🚨Thread on how I personally find my edge trading $SPY 🎯
I used to be like a lot of people where I would try to play 20 different stocks every day. I was having a really hard time and that's because I didn't really know how these names moved nor did I have an edge trading them.
I used to be like a lot of people where I would try to play 20 different stocks every day. I was having a really hard time and that's because I didn't really know how these names moved nor did I have an edge trading them.
When I finally started to have success was when I took away that huge watchlist I would have every day, and decided to only trade $SPY. I took away all the bullshit indicators I was trying to use and I got really good at drawing supply and demand zones.
What you need to realize is that every single indicator is lagging, the only thing that isn't lagging is price and volume. So I started heavily focusing on price action and volume along with my Supply and Demand zones and this is where I found a true edge in the market.
I found a way to draw zones that works very well, its not the typical way, but I found that it works best for me. This is why I tell people not to use those indicators that auto draw zones or levels for you. The reason I trust my zones and I have confidence to trade them
is because I drew them, and I know what I was seeing in those areas. I'm not just trusting some computer generated shit. One of the biggest keys to trading is having confidence in your trades, if you don't then you will act with your emotions and not execute properly.
During this time of only trading $SPY I realized that it is very important to be familiar with what you're trading and to know how it moves. I became very good at recognizing areas that $SPY likes to react to and being able to interpret the volume intraday to give me an edge.
You also need to know what the biggest holdings and sectors of $SPY are doing. I watch $AAPL $AMZN $MSFT $GOOGL on a separate monitor. Take Friday 1/6/22 for example. every single tech name was in demand and $SPY was holding 380 psych level. This was a great indication that
$SPY could reverse if all of these tech names found buyers in demand. Well they did and this was the result and how you could have caught the bottom with amazing R/R on Friday. This is why supply and demand is so great. While a lot of people are taking puts on a breakdown of 380
I knew that tech was at a likely reversal spot and was able to catch the bottom.
Now sometimes you might see the tech names moving and $SPY isn't reacting as much. and that's because some other sectors might be holding it back. This is where you can make some amazing trades.
Now sometimes you might see the tech names moving and $SPY isn't reacting as much. and that's because some other sectors might be holding it back. This is where you can make some amazing trades.
I watch $XLE $XLF and $XLV intraday as well. Now say all the tech names are pushing up, but $XLE and $XLF are selling off but coming into a demand zone. I watch these other sectors to see if they catch a bid in demand, because if they do and all the sectors of $SPY are seeing
buyers then $SPY can get rapid movement one way or the other. This works great for quick scalps as well.
I also will not take any trades during the dead period or anytime where spy is seeing low volume. This is where people over trade and get smoked and give back their gains
I also will not take any trades during the dead period or anytime where spy is seeing low volume. This is where people over trade and get smoked and give back their gains
or take big losses. Only trade when you have an edge, and when there is low volume the edge just isn't there. You will have to be okay with missing some moves, but in the long run this will save your ass. Volume trumps everything
So this is just a strategy that I have found works best for me and I can be consistently profitable while trading. BUT, this is just a small part of being a successful trader long term. 90% of it is psychological.
You can have a great strategy, but if you can't execute without
You can have a great strategy, but if you can't execute without
emotions then it doesn't mean shit. You can be the best technical analysis person in the world, you still won't be profitable if you can't execute without emotions. (Trust me its half of the twitter furus, dont let the nice charts deceive you)
my next thread will be on what I did to master my emotions while trading. and THAT is what ultimately pushed me to the next level and allowed me to change mine and my families lives. For now i would recommend reading "trading in the zone" my Mark Douglas. Hope this helps!
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