I remember a time (not too long ago) when I would return home from my morning walk along the beach – excited to see how the markets where behaving.
Ahh the good ol days, when I’d get back to the house eager to pull up my charts and see the profits. Seeing the market moving “exactly as I anticipated” and revel in the knowledge that “I’ve got this thing figured out”.
Well……
When things have traded sideways for this long…those days are now few and far between.
I’ve weathered the storm countless times throughout my career, and have endured extended periods of “nothingness” before but…..this time……this time has been nothing but a cruel exercise in both “patience” and “self-discipline”.
Frankly….I can’t remember the last time I came back to the computer and saw anything of interest. Just day after day of the same “up and down” intraday shakeouts. The same flatlined “nothingness”. The same ol day-to-day “grind” as price action essentially grinds to a halt.
It’s dull. It’s boring. It sucks the life out of hopeful traders looking to “catch a trend” when all they continue to see day after day…..is the same ol thing.
Nothingness.
At least for those of us who’ve “seen this all before” one can take solace in the fact that these extended periods of “nothingness” are almost always followed by periods of “somethingness” ( however short ) and that perseverance, patience and self-discipline always pays off in the end.
We can’t make the market move any faster,
We just plan to be on the right side of it when it does.
Very philosophical post. The void becomes nothing while turning into nothingness! 😉
You can obviously oull up a chart of $DXY / USD or EUR/USD or AUD/USD and the list goes on…..
All you can do is be patient. It’s hell for newbies looking to “catch every move” when in the general sense there is “no move to be had” so…..best advice I can give at the time.
Does it seem like the markets (over the years) have pretty much transitioned from Investor-driven to trader-driven? The traders were always there, but reacting to investor mentalities. Like when Peter Lynch headed Magellan.
Anyway, it looks like fundamentals have taken a back-seat to speculative strategies.
Yes the fundamentals have been out the window for some time now….and as I see it, it’s barely even a “traders market” as The Central Banks and HTF computers run the show.
I really don’t think there are many buyers left, as this thing continues to float on one big bag of hot air – thanks to your friendly Fed and the Central Banks.
good post kong, doing nothing is sometimes the hardest thing to do.
Disagree with you when you say markets are flat.
Fx may be flat but equities certainly are not. US and EU indices have made higher lows and higher highs, all pull backs have been shallow and rises have been steeper. Moves up are much easier and quicker than any moves down. All this implies trend is up. It takes markets hours to come down 50 points but only 10 minutes to go up, this is a sign of strength, irrespective of the reason whether this is real buying, hft or govt manipulated inspired. A move up is a move up.
A flat market is where up/down is fairly equal and markets stay within a price range. What we are seeing is markets constantly up rather than down. Markets finishing near days highs rather than days lows or days mid.
Shorts are petrified, they bailing at the first sign of a resumption of bullish trend. On what basis the bullish trend takes place is immaterial, a higher highs and lower highs means risk on. Shorts have no strength or confidence that they can stop the bulls, prices slicing up far to easily and quickly.
Just keep buying then Madness – no debate here.
Oil the same price it was back on Jan 7th…..(7 weeks flat), yes currencies markets ( as this “is a forex related site ) flat as a pancake, and U.S equities maybe a “single day’s trading” higher than highs put in early Dec, and just as close to highs back as far as mid Nov.
If you consider this “endless string” of +5 SP points here, minus a couple there as anything other than “flat” well hey…..rock n roll ma man. Keep on buying and all will be well.
A string of +5 SP points over a week still adds up. It’s the fact that despite all the known issues with the financial and macro state of the world, SP makes +5 without making a -5 which is concerning for bears.
As I commented in your last blog, I have a guaranteed 800 pips in Dow locked in (long from 17150) and a guaranteed 70 handles on S&P (long from 1926) and guaranteed 400 pips on dax (long from 10500). Chances are I will make more as I intend to cut the moment we have a 1% down day. My take is if the markets can’t even go down 1%, how on earth is it going to go down 10%-20%.
My regret is that I too believe markets are over values hence why I am only allocating a maximum 10% of my capital to all my “risk on” positions hence the above have had very little of my usual lot sizes allocated to them.
