Results of Thursday’s Best S&P Futures Turning Points: Shorting 4206.50 stopped out immediately. Same result as yesterday though. Make sure you take the breakout after the failed reversal. This one ran 14 points.
Today’s Best S&P Futures Turning Points (consider wider stops and less size in fast moving markets):
Buy 4182.00 stop 4178.75. Short 4271.75 stop 4277.50.
The World Sentiment Index: (+100/-100) slumps from +50 to +14 with Asia struggling and the west modestly Bullish, Germany’s DAX near a record.
Catalysts: Nothing on the economic calendar. Fed-speak @ 8:45 & 9:00. Powell speaks @ 11:00.
Quick Tip: Hindsight
Have you ever looked at your trade result and thought to yourself “If had a bigger stop it would have been a winner” or “If I don’t use a stop I’ll see more winners because this market just swings up and down.”
What you’re experiencing is hindsight bias. It is your tendency to look back at an unpredictable event and think it was easily predictable. It is also called the ‘knew-it-all-along’ effect.
It's not uncommon to feel this bias. When you combine it with small sample size the pair become lethal. You see something unpredictable happen a few times and now you think you can predict it. Nope.
Don’t beat yourself up over these feelings. Do recognize them. The trigger words I’ve found that lead to these illogical biases are “coulda, woulda, shoulda.” Get in the habit of stopping yourself when those 3 words enter your mind or vocabulary. Analyze the situation for hindsight and small sample size bias.
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