Experience Will Get You Through
As Dave Landry stated very well yesterday,
"It’s a marathon, not a race." This market will certainly leave you
confounded at times. Bear in mind one thing, experience is what’s getting
traders through right now, not some "gee whiz" system. I have been
fortunate enough to have traded eight summer markets and make money in all but
two (my first two summers as a trader). The current environment is not radically
different. Paying my dues over the years forced me to let the markets come to
me, not me to them. For the last week, I have only been trading (HVT)
the mornings, and did the same again today. Perhaps today was not the day to
miss the afternoon, but with my wife on the verge of labor, I am needed at home,
not the office.
Nonetheless, there was money to be made this morning. Did you trade Tyco
(
TYC |
Quote |
Chart |
News |
PowerRating)? That stock had plenty of movement. How about shorting El
Paso Energy
(
EP |
Quote |
Chart |
News |
PowerRating) on the news that their CFO committed suicide? (It
sounds horrible to trade that, but that is reality as a trader.) I learned many
things at Kevin Haggerty’s seminar a few weeks ago, but the most important was
that here was a guy with tons of experience who seemed unfazed by the current
market environment. To me it was obvious he was still doing well. It all boils
down to experience, and if you do not have a ton of it, perseverance will get
you through to that level.
This type of dialogue is becoming a bit stale perhaps, but it is reality.
What are you going to do to get through this market? Did you make note of the KTNs
this morning and catch the two moves off of 1052, one on the long side and one
on the short side? (See chart below.) Did you go long gold stocks when the
market cracked in the afternoon? Did you fade the gap down in Tyco
on the opening? The trades are there. You have to find them and then let the
market dynamics dictate your entry point.
Now I will admit that yesterday was probably not the right time to have
highlighted the KLA-Tencor
(
KLAC |
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PowerRating) setup
on the daily chart. For those of you who may have taken that trade, I trust you
used a stop. I took the trade off the opening and was stopped out. The setup was
there, but the market had different ideas, but I was in the game, and the
risk/reward was in my favor.
So what do we do today? For me, the game plan is the same. Trade assertively
on the opening and know my levels.
For those of you who may not be aware, TradingMarkets
will be launching a subscription service that provides KTNs for stocks. The
executives in the marketing department have named them The
Floyd Numbers. We hope to roll that out in the next day or so, but
given that my wife and I are expecting any day, it may get put off until Monday.
Nonetheless, this service will prove invaluable not only to daytraders, but
position traders, too. If you have found KTNs for the S&P and Nasdaq futures
helpful, these will be the ideal compliment.
If you have any questions regarding the service, feel free to send me an e-mail.
Key Technical
Numbers (futures):
S&Ps |
Nasdaq |
| 1069 | 1226 |
| 1061 | 1203-05 |
| 1048-52 | 1184 |
| 1036-39 | 1161 |
| 1018-19 (confluence and critical support) |
1140 (contract low) |
| 1008-09 | 1117 |
| 1080 | |
| 1058 (projected low) |
As always, feel free to send me your comments and
questions. See you in TradersWire.