One of my buddies growing up became a black belt at an early age, and we both became big fans of the great Bruce Lee. “Enter the Dragon” is a classic, almost as successful (as a low budget film) as the original “Halloween”. Bruce’s physical prowess is amazing, but his mental abilities even more so. It’s what led to what we all viewed in his films, but his workouts and his mental toughness, truly magical. His “one inch punch” and his “two finger pushups” are legendary:
So what does this have to do with trading? Well when you familiarize yourself with some of his quotes, it starts coming together, such as:
“If you spend too much time thinking about a thing, you’ll never get it done.”
“I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times.”
There is way too much thinking which goes on with markets – way too much.
What have we heard from the total clowns who populate the media about Bitcoin for months, and the stock market this week – “crash”, “bubble“, blah blah.
What did I say this week, and repeat on Friday:
“In the meantime, I do not remotely believe the bull market in stocks is over, not even close, but I do believe volatilty is here to stay, and I do believe in opportunities being more available going forward. And I do not believe in the very amateurish gold permabull theory that the “crashing stock market” will cause gold to soar….
As to stocks, for the last few days I have not given symbols. Since starting this website, I have given this advice at times – don’t “press it”. But I’m looking thru some of the wreckage, strong stocks which haven’t “broken down” like ABBV or IMMU (long), or former strong stocks which have broken down like OSTK (long), or stocks in accumulation like IOVA , or stocks which have recently broken out like INTC. I have given out numerous stocks which fit these categories.
I talked about this idea yesterday – “Turn Around Tuesday” – an old Wall Street saying.
“It is the low rates, especially the last few years, which has smothered volatilty. That is history….Mondays after a big Friday selloff can often be a turn around day. And the retest on Tuesday.”
“I believe stocks are in a major bull market, nothing changed there. The stock market will continue to be volatile. I believe this whole area, is reaccum, meaning what – more new lows ahead, and “not at all easy – not at all”. Exactly what I’ve been/had been saying about BTC – not at all easy, as we did spike to new lows. Still long BTC and ETH, but aware of this resistance area (chart below).
I only listen to my work. When it is (I am) wrong, I fix it. Everyone else, everything else, to me is sentiment. Nothing more. Please understand how important it is to spend the struggle to hone your work, and then trust it. This business is purely about probabilities, working hard, believing in it, implementing it, entering, exiting. Period. I am very stubborn, too stubborn at times, about my belief in the trend. But again – probabilities.”
Why does almost everybody want to make this even more difficult
This isn’t a physics exam, it’s about overall performance. It’s not about pontificating, analyzing, spouting hot air, guessing, and over-thinking. It’s about learning one specific trade setup (not spending time thinking), and studying chart after chart after chart (10,000 kicks) – to imprint in your mind exactly what it is you are looking for. And no, there are no two trades which are exact, but the setups themselves, the process, the details, yes exact.
My favorite trade by far is a spring, we saw it in the stock market a few times this week (intraday) and a daily one Friday – time-frames. Along with accumulation and the trend and springs, I have discussed these technical situations more than any other. Many years ago, as a struggling (very struggling) trader, I finally understood that it is about focusing on one specific setup, becoming a master at it, and then being able to survive and to prosper in this tough business. And then I learned several other specific setups, these are discussed over and over. But we will never make it without learning that one specific setup, mastering it, and then keep doing it over and over. No one taught me anything in this business, I just worked my a.. off.