Anatomy of bad market commentary via a tweet.

Trading is personal.  Your DNA plays a part in your trading.  I do not think you can tell someone how to trade or grieve without learning something about them (trade not grieve). With that being said there are thoughts and mindsets that make trading hard.  I do not remember the exact tweet or who said it but it was something like “I am selling the next extreme move, no time explain now.”

This was tweeted at the end of the day after a big move and I believe they are firmly in the bear camp.  I am not sure why they could not explain it at the time.  It is important to me to have breaks.  It is important for me to get away from trading.  I think you need a physical and a mental divider from the rest of your life. If I am thinking about a trade and I am not looking at charts/facts it is highly likely that I will bend the events to my bias.  It is easier for me to imagine something with my eyes closes.  But given the choice between having a break and letting my mind run wild I will let my mind run wild.

Your goal is to make money over time, you do this by repeatable and intentional action.  To make something repeatable you have to some restriction or guidelines.  Every input cannot be a variable, just like a science experience.  If there are multiple variables how do you know which adjustment worked?  If the market is going down anyone can sell it, but where do you take risk off and where are you wrong. What is an extreme move?  It could be they know exactly what an extreme move is in there head, but how helpful is that to everyone else. The best traders have the ability to adjust but even an adjustment needs to have some boundaries.

I have an ego, you have an ego, and ego is necessary to be a trader.  You have to know that you can get back up after getting knocked down that you are better than the next guy.  But it is an entirely different ego to want to be right on the internet.  Anyone can swing for the fences. By being vague in a tweet, the way I read it and I could be wrong, is that you want to be right.  You want to be right without having to risk anything.  I see this on TV all of the time, I get it on TV because you have to say something and there is limited time.  A tweet does not have to be written and there is plenty of time to explain (I could have missed the explanation).

Once again, I am not trying to tell anyone what to tweet.  That can be a perfect way to construct a trade for them. But for most it doesn’t work and I am not sure it adds much value. The reader is the one who takes on the risk.  It once again illustrates that whatever you read, including this blog, that you need to think very critically about why they are saying it and how it fits into your experience, DNA, etc.

I am not a fan of Reminiscent of a Stock Operator because Livermore did so many random things. Trading on a tip while on vacation despite not taking any tips while at his office.  He is living in contradiction and that is not repeatable.  Not only should you be asking why you made or loss money you should also be asking if it is repeatable.

To be fair to the tweeter, they may have cleared up all of those questions.  I did not check.  They could have been having an emotional/busy day.  There may have been no thought behind the tweet, which I am in no position to criticize as I am plenty guilty of that.  But I think that tweet was more detrimental to a trader’s progress than helpful.

So please, do not tweet something vague and without context about a trade if you truly want to be a steward of the business.  I have a deep respect for those that share their experience and knowledge but do not understand the purpose of the tweet other than what I outlined.

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2 Responses to Anatomy of bad market commentary via a tweet.

  1. tom power says:

    Well I certainly follow the flock but unfortunately I’m always late to the party.

  2. […] you have an ego? Once was a guy in the $ES_F with a badge EGO. Wore it to remind him not to have […]

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