Wednesday, May 13, 2009

Are we home yet?

We are very close to HOME

(ie 875 spx, I mentioned last night)

"Wait for the pullback, and then its a FREE RIDE TO SPX 1100" etc, etc I hear many cnbc heads say.

So this is IT huh? This is the "pullback" where every barber shop crowd and bridge club jumps in long for the "easy ride up to spx 1100 by year end" right?

I don't think so, nothing is free, and the obvious is usually the obviously wrong.

On the shorter time frame picture:

I do think if we get to 875-880 spx (which we are very close here already), it is safest to turn off the Bear Juice for just a little bit. (it's hard for some of us at times, I admit that myself). I don't know how much, how long, or how clue...but I do think we get a bounce off 875spx, fwiw. It was the same price that MANY were calling for resistance, and it was for a little while. So I have a feeling the bulls defend it with all they have.

I don't really feel like MASHING the gas long at 875spx perse. But I sure as heck, wont have any shorts if/when we visit that level. (again we are almost there).

I am looking for play ideas (longs) just for that level. But since most everyone has reported here. I think its better to maybe look at the spy, and the etf's, etc.

I am NOT BULLISH! I just think they defend 875, and I would not be shorting aggressively at that level. I might look to be lightly dabbling my toes into the bull camp for a very quick 1-2 day trade, if we get to 875-880 and stall for a little bit. I might also (more likely) just sit back and watch for a little while and see what they do for a couple days.

But dabbling being the operative word, trying to get "cute" and push the gas hard and catch "every" single a sure fire way to get your clock cleaned. Over-trading get's some of the best of us. (it has hurt my bottom line before, I can admit and say from experience, but it has also helped me learn the valuable lesson, the best way too.)

There are 2 days left in options expiration, and we are very close ALREADY to 875 spx here.

I mean for the last few weeks, I don't want to sound like I'm pounding my chest here, but I'm trading in the freaking zone.

I am not "falling in love" with this. Prior times, I might continue to mash the gas hard here trying to catch EVERY SINGLE MOVE down and up, then back down and back up....till of course eventually I was WAY wrong on one. That is where experience finally starts to kick in.....

fiscally, yes giving back some of your profits is bad, that is evident.

But more importantly, is mentally.

Mentally you are stepping to the sidelines with the "last trade" most recent in your memory, which was a loser. You don't recall as clearly the 5 or whatever winners before that, and the overall profit from the total of them.

Pull back, let it come to you. I would love to have the discipline to make just 10 trades a year, (excluding the daily gap fades of course, ya can't give those up!) yet watch the market just as closely or even closer. I think I would be just as good trading too, maybe better. At any rate, this is more a self ramble here. lol So my apologies. I do think it's helpful information though, fwiw.

Do not settle for "good plays"....wait till they become "GREAT"...

Cash is king....wait for an your entries to get EXTREMELY juicy, then hit em hard, do NOT settle for "yea that looks kinda good here, I haven't made any trades in 1.5 days, so Ill take it"

By the way, if you have not read "Trading in the Zone" by Mark Douglass, I would consider it.
Best trading book, in my collection, hands down.
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