Any trader worth their own salt has war stories of darker times, when it seemed that the World was caving in and all hope was lost. If nothing else, time brings perspective and the mistakes we make often become our best lessons. I could fill your entire day with stories of the right trades at the wrong time and happenstance that caught me off guard. There was the First Interstate takeover in the early 90's when I was trapped the wrong way, the Asian contagion semicap ride through hell, Long Term Capital Management and the derivative spiral...I could go on and on. Through all these years and all these trades, I was continually taught new lessons that made me better at what I do. I am hopeful that this public forum saves you from making mistakes I've already made.
There is no set formula for successful trading. We can walk through our metrics till we're blue in the face and they'll typically enhance our odds for success...but there are no guarantees. I often say that our business is more of an art than a science and, as an extension of that, every successful artist has a poetic license. That means there are times when you can augment your style according to the landscape. When do you do this versus maintaining strict adherence to your set parameters? Well friend...that's what separates the Rembrandts from the Dutch Boys.
For the better part of yesterday's session, we discussed the difference between a trading bottom and a topping process. There are no guarantees (or advice), but my instincts tell me that we're in the process of making a short term trading top-and I wouldn't be me if I didn't communicate that to the good readers of this site. That said, if there wasn't risk involved it would be called winning, not trading, so we must always allow for a margin of error. As such, I will continue to actively trade around a short "bias" as a function of price or time.
The beauty of our business is that each day is fresh with opportunity and we must approach it with our heads up and a positive attitude. Remember, it's a marathon and not a sprint, so pace yourself and trade to win-never trade "not to lose."
Good luck today
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at email@example.com.
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