Hello traders and welcome. We have all traded through different markets. Some markets are responsive markets and have a rational flow, others are super volatile with large irrational swings. As we continue on our trading journey it is important to keep track of the market behavior and how that behavior affects our edge.
For those who are new to this blog and or who I am, I am a Day trader and the founder of The Freedom Grind. I primarily Trade with a heavy short bias (trade the downside action) on lower cap Stocks, This will be my interpretation of the market as it relates to my edge and what I see as the current market condition.
Looking at some of the trades that are most recent we can see some good moves to the upside and then a very slow descent back to rational levels.
GMVD – This stock is a good example of market conditions. Today’s Trading had 2 stocks that had a similar price action, the other being VVOS. The reason it is worth noting how these stocks traded today is because it will give us an idea where our edge sits in the current market. This particular trade would have worked out but only just, as it had a decent grind to the upside but on the downside we stalled.
When I am trying to asses the market condition, I am doing so in a way that will determine how I should approach my trading. (If you trade to the long side mostly, look at your trades and others that fit your strategy – to determine how well your edge fits the current market.) My current interpretation of these particular examples is to go light on my sizing and pull profits quickly. There are other interesting metrics we can use to tell what the market condition is for your edge that we will discuss other writings.
This is a very quick synopsis, If you would like to have a better understanding of the stock market and get good trading info and tips – join the Trading chatroom and click the Chatroom Button or checkout Our Youtube Channel.