When I’m mentoring one thing traders are surprised at is my ability to “stay with the move”. This is a common struggle of many traders as they try to reach that next level in their trading. Just this one skill alone can go a long ways toward getting you to that next level. The ability to “stay with the move” and trade the move is essential for an intraday trader and even for swing traders. Why is this hard for so many? I can think of a couple of reasons.

1)  Lack of confidence in their initial analysis.
2)  The fear of giving back some profit.

How can a trader overcome this? My answer is to get better with your tape reading skills.

I know, you’re thinking there he goes again with this tape reading stuff. I’m sorry, but there is no quick-fix magic potion. If there were such a fix I would have taken it 11 years ago and been a pro instantly. The truth is that it takes work and, yes, that dreaded word: time. And keep this in mind as well: if you try to improve this skill on your own without some training it will probably take longer to master.

Staying with the move, when trading an “in play” stock, requires the ability to read the order flow in that stock. By virtue of the sheer volume being done, reading just this order flow will be sufficient most times. Tape reading the second, third, and fourth day plays along with technical setups requires the ability to read the tape with regard to overall market conditions. Although these plays can still have a great range, the order flow may not be enough to utilize it solely. Also, the robots should be more active in the plays without the huge volume.

As for slower time frames, I marvel at the ability of @TraderFlorida (on the StockTwits stream) to “stay with the move” and tape read the swing-trade time frame. I’m pretty sure that if I ever got to meet and ask him how he does it he would say it took hard work and study to hone this skill. I have the skill on an intraday trader time frame, but I read closely what he writes to help expand my skill on the next higher time frame and incorporate that in my intraday trading.

Expanding your tape reading skills should help cure traders of their struggle to stay with the move. To understand what you see in your tape reading should breed a new-found confidence that enables you to overcome this problem. The second reason will require a separate blog post in the near future.

Jeff Davis           @Shaq48_Trading

You can be better tomorrow than you are today!

Mike Bellafiore

One Good Trade
The PlayBook

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