Skill of Execution = when entering and exiting a trade=you develop the skill but it never is completely Mastered and will constantly require reprocessing going through stages of refinement...
When working with experienced players it becomes much more a question of refinement and showing them how to apply what they know to the best effect given the situation at-hand.
The working words here are..."apply what you know to the best effect given the situation at-hand."
And what is the situation at hand...is the Market becoming more bearish or more bullish...? Based on the recent earnings reports and guidance/outlook for the next 3-6 months...my assessment is more Bearish...plus we are near some important intermediate support levels and many stocks have fallen below their intermediate support levels or 50day averages...so you adjust the way you enter and exit a position...I can say I'm hair trigger bearish below 1430 and not until price is above 1430 can I be more casual about the way I enter and exit long positions...
This assessment gives a good picture of the situation at hand.. from an earlier post.
Reaction To Q3 Earnings: Will Reality of Global Slowdown Again Overcome Central Bank Manipulations?
As we noted in Prior Week Market Movers & Lessons: Beware Deceptive Quiet & Bond Market Signals, for most of the prior year, markets have rallied impressively due mostly to central banks stimulus and the expectation of more to come. "Over the past three weeks however, the reality of the global slowdown has forced its way back into market consciousness because it is now showing up in Q3 earnings reports."
We've just completed the third week of earnings season, after which it typically loses its influence on markets because the tone is already set and is theoretically already priced in.
If however, earnings and revenues reported continue to miss forecasts at higher rates than seen in years, and markets continue to retreat on that news, we may have a the start of a change in perceptions that drives markets lower. If markets continue to sell off on bad earnings news, that would likely mean that that investors no longer believe that central bank stimulus and money printing alone can continue to drive asset prices higher while the global slowdown hits corporate performance in earnings and revenues.
The coming week or two should clarify whether unlimited monetary easing has reached the end of its effectiveness.
We also note in the above post that in fact the earnings picture is even gloomier than it appears when one considers that the higher rate of missed forecasts is coming despite these forecasts having been repeatedly lowered, and there are signs that Q4 earnings season could be even worse.