This way, I am participating in any prolonged risk on rallies and building up even more trading capital (even though it may not be on my full size). Trading is all about trading the long and the short, we are not investors. When we get so single minded and think markets ought to be heading in just one direction, even though price action is telling us otherwise, that is a sure fire way to losing not just money but your mind. How many bears are tearing their hairs out with frustration this year?
Bears will eventually be proven right, but until then, why not buy (with controlled risk) and make some money.
Sounds like you’ve timed some great entries and made some great trades – fantastic man.
I too have several hundred pips in the bank long GBP/USD for weeks, as well a host of other pairs more or less still trading flat, planning to add here on my second round of orders.
Everybody has their own approach no question, and if you’ve managed to squeeze profits “at all” out of these past few months trading – you are looking good!
USD now red on the day……and lower we go.
Forex set up / trade suggestions all firing “as suggested”.
Those trading equities walk a slippery slop up here for sure….but if you’ve managed to hang in there ….hey! Great!
We all take our shots….we all have our areas of expertise etc.. Key is that we ALL make money!
Thanks but as I said, only trading with max 10% of capital as do not feel comfortable buying at such highs so lots sizes have been much smaller than per usual.
One can be a bear yet still make money in a bull market, just have to re-organize risk and money management and just trade what you see, forget fundamentals, they simply do not matter at the moment.
Yellen talking, wow look at risk on in equities, She even mentioned equity valuations appear elevated but risk on, equities just do not care. This is exactly what I am talking about. Bears are going to be driven mad by all this.
Everyone is being driven mad by this!
It just seems to go on and on and on and on with no “real” material change ( as I trade much higher time frames / longer term ).
It’s a bitch – that’s for sure but as you’ve also suggested “It’s trading….not investing”!
Up and down intraday shake-outs, flatness, etc… this all hardly applies here. Just a couple of weeks ago you were talking about “rolling over again” on the S&P around 2040-2060. The simple fact is we are now at all time highs at 2115. You were wrong Kong, so was I, and I’m sure many others were. I’ll be the first to admit I was wrong, I’ve been trying to “short” this “top” since last October. Luckily, I gave up that plan months ago.
Adaptation is key. The market is ranging on a few key pairs. Lots of hundred+ pip back and forth action on GBP pairs almost daily have proven to be very profitable. Will this continue? Probably not, but I’m taking advantage as long as I can. Other areas of interest have been AUD/NZD at pretty much all time lows just under 1.03 last week. That’s a screaming a long-term buy and hold. There are even shorter-term plays on that pair, we broke the support turned resistance at 1.0365 and back tested it yesterday, now we’re much higher. 1.0458 as of right now with a test of 1.05 soon and maybe even 1.0570-1.0625.
The CHF pairs have also been on a tear, USD/CHF at 0.95-0.9550 looks ripe for a pullback, which will also take EUR/CHF and GBP/CHF down with it. In fact, EUR/CHF is likely to stay in a 1.05-1.10 range for the foreseeable future, so there are plenty of safe pips there for the taking in that range.
Long story short, it’s not about being “right” eventually. With that logic, you can just load the boat on stocks as you will “eventually” be proven right (even if it takes 5 or 10 years for Dow to hit 20,000 after it goes back to 14,000 first).
I’ve been wrong about a “real correction” in risk at least a couple of times over the past few months – no question about it, and thankfully have been nowhere close to “loading the boat” for at least as long.
Long term survival being key….I certainly don’t advocate “anyone” gets too attached to “any position” these days.
Am out all my long positions now, almost end of Feb and it’s been a good month albeit frustrating as I wasn’t able to load my usual lot sizes.
Price action seems to indicate we could either trade sideways or lower from here until mid March (fist reporting quarter of year).
If equity indices close down on the day or near days lows, I will initiate a short with stop loss above days high. naturally start to build short position slowly.
Nice work man.
Anyone banking profits “at all” these days should just count themselves as awesome!
Go man go.
Thank you Kong.
In this game, you’re only as good as your last trade. Best to always remain humble and appreciate all we have, no matter how little it may seen. We in the Western world have it better than 75% of the worlds population. As you said, at the end of the day, it’s just a trade.