Feelings Are The Enemy

There was a fair amount of profit taking out there (mostly significantly in small caps), but bulls were able to hold the line and manage yet another win.

Buyers were focused on airlines, biotech, chips, and transports while the sellers were heavy throughout energy, precious metals, and REITs. Stocks showing notable moves, at least in my opinion, included PPDI, IFLO, AAPL, MNTA, GENZ, MSTR, IRIS, CSCQ, COSI, ELTK, BOSC, ZONA, & CBST.

Clearly, it has been an interesting ride from the depths of despair back in April. Now, everyone seems to be in agreement - the economy is doing well, there's no inflation, earnings are good, energy prices are going to continue to come down, and the consumer is strong. Based on these recent headlines, my only question is why the market isn't up more. In fact, a whole lot more! Unless of course, all of this data is just bogus.

Just a few days ago I commented that we'd soon get a good idea how the market would react to earnings and it is quite evident that is has been exceedingly favorable. Can that continue next week when even more reports come out? If I had to place a bet, I would say that you'd be stupid to bet against it. While we're very overbought and due for a pullback, truly strong markets never let you buy when you feel like it. That's frequently the difficulty of trading - making decisions contrary to what you feel like doing based on what the tape is clearly telling you.

Feelings often work against us in trading. As many of you know, I love to trade and help readers trade better through this website, even though I know there are times I should just simply step away. When I made a couple of trades this week (both of which turned out to be unsuccessful because I was late to the party), I'm reminded of a lesson that I tend to forget - you can't trade stocks well on a part-time basis. At least I'm not smart enough to. Perhaps you're a bit more focused than I am.

As I've shared with you for the past few weeks, I've been busy with lots of things away from the market and that has taken a serious toll on both my judgment and bottom line performance. I've seen dozens of tremendous profit opportunities over the past couple of weeks, yet failed to capture any them. As a trader, there are few things worse.

So, it is time for me to eat my own cooking and follow the advice I commonly give to others in this situation - don't trade until you're ready - the market will always be there when you return. I'm currently not ready. Not ready by a long shot.

Instead of trying to do too many things and none of them very well (or even worse, actually losing money), I'm going to step aside for a little while, until August 1st. I simply need the time to clear up loose ends, make a trip to visit my mother in Ohio next week to celebrate her 65th birthday, finish another chapter or two for my book that will be finished by the end of the year, and complete some additional DIY projects around the house.

While I'm not sure that will be enough time, that's my goal at the moment and of course, I'll keep you up-to-date with my progress from time to time. Because I'll be away from trading, the frequency of posts will come to a slow crawl. I just need the time to get my act together so when I return I'll be at the level that I can actually do some good, both in trading and for those who've come to expect me to help them figure out the market through this website.

Until August, I hope all of you have a wonderful July. I'll be back before you know it!