WIFI connection and, crucially to a day trader, my chosen broker’s connectivity.

Speed, therefore, is a review of my physical and interactive process to ensure my mind is in the right place—focused, open, ahead of the chart, if only minutely—and decisive. As I have said previously, I enjoy considering multiple charts as that helps keep me absorbed. But I make a point of trading one chart at a time. Once I recognise a qualifying ‘ASSS’, I automatically judge my risk and ask, “is this a B trade or better”. Finally, I view the other side of the trade closely—because there is always another side to some degree or other. Am I seeing the beautiful lady and missing the witch?