October 16, 2014

Don’t Panic It’s Only A Number – Revisited Again!

nothing is impossibleThursdays’ trading action again brought to the forefront a post I first wrote in November 2013 and republished in April 2014, entitled “Don’t Panic, It’s Only a Number”. I’m bringing it back today as a reminder to myself and anybody else that may get caught up in the levels reached during today’s selling and then the intensity of the recovery off of the lows.  Viewing it in any other context than, “it is only a number” would have drawn my focus to the “who, what, where and why”, which in turn normally takes me away from participating in many trading opportunities.  I don’t know about you but I hate when that happens.  I’m repeating my post from November 17, 2013.  In it I talk about the importance of “trading the numbers”.  That is very important to keep in focus when the NQ slides to new lows overnight coming within a few ticks of make or break support at 3677 reaching a low at 3684.75 and then rallies to 3786 by mid day. The YM was even more impressive creating a 300-point range within the first few hours of trading and the ES put in a stellar performance with a 54-point range by mid-day. These are huge swings and produce more opportunities for every level of trader. Stopping to figure out why the market was selling off or surging higher is a total distraction and takes you out of the present and the opportunities the market is giving.

From my November 17, 2013 post:

buybuybuysellsellsellOne my oldest trading friends called me on Wednesday after the markets turned around and blasted higher.  “Can you believe it?  The S&P is making new highs.  So is the Dow.  Man just look at the Russell and NASDAQ.  Has the world gone nuts?  Who’s buying at all time highs? “  To which I responded “Don’t panic it’s only a number.”

In all fairness I have to admit I’m constantly amazed at the trading action as the markets move to their respective highs.  Even though I have for several years written that the equity markets would do just that move to new all time highs.  To make matters more confusing I’ve added that they will do it on increasingly negative input.  So it won’t make much sense against what the economies are actually doing.  To sum it up the markets will go up on the hope whim and a few prayers that all will resolve itself and the global economies will right themselves and progress forward.  That’s what history has told us right?  Not really. 

Whether or not I agree with a particular direction the market may be taking as a day trader I can’t stop to try to figure out the why or the cause.  To do so often results in missing numerous very profitable opportunities.  Instead I attempt to ascertain the market mood and see what opportunities are available.  That’s where the Diversified Trading System comes into play.  Using the Hawk, Eagle and Falcon to generate trading signals takes much of the emotion out of trading.  If you are attempting to trade against algorithmic traders that run a multitude of programs it is best to not second-guess but to trust your signals and once again this is where the Hawk, Falcon, and Eagle excel.  Coupled with Indicator Warehouse’s Trade Manager has proven to be a winning combination in allowing a trader not to panic and trade the numbers.

keyinsandThe current atmosphere remains prime for day trading.  I expect there will be numerous opportunities from a growing list for both traders who approach the market from a bullish prospective as well as traders who approach the market from a bearish prospective.

Remember the key is being able to reduce and separate the “noise” from opportunity. This takes knowing and executing a well-defined strategy and allows you to see opportunities amongst the “chaos” and by trusting the mechanics of your strategy, be able to take advantage of them. 

Opportunity continues to knock on our doors.  While it doesn’t come without risk, risk can be defined and more manageable. Volatility and broad moves are exactly what a day trader desires and being able to respond without questioning is a luxury many are unaware of.

tradersThe Logical Signals Trade Room is up and running. We have an outstanding group of members that have already begun contributing across the board from trading indicators, patterns and products, to computer software and hardware.

Thus we are ready to move on to phase two of membership/subscriptions. Now that a core group has been established we have a few additional spots for other traders that may have an interest. Phase two, though will be somewhat more involved in that prospective members will get a chance to talk in more detail on their trading goals, experiences and expectations with me and possibly other members before deciding to join.  At this early stage it is important to continue to steer the room in a direction that favors all of the members. Should you have an interest please contact me at Michael@logicalsignals.com I should have the updated “Invitation to My Trade Room” under the Trade Room tab back in place this week. Presently we have 10 additional spots open before closing this room until next year.


Steer the course and don’t compare yourself to everyone else. You are not they and they are not you. Remember to trust and believe what makes you unique at this moment in time and in this situation and allow others to choose for themselves. Don’t be swallowed up by the chaos and false emotions swirling around. Remember it’s just a number.