When participants change, reaction does too.

I realize this post is about three years too late or at least two years but I see some people making the same mistakes and it is good thing to think about any way. As a general rule, I do not talk about current market conditions because if you want to know our thoughts you can sign up here for free.  And secondly it is tiresome because there is a lot of change that happens. Also, there is nothing worse than the blogger who talks about a change that everyone saw two years ago, today.  This is not a research blog.

OK.  I look at trading as telling a story. Just like when the story adds or takes away a character it has the potential to change the ending, the market acts in the same way.  In terms of volume, regulation, market events, new products, economy, market reaction; it is obvious that the market participants have changed.

I am not saying that you should throw the baby out with the bath water but the only thing that ensures your survival in this business is constant learning and discipline.  That constant and relentless tapping you feel on your shoulder every morning  is your brain tell you to continue to evolve when signs point that way. You cannot do this without learning. Have a process.

Another example, we have all taken a drink out of cup thinking it was one thing while it was another.  Nothing worse than drinking milk when you thought it was water.  The contents of the cup or what you believe is in the cup will have significant impact on how you react.

Here is the difference, I do not go into the day thinking I am drinking water.  I may have a healthy bias, based in evidence, that I will be drinking water.  I let my preparation, process, progressions help me determine what I am drinking before I drink too much.  The contents or participation changes your reaction/analysis should too.

Adapting to change is not easy, but the easiest way to do it is having a process to notice the change.  The way a market participant acts does not change as often as their participation, in this market.

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