What a great way to start of the month, with the H1N1 virus..
I am out of work + school for 2 weeks now!
Market Overview:
Here's what's going to happen in the next 2 months:
I expect the S&P to reach at least 1120 by end of November and 1150 by end of December 2009
The $CPCE is confirming a bottom in the next couple of days. I am long for the rest of the year based on this chart and my cycle data.If you go back a couple years on the put/call ratio, you will see that actually most bottoms are put in with a ratio of 0.80 and above.
Market Psychology
Lesson #5: Out of Sync
Beating the market requires the same skills as playing music.
The audience doesn't care about small mistakes because as long as your in sync with the notes, your fine.
As soon as you start getting out-of-sync and not doing what is natural (for ex: adjusting stops, telling yourself that the price of a stock will return , that MMs are out to get you. you lose track of the natural rhythmic way to play the stock market).
So what is the best and most natural way to play the stock market.
It comes down to 2 rules.
1) Cut your losses as quick as you can.
If your wrong, your wrong. You can't fight the market. Complain all you want that UBSS was after you [UBSS is a market maker], or that the PPT prevented a P3 wave.
2) Let your winners ride.
Too many people will sell for a quick gain because humans are predisposed to not wanting pain.
If your serious about becoming a trader, develop a natural cycle.
Wake up at 7, check the news, medidate & prepare yourself for the day too come.
After work look at what happened wrong, and then after 6, rest your mind with school, friends, family, sports, etc...
When your in the stock market, act the same for a loss, and act the same for a gain. If you find yourself punching yourself because you took a loss, the stock market is likely not for you. The best traders are very calm, from what I see on my trading floor.
Well, enough writing for me, I'm out.. I might be trading tomorrow.. depending on how I feel.
GL in the markets.. there's the Fed Rate Decision on Wednesday + unemployment number on Friday so expect volatiltiy to go mental.
Peace
