What Did I Learn Today?

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Well, a brief anecdote…….and then I'm going to bed, because I am tired.

Disneyland is fun for little kids, I suppose, but it encompasses the kind of "fake" that drives me right up a tree. Even the place we're staying – Grand California – which is their "nice" resort – looks like it's made of the world's largest beams of plastic wood. It's supposed to look like arts & crafts style wood, but I don't think it's fooling anyone.

Mrs. Bear signed us up for "character dining", which means that you get to sit down to an overpriced meal and be assaulted by a swarm of princesses swinging by your table to chat. Those who know me even a little bit can understand how cringe-worthy the entire experience was, but – – anything for the little girl, right?

Anyway, it's sweltering hot here in Southern California (which just adds to my already chummy mood), and at Ariel's Grotto, they seated us outside (!). The theme park is working on all kinds of huge projects slated for 2010 and 2011, and although they sound pretty spectacular for those attending years from now, at present it's kind of unpleasant. In fact, this is the view from where we sat down for our fine dining experience:

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Nice, huh?

So we had four princesses swing by the table – – Belle, Ariel, Snow White, and Cinderella. It took everything in my power not not crawl under the table. I felt the worst for Snow White, because she had to affect this kind of muppet-like weird voice to sound like the original animated character.

Well. Enough of that. One comment on trading before I collapse in a prince-like heap.

I read somewhere that Dr. Brett Steenbarger suggests that, at the end of the trading day, you ask yourself something that you learned. I learned something very valuable today, and I'm going to incorporate it into a rule I'm working on which is going to replace one of my existing rules. So I'm not going to word this very well right now, but you'll get the jist of it.

Relatively early in the day, my many short positions were experiencing very good gains, and I thought to myself, "perhaps I should go long the /ES just in case things start climbing – – just as an insurance policy." I didn't, and the /ES marched from 1015 to 1030 without me.

I think if you are positioned heavily a certain way, and the market moves in that direction a meaningful amount, there is no harm in making a day trade counter to your positions in order to ameliorate the effects of a reversal. If it keeps moving your direction, fine, the loss will be modest, and you'll more than make up for it with the continued prosperty of your positions. If, however, things move against you, then you've got a valuable counter-position in place to ease the pain.

Like I said, I'm going to put this into a more formal form, but this was my big take-away for the day.
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