I understand the trials and tribulations that you are currently going through. I came from trading options and some ETFs in the late 90's and early 2000'. I didn't do enough trading to call myself an "experienced trader," but I always kept abreast of the market. I've watched the market on a daily basis because I love it. There is nothing more amazing than watching MSFT or another major stock on Level II and think to yourself, "Wow, there are millions of people in NY, Chicago and dozens of other major cities trading this stock right now! All of them are working together and everything that happens, from the small office in a warehouse in Baltimore to the farm-house in Iowa -- all of these people are trading a stock and I am witnessing the interactions of thousands of trades right before my very eyes." You have stated countless times that you feel that trading is difficult. Well, despite the wrath of bullshit I will incur for saying this, I believe trading is not difficult. Here is what is difficult ... Put yourself in a frame of mind to accept change. As a human, we all resist change. We find comfort zones that we do not wish to leave. This applies to all aspects of life. We wake up in a familiar environment and some of us wake up next to a familiar significant other. These things are constants in our lives that we depend on to keep a level of rationality and harmony within our own lives. Now, let's look at the market. The market is merely the byproduct of interactions between a vast and significant number of traders. Some are speculators while others are arbs, hedgers, etc ... The dynamics of the market are such that change is swift, constant and always ongoing. This means that the market will change trends instantly whenever it wants to. We, as humans, are not so easily acceptable to change. Think about this Gordon -- how many people do you think today kept trying to fade this market as it went from 817 to 825 to 830 to 835 to 840? Why were they trying to fight the trend? Well, simply because humans are used to comfort zones. Everyone was comfortable with a downtrend and then suddenly the market reverses upwards. Instead of following where the market goes, they rationalize their comfort zones with thoughts similar to, "Oh, this has to go down now -- this has been going down for days and this isn't right .. yada yada yada" Right? Screw what is right or wrong. If you want to succeed in the markets, you need to drop your predisposition to being reluctant to accept change. You need to embrace change in the market and not give it a second thought. Is the 5 MA moving up? Great, a little upwards retracement. Oh, 10 MA? 20 MA? 40 MA? Looks like we have ourselves a reversal. Don't question it. Don't deny it. Don't let your ego overcome you. If it is going up one hour and down the next, who gives a shit. Just follow it. Learn to recognize what the market wants to do and not what you want it to do. Follow the trend as it occurs on your trading timeframe and do not question it. If it suddenly reverses, do not assume that it shouldn't be happening. Merely accept the new reality instantly and with no reservations. Gordon, trading is simple. The psychology within our own minds is what is most complicated. Buy when the prices are going up and sell them when they stop going up. Short the prices when they start going down and cover when they stop going down. Don't assume that it needs to go somewhere other than where it is presently going. The market provides you with information every moment of the trading day. Learn to accept that information without reservation or dispute, and act accordingly to price movements. Use sound money management techniques to further your edge. You are merely a puppet that dangles from the strings of the market. If you even begin to think that you are the director of the play, then you will proceed to get slaughtered. Don't think, just follow. Don't assume, just react. Clear your mind and let the market think for you. Just repeat to yourself each day, "I am a bitch to the market. I am a bitch to the market. I am just a little bitch to the market." Don't grow an ego and dispute the information the market is providing to you. If it wants to go south, you go with it. Don't say things like, "Oh well its going to go North shortly -- so I'll just buy right here." No, when the market goes south, like the little bitch you are to the market, you go south with it. When it stops going south in your trading timeframe, then you cover. When it gives you information and says, "Ok boys, we're going North!" You merely say, "Yes'a Mast'a, I'm going North, too." You are a puppet. You are nothing more. Let the market tell you what to do and by the end of the month, you will be rewarded. If, on the other hand, you are like most people and demand that the market do something else, you will struggle daily and wonder why it is so hard to trade. Hope this helps you.
Really, I have tried to stay away from all this, but excuse me, what the hell do you know about trading?!?!??!?!?!?
I don't know why you guys are breaking balls -- the above post IMO is brilliant! Great Post Aphie -- Make sure you follow your own advice when you jump in there and you will do lovely Your Fan, Commisso
Gosh, JC, lemme reread that "brilliant" post: "Buy when the prices are going up and sell them when they stop going up. Short the prices when they start going down and cover when they stop going down." Incredible insight into the market. How did Gerry Tsai do it without knowing this?
Aphie, You make some good points but as you can see from the responses, most of us can't HEAR you because you aren't trading. You can theorize up the wazoo if you like, but don't expect anyone to take you seriously until you get you feet wet in the markets. I for one am looking forward to some content in your Journal - so how about it? Why don't you make a committment to start trading, tell us the date and then we can all support you by holding you to your promise. Best of luck, Indie