The one thing I’ve learned about trading stock is that my opinions had value and I’m more right than wrong. Perhaps it’s instinct or learned ability.But I also have learned the hard way that sometimes my ideas and perceptions about the market are completely wrong. You have to be mature enough to accept the idea that maybe, just maybe, you could be wrong.
To be truly good you must deploy recursive third tier thinking, akin to watching MSNBC at times for political advice. You might not want to accept certain realities; but often times that manifest themselves when least expected.
What do I mean by this?
Today I was emphatically long, 120% leveraged with only bullish positions and then they flopped into the close, as markets meandered slowly lower in apathetic trade. I was faced with a decision: stubbornly hold onto the longs “hoping” markets went up tomorrow or selling them because my original stratagem failed and the impetus to be leveraged long passed.
I ended up selling them and applying a 16% hedge via $SQQQ just in case the rout in the semis picks up steam in the morning. We have recently enjoyed a respite in the semis and although they look much better than at the end of last week, it’s entirely possible for this small pullback to blossom into something more terrifying.
Down 40bps for the session.
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