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if all you can trade is onesie, twosie, then don't trade. the floor
will go with a 5-10-15 etc size over a 1 lot. trade in increments of
5 lots or don't trade.
trade only in the early morning and middle to late afternoon. wild
days chop during the middle session in thin, volatile trade.
use globex for entries and exits if you're gunshy. globex is tamer
than the pit on days like today. remember that globex doesn't take
market orders.
know the rules (not held, fast market, limit down, etc) before
trading. you know what they say about ASSumptions. it's been proven
over and over that e-trading is shitty on wild days, so avoid it or
don't trade.
don't trade breakout systems on days like today unless you're prepared
to get hammered on the slip. hell, the whole damn world sold the quad
bottom breakout today at 1055. this was so obvious that a blind man
could see it. my pit guy said paper was easily getting slipped 5+
handles.
don't overtrade. the slip will cost you your profit. example: i sold
the open, and covered around 10:30am (CDT). the bond trade was
reversed, went long on bond open and sold em when i covered the s&p
short. then i took a nap from 11:00 to 1:00 (i was dead dog tired).
around 2:00pm, I sold the retracement after the bond close and held to
the close. if i wasn't so damn tired, i'd just sell the open and hold
til the close.
remember that quotes will be running late. call the pit for bid-ask.
don't be surprised at a 2 handle spread. in the oct 87 panic, the
spread was running 5 handles most of monday morning.
the market is panic driven on days like today. i heard rumors that
yeltsin was murdered, a military coup took over, russia launched the
nukes, and clinton was in airforce one preparing a counterstrike, plus
everyone was defaulting on 200-600 bil derivatives, as if anyone would
care about money if we were in a nuke war. of course it was all
bullshit. but rumors that would have been laughed at a month ago are
taken seriously in this panic environment and are reflected in the
wild gyrations of the markets. remember that if your broker was in a
surly mood today.
my best advice: don't trade. the markets will settle down and things
will get back to normal.
TJ
contrary to popular belief, traders who make big bucks today are
meanier than junkyard pit bulls by the close.
handling losers is a hell of a lot easier than managing winners on
wild days.
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