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![\"NE](\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2009\/11\/NE-trade.bmp\" "\\"NE")
<\/p>\n","protected":false},"excerpt":{"rendered":"If POT breaks 112 then I will get long.<\/p>\n
If RIMM hits 65 I will start a long term short.<\/p>\n
If MON gets above 70 then I will get long and try and stay long till 74.<\/p>\n
If AAPL breaks 205 I will whack the bids and play the downside momentum.<\/p>\n
All of these are example of excellent trading plans our traders have developed at some point during this month. \u00a0This is great work and examples of the continued opportunities in the market. \u00a0And then today this happened:<\/p>\n
“NE just dropped. \u00a0I don’t know why?” alerted Beyda.<\/p>\n
“Any news?” I asked.<\/p>\n
At 39.60 an offer was tested and held. \u00a0Short Bella for 1\/3 of a lot.<\/p>\n
Then at 39.40 the offer was tested and held. \u00a0Short Bella for 1\/2 of a lot.<\/p>\n
Still later at 39.25 the offer was tested and held. \u00a0Short Bella for one lot.<\/p>\n
Again the news had not been announced.<\/p>\n
39 held the bid and I lightened up. \u00a0The stock traded slightly higher. \u00a0The 39 bid was tested again and held again. \u00a0I lightened up some more. \u00a0After two more holds on the bid and near 39 I got almost flat.<\/p>\n
And then came the news. \u00a0The news has no relevance to the point of this blog.<\/p>\n
I had not planned to trade NE. \u00a0I did not know the news. \u00a0The tape CLEARLY indicated a shorting opportunity. \u00a0The intraday trend offered evidence to short. \u00a0Our intraday fundamentals indicated that NE potentially might finish at the low of the day. \u00a0And I got short.<\/p>\n
Yes it is great to be prepared. \u00a0And yes almost all of the trades you make require\u00a0substantial\u00a0preparation. \u00a0But some part of your trading must consist of just playing. \u00a0The stock was weak so get short. \u00a0This is a pattern that I recognize is an excellent risk\/reward. \u00a0It was just not a planned event. \u00a0 And see what happens. \u00a0Not every trade must intellectually make sense to you.<\/p>\n
Think of college basketball. \u00a0A team practices hours everyday. \u00a0Plays are taught and practiced. \u00a0These plays have names. Coaches scream them out from the sideline to their point guard. \u00a0There are two minutes left in a close game. \u00a0The play drawn up is to thrown the ball into the low post through your side. \u00a0You receive the ball and recognize your defender is off balance. \u00a0You instinctively dribble past him, drawing another defender to pick you up and you dump the ball to your cutting teammate for a layup.<\/p>\n
Those that need for every trade to make perfect sense are not complete traders. \u00a0This was a great shot. \u00a0This was not the play drawn up. \u00a0But this is just what was offered by the defense and you made a play. \u00a0Sometimes this is what happens in trading. \u00a0Can you just play?<\/p>\n
Best of luck with your trading!
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