June 2008

How Clear is Your Market Vision, Through the Lens of Emotions?

Do lower prices frighten people? Or, do fearful people cause lower prices?

On some level, it is clear that the ebbs and flows of a Market Chart represent the collective fear and greed of its participants. As more people get fearful, you have more sellers. As more people get greedy, prices catch a bid.

But what about you and me? Are we immune from the primal portion of our brains? As I was thinking about this, I saw the following quote:

"The thoughts they had were the parents of the actions they did; their feelings were parents of their thoughts."

-Thomas Carlyle (1795-1881)

It is true, isn't it? Thoughts flow from feelings. Or (at least) feelings affect thoughts. At some level, I've known this about many discrete areas of my life (motivation, relationships, etc.). Yet I've resist accepting this as a global truth.

Nonetheless, it makes sense that understanding (or at least recognizing) what you feeling is an important step in better thinking and better actions.

Likewise, if you are a discretionary trader, it might be interesting to note how your emotions affect your trading. For example, it is pretty clear that your emotional state can create an anchor point and context that affects
judgment and even the interpretation of market signals (for example,
whether or not to take a trade).

On any given day, I might get angry, happy, frustrated, excited or even
greedy. We all experience a range of emotions regularly, don't we? Yet from a trader's perspective, it might feel like nothing noteworthy is happening to them throughout the day. Why? Because traders are so used to the range of emotions they experience, experiencing them again simply feels "normal", and they learn to ignore them.

As a systematic and algorithmic trader, emotions still affect my day. That is why we follow the "rules" while the market is open. Discussions about changing rules or adding new rules happen after-hours (when the fear and greed simmer down and heads clear).

Clearly, many things can affect how and when a discretionary trader
trades. Identifying and recognizing when something affects you is the
first step towards mastering it.

June 22, 2008
How Clear is Your Market Vision, Through the Lens of Emotions?

Do lower prices frighten people? Or, do fearful people cause lower prices?

On some level, it is clear that the ebbs and flows of a Market Chart represent the collective fear and greed of its participants. As more people get fearful, you have more sellers. As more people get greedy, prices catch a bid.

But what about you and me? Are we immune from the primal portion of our brains? As I was thinking about this, I saw the following quote:

"The thoughts they had were the parents of the actions they did; their feelings were parents of their thoughts."

-Thomas Carlyle (1795-1881)

It is true, isn't it? Thoughts flow from feelings. Or (at least) feelings affect thoughts. At some level, I've known this about many discrete areas of my life (motivation, relationships, etc.). Yet I've resist accepting this as a global truth.

Nonetheless, it makes sense that understanding (or at least recognizing) what you feeling is an important step in better thinking and better actions.

Likewise, if you are a discretionary trader, it might be interesting to note how your emotions affect your trading. For example, it is pretty clear that your emotional state can create an anchor point and context that affects
judgment and even the interpretation of market signals (for example,
whether or not to take a trade).

On any given day, I might get angry, happy, frustrated, excited or even
greedy. We all experience a range of emotions regularly, don't we? Yet from a trader's perspective, it might feel like nothing noteworthy is happening to them throughout the day. Why? Because traders are so used to the range of emotions they experience, experiencing them again simply feels "normal", and they learn to ignore them.

As a systematic and algorithmic trader, emotions still affect my day. That is why we follow the "rules" while the market is open. Discussions about changing rules or adding new rules happen after-hours (when the fear and greed simmer down and heads clear).

Clearly, many things can affect how and when a discretionary trader
trades. Identifying and recognizing when something affects you is the
first step towards mastering it.

June 22, 2008
Phi on Fibonacci and Markets

As noted, 6/18 is "Phi Day" for Fibonacci aficionados.

So, here is a link to a description of the sequence on Prechter's Elliott Wave website.

And here is a follow-up article.

June 18, 2008
Phi on Fibonacci and Markets

As noted, 6/18 is "Phi Day" for Fibonacci aficionados.

So, here is a link to a description of the sequence on Prechter's Elliott Wave website.

And here is a follow-up article.

June 18, 2008
Online Meeting Schedulers

Have you ever tried to schedule a meeting with one or more people, only to play "dueling calendars"?

Even one-on-one lunches can be tough without shared calendars. Getting groups together is considerably more challenging.

