An Olde Fashioned Rout

Raul3 Mon Mar 31, 2014 5:21pm EST 1 Comment

If you must play, decide on three things at the start: the rules of the game, the stakes, and the quitting time.

—Chinese Proverb

We put the first quarter to rest, and I managed to be down eight percent over the duration. What may seem like a grotesque underperformance and waste of time to you has been one of the most enlightening periods in the market yet.

I overtraded momentum stocks, piling each successive win into two or three more ideas. Then I mismanaged a few of the key puzzle pieces that would have kept the whole leaky dyke in place at unchanged on the year.

Literally mismanaging two winners put me at eight percent. There isn’t a huge margin of error in this game folks.

Nor any game, for that matter, especially on the highest level. If you think you can trade live and make correct decisions one-after-the-next without a plan you will slip in the heat of battle. Most of you live outside the world of total market immersion too, so your daily work life may be even more complicated.

Have a plan. Set hour(s) of operation, talk about what overrides said hours of operation, and just trade for that moment. I am narrowing that timeframe tighter and tighter to the open. At this point I can surmise the gist of a trading day by 11.

Today was looking like an odd normal day again until sellers took a massive battering ram to the NASDAQ into the bell. It was something to see. The support was there right up unto 4pm, for the tape paint I suppose, then it wooshed lower in that little 15 minute settlement period over in degenerate Chicago.

I was a buyer in the afternoon, just before the above rout occurred. I was buying with the expectation of a similarly awesome powered rout, just in the opposite direction. Such is life.

You must understand, a normal day occurs less then 30% of the time so if you can approach either initial balance extreme late in the day, you are talking about a 70% likelyhood of a breach. DOESN’T THIS KIND OF STUFF EXCITE YOU GUYS? Stats!?

I like’em.

Finally, I think everyone is out watching baseball and enjoying their children and such, not buying Facebook and Zynga Monday afternoon. I don’t know, I felt unique. Let’s see if it pays off to be unique, or if I am just the only jacked ass sitting inside my hipster office.