Nobody beats the Market 100% of the time. It is a normal part of trading to have 2 or 3 losing months each year. It happens as a result of the Market going into a Market Structure Stage 4 while a position is on. The key is to minimize the loss that occurs in those months. One of the hardest disciplines to learn in trading is to close a position at a stop loss. This discipline is essential in becoming a professional trader because it determines whether an account shows at profit at the end of the year or winds up losing all the profitable months to a few unprofitable ones. Things move faster to the downside so when key support levels are broken we quickly close the position as we did yesterday for a reasonable loss of only about 9%:
Close - 6 Mar/Feb 114 SPY Call Calendars for about $0.74
Close - 1 Feb 108 Put at about $1.80
Friday, January 29, 2010
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