Tuesday, June 09, 2009


Wow, we went from the most volatile period in market history to TOTAL flatline! I have officially cut down on my trading both size wise (lot size), and the amount of trades/positions. It's very tough for a trader to navigate this market outside of scalping intraday and waiting patiently for the right time(s) to play breakouts and breakdowns.

Tonight I want to discuss the art of losing, and of moving forward and putting a bad stretch behind you!

I had a couple weeks there where I had losses. Why? Because I overtraded and because I didn't make the proper adjustments. I've discussed this type of thing extensively over the years, but its important to discuss it and learn from losses. There's no shame in losing, its when you don't learn from your mistakes that its all in vain.

It's funny, I know when we hit this kind of stretch that its frustrating to many traders, including at times - ME!

I get emails where people somehow assume I never have a losing day, or week, or even month. I'm a trader, I'm in it for the long run and over the long run I feel I have a TREMENDOUS advantage based on historical patterns, and my own track record and skill level over most traders and almost all investors, but that doesn't mean I am remotely perfect or infallible.

Flatlining is the worst trading for our style of trade, I've done ok scalping some stuff with large lots recently, but that's not the style I prefer. I'm trying to adjust to the market, for now, because our job as traders is to take the candy when the candy basket is passed.

So, what am I trying to say? Well, only that we need to be patient here and pick our spots. I own CLF, I like(d) the way its been trading and if it can break past $31 it looks like it has a lot of upside. I also own CEGE as a speculative small cap, BUT I will say unequivicably that I plan on selling them and trading them on any move, and at any time based on any number of reasons. I'm an active trader when I trade and I monitor my cash balances, risk tolerance and more. I almost sold some CEGE yesterday into the close because it was up so much, but unfortunately held them all. So, we'll see what pans out, it sold off on roughly 1/2 the volume it had yesterday on the buy side day, so I do still think it can see a lot higher, but its just a stock and therefor I have no alligence with or for it.

Tiny said someone told him they were trading off what I say in the blog here. I have to tell you I think that's really foolish. I have no problem discussing things we are in, and things I like, but unless you do your own due diligence and really be comfortable with what you are doing. Plus, you never know when I'm selling something, so if you are strictly following my lead for your own reasons, well, I may be selling when you are buying, or adding when you are selling! So, you really need to have your own trading plan no matter what. Trading involves a great deal of risk, and you could lose your money, so make sure you have a comfort level that you can live with, its your money, we started Trendfund.com to help empower people to do it on their own, that includes learning to earn on your own!

Why am I harping on this? Because people are scared and when people are scared they tend to take risks and often basically gamble in many things they do in order to play catch up, and that includes trading! There is NO RUSH, the market isn't going anywhere fast so why press when you don't have to? This really is a marathon, not a sprint. Make sure you remember that the market is open 5 days a week basically 52 weeks a year. I know I will remember it myself!

I'll also remember that overall in the last few months I've made a helluva lot of money, and I do think that there is going to be a TREMENDOUS opportunity in a few weeks where we'll be able to catch a very nice trend move UP. Yummy for my tummy, and if we're patient, all of ours!

I read today that the math is mind blowing as far as budget deficits and our debt as a nation. These are scary times, lets try to make them as profitable they can be!



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