Market Wizard 'Michael Marcus.
There is a saying when you struggle and can't find the way out of your problem "go back to basics" so I started reading one of the classic books on wall street "Market Wizard" which I read in june 2004, at the start of my trading career. What is fascinating is that after 19th years in this game, this book is teaching me a new lesson about where I am at the other end of my trading journey.
A trader from Market wizard book , 'Michael Marcus' who started a company trading account with 30k in August 1974, after 10 years he turned that account into 80 million, he resembles my own personality, very competitive. Over the years the market has taught me that being competitive does not work in the stock market, what works is being flexible!
Following is exscript form his interview, "
The best trades are the ones in which you have all three things going for you: fundamentals, technicals, and market tone. First, the fundamentals should suggest that there is an imbalance of supply and demand, which could result in a major move. Second, the chart must show that the market is moving in the direction that the fundamentals suggest. Third, when news comes out, the market should act in a way that reflects the right psychological tone. For example, a bull market should shrug off bearish news and respond vigorously to bullish news. If you can restrict your activity to only those types of trades, you have to make money, in any market, under any circumstances"
In the next paragraph he says "However, the thing that saved me was that when a trade met all my criteria, I would enter five to six times the position size I was doing on the other trades."
In the recent bull market which started in March 2023, I was not able to get any traction, I believe that though we are in a bull market technically, there are hardly any set ups in the growth area where I find three factors which Michels talks about. Then why to force, the goal should be wait patiently.I know when things line up I can make triple digit.
Until 2019, I was extremely busy with kids, kept trading games with myself, things have changed now I have so much time on my hands. The constant barrage of information from Twitter, top CAN SLIM traders, my friends, meetups, and more has created a lot of noise in my life. I've realized that I'm getting too close to the market, and this isn't proving beneficial for me. It reminds me of the following quote, which resonates with my current situation.
"If trading is your life, it is a torturous kind of excitement. But if you are keeping your life in balance, then it is fun. All the successful traders I’ve seen that lasted in the business sooner or later got to that point. They have a balanced life; they have fun outside of trading. You can’t sustain it if you don’t have some other focus. Eventually, you wind up overtrading or getting excessively disturbed about temporary failures."
The exact same situation unfolded for me recently. I made my highest trades in my CAN SLIM account. My mental game is affected due to overtrading, I realize that I need to keep it simple and trust myself. No setups, no trades.
Let me end with best paragraph from the book, characteris to good trader "
Objectivity, a good trader can’t be rigid. If you can find somebody who is really open to seeing anything, then you have found the raw ingredient of a good trader".
Happy trading.
