One of my all-time favorite sayings is "money saved is money earned", and I believe that was a great saying to live by this past year, especially towards the end. Like many of you, I was stopped out of almost all of my trades by the Trade Triangles in early October, avoiding devastating losses and living to fight another day. But then there was the flip side, the urge to jump back into some trades. And I can tell that the urge to jump back in the markets is strong amongst our fellow members.
This is where patience comes into play. As I do every day, I followed my game plan and scanned the market because even in a down market there are trades to be made, but I wasn't finding anything that fit my criteria. It's been frustrating, but then I reminded myself to be patient, the market will come back to me at some point. It just so happened that it didn't in October and then I thought of that saying "money saved is money earned," and I didn't feel so bad. After all, I could have pushed and ended up with significant losses.
I know I'm not alone either, I've been talking to our fellow MarketClub members all month answering questions like, "should I change my plan?", "what are you looking at market wise?", "is it ok to trade new weekly Trade Triangles vs. Monthly ones?", "what do you think is going to happen next." I'll take a crack at answering these questions.
Should I Change My Plan?
The Simple answer is no. If you have a plan that is working for you why would you change it? You have a plan for a reason, just because the market isn't cooperating and providing trades to meet your criteria doesn't mean that you change your plan to match the current market. That mistake can be expensive trust me, I've made that mistake. Instead of getting impatient, look at it as the market telling you it's time to be patient.
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What Are You Looking At Market Wise?
While I can see some value in asking this question of fellow traders, I've never been a big believer in trading someone else's ideas. You might as well give your money to a money manager and let them trade it for you with their ideas. The same thing right?
Is It Ok To Trade New Weekly Trade Triangles vs. Monthly Ones?
This has been the number one question that I've had over the last month by far. My answer is and will always be absolutely not! The power of the Trade Triangles is identifying the long-term trend and acting upon that. The further you get away from that trend initiating the odds are less likely to be in your favor. Why put yourself in a vulnerable position just because you feel a need to trade something?
Now the only caveat to this is if you're already in a trade and you're awaiting re-entry. I was stopped out of six trades, and I am patiently waiting to re-enter two of them. The other four ended up issuing new red monthly Trade Triangles. And no, I'm not a short trader, I made that mistake a couple of times, it's just not for me.
What Do You Think Is Going To Happen Next
I get this question all of the time, and honestly, I don't know. I don't think anyone really knows, because if they did they'd be unbelievably rich, well maybe Warren Buffett knows.
Instead of getting impatient and speculating what is going to happen or forcing your hand, sit back, take a breath and practice patience.
Every Success,
Jeremy Lutz
INO.com and MarketClub.com
