When I look at the markets for trade ideas I try to look with a fresh, objective mind. I try my best to tune out any bias from the trading which occurred that day or the last week, month etc. My number one objective is simply to identify what look like low-risk trades. I don’t look for longs and I don’t look for shorts, I look for opportunities.
This method of identifying trade opportunities has surprised me more often than not because I often find ideas that are against the small biases my brain will not let me get rid of are the best ones. Meaning, I may have bearish leanings on the market but I then find three great looking longs and then the next day the market goes up! It happens the other way too, I may be leaning long but the stocks are “telling me” there is weakness, as I only find good looking short candidates.
There is nothing wrong with having automated scans to assist you in finding trade setups, but as we know, ONLY PRICE PAYS and our job is to listen as objectively as possible to the market and let it reveal to us where the low-risk setups are. After manually going through my lists, as I do each evening, tonite I found ZERO low-risk ideas to present to you for trading tomorrow. The message of the market should correctly be interpreted as INDECISIVE. If you are not an experienced and skilled day trader (or you don’t mind massive drawdowns in your equity) then you really have no business being involved in the markets right now.
The market is the ultimate seductress who will lure you into giving her (why does everyone call it “Mr. Market”) your hard earned cash. Don’t be one of the dopes who has no business being in that strip club at 2AM, go home to your wife or girlfriend and appreciate what you have (weird analogy I know).
One of my favorite sayings about the market is very appropriate right now.
“It is better to be on the sidelines in cash than it is to be in the market wishing you were out.” ~Source Unknown
Good Luck in this market!