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Coach's Playbook Posted by Team Topstep April 7, 2021

How To Slow Down Your Trading

Is there a benefit to trading hundreds of round turns a day? Are you missing the bigger picture by only staying in a trade for a few seconds? On the surface, high-frequency trading may look like a good opportunity for retail traders, but there are some technical and fundamental barriers to success for this type of trading that you should be aware of. This week, the Topstep coaches are here with some advice for why you might want to slow down your trading.

Funded Trader Shoutout

With stock index futures hovering around all-time highs, it appears that “UP” is still the path of least resistance for the time being. We talk a lot about recognizing what direction the overall trend of a market is and the importance of trading on the right side of it. One particular Topstep trader showed us what can happen when you follow the most basic of all trading rules.

Funded trader Yun W. caught a few rippers staying on the right side of the E-Mini Nasdaq-100 futures market and pieced together a solid $4,600 trading day. Take a page from Yun’s book and don’t fight the tide. It helps to have deep pockets to trader counter to the trend, so consider going with the flow when an opportunity presents itself.

Slow Down Your Trading

Let’s be honest about this; point-and-click scalp trading is a thing of the past. It just flat-out doesn’t work anymore. Sure, you might get lucky with fills on a simulator, but in a live market, you’re dead in the water if you think you can trade faster than an algo.

The reality is, the deck is stacked against retail traders who try to trade too fast. The big players pay more money than you might imagine making sure they have the best access to the markets and trying to compete with them usually turns into a losing battle.

In our experience, the best way to stay in the game is to slow things down and expand your view of the market. Always have an eye on the bigger picture. Getting caught up in the “noise” of shorter timeframe trade setups can sometimes prevent you from seeing better opportunities in the market.

Be Busy Analyzing

While it is your job as a trader to be in the market, don’t feel like you need to be in a trade constantly. Many successful traders do much better making 4-5 trades a day than making 400-500. And, sometimes, the best move is to not be in the market at all. 

Try spending more time analyzing than trading and see what happens; you might find the opportunities you get from longer timeframe setups are more profitable and less stressful to manage.

Trade Well!