May 21st Plan

A lack of patience continues to plague my trading. I develop plans that ultimately work amazingly well. Yet, while watching the charts, I start to focus on potential opportunities to make money. I zoom into the 3m chart. I justify an entry for a trade. I take the trade. Then by the time the trade that the plan mandates to take, I've already made the profit for the day or burned through my capital and confidence.

It either becomes incredibly clear because I'm out of capital or it just always eventually becomes clear and I just have to be incredibly patient.

Today I will choose patience.

The 10m chart and plans lend it self to huge gains. By zooming into the 3m chart and forcing trades I'm required to size large to get returns. That is not how to protect capital.

Perfect example at noon today... This is how the chart looked when I started my day.

A 4h chart that had closed below the 21e after holding as support. An hourly chart with a bearish ribbon. But, a 10m chart that had flipped solidly bullish. Despite the bullishness I was not willing to get long because we were 1. so far from the ribbon 2. so far from the previous swing low 3. at supply from yesterday. I immediately went into thinking puts at resistance. That is not enough of a setup so I then was looking for an M. A higher high on the 3m into resistance with a lower PO value.

We got exactly that. An attempt to break the previous high, followed by a quick rejection tweezer top. This was my justification for entry and a good one at that.... on the 3m chart for a scalp yes. I sized large because I had a proper setup and entered at resistance. But, I exited because we weren't able to break down. Which frankly should've been expected because the 10m chart was clearly bullish in the ribbon and waiting for a 10m divergence / rejection would be far more meaningfully. Regardless I made profit albeit a tiny return. Which makes sense because the trade was based on the 3m chart.

Now, had I waited for the 10m chart....

The thesis was right. We were extended from the ribbon and the previous swing low and running into yesterdays supply. The right mindset was puts at resistance. Using the 3m chart as justification for entry lends itself to 3m chart sized moves. Where as if I could've waited on the 10m chart...

We got a big push higher. Which in the moment I likely would've felt annoyed I missed it, because the right play in that case was calls at support. (Calls, where I correctly exited my puts, were $24 and ran to $29, +20). I know I would've felt fomo or chased because it was going higher. In reality, my analysis played out. We then had a high volume 10m bearish engulfing candle. That alone was more than enough justification for entry. Puts were at $20 (I entered 30 minutes prior at $19 and took profit by $21) and at the next level down hit $27 (35%), then $50 (150%), and peaked at $73 (265%). It's the 10m chart that produces proper day trades with real movement. Even more convincingly, after the 10m bearish engulfing candle, the 3m21e finally flipped red and should've given me confidence and a clear technical stop loss for puts.

It comes down to waiting, waiting, waiting until it's hilariously clear on the 10m chart. Being okay with "missing" smaller movements. Then only needing to size very small to get outsized returns. 20 to 27 to 50. 2 cons, 1 exit at +$700 and and 2nd at +$3000. I make this more complicated by not being patient enough for it to become easy. The hardest part is patience.

Okay, well now that the big move has happened what's the plan from here? First off, it's to stay and wait for the 10m candles, period. Just do less.

We're in a clear down trend. Hourly is down. 10m is down. But we are far from the ribbon and far from the previous swing high and finding support at the demand zones from the middle of last week, which also happens to coincide with the daily 8e.

I could see us retesting the low and then continuing or bouncing with divergence. The entry point for retesting the low would be at resistance / the ribbon. However, the swing high is very distant from where price is, so we could easily rip up before any continued move down. Given the freshness of this mornings trade and the fact I'm in profit for the day. I will just wait and see on the 10m. I am okay not taking another trade. I am okay missing moves I may have anticipated. I will wait for a clear setup on the 10m.