{"id":2734,"date":"2009-11-27T18:22:46","date_gmt":"2009-11-27T23:22:46","guid":{"rendered":"http:\/\/www.smbtraining.com\/blog\/?p=2734"},"modified":"2023-08-02T16:57:08","modified_gmt":"2023-08-02T20:57:08","slug":"reflections-on-black-friday-market-psychology","status":"publish","type":"post","link":"https:\/\/www.smbtraining.com\/blog\/reflections-on-black-friday-market-psychology","title":{"rendered":"Reflections on Black Friday: Market Psychology"},"content":{"rendered":"

At 5:15 AM I awoke Eastern Standard Albany Time. \u00a0I was in Albany, New York about to take a borrowed car to the Amtrak train station to the subway to my office trek. \u00a0Door to door it took me just under four hours. \u00a0I was the only one awake on Amtrak from Albany to Penn Station as I was preparing for today’s open, trying to communicate with my partner Steve, rip through charts, and find patterns from overseas trading that might give us an edge before the open.<\/p>\n

The night before we had called all of our traders in for today’s trading session because of the Dubai news. \u00a0We reached some but not all. \u00a0We spread word to the StockTwits community that this Black Friday was not a session to miss if possible. \u00a0SPY was opening down huge. \u00a0We might bounce. \u00a0We might tank. \u00a0Whatever would happen would offer opportunity. \u00a0As intraday traders opportunity is what sustains us (though for one of our traders it’s Burger King and candy). \u00a0I was hard pressed to remember a day that offered more potential intraday trading opportunity than this Black Friday as I reflected on this trading year Thanksgiving night.<\/p>\n

As a trader you never know when you are going to walk into a market raining money. \u00a0Today could have been that day. \u00a0I was not going to miss it. \u00a0So I woke up early, sacrificed time with my family (which is of great importance to me), and started my\u00a0travails.<\/p>\n

I patched into our AM Meeting which we broadcast to the StockTwits community via a crappy travel lap top (all in we are talking $300) from a spotty wireless region. \u00a0But I saw and heard Steve from my reclined seat on Amtrak offering me a game plan for today’s open. \u00a0That was pretty cool. \u00a0What a super job by Steve and all who helped him prepare for his show running down all the key levels to watch before the open. \u00a0But then he said something that mattered most of all. \u00a0And it is the central idea that market players ought to take away from our trading today. \u00a0Steve introduced the idea of market\u00a0psychology.<\/p>\n

Yes the news before the open was not good. \u00a0Asia had digested this Dubai news the past two days and showed signs of food poisoning. The Asian markets got hammered the past two trading sessions. \u00a0And our markets were poised to open supremely weak. \u00a0But Steve reminded all of us that what mattered most was market\u00a0psychology. \u00a0The market has shrugged off every piece of negative news since SPY 70 (boy does that seem like 3 years ago). \u00a0The pattern that has rewarded traders of all trading periods the past year has been to buy the dips. \u00a0Steve reminded us that if SPY held above 109.10 then this would be a signal that this was just another piece of news the market would likely shrug off. \u00a0It did.<\/p>\n

We did not see the panic in the financials that some might have expected before the open. \u00a0The\u00a0psychology\u00a0of the market is still to buy all dips. \u00a0 What will change this? \u00a0I am not sure. \u00a0Maybe there were too many traders unwilling to hop on a train like me and make into work to change this\u00a0psychology. \u00a0Maybe come Monday you will see an influx of sell orders. \u00a0Maybe new news will develop that scares investors before the end of 2009.<\/p>\n

The market is what it is. \u00a0And right now it shrugs off all bad news. \u00a0Back in the day, during the Internet Boom, an internet company cold say virtually anything negative about their future prospects, the stocks would gap down, and then bounce. \u00a0The market\u00a0psychology\u00a0was to buy all gap downs. \u00a0There was a sea of money to be lost ignoring these market patterns in the late 90’s.<\/p>\n

We did see some selling in GS and FAS into the close in the last ten minutes. \u00a0That is something for the bears to hang their hats on. \u00a0We will know more on Monday. \u00a0We can learn more from watching Asia and Europe trade Sunday night.<\/p>\n

As for me, I will watching some college hoops (does it get any better than UConn\/Duke?), eating Patsy’s pizza, enjoying a glass a red wine (maybe two) and relaxing. \u00a0By the way, did I miss any good Black Friday sales?<\/p>\n

Enjoy your weekend. \u00a0And thanks for reading!<\/p>\n

Don’t forget to follow us<\/a> on Twitter.<\/p>\n","protected":false},"excerpt":{"rendered":"

At 5:15 AM I awoke Eastern Standard Albany Time. \u00a0I was in Albany, New York about to take a borrowed car to the Amtrak train station to the subway to my office trek. \u00a0Door to door it took me just under four hours. \u00a0I was the only one awake on Amtrak from Albany to Penn Station as I was preparing … Read More<\/a><\/p>\n","protected":false},"author":144,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,10],"tags":[393,394,18],"class_list":["post-2734","post","type-post","status-publish","format-standard","hentry","category-general-comments-2","category-mike-bellafiore-bellas-blogs","tag-black-friday","tag-market-psychology","tag-smb-capital","no-post-thumbnail"],"yoast_head":"\nReflections on Black Friday: Market Psychology | SMB Training<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.smbtraining.com\/blog\/reflections-on-black-friday-market-psychology\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Reflections on Black Friday: Market Psychology | SMB Training\" \/>\n<meta property=\"og:description\" content=\"At 5:15 AM I awoke Eastern Standard Albany Time. \u00a0I was in Albany, New York about to take a borrowed car to the Amtrak train station to the subway to my office trek. \u00a0Door to door it took me just under four hours. \u00a0I was the only one awake on Amtrak from Albany to Penn Station as I was preparing ... 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