Wednesday, March 21, 2012

A Typical Day

This week we have seen some pretty easy and standard trading. In the Emini S&P today, we saw a long covering coming into the open with an opportunity to get short pretty soon at 1401.75. At 10am we had weaker than expected housing data which added to the downside move. There was no reason to get out of your shorts until the market established value low at 1397. After the market established a value low, the market tried to extend this value, however the market rejected lower prices with short covering to trade higher and develop value for the day.  Towards the end of the session we had fully established our trade area for the day and we clearly had most of the market covering longs. This gave us our final short in to the close from 1401.25 with a target of value low down at 1397.25 which was achieved


Remember you're traders and not analysis. This is how you should be viewing the market each day as it's all about where people want to trade. There's a large chunk of people out there who fail because they feel the need to justify everything that is happening. They will be asking questions like 'why is someone selling/buying there', 'what does this indicator mean?' or 'I hear X person does this, what does it mean, and how can I do it?'.......

The need to justify everything will be the end of your trading career if you're not careful. A lot of rookie traders will often admit that they can't make a penny, but if given the opportunity to learn from someone with experience, instead of listening and taking on board a concept and experience, they will tend to waste that valuable experience by asking question after question, the vast majority of the questions will be completely irrelevant.

Trading isn't about all the lingo and jargon. It is what it is, which is just people buying and selling. Is the asset that you're speculating in undervalued or overvalued? Most people seem to want to learn to talk the talk first so they can impress other people. Very few actually understand the concept of trading.

Which group do you fall into?