…on making your brokerage rich via copious amounts of commissions from your overtrading.
This kind of market does not just wipe out stubborn bulls who buy stocks the whole way down, it also punishes habitual bottom pickers, and basically everyone except the most talented of daytraders. Eventually, we will form a tradable bottom. When that comes is anyone’s guess, and is out of my control. What I CAN control, however, is not making low probability trades out of boredom while the market remains unhealthy. On the back of last Friday’s distribution day, the bulls have to overcome a heavy burden of proof to get me enticed on the long side anytime soon. I am willing to change my mind at a moment’s notice, but I need to see the evidence first via accumulation and healthier setups across the board.
Finally, I urge you to continue to monitor $FCX as a broad market tell. It continues to weaken and has yet to see any kind of a bid. Watch it closely to see if that changes.
If you are having problems sitting tight, go get some discipline at basic training for Marines:
(Warning on the video for all of you thin skinned types)
See a penny, pick it up..
Nat gas has been one of the few exceptions and been a great trade lately
Otherwise I’ve been paring back(almost 65% cash), not adding as this market has been continuing to suck ass.
I am guilty of a few test trades here and there though which is not a good thing
ECA (pure gas now) on the weekly looks to be setting up nicely for possible B.O. Am I right or f.o.s. ?
SIR! THANKS FOR ALL THE GREAT ADVICE SIR!
Thanks for reading, Count.
Count the money or DeMonet? As mel brooks movies say.
It’s from History of the World: Part 1 (The French Revolution)
Will you consider going short at any point? Or are you now just waiting for that tradeable bottom to initiate long positions?
I would go short into any weak bounce. But the bounces we have seen thus far have been too ephemeral for me to think the shorts were correct (I was wrong–I should have been aggressive to the short side).
However, I am content to protect capital in markets like these and wait for quality long setups., even if I never short.
Excellent advice (as usual), chessNwine!
FCX is indeed a great market barometer for the present; I use http://www.kitcometals.com/charts/copper.html as spot copper confirmation…
Great stuff–thanks Jim.
Chess,
That clip brings back fond memories. I will always remember my first day. It was November 21, 19……….Well I wont say what year it was out of fear of being banned. Lets just say that during my ‘time’ we had a real ‘Dick’ for a president. I guess depending upon your political persuasion that term could be applied to any or all of them in the last 40 yrs or so. Stellar performance for your first month as a tabbed blogger. Keep up the good work. 100 % cash and waiting.
Thanks Stevo–great to hear from you as always. And I appreciate your loyal readership. That cash position will serve you well, in my view.