To adapt a quote from the great Yogi Berra, “trading is 90% mental, the other 50% is physical.” Huh? Simply, mastering the psychological aspects of trading is vastly more important than the physical act of charting and executing trades. The most difficult part of dealing with the markets on a daily basis is controlling the mind as opposed to controlling trades (which we have no influence over). Therefore, I’d like to explore the four quadrants that make up a trader’s psychology. (more…)
Slope of Hope Blog Posts
Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.
Sunny Skies Equities Die
As I’m writing this the S&P is in beautiful new all time high territory. The concept of a correction has now been downgraded to, at worst, a gap down in the morning to be bought and at best, a five point intraday drop. This is the world we live in. And the consensus seems to be that this will continue for the foreseeable future. Every central bank in the world is printing, there is zero fear, and we are now in Livermore’s AOT market meaning “buy any old thing.”
As traders we are told to check our emotions at the door and just trade what we see. The faster we conquer fear, greed, and all the other destructive emotions that befall our fragile human condition the better traders we will be. And normally I fully agree with that sentiment. However, there are the very rare instances where emotion is the best indicator above all other market signals.
I’d like to tell a personal story. Two years ago to the month I went to war with silver. I had been watching silver go up EVERY SINGLE DAY and it was driving me nuts. To make matters worse my neighbor at the time ran a precious metal business and was borderline unbearable as shiny things marched higher and higher. The concept of precious metals ever going down again was unfathomable. I nibbled short and got hit several times. Come the end of April 2011, I was absolutely FURIOUS with the silver market. Shorting silver now became personal on many levels. I remember very few specific trading days of my career but I vividly remember April 29th, 2011.