Most people understand the hassles of playing telephone tag, and email can be the same. To organize a meeting or event, it might seem that it's easy to simply send an email message. But more often than not, you need to know when people are available. For example, if you're inviting six people, you need to wait for six separate responses, manually collate them, and hope you've got a match, then confirm with all the details. If you don't get a match, you have to start all over again. Moreover, there's just too much room for confusion and error in this process.

Well, I just found a few tools that help solve these problems.

MeetingWizard sends the invitations and collates all information and all responses in one place. Another advantage is that it organizes and standardizes the event information so that important details aren't missed, and users become familiar with a standard request-response interface. This makes scheduling go much more smoothly.

Another tool I found is called "Presdo" and excels at understanding natural language phrases,like: next Wednesday or two weeks from today.

I also liked Presdo's user interface, which includes the ability to search for locations and include map links in the invitation. Here is an example.

Two others worth checking-out include Tungle and TimeBridge.

So, let me know what you think.

June 18, 2008
Online Meeting Schedulers

Have you ever tried to schedule a meeting with one or more people, only to play "dueling calendars"?

Even one-on-one lunches can be tough without shared calendars. Getting groups together is considerably more challenging.

Most people understand the hassles of playing telephone tag, and email can be the same. To organize a meeting or event, it might seem that it's easy to simply send an email message. But more often than not, you need to know when people are available. For example, if you're inviting six people, you need to wait for six separate responses, manually collate them, and hope you've got a match, then confirm with all the details. If you don't get a match, you have to start all over again. Moreover, there's just too much room for confusion and error in this process.

Well, I just found a few tools that help solve these problems.

MeetingWizard sends the invitations and collates all information and all responses in one place. Another advantage is that it organizes and standardizes the event information so that important details aren't missed, and users become familiar with a standard request-response interface. This makes scheduling go much more smoothly.

Another tool I found is called "Presdo" and excels at understanding natural language phrases,like: next Wednesday or two weeks from today.

I also liked Presdo's user interface, which includes the ability to search for locations and include map links in the invitation. Here is an example.

Two others worth checking-out include Tungle and TimeBridge.

So, let me know what you think.

June 18, 2008
Cell Phone Popcorn Popper

Up till now, I've kept my cell phone in my front pants pocket. After watching these videos I'm worried about fried eggs. Pretty cool … or hot … depending on the perspective.

Here is the direct link.

Just in case one wasn't enough.

Here is the direct link.

So, what does Snopes say?

June 17, 2008
Cell Phone Popcorn Popper

Up till now, I've kept my cell phone in my front pants pocket. After watching these videos I'm worried about fried eggs. Pretty cool … or hot … depending on the perspective.

Here is the direct link.

Just in case one wasn't enough.

Here is the direct link.

So, what does Snopes say?

June 17, 2008
“It’s About Time” — Or, Isn’t it?

There is a difference between working on a problem and focusing on a solution. Thus, trying to improve performance is different than focusing on limiting losses.

Einstein said: "We cannot solve our problems with the same thinking we used when we created them."

It got me thinking. Most trading charts are time-based (meaning that price change is measured against time). But maybe looking at price change in other ways would provide a different perspective.

There are several interesting techniques gaining favor among technical traders. These include measuring price change based on a certain volume traded or a constant range of directional movement. Here is a link to a brief article about this in StockCharts.com.

In some respects, these are "smoothing" techniques. Nonetheless, they present a different picture of the market, and are something worth investigating.

Here is how the S&P 500 Index looks like in one of these charts.

June 16, 2008
“It’s About Time” — Or, Isn’t it?

There is a difference between working on a problem and focusing on a solution. Thus, trying to improve performance is different than focusing on limiting losses.

Einstein said: "We cannot solve our problems with the same thinking we used when we created them."

It got me thinking. Most trading charts are time-based (meaning that price change is measured against time). But maybe looking at price change in other ways would provide a different perspective.

There are several interesting techniques gaining favor among technical traders. These include measuring price change based on a certain volume traded or a constant range of directional movement. Here is a link to a brief article about this in StockCharts.com.

In some respects, these are "smoothing" techniques. Nonetheless, they present a different picture of the market, and are something worth investigating.

Here is how the S&P 500 Index looks like in one of these charts.

June 16, 2008