Sometimes I patiently wait for a setup to come together, only for the move to never fully unfold. Other times, it appears to be setting up perfectly, but not everything quite aligns. I can remember years ago feeling the need to force an outcome in these situations, rather than simply accepting it and waiting patiently for the next opportunity.

Letting go of the need to be right has helped my trading results enormously.

Another thing that improved my win/loss ratio was having an adequately financed trading account. I’ve traded small accounts and I’ve traded larger accounts, and I believe everyone needs to find their happy medium.

I can only speak from my own experience, but in the very early days of my learning, I was WAY overcapitalised. My mindset was wrong and my trading needed far more structure and discipline.

After learning some valuable lessons, I then scaled my account back far too small. As a result, I tried to work my capital too hard, again attempting to manufacture outcomes to grow the account quickly – which only led to increased losses.

I know it’s probably a fine line between growth and comfort, but everyone needs to find their balance. It’s helped my mindset enormously because I naturally avoid average-quality trades as I don’t want to lose profits on substandard setups and I don’t need to force an outcome.

It also keeps my mind at ease knowing that if a trade setup doesn’t fully line up, no problem, I’ll simply wait for the next high-quality opportunity.

In my Safety in the Market Newsletter article earlier this month I was watching for a potential triple bottom on a 62.5% retracement to kick the market off.

Chart 1

For me to trade long I had three requirements that needed to come together to prove to me this market was showing signs of strength.

1. A daily Overbalance in Price swing to the upside into Point B (greater than 116 points)
2. Point C sitting on or above the 50% retracement level
3. Stronger volume on the A-B move.

Chart 2

Now the very next day ended up being a key indicator, the SPI200 ran up well through the 50% retracement then closed below the 50% and the open! Also, lower volume than the previous days.

Chart 3

For me there was no long trade here, I just happily sat out waiting for the market to show me which way it’s going to trend.

Fast forward another week and a half and we have a low on 20 May, just above the 75% milestone and 180 degrees exactly from the 21 November 2025 low. The bounce out of there had the SPI200 trading above the 2×1 which is a stronger position in my books.

Chart 4

I also read this last weekly swing down to be made up of four daily swings, when combined with 180 degrees from a previous turn can be a great place for a turn.

Chart 5

Again, I still wait for my three elements to come together, and the market didn’t give it to me. Instead, today 28 May, the market rallied early but was unable to hold the slightly bigger 50% retracement level made by the 2 March to 23 March range of 8746.

Chart 6

This market hasn’t been able to close above this 50% over the last 2 weeks once, let alone any kind of higher swing bottom on any of these 50% levels.

Even though my setup didn’t materialise into a long trading opportunity, I also haven’t lost any capital! Now looking at the current swing range, the current daily swing down is very close to a 200% Overbalance in Price to the downside and is now trading under the 2×1.

Chart 7

If 28 May is to be a weekly swing top, then it is happening in the weak part of the All-Time Low square of 458. Now that we’ve seen a near 200% Overbalance in Price to the downside, the next logical place to look for a setup to occur would be a lower top underneath the resistance level which would have you trade in sympathy with the major weekly trend.

Chart 8

This 8700 level has been key for me and my form reading skills and has kept me safe while the market shows me what it’s doing. If a setup comes together with the potential for a high Reward to Risk Ratio, then I may look for a short opportunity.

Happy Trading,

Gus