Listen up, Evolvers. This needs your attention…
As the market was closed yesterday, we’re heading into a shortened week of trading. I’ve seen short trading weeks go a few different ways…
Sometimes, price action is muted due to traders traveling and less overall volume.
Other times, if major catalysts occur, the condensed nature of the trading week can lead to heightened volatility.
Hopefully, you spent Monday studying and preparing for the week ahead by building your watchlist, going through your recent trades, and identifying potentially actionable setups.
But personally, I need to remind myself of a few important notes about my trading this week.
And who knows, you might need to hear these things just as much as I do.
Keep reading and I’ll show you…
Leave Last Week in the Past
Some traders tend to let the sting of their losses — or the overconfidence from their wins — carry over into the following week.
But as we begin this short week of trading, I want you to avoid bringing past emotions (or any emotions, for that matter) into the present.
Now, that doesn’t mean you should forget about valuable lessons you’ve learned from your past trades. I’m not saying that…
I’m simply suggesting that you start the week with a fresh outlook, unaffected by the feelings that prior trades have brought you.
Of course, this is easier said than done (take it from me)…
On the other hand, overconfidence can also be a trader’s worst enemy…
If a string of lucky wins have you feeling invincible, you may find yourself overtrading or oversizing your positions.
All this to say, don’t let your recent results affect your decision-making this week.
Every month, every week, and every day is a clean slate in the stock market if you choose to treat it as such.
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One Trade at a Time
If you’re trying to track too many trade opportunities simultaneously, you risk missing the ones that matter most.
For most traders, this means having no more than two or three charts up at a time.
Our brains can only pay attention to so many things at once.
Even if you have three charts up on your screens, you can only truly focus on one at a time.
Think about it …You can’t go to a theater and watch three movies at once.
A vital part of being a great trader is having the skill to identify a five-star setup from a slightly less perfect one.
Then, you should zero in on the ‘play of the day’ and tune out the noise … especially if you’re not yet consistently profitable.
Let me tell you a cautionary tale about overcomplicating things from my recent trading…
The Dangers of Watching Multiple Charts at Once
At the beginning of June, I faced a serious decision dilemma between two setups — Palantir Technologies Inc. (NYSE: PLTR) and Nvidia Corporation (NASDAQ: NVDA).
PLTR was a relatively new chart on my watchlist. It wasn’t my bread and butter.
However, the chart was overextended and it caught my attention.
I bought puts on the stock too early, the chart cracked my risk level, and I cut the position for a 50% loss.
But that’s not the worst part…
Simultaneously, a beautiful setup was forming in a stock I had been watching for as long as I can remember … NVDA.
Because I focused on a questionable play in PLTR, I missed a five-star opportunity to buy puts on NVDA at a perfect $402 rejection.
I should’ve been focusing on NVDA, a chart I’m familiar with that I know can deliver incredible setups.
Instead, I got distracted and failed to zero in on the best play possible.
That’s why I’m reminding myself — and you — to focus on one play at a time.
When we face a shortened week of trading, it’s hard to know exactly how the price action will react.
But by leaving last week in the past and taking your setups one trade at a time, you’ll be better prepared than those who don’t.