Learn From Your Mistakes — Here’s What I Did Yesterday
If you are human, you
are bound to make mistakes, regardless of your level of experience.
For me, yesterday was a case in point. Did the mistake result in a loss?
No. But it did result in squandering some good short opportunities on the
opening.
First, let’s frame the situation. The market
opened flat and proceeded to drift off a bit. Semis and banks were under
pressure, and the 1- and 5-minute charts were signaling that shorting rallies
was the game plan. However, for some strange reason the fact that
Citigroup (C) would not fall off, and was in
fact moving slightly higher, had me intrigued. This was a good observation, this
was one that would be a great long candidate if the S&Ps ever set-up for long
entries. My mistake was trying to trade C to
the long side on any bounce in the S&Ps, despite the trend being clearly down.
If you go back and look at the 1-minute chart of
the S&P’s and TXN
in the first 45-minutes you see just how much weaker
TXN was relative to the market. This is even better than simply
having a stock in “synch” with the S&P’s. This is exactly what defines a quality
set-up for HVT, not trying to buy the strong
stock, (C), when the market is trending down. So, look again at the
TXN chart, no, these trades were not lay-ups by
any stretch, but they were trades then should have been taken.
So, nothing more really needs to be said, simply
this: learn from your mistakes. My estimate is that by not sticking to the game
plan yesterday prevented me from having a solid day. Instead I was left with a
few bucks, the only upshot was that the FX trades really kicked in.
Today will be extremely quiet after the opening
hour and I for one will close up shop early. I suggest that you seriously
consider doing this too. When was the last time the afternoon session was really
robust anyway? I really doubt with the bond market being closed today will
offer anything better.
| Support/Resistance Numbers for S&P and Nasdaq Futures |
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As always, feel free to send me your comments and questions.