The Elder Statesman
Good morning and welcome back to daily dance. The Minxy match continues to ignite the great debate as traders try to wrap their arms around the price action. With yesterday's slippage alleviating the overbought condition (which, by the way, had worked off the oversold condition), we saddle up today's pony with anxious anticipation and considerable consternation. I mean, seriously...how the heck are we supposed to make money in this muck?
I often discuss the virtues of a tradable edge but, if you haven't noticed, they're proving to be few and far between. That leaves us with a natural dilemma--do we try to make hay when the sun peeks through the clouds or do we wait for the perfect day to step outside and play? It's a good question and it shouldn't be one that's addressed after the fact. In other words, if you're already deep in the trading hole, this entire discussion is a moot point.
The hardest thing to do is stare at the flickering ticks and sit on your hands. Traders are aggressive by nature and a passive observance doesn't come naturally. For my part, this column allows me to synthesize the metrics while keeping myself busy. I've actually found that by writing, I focus more and trade less--which allows me to (hopefully) identify the higher percentage trades (while not diggin' myself into that proverbial hole).
Many are conditioned to believe that they must trade every day...that the opening bell is some sort of starting gate in a daily race. What you've got to realize is that it's not a sprint--it's a marathon--and you don't have to run hard every single day. The market is littered with pot holes and bull shnitz--if you're not careful where you step, it could very well be your last.
I'd be lying if I said I don't succumb to the sirens at times--it happens to the best of us. However, moderation is the key to life--and trading--and while we're sure to trip at times, the goal is not to fall. At the end of the year, we're measured by wins minus losses. Cutting down on the latter will only increase the former.
I'll walk through my trading posture (and near term thoughts) in the next post but I want you to take a moment and think about what I've said. The grizzly is weeding out financial players daily and the horror stories continue to continue. If your mechanics aren't sound and your process isn't disciplined, the Minx will sniff it out and squash you like a bug. I don't say this to scare you. Au Contraire, Mon Frere--I say it with the purest and most benevolent of intentions.
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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