Sage words from Rico
poster at Trader Dan’s beehive
This is violent, short-term, chop–exactly as Dan describes it. It indicates algos in a Chinese Fire Drill, and any number of manipulations, big and small. Directional trades are suicidal, ESPECIALLY bottom/top picking, which are a sign of amateurish foolishness in the best of times.
Wait for things to settle down, and settle on a real direction/trend. This means NOT trading, but it does not mean getting frustrated and pissed-off and walking away from the markets in a huff. If you do that, you will miss the subtle, yet key, daily developments (or intraday) that will provide the next good trade.
Almost everyone is drawn to trading for the thrill of quick money. It is an almost purely EMOTIONAL. The sublime paradox is that one MUST master emotions to be successful! Success comes from cooly intellectualizing your market approach. Keep your head while all around you are losing theirs, as Rudyard Kipling said. This is also what Buffett means with his famous quote about being greedy when others are fearful, etc. Most people look at it too simplistically, like some simplistic definition of contrarianism. That’s why EVERYONE says they’re a contrarian–but
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