It is during times of uncertainty where you must be the most prepared mentally. Trading markets can be thrilling but most of the time oh so boring. No-limit holdem is similar to trading, as WSOP champ Robert Varkonyi was quoted as saying ‘no-limit is hours and hours of boredom and moments of sheer terror’. In this business, there is no forgiveness, no apologies and no sympathy. Nobody gives you anything, what you gain is earned through hard work, research, and diligence. So how do you gain an edge? Well, someone once said that ‘luck is where preparation meets opportunity’. If you are ready to take that next step, make that next bold move – then you do not need luck. You just need to be different – listen to the markets and not the noise.
As a technician, I use charts and technical indicators to give me that edge. I can interpret the charts based on what I see and what I have experienced in the past, there is nobody out there who can exactly duplicate my experience. So, having seen many events over the years – earnings, takeovers, high volume trades and many others – pattern recognition is my main edge. See something repeat over and over and odds favor it happening again.
I often get tweets or messages from those asking my opinion or interpretation. Every now and then I get someone’s opinion shoved down my throat. Even some of the most wild and crazy possibilities are considered – one person told me ‘the VIX will get back to 75-95, it is an inevitable fact’. Ok, whatever! Others have solicited my view on markets and will just argue with me till the ends of the earth. Ok, I’m all for a healthy debate – but stubborn arguments with no supporting evidence other than repeating what was just heard by a bearish analyst on CNBC is not thinking.
Are you aware of the noise that is going to have a psychological impact? The upcoming election will shape opinion for the coming four years and what direction we may be moving, while the much talked about ‘fiscal cliff’ has become a showdown between lawmakers in Washington. So far, markets are sanguine and not worried (yet) about any potential ramifications. Is that right or wrong? Our job is not to judge, rather just go with the flow of the markets and trade accordingly. The less thinking and interpretation we do the better off we are, focusing on what the markets are telling us about direction, trend and momentum.