Monday, May 08, 2006

The market is contrarian

I've been net long in my account since I closed a short on friday at 112.93. My two positions are at 114.52 and at 113.11 both with T/Ps at 15 pips and a S/L of 500 pips. I'm a little frustrated by the fact that my system is holding those two positions and not moving at all right now. Part of that is just me being impatient (bad news, I know) so I'll have to just calm down and let my system play itself out. The other part though is that I think we have a natural tendancy to become de-sensitised to risk the longer it exists. This is sort of like troops in a combat situation getting complacent and ending up on the business end of a land mine - in my situation, because I have become used to my current exposure to the market I might (without a system to protect me) risk taking on extra positions that would further increase my exposure. Since the idea behind my system is that even the drawdown I am currently experiencing is temporary, I have the urge to open other positions (since I know I'll be back in the money pretty soon). Thank goodness I don't trade like that anymore! I do, however, think I will open another account to play around with and do some testing with my trending system.

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