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Before You Take That Trade: Strategic and Tactical Questions
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Before You Take That Trade: Strategic and Tactical Questions

  #1 (permalink)
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Before You Take That Trade: Strategic and Tactical Questions

In clarifying my own trading principles, I came up with a list of strategic and tactical questions to ask before taking a trade. Most traders do not seem to distinguish between the two... which I think is a mistake. Strategy refers to context, while tactics refers to setup. To me, these are two sides of the same coin, and both are needed for good trading. Enjoy.

Strategic Questions (Context):
Is the market trending or in a range?
If it's trending, is it on the extreme or in a pullback?
If it's trending, has there been climax?
If it's in a range, is it on the edges or in the middle?
What would have to happen in order for the state to transition? (range to trend or trend to range)

Tactical Questions (Setup):
Is the context right for my setup?
Is my setup present?
How good is the setup? (positive factors vs. negative factors)
If I enter, does it have room to run at my RR ratio?

"...the degree to which you think you know, assume you know, or in any way need to know what is going to happen next, is equal to the degree to which you will fail as a trader." - Mark Douglas
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  #3 (permalink)
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I think along similar lines, but also consider trapped traders....

Strategic Questions (Context):
Is the market trending or in a range?
If it's trending, is it on the extreme or in a pullback?
If it's trending, has there been climax?
If it's in a range, is it on the edges or in the middle?
What would have to happen in order for the state to transition? (range to trend or trend to range)
>>>> Where are the potential trapped traders and where do they feel pain if the market goes against them?



Tactical Questions (Setup):
Is the context right for my setup?
Is my setup present?
>>>>> Are their trapped traders exits inline with my setups entry locations?
How good is the setup? (positive factors vs. negative factors)
If I enter, does it have room to run at my RR ratio?

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Anagami View Post
In clarifying my own trading principles, I came up with a list of strategic and tactical questions to ask before taking a trade. Most traders do not seem to distinguish between the two... which I think is a mistake. Strategy refers to context, while tactics refers to setup. To me, these are two sides of the same coin, and both are needed for good trading. Enjoy.

Strategic Questions (Context):
Is the market trending or in a range?
If it's trending, is it on the extreme or in a pullback?
If it's trending, has there been climax?
If it's in a range, is it on the edges or in the middle?
What would have to happen in order for the state to transition? (range to trend or trend to range)

Tactical Questions (Setup):
Is the context right for my setup?
Is my setup present?
How good is the setup? (positive factors vs. negative factors)
If I enter, does it have room to run at my RR ratio?




This is a perfect set of questions to ask before initiating a trade. Thanks for starting this thread @Anagami

Once market context is clear then mind context has to be examined, if everything ok then the trade can be initiated.

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  #5 (permalink)
Live Your Bliss
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tulanch View Post
I think along similar lines, but also consider trapped traders....

Strategic Questions (Context):
Is the market trending or in a range?
If it's trending, is it on the extreme or in a pullback?
If it's trending, has there been climax?
If it's in a range, is it on the edges or in the middle?
What would have to happen in order for the state to transition? (range to trend or trend to range)
>>>> Where are the potential trapped traders and where do they feel pain if the market goes against them?



Tactical Questions (Setup):
Is the context right for my setup?
Is my setup present?
>>>>> Are their trapped traders exits inline with my setups entry locations?
How good is the setup? (positive factors vs. negative factors)
If I enter, does it have room to run at my RR ratio?

That's important too... all good contexts/setups have some trapped traders screaming for air. Both tactical and strategic.

Do unto them, before they do unto you. j/j

"...the degree to which you think you know, assume you know, or in any way need to know what is going to happen next, is equal to the degree to which you will fail as a trader." - Mark Douglas
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Live Your Bliss
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iqgod View Post
This is a perfect set of questions to ask before initiating a trade. Thanks for starting this thread @Anagami

Once market context is clear then mind context has to be examined, if everything ok then the trade can be initiated.

@iqgod , I'm curious if people think that one can be successful on purely tactical considerations (i.e. setups only). I think there are some traders out there who would argue yes... from their own experience. Perhaps the answer is that all good setups include strategic elements as well.

"...the degree to which you think you know, assume you know, or in any way need to know what is going to happen next, is equal to the degree to which you will fail as a trader." - Mark Douglas
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  #7 (permalink)
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Yes and No


Anagami View Post
@iqgod , I'm curious if people think that one can be successful on purely tactical considerations (i.e. setups only). I think there are some traders out there who would argue yes... from their own experience. Perhaps the answer is that all good setups include strategic elements as well.

@Anagami I would argue that context is king and an emotionally fit trader would still be able to capitalize if he is right on context.

However a trader who sees head and shoulders in a bunch of candle bars which look more like cumulus clouds is seeing nails because he holds a hammer in his hands.

But again, it may work if he is deftly cutting losses and riding winners properly.

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Anagami View Post
In clarifying my own trading principles, I came up with a list of strategic and tactical questions to ask before taking a trade. Most traders do not seem to distinguish between the two... which I think is a mistake. Strategy refers to context, while tactics refers to setup. To me, these are two sides of the same coin, and both are needed for good trading. Enjoy.

Strategic Questions (Context):
Is the market trending or in a range?
If it's trending, is it on the extreme or in a pullback?
If it's trending, has there been climax?
If it's in a range, is it on the edges or in the middle?
What would have to happen in order for the state to transition? (range to trend or trend to range)

Tactical Questions (Setup):
Is the context right for my setup?
Is my setup present?
How good is the setup? (positive factors vs. negative factors)
If I enter, does it have room to run at my RR ratio?

Nice. Thanks. I have a few monitors. And wallpaper made up of quotes that I can burn into my brain. I still have a couple monitors spare. I will put your quotes on one of them. That's exactly the thinking I need to manifest.

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