I thought it will help all the traders to create a thread just to post/discuss about definitions/ideas/trading with CONTEXT.
Very recently I realized METHOD or TIME FRAME doesn't matter if you are NOT trading with CONTEXT which is the MOST important factor in both day trading and swing trading.
One can make money with ANY method and ANY time frame and with either with ZERO indicators or INFINITE number of indicators but to achieve CONSISTENCY one MUST understand CONTEXT.
What is CONTEXT?
As per my understanding, there is no single definition of context. It's definitely NOT an INDICATOR :becky: NOT a SCIENCE :becky:, then what is this damn CONTEXT :pcguru:???
To simply put it CONTEXT is an ART of recognizing WHEN to take a trade as per your METHOD/STRATEGY and WHEN to ignore the trade as per your METHOD/STRATEGY.
So for me CONTEXT means finding what is DRIVING the market at the bigger level and at the day to day level.
There can be numerous driving forces but KEY is to find what is the driving factor NOW and using that in your trading.
Few examples of driving forces are Central Bankers, QE, OIL correlation, USDJPY correlation, BONDS correlation,
Small caps correlation, Banks, Techs etc. KEY IS FINDING WHICH ONE IS RUNNING THE SHOW NOW.
Note: This is just my understanding, if anyone wants to add please don't hesitate.
I thank all the traders who contribute and help other traders in FIO mainly these
Inletcap, Big Mike, tigertrader, rahulgopi, Pariah Carey, bobwest, choke35, Narcissus, GruttePier and rocksolid68
wonderful human beings from whom I learned a lot.
My main idea is to post anything that helps us to understand CONTEXT to become CONSISTENT trader.
I will start with Inletcap method, I gathered from some of his previous posts.
Inletcap's Method/CONTEXT trading
Please note NOTHING is CONCRETE in trading if that's the case every trader will be millionaires by now.
I copied this info from GruttePier journal :becky:
To start with, keep it easy- always ask where price is relative to yesterdays hi/lo/close. Where is it relative to daily & weekly vwap/pivots? Does this look like a trend day, reversal day or a range day? Keep asking this all day. Maybe even write it in your journal every hour or say at 10:00, 11:30 and 2:30 to keep it top of mind. Once you know what kind of day structure is likely in play and you have a bias then you focus on how "stretched" the market is (ADR ~ significant price levels ~ etc.)
Here is another example of trading with CONTEXT and method explained by Inletcap (Thanks sir)