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Ripplin' Through the Muck

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There is a road, no simply highway
Between the dawn and the dark of night
And if you go, no one may follow
That path is for your steps alone

(The Grateful Dead)

OK, Junior Alert! Whenever my trusty sidekick starts getting in one of his "moods," there is typically a sizable trade coming. I'll tell ya, here's a kid who is salt of the Earth---decent hoops player too---but when he gets saucy, the whole World has to stop and take notice. Look at me, look at me, look at me!!! Pah-leeze, kid...I'm entirely too self absorbed to pay attention to your emotional variances! What the heck is a Quinnipiac anyway? Sounds kinky!

I can't say I blame the young lad for psychological baggage---this tape would make the steadiest of souls stand on edge. Still, our ability to maintain lucidity in the face of adversity will surely differentiate our performance and serve us in good stead. Our journey will take us through many emotional states...but if you're going to succeed in the trading game, you must check that emotion at the door. Panic decisions always have a way of coming back to bite you in the can.

As of this post, the market has held our levels and the tug-o-war that is our "tells" continues to fight it out. As somebody who loves to "fade" (read: buy) despair, I continue to be intrigued by the sirens of Hoofy and the lure of Snapper. That said---if nothing else---I am disciplined and will always attempt to honor thy process. This, of course, doesn't mean we can't zag...it just means that we must factor all inputs into the decision making process and live with our choices. There are two ways to "trade in between" when getting conflicting signals---pare back on your size or set tight "stops" on your exposure. The method you choose is unique to your risk profile and style of trading.

The bulls are giving it the 'ol college try as some "black box" type accounts seem to have stepped up on the buy side. The price action off the lows is constructive, but the internals continue to bridle my enthusiasm. Again, doesn't mean you can't play...just means you have to be extra careful.

Hope this finds you well.

R.P

No positions in stocks mentioned


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 todd@minyanville.com.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

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