Hey Trader,
I love trading.
So, days when I have to step away from the market aren’t much fun.
When that becomes a full week, that kinda sucks.
After years of working my way through bull and bear markets, I know when to play and when to walk.
In fact, my Golden Setup Indicator codifies this into a simple reading.
However, when you sit through days of violent market moves without taking a single trade, you start to wonder whether it’s time for a change.
That’s why it’s worthwhile to log not only the trades you take but the ones you don’t.
Instead of taking real losses, look at the trades you avoided on paper. It costs nothing and helps you rebuild trust when you need it most.
I don’t care how long I’ve been trading. These FOMO feelings always creep up.
That’s why I took some time this week to walk through the trades I avoided.
I wanted to PROVE to myself the value of stepping back and the Golden Setup Indicator.
Yet, it didn’t go quite the way I expected…
Volatility isn’t Enough
Traders need volatility to exist. But there’s a balance.
You want enough to make it worth your while, but not so much that it creates huge losses.
This market, right now, is TOO much.
My Golden Setup works off very specific levels and parameters I built and tested over years.
I will NOT try to adjust them. I have no reason to.
Sure, it’s no fun watching price jump around while you’re sitting on your hands.
But you know what feels infinitely worse? Blowing up your account.
Wednesday was a perfect example of this.
The chart above highlights the lack of trades we took in the Golden Setup room.
I want you to focus in on the gold (yellow) lines.
Notice how price blasted through it on nearly every touch?
That’s not what I want to see. For my strategy to work, price needs to not only hit the levels but come in the right way.
What do I mean by come in the right way?
Without giving too much away, price needs to hit those levels directly, without any stops, and then bounce, not blast through.
I need the movements to stay within predictable ranges. Otherwise, I’ll get stopped out too often or eat a massive loss.
Were there setups that did work on Wednesday? Absolutely. There were many.
But, they were outweighed by the ones that didn’t.
Now, let me state the obvious: There are days I wouldn’t trade that would have turned a healthy profit.
Some, even a huge profit.
You can’t look at the results of any one day, or even several and draw definite conclusions.
You need to collect data over time, under different conditions and market environments to truly understand what works and what doesn’t.
Method Over Madness
I cannot stress enough the importance of a plan and sticking to it.
I see more traders lose their shirts when they adjust a stop loss, or even worse, never bother to set one in the first place.
Markets will screw with your emotions.
You fight back with order.
Stick to a strategy that works for you. Don’t worry about the P&L day to day.
Instead, focus on eliminating bad decisions – the ones where you break the plan.
Only then can you evaluate whether your strategy will stand the test of time.
Now, there’s no reason for you to start from scratch.
My Golden Setup methodology was born in the pits of the CBOE and has lasted me week after week, month after month, year after year.
Do yourself a favor and start with a foundation built on success.
Trade smart,
Tony Rago
Creator of the Golden Setup
