-TopstepTrader-

This applies: John Hoagland's Scouting Tip of the Week Part of being a consistent trader is a constant and creative acceptance of the information the market is giving you. No matter what tools or charts you use, the price action has already happened. Through journaling, study, and repetition, traders can develop a sense or intuition for price action in the present tense as well as a recognition for when the other short time frame traders are on the wrong side. At times, catching these traders in a "one sided" position can be the main reason for taking trades, even counter trend. Pit traders always watched for conditions where the pit was "too long" or "too short" as this situation is a catalyst for some good market moves. It's a very popular question for off floor customers to ask their broker, "Is the pit long or short?"

Funded Trader Trade of the Week James Dalton had it right when he said, "The best trades often fly in the face of the most recent market activity." Our trade of the week is a great example of this Dalton quote. One of our ES traders truly acted as an innovator with his impressive trade. After a convincing short term bear trend, sensing falling volume in the direction of the trend, he entered a long position at $1598.25 with a 10 tick stop. Waiting patiently and giving the market the chance to retest the level, a reversal in the trend yielded him $362.50, a profit almost three times the risk. In a longer time frame, this turned out to be the low of the day and by the close could have been worth over two thousand dollars per contract. John Hoagland’s Scouting Tip of the Week When I was a beginning trader, situations similar to this Trade of the Week had me selling lows, buying highs, and scrambling to get out when the market turned against me. With coaching and experience, I learned to recognize this urge in a different way and change my response. It wasn’t easy and this was pit trading, but it still comes down to reading the volume and recognizing the change in participation. Sensing the rejection of price levels early, as well as creating correct intuitive response to your emotions can help you see these situations and respond accordingly. A BIG word of caution: I am in no way suggesting it is good trading practice to try to pick bottoms and tops. Vast experience is the only way to learn to trust TRUE intuition where these locations might be. These are not only some of the most difficult trades to identify and execute, but they can be risky. In fact, old school traders used to call it "standing in front of a freight train."