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3/28/25 – The best trades occur when markets are trading thematically, with the themes representing the actions of the largest investors who move the most money. I am watching the correlation between equity markets overseas (VGK, EFA, EEM) and the U.S. stock market. Until recently, those had been moving in different directions. If we were to have genuine trade wars, we could see a toll taken on global markets. On the radar as a potential opp…nice example in real time of allowing a big picture to inform short-term trading.
3/25/25 – Yet another key to trading success: The ability to recognize, in real time, when your market is lining up for an unusually good potential opportunity and then to be able to size up for that opportunity without losing sight of sound risk management. Selective aggression is all about being willing and able to wait for the right opportunities and, when those arrive, being able to pounce decisively. Very often, a meaningful part of overall profitability for discretionary traders comes from a relative handful of trading opportunities. A key to great trading is being able to outline–in detail–the criteria for a true A+ opportunity and then having the discipline to wait for those criteria to be met and being able to go from waiting to pouncing. In my next post, I will outline the high opportunity criteria that guide my largest trading.
Great trading comes from looking beyond the market and time frame we’re trading to see the bigger picture that will be driving price action. The microscope helps us get the best price for our orders; the telescope tells us what to order and why.
3/23/25 – What if a key to great trading is found in what you do during the time when you’re not trading? What are you doing between trades to generate ideas, to track shifts in what you trade, to track shifts in the markets that impact what you trade? When I compared being a trader to being a sniperI pointed out that “It’s a beautiful feeling to plan one good trade, execute it to perfection, and then sit back and wait for the next opportunity. Any performance skill, honed and executed with precision, is a kind of work of art. I think the best snipers understand that”.
The artistry of great trading is found in what we are doing when we’re not staring at screens and firing away. Like the sniper, we succeed because of our focus during the 99% of the time that we’re not firing. Creative vision is what makes a work of art. It is also what makes for artful trading. Skilled traders have studied and experienced so many markets that they can recognize when a meaningful pattern is playing out. What if we only traded when that creative insight came to us, when we saw–truly saw–how things were playing out? The cost of overtrading lies not just in the P/L lost, but in the damage we inflict upon our capacity for creative insight. Our job is not to make great trades; it’s to have the wisdom and restraint to allow great trades to come to us.