There is a perception that traders are constantly in motion -- aggressively buying and selling no matter what market conditions might be. While that is true at times, the reality of trading is that it is a balance between great patience and aggressive, decisive action.
The best traders develop the ability to shift from long periods of patience -- when they do little -- to fast and furious action and then back again to a period of patience with little action. It is a skill that can be cultivated, but many traders are addicted to the adrenaline rush of trading and they have a hard time resisting the temptation to make trades, even when there isn't any clear edge or a compelling opportunity. Boredom trades can be very costly and they often end up undermining what will be an even better opportunity with some patience.
Tuesday is one of those days when I'm not seeing much to do.
There are quite a few stocks that I'm watching and am optimistic about, but I see no reason to act on them at this point. The easy thing to do would be to make some buys and then hope that the trades work, but the best strategic move is to stay patient and do nothing, until I feel that conditions are right for some immediate movement.
There should be a natural ebb and flow to trading. There will be days when you are aggressively pursuing profits and then there will be the days when you are simply watching and waiting for favorable conditions to unfold. That is just the nature of the market.
Traders often complain when they aren't racking up the big gains, but profits will come in cycles and they will be even better if you recognize that is how it works. Rather than becoming frustrated when you have a lackluster day, it should be acknowledged as part of the process. You can't change the cycles of market action. You have to try to be in tune with them.
The market is perking back up at mid-day and there is still hope that a stimulus deal will be made, but I see little to do in front of that news event.
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October 20, 2020 at 11:58PM
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The Ebb and Flow of Trading - RealMoney - RealMoney
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