WE ARE FORTUNATE
After hearing highlights of the speech yesterday I realized how fortunate we all are to have him. It is so rare to see anyone publicly just expose so completely all of the flaws that makes us all human. It is also rare to see someone in such an important position just be so incompetent to the point where if they were to work at any job other than President, they would have been "so fired" a long time ago, yet still be employed. One of the things that is a truism of life and gets magnified in trading, is that if you do the wrong thing, you will pay the price eventually. In the above example, he does the wrong thing virtually every time he speaks. Think about him as a trader and how he would approach it. First off he would clearly have a very strong conviction of what he wanted to do, as he does at times in his current job. Next, he would then flip flop back and forth with equal conviction, changing his mind over and over. He would be what we call a Nintendo trader. It is going lower, now it is going higher, translated it is going down, oops now it is going up.
Next he would lash out at those that are having success and ask them to give him some of their money because he could not do it himself. He would resent the success of profitable traders and would want to regulate them to the point where they could not succeed, hence bringing them back down to his level of mediocrity. Translated, SOCIALISM. Next he would cry out that we need to stop doing what he is, instead of looking at himself as the culprit. If he were OJ Simpson, he would be yelling at people for murdering their ex wives. It is just incredible to me that he is a compulsive spender then appoints a commission to investigate spending! Of course he then ignores the advice because it is along the lines of cutting back spending. He then goes on national TV again and says we have to cut spending. Well then just do it and shut up, you are the one who is doing the spending not us. This is just so insane. Stop selling 30 day lows in an uptrend if there is an uptrend, etcc. That would be a good analogy.
All of these blunders serve as a very teachable moment for me. He epitomizes doing the same thing over and over and expecting a different result. We as traders have certain core things we need to do correctly and no matter what else we do properly, if we get the core wrong, we are doomed. I think the basic thing most of us have to do in order to trade successfully is get in tune with the underlying momentum of a market. Most of the time that is just with the trend that is in place. At other times it might be underlying things that are about to change the current trend. It is not an easy task to do this, but I can tell you that if you constantly fight a trend, you will constantly lose. I have been down that road at times in my career and it is incredibly frustrating. You get it in your mind that for whatever reason be it an oscillator diverging, or a belief in some fundamental influence, that the current trend has to change. I have a close friend who is just always short everything, he almost never takes a long position. He has his moments and is having one now that we are having some declines occurring, but he inevitably gets run over because he is always trying to fight the trends.
He is aware of this problem, yet keeps doing it because he is comfortable in his approach. You have to get out of your comfort zone to have success. Barry is not comfortable with Democracy and he wants Socialism, however, the US public does not. Every time he makes a small move toward Democracy, which would be akin to my friend taking a long position in something, he immediately goes right back to Socialism, my friend going back to shorting. In our current environment we are witnessing what will likely be the greatest trend moves we will see for a decade maybe more. This is a momentum traders market, don't fight these moves.
I mentioned recently that one thing that was bothering me about the current stock market situation is how weak COPPER was on a relative basis. This market is a reasonably good bell whether for stock prices. It is no surprise that stocks have declined some here with this markets current condition being considered. It is a good idea for those of you trying to get a gauge on what will likely happen next to watch this market. I do not see anything definitive other than just it being relatively weaker. I do not see a short entry in COPPER at this moment, if anything a long might be setting up here. However, just as an overall gauge on things this says to not be too bullish on stocks here.
The net comment for today using our fearless leader as our guide is, if you do the wrong thing over and over expect bad results. If you are having bad results, change what you are doing, do not just walk off a cliff following what you are comfortable with.
Get out of your comfort zone.