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Today: A Lesson In Stops

August 7, 2008 5:15 PM

grasshopper.jpgI have mentioned that I generally just trade paper on the SP futures while writing for this. One reason is that it is hard to trade while trying to write. The other reason is, quite frankly, I do not have the temperament to trade the SP futures as I get far too jumpy.

Today, it was reasonably clear to me that we had most likely made the day’s low 30 mins in. I also said we were likely to reverse near 1275 and it did with a low of 1275.25. It then moved all the way to a high of 1283. I saw no sign of a high and the gap had not totally filled. Therefore, I was convinced that we would eventually move higher. Even though just paper, I could have easily been up 5 to 6 points twice. If money, and you have that early - turn the pc off and head to the pool, lol. In addition, it would have been greedy as I thought we would likely reverse once the gap filled near 1287.

 Here is the problem. News had broke that Moody’s put AXP debt on credit watch for a possible downgrade - and I did not know it until it was too late. Once 1275.25 cleared, you have to exit and wait and see what will happen - not guess. I kept thinking - this doesn’t make sense…this doesn’t make sense. Well, it did make sense once I found out about AXP.

Anyhow, do as I say, not as I do. Know when you are right and know where you are wrong. If wrong, exit. It doesn’t matter why as there may be something going on that you are not aware of or you may have missed something that others see. Apparently I am the grasshopper that needs to learn from myself.

Written by Tom@StockBlade.com · Filed Under General Investing/Trading Commentary 

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