09 June 2021
The day began at 6.30 in morning.
Heart: A cursory glance at metrics says I am up more than 6% in month of June 2021, not even 10 days. This comes at back drop multiple months of double digit return. The juggernaut will roll on. Stay strong.
Mind: This is all good historical data, I am uneasy about the compressed event. The order flow of Nifty, leading stocks is quite odd. Distribution is carried out even with strong results. This is a clear indication long term forecasting is not factoring next quarter for now! Don’t you remember I have been telling my trader friends…Nifty is imminent for a pull back.
Heart: Yes yes, you are writing these cocktail stories for days. The market is booming and will rise further. There is no stopping, god is giving you money. Grab with both hands.
Mind: No no, I will play safe. I won’t take new positions and watch the existing positions closely.
Heart: As you wish but I am telling you. Boss you are doing a mistake.
Heart: what happened big thinker? Market opens positive…you must shreds all your fear and go long again.
Mind: no, I will wait till post lunch .In fact at first sign of weakness if any I will trim my positions. Anyway I am 90% invested,
Heart: you forgot what Peter Lynch said. You lose more money by waiting for corrections than in actual correction.
Mind: that’s true. Who is waiting with cash? I am 90% invested.
Heart: you should be 100% invested within next 10 minutes and if possible use leverage.
Mind: no I will stay sidelines and protect profit.
Heart: as you say so! But you are going to pay a price.
1 PM- at lunch, market lost positive momentum; becomes flat.
Heart: don’t bother about this minor loss of momentum. Hang on stay strong.
Mind: stay strong for what? I have booked out all positions where there was a good profit cushion. Also exited the ones which were on minor loss. Holding only the ones where I believe order flow looks still to be on accumulation side. But back in 80% cash!
Heart: 80%?? You are mad, you are ruining the profitable opportunities. Remember Big Patrick word (Reminiscences of a stock operator)? It’s a bull market!
Mind: it may be a bull market. What is stopping me to re-enter? With exit today my average loss margin for the month will come down further while retaining the winning margin.
Heart: trading is intuition, you have to take uncomfortable decisions to make money.
Mind: thats fine, but who is taking comfortable decisions either? In speculation you have to a directional call which results in profitable amount over all. My metrics was good till date this year, so I am out. You better get lost now.
Heart: you shorted?
Heart: Did you forget this would be your 9th attempt this year in shorting, last 8 of them are failure?
Mind: I know, but combined losses from 8 attempts is not even 4% of portfolio. I have been reducing sizes.
Heart: 9 attempts back to back is suicidial. You are abandoning your better skillsets of long !!
Mind: no I am not, I am trying to go with the flow. I will not stack up full position size; rather wait tomorrow to see further.
Heart: what makes you think market will go down?
Mind: the same process which identified market will go up. No change in process.
Heart: process? Are you crazy? Bull market boss, reducing covid cases. Burgeoning profits, this is the beginning.
Mind: when did I say this is starting a bear market? No knows, no one will either. This is directional call, wrong or right doesn’t matter. What matters is how effectively I carry out this trade with risk and money management both.
Heart: you will lose, why using jargons?
Mind: Jargons? money management is fundamental pillar.
Heart: what ever!!
Heart: did you saw SGX nifty is up?
Mind: I don’t care about something which I can’t control. I know where to get out tomorrow.
Heart: we shall see tomorrow…
Mind: yes, we will. Good night!