There will always be a better price

What have I learned from these last days? As usual my TZA position at 9.31 was early. I anticipate, but cannot wait. On the last down days I thought to myself; take the profit while you have it, it’s a good 3% of your account. Still I couldn’t quite do it, as I remembered how I would take profit and just see prices fly past the point where I took profit. This last week I instead remained passive – losing time (potential profits) and money. I have one OK entry price now; 20% at 9.10. Still, I really want to let it ride, as, logically, the money is to be made on the downside. This of course does not mean that I couldn’t have traded on my position. had I done that I would probably have been in a zero risk position right now.

I am expecting the downside to go past 1084,5 ES like yesterday. The run up was just amazing. Blatantly executed by MMs.

What have I learned?

1. There will always be a better price, therefore I buy positions and set good stops so that either price goes in my direction right away, or I limit the loss and can pick the stock up later for a better price.

2. Take the profit (partial) when feeling uneasy. If there is lack of strength in the direction you are trading and divergences in the oscillators – EXECUTE, DO IT NOW!

3. I am not biased, I trade in the direction of the market.

About number 3. I see now that there is a divergence between SML and SPX in buying/selling, the SML is clearly weaker – sell offs stronger and rallies weaker. This is a safe sign of trader sentiment – it has turned. Therefore I am keeping my position.