I watched a film the other day called the Oxford Murders. I’m not recommend you watch it because I thought it was average at best. It did strike a chord with me though. It’s about a professor and his student who try to stop a series of murders seemingly linked by mathematical symbols. The thing is though as they go along trying to figure things out they mention about Human beings finding an order to everything.
What is the next number in the sequence 2,4,6,8…..? Most of us including me would say 10, but why not 11 or 12 or 438 or any other number? The fact is we create the sequence in our minds that each number is equivalent to it’s predecessor + 2, 2+2=4 4+2=6 6+2=8 and so on. If the sequence went 2,4,6,8,438, I’m sure there will be some way to calculate the sequence.
What I am trying to get at here is that although the obvious choice is 10 it can in fact be any number and someone somewhere will find the calculation that fits the sequence. This is how I feel about my trading sometimes. I feel like I am trying to make things fit and I think that I see patterns in the charts but most of the time they turn out to be a load of rubbish. So where does this leave me? Well more confused than ever. I think I need to just try and keep things simple. Rather than thinking I see patterns emerging in charts I should look at what the chart tells me has been happening a trade based on what has been happening rather than what I think is going to happen.
Alan put it best a few weeks ago with his K.I.S.S (Keep it simple stupid).
Does anyone else feel like they only see what they want to see in a chart sometimes? I’m not sure how to stop myself doing this but I know I need to work on it.
My position in standard life stopped out today for £13 loss. I currently have 3 open positions and I am in no hurry to add to them.
On a brighter note my Dad, who is even more of a spread betting beginner than me, made a quick £30 of a trade in BP today. He’s always had an interest in stocks and shares but is more of a hit and hope trader than trying to use any kind of technical analysis etc. The thing is he’s doing way better than me. He hasn’t traded for ages and the first time he does he makes himself a tidy little profit. Not bad considering his account size is less than £200. So well done to him. It’s more sheer luck than anything else but maybe that’s where I’m going wrong!
With the FTSE 100 only looking like it can go lower at the minute I’m looking for some possible shorts. I’m going to try Malcolm Pryors strategy from his Spread betting Handbook. Look for trending stocks, wait for a pull back then get in on the action if the price returns to the trend. If you haven’t read his spread betting handbook it’s well worth a read. It was the first book I ever read about spread betting and I think if I had followed most of the rules he outlines in there I wouldn’t be in such a mess now.
Anyway I’ve rambled on enough today.
Until next time
“May the markets be with you”
Spread Betting Beginner