≈ Be water, my friend. ≈
Empty your mind. Be formless, shapeless, like water. Now you put water into a cup, it becomes the cup. You put water into a bottle it becomes the bottle. You put it in a teapot, it becomes the teapot. Now water can flow or it can crash. Be water, my friend.
Bruce Lee interview on the Pierre Berton Show (1971)
When it comes to trading, coherence can be a sin. The quality of being logical and consistent at all times, independently of the scenario that is developing in front of your eyes could be a deadly mistake.
You’re in love with a company and want to stuff your portfolio with some of its shares. Coca-Cola, Apple, Boeing, Berkshire, whatever corporation. You love it, you buy it. Right?
On the other hand, you hate a bunch of companies and would never hold them in your portfolio. Azul, General Electric, Facebook and so on. In fact, you would be glad to short the hell out of them. Right?
That’s when coherence becomes the 8th deadly sin. The companies you love are on a year-long bearish trend. The ones you hate are running up like hell.
Shorting a stock that’s on a bullish uptrend is a sin.
Buying a stock that’s on a bearish downtrend is a sin.
Trade what you see. Be water, my friend.
Chart of the Day
Hold your nose and buy
Say you hate Facebook. You love the fact that this company is at the centre of a privacy scandal. “Geez, I want to short the hell out of Mr. Zucka.”
Yes, it’s perfectly reasonable except that Facebook is on a bull run since January this year. Now what?
Coach Keith King has his own version of “Be water, my friend.”: Hold your nose and buy.
Video of the Day
How to Calculate the Perfect Call to Put Ratio
In this video, Coaches Tim Justice and Noah Davidson discuss how to calculate the perfect Call to Put Ratio.
Today’s line up
Traders Lounge 11PM EST
Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.
The Coaches Show Replay
If you missed last night’s episode where Coaches Gino Poore and Noah Davidson talked about multiple timeframe analysis and some of the Scouting Reports picks from the past weekend or would like to watch it again, check it out here.
Tackle 25 MasterMind Group 8:30 PM EST
Join and learn how to better use the Covered Call System with the Tackle 25 with Coach Noah Davidson.
Halftime Report 12:30PM EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day and fun in a way that only Matt and Tim can deliver.
Market Recap
The Market Recap is designed to give you a quick overview of the day that was. While brief, this report is designed to cover all of the major events that drove the markets that day and help you plan for the trading day ahead.
Trading Justice Episode 319: Anatomy of the Bullish Retracement
In this episode we deep dive on the Bullish Retracement pattern and how to identify and qualify it. Primary qualifications include trend, liquidity, candle retracement guidelines, how to read a technical catalyst, identify signal candles and recognize confirmation candles.
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