Why you need to score the market? It helps avoid emotional trading decisions.
In trading, you need to control your emotions if you want to avoid mistakes.
One method to control your emotions is to bring structure your decision making.
One way to bring structure and form to your trading decisions is to develop a scoring system.
Market scoring will help you objectively define the market condition on a scale of -10 to +10.
If the market is trending strongly, your market scoring system should be above +8 or below -8.
Above +8 means market is in a strong uptrend and -8 means the market is in a strong downtrend.
You can also include candlestick patterns and volume in the market scoring system.
You also need to score volatility. I have written this blog post on a simple market scoring system.
Reading this post will help you develop your own market scoring system that helps avoid costly mistakes.
