Reacting to Monday’s Price Action
As precarious as the world feels and as heated as the markets are, it is starting to feel that things might very well proceed in a more orderly fashion. What is orderly? A very curious cascade of ill timed events and slight price adjustments teasing prices generally higher with due correction from time to time. But, many markets are testing critical levels or are nearing the end of significant coils. So, at any moment, things can change quite dramatically. Proceed, life as usual, one hand on the cup of coffee… ho hum… and the other on a shotgun. Just in case, we have unwelcomed intruders, we are prepared to defend ourselves.
Because market timing is never something we will know with any great accuracy, it’s important to keep trying and probing. Even though, I’m much more interested in the downside of a lot of these markets, I’m still actively setting up trades to take advantage of the long side. As always, every trade, long or short, know your entry, your exit, your target, your risk, and your reward. Under no uncertain terms, these are all givens. It’s the research and preparation that goes on before you relay an order to your broker. There is zero tolerance for improvisation when you have your trading groove on.
So, where is my attention tonight? How have my thoughts adjusted over the past 24 hours? Yesterday, I had orders on in Bonds, Cotton, Sugar, Silver, and Crude. I got zero fills. No biggie. It played out as a very orderly “bounce” / range bound day after a monster trend day. Perfect days for losing lots of money. I was grateful not to get pulled in. And, it gave me a chance to look at things again with fresh eyes. What do my “fresh eyes” see? Two things primarily: #1) I’m less interested / concerned with equities, bonds, metals, dollar…. more small moves ahead… worth waiting for the story to develop further before taking key positions. #2) It brought a little more personal interest towards the bullish scenario. So, I personally will be looking for both long and short side on some of my key remaining markets. But, again, I’m putting some of the gunpowder back in the shed.
