Say it loud 10 times in a row (or longer until it sinks in): “One particularly bad/good trade especially when fluky has absolutely nothing to do with another.” Just because you have your worst trade of the week in, say, shorting something and a piece of good news comes out in destroying you- it has nothing to do with your next trade. Nothing. Nothing. Expanding a little more on this theme, there are many many times when someone has a very good trade, goes out for the rest of the day, and then has six losing days in a row. Conversely, many people have a terrible trade and either a)try to double up on the next one or b)get scared to do anything thereafter. The mission here to use baseball speak is to try and get single after single after single- do not try to hit a 450 foot shot over the centerfield wall. Just because you are wrong (or right) on 21 trades in a row does not necessarily mean that the trend will continue on the 22nd trade. In short, sounds obvious, but keep as level a head as possible. Show fury (or joy) in microdoses ;it is indeed VERY healthy to get it out of your system rather than let it fester. But, really, get it out of your system and go on to the next trade- all the while remembering that any two random trades that you execute will have next to nothing to do with one another.
Watch list:
2182009Eriklist.zip
Markets in Asia were mixed with Hong Kong up slightly, but Tokyo down again. Prices were down in Europe about ¾% on average. Oil, gold, and currencies are quiet although bonds are up again. There looks to be a bit of a bounce this morning, but it just doesn’t look sustainable. With nothing major on the outlook to change things, look for a very choppy directionless day today much like the market traded between 11AM onward yesterday.
Reiterating-
Please understand that if the ideas do not get to the hoped for set-ups cited below, more often than not, one should not blindly trade the symbol next to said idea.
If the whole story is not there -
If something is good, assume either a short thru unchanged or an A-B-A2 based on direction of the market unless specifiedIf something is bad, assume either a buy thru unchanged or an A-B-A2 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specified-
Good- The following stocks have good news and/or a strong technical pattern
AMMD- good earnings
MBI- splitting itself in two
Bad-The following stocks have bad news and/or a weak technical pattern
CHK- bad earnings
UPL- bad earnings
A – bad earnings
RIG- closed near low of day
HIG- closed near low of day
AEE-closed near low of day
ADS- closed near low of day
EOG, DVN- among weak oils closing near low of day
MEE, BTU, ACI- coals closed at their low of the day
JPM- closed at low of day
DE- bad earnings
Earnings:
WED FEB 18 BEFORE
AEE AUXL CEG
CMCSA CBS DE
GT HST IMA
NU OC OMX
PWE RCI ROC
STP XEC
WED FEB 18 AFTER
AAP ADI AEM
BDN BIDU BMRN
CYBX DBRN DVR
EXR FRT HPQ
IM ITRI KGC
NHP OII ORLY
PCLN PTP SKX
SNPS TRN VVC
WFMI
Good luck today.
www.epiphanytrading.com
Erik R. Kolodny- Chief Markets Strategist of Epiphany Trading, LLC
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