The business of trading is about balance. Being able to survive bad days by balancing them with good ones. Balancing the mentality of confidence versus the mentality of arrogance. When I began trading, I worked for an organization that was appropriately named Sangfroid Trading. The name Sangfroid is a French word that translates to cold blood. Many dictionaries define Sangfroid as "composure, level-headedness, coolness in trying circumstances". On certain days, it's easier said than done.
For some time, we have been trying to identify the change in trend. Ron Wheeler has mentioned on many occasions about being "cautiously bullish". Today is a prime example of why it is good to temper and balance your optimism with cautiousness. Over the past several months, the S&P has been continually getting weaker with each respective high. With the Regression Trend Channel clearly pointing to a changing bias, we need to be focused on all of the low pivots that were made up until this point. As this market continues to work itself out, look for continuation trades that help isolate opportunities in the trend....and yes, we are in the early part of the trend, simply take a look at the false bar on the daily chart of $SPX.
Trade Smart.....
~Duane Gott
"Speculation, in its truest sense, calls for anticipation."
Richard D. Wyckoff
great point duane. great call by all of the trainers on this one! you guys we all over it!
Posted by: edwin apel | February 08, 2010 at 12:48 PM