You Don't Have to Trade

There was not a lot setting up yesterday morning as the volatility had pretty much died after the first 40 minutes of the cash session. I think a lot of newer traders (and veterans alike) have this constant feeling like they NEED to be doing something. I thought I would share this series of tweets from the Intraday Alerts with the StockTwits community and hopefully drive home the lesson that "you don't have to trade".

Not much setting up...aggressive trades only 7:07 AM Dec 10th via TweetDeck
Market is sideways 6 days in a row... 7:09 AM Dec 10th via TweetDeck

Volatility is just not there. $YM_F in a 150 pt channel for 6 days and most of that has come overnight LOL = not much setting up. about 24 hours ago via TweetDeck

If you take out the o/n moves market in a 50 pt cash session range. about 24 hours ago via TweetDeck

When volatility contracts it leaves aggressive trades. You can force things but aggressive trades CAN lead to aggressive losses. about 23 hours ago via TweetDeck

So many people feel the need to DO SOMETHING. I am content to sit back and WAIT for the market to come to me. about 23 hours ago via TweetDeck

Notice that #1 is patience for a reason :) http://tradersmarts.blogspot.com/2010/05/qualities-of-top-traders.html about 23 hours ago via TweetDeck

Then we had a member ask "what do you do, specifically, to encourage/enforce that feeling of contentment to sit and wait?" This is so important. My reply was to think about the losses that can occur by being an idiot. But then I thought about it and I like to focus on the affirmative so I said it is probably better to focus on what practicing patience will do for your trading and all the benefits it will bring. Which made me think of a video from a while back that was circulating on Twitter and the wonderful line at the end of it: "If you're afraid to fall you fall because you're afraid. Everything is choice".

This is so true. EVERYTHING is choice. You can CHOOSE to be an idiot or you can CHOOSE to make smart decisions. You can CHOOSE to have patience or you can CHOOSE to sabotage your trading. What is the first thing you need in order to CHOOSE? Awareness. Awareness of self.

There is a great line from "Joe Versus the Volcano" (great movie highly under-rated) where Patricia (Meg Ryan) is talking to Joe (Tom Hanks) and she states: "My father says almost the whole world's asleep. Everybody you know, everybody you see, everybody you talk to. He says only a few people are awake. And they live in a state of constant, total amazement."

Be aware. Choose to execute patience in your trading. Be awake. Choose to live life like a child "in a state of constant total amazement".

Here is the video:


Here is the link to the audio (I couldn't find the video) of the line from "Joe Versus the Volcano":
http://www.mindspring.com/~waponi/wav/awake.wav

Update: 10/13/2012 I found the video...