I cleaned out my account, swept out all of the junk and the losers and placed them into a trash bin. The hardest part of trading is admitting that we are wrong. It’s in our nature to want to win. Humans are competitive and most of us think we are some special gift to the universe, when in fact we are nothing but particles and dust. We put on clean white coats and wear stiff ties; but we’re still just particles of dust.
I am upset that I sold my FAZ so early, taking early gains. I am equally saddened that I got caught long SHIT stocks into a maelstrom. But I can’t do anything about that now and must react to the market I am seeing, not the one I hope is there. The question I ask myself is “would I buy this now?” If the answer is no, I sell it. Ergo, I sold a bunch of stuff today — raising cash to 75%. In those sales was my last hedge, SOXS. I kicked it out because it was up and did not want to hold it with markets already down 550. Who knows — maybe we rally into the close?
Net net, I am looking at losses at around 2.7% for the day — an awfully moribund circumstance — but the blood letting, more or less, is over. I can now refocus my efforts to recapture losses and catapult myself towards new successes. I do think, however, one should keep a sharp on the VIX and use that price action to determine the near term direction of the market. Bias is to the downside now.If you enjoy the content at iBankCoin, please follow us on Twitter