Several large language model (LLM) agents have been constructed for diverse purposes such as web navigation and online shopping, leveraging the broad knowledge and text comprehension capabilities of LLMs. Many of these works rely on in-context examples to achieve generalization without requiring fine-tuning. However, few have addressed the challenge of selecting and effectively utilizing these examples. Recent approaches have introduced trajectory-level retrieval with task meta-data and the use of trajectories as in-context examples to enhance overall performance in some sequential decision making tasks like computer control. Nevertheless, these methods face issues like plausible examples retrieved without task-specific state transition dynamics and long input with plenty of irrelevant context due to using complete trajectories. In this paper, we propose a novel framework (TRAD) to tackle these problems. TRAD first employs Thought Retrieval for step-level demonstration selection through thought matching, enhancing the quality of demonstrations and reducing irrelevant input noise. Then, Aligned Decision is introduced to complement retrieved demonstration steps with their preceding or subsequent steps, providing tolerance for imperfect thought and offering a balance between more context and less noise. Extensive experiments on ALFWorld and Mind2Web benchmarks demonstrate that TRAD not only surpasses state-of-the-art models but also effectively reduces noise and promotes generalization. Furthermore, TRAD has been deployed in real-world scenarios of a global business insurance company and yields an improved success rate of robotic process automation. Our codes are available at: https://github.com/skyriver-2000/TRAD-Official.