I’ve recently written here on the blog and in my tweets that the rally into options expiration was very suspicious. Frankly it reeked of bullcrap to me. But I don’t try to fight such things any more. A year ago I would have loaded up full short. However a year ago I would have been way too early and probably broke even. So now I know better.
Two days ago we had that late afternoon selloff and I tweeted “someone knows something”. Well they did. That’s why it’s extremely important not to fight it. Today I traded only on the short side. I didn’t trade that well as I didn’t get any major runners. And one trade I did 1 contract, if I had done 2 I could have gotten a lot more. But each trade is a lesson to be learned. What’s important is that today I traded on the right side. Short only.
When there is a strong move like that, pick your spots and be patient and wait for the the market to come to you. I waited 90 minutes for my first trade this morning and didn’t take another trade after that. Then today in RTH I was quite patient as well. If I was a better trader I could have made a killing, but I’m not and I know that. I know my limitations. I know my edge and when it’s valid and when it’s not.