Saturday, January 17, 2004
Well it feels like it's been forever since checking in but I see by the last date it's just over a month. Not so long considering the major events that have gone on. I lost my focus completely over that time. We've had a mad cow wipe the floor with any longs in that market, Christmas, my 55th birthday and then the loss my beautiful cousin from a brain tumor. I know this happens each and every day but when it touches you with the loss of someone young, fondly remembered and so special, the internal heart-felt pain is difficult to deal with. Her own family of three children now alone with their father in Texas is having to come to grips with the loss of their young mother. The letter I worte my Aunt upon learning of Pat's death was one of the most difficult things I've ever done. It was rewarding to see her peers from College enjoy a celebration of her life. Having been an honors graduate, how rewarding for my Aunt to be invited to a different city for a commemorative service. Pretty cool. But honestly, doesn't it seem a cruel turn to ever be preceeded by your own son or daughter. Like I wrote, it goes on every day. But we all need to take a reflective pause, then tell our loved ones how much we care. The old adage "it's never too late" isn't true.
So, on a scale of 1 to 10, my focus on the markets has been a 3. Despite that I've found the coffee market interesting and fun. I was short corn when the mad cow went on the rampage in the barnyard. I was short on technical chart resistance so to wake up and have a near limit move with me, I of course grabbed it. Since then it's gone straight up.
I'll never forget walking into my broker's office at 05:00 one morning. I used to drive there before going to work and trade currencies for an hour or so. This particular day I was up a full cent in my short Swiss Franc position when the day session opened. That's $1250.
Howard told me to grab it. In retrospect I should have seen the overnight move and gap opening as the gift it was. Of course greed raised it's ugly head. For the next hour I fought with myself over whether or not the move would continue. You know the rest of the story. It tested the lows a couple of times, found the buying support and took off to close the gap created on the opening day session. Then the internal fight was, do I cover now or will it head back down. God, I'm glad I don't do that anymore. That's the value of experience. If you've got the discipline to listen to yourself. Well, or course the value of that move ran out pretty quick. The day turned out to be an exhaustion spike so I think by leaving the screen, not staying focused and not grabbing the gift, the entire move eroded. It's to long ago to remember how much I lost. It gave my broker a chance to say 'I told you so' which he was fond of saying. That's why I moved to electronic trading. Even after a 19 year relationship with my broker, I just couldn't deal with his negative expectations. Imagine how you would feel though if EVERY account you ever opened went broke. Usually sooner than later. Oh, the cutting truth about what leverage can do to your equity balance in a big hurry. What an interesting game.
So now the time is here to re-capture my focus. I feel we're on the edge of some big moves in a couple of areas. The small profits I took out of sugar pale in comparison to the melt down I witnessed in my end-of-day quick glances at the charts. Loack of focus causes missing big moves. I have participated in the coffee swings nicely. Ironic to find comfort in one of the more difficult markets to trade. Odd too watching the grain market with more volatility that coffee and cocoa. Your assignment, should you choose to accept it, is to find those areas of opportunity you're with which you are comfortable, and no matter which market, trade that puppy for all it's worth.
Seeing the Euro chart topping out at major resistance last week and the exhaustion spike created by the last downdraft of the US dollar gave me a nice little three day move selling Euros and buying the Uncle Sam. Felt good. I took it off the the long weekend of Martin Luther King Day on Monday. I don't trust currencies to behave well when I'm not looking.