A Weekend Note - The Delicate Balance

Sometimes I become so embroiled with picking stocks that I neglect another side of my life. I can't deny a feeling of disconnect. The market is riding high and the life in the USA no matter how much make up is put on it is pulling me down. A trepidation that has been building for some time in me is becoming more and more aware that what I've feared the most may be inevitable. This rally starting in 2009 is now seemingly going sideways and some say it will end at 15,000 and others that it will go down and can't hold without a pullback.

In "normal" times I would agree that a pullback is essential for Dow 15,000 or even to hold the 13,000 as I have been showing on YouTube. But please note that these are not "normal" times of any recent or past history of the USA. When you have a president that writes regulations at record levels, nothing will be normal every again in the sense that we, adults, have been used to. Add to it that the education of children in schools today is to adapt to the President's model, will only assure that the past "normal" will never have a chance to return. To which I must add my theory which is that in order to continue these new "normal" times the current office holder of the highest office of the world ( or so it seems) will have to be re-elected. Notice that I implied that his re-election is not a "may be", but a "must". In other words it has to be assured.

We are already witnessing the media slowly taking down the competition via much ridiculing of the debates, not to mention altering of facts by reporting dismal data as good or a "good sign" for recovery. Same results and reports a mere 5 years ago would have been deemed unacceptable by the same people, but what is not really discussed is that there is a "Hungry Hippo" in each of our households representing that the real battle is the monetary one.

Most prices today have inflated by 20% (food and energy) while houses have deflated by 20-40% in the past 5 years. So not only have household "wealth" been reduced by deflation of value in property (for those who own) but the cost of living has increased by about the same amount, reducing our real wealth overall. Which can only mean that the markets have inflated to match some of that difference at least. You know, buy less with more. As prices rise, inflation rises is perhaps new to a few, but it seems not to be a concern for those who hold stocks. Bond yields have been 0 to barely nothing, so markets have had to create room for desperate people to make something on their money.


For this President to be assured re-election will require the seeming continued "recovery" and therefore "Green at any cost" is the secret re-election slogan. With markets ending to the upside on almost a daily basis with seeming absorption of any bad news keeps the delusion of things going well and at the same time continuing the inflation to keep'em happy.

But paper money is paper money. It's paper if it's printed and it's paper until cashed from the markets and if/when that frenzy starts, the need to make it real can strip the market very fast as we witnessed back in March 10, 2000. That is the challenge for this administration and the real challenge of the Federal Reserve: The Hungry Hippo must not know that it's hungry and the masses must feel that they are gaining on this losing battle rather than losing their real wealth. So the Fed will keep printing and injecting via mandate to banks they lend to and the investors will keep buying because when the market direction is straight up, investors must invest.

At some point it will have to correct, but when is probably the trillion dollar question because just as the European Union must be kept together at all costs to keep hiding the real debt problem, the USA must keep seeming the most free and prosperous nation to the world for the same reason.

Keep it up another generation and most will not remember how it was and will accept whatever they will be told as the cause of their poverty midst their millions. Can it be done? I say yes, it can. Remember that the delusion was successfully executed by the Soviet Union for 75years and currently still held by many citizens in suppressed countries at a great human and development cost. I think current technology is already assisting in the delusion. Which only proves that choosing who you believe is just as important as what you believe because eventually you may not even have that choice.



Happy Trading, Living and Dancing
Anni

The Daily Pick - DJIA DJT SPX NDX

©DayTrading with Anni 2012 All Rights Reserved

The Daily Note - The Don't, Won't, Can't of Trading

Have you noticed that whenever you resolve not to do something, you do it anyway? The duh moment comes after you realize that you've committed the same act once again. Why is it so difficult to let go of a non-thinking habit? I'm sure there are many answers if you take the time to dwell into yourself, but consider this one also: Your subconscious mind does not hear the "negative".

In other words if you say "I won't, don't, can't do this or that" your subconscious registers "I will, do, can this or that".

The first time I heard this theory I kept looking for ways to negate it. (Get the joke?) But more often I noticed that I did exactly what I don't, can't, won't, "wanna" do, because the negative statement basically reinforces the negative action rather than replacing it.

All too often traders will repeat to themselves what NOT TO DO rather than what TO DO. So, turn the statement into a positive which will reinforce a positive action and make it your mantra rather than keeping the negative mantra as your guide. Give it time to work also, it took many years for you to practice the negative, so it will take some time to turn the tables of your mind, but the good news is that it will take far less time as you see the positive results to your positive thoughts and actions.



Happy Trading, Living and Dancing
Anni


The Daily Pick - $DJT NDX Outlook


©DayTrading with Anni 2012 All Rights Reserved

The Daily Note - Analyzing your Analyst

Being in the moment does not mean that you are not influenced by anything else that may be going on at that same moment. Your mind may be chattering away, critiquing or cheering, uplifting you or digging your grave. Your ears will not be automatically plugged up to any news, discussions that may be blasting in the background of your charts, and your eyes will notice all sorts of possibly distracting pictures and of course you will not know any of it if you are not paying any attention.. right?

Well, not quite. You will record every bit of it and may even recall it later, often too late. You may note it consciously or unconsciously but it will be noted and recorded and played back at the right moment to bug the heck out of you if you ignored the information the first time. Usually it's that "gut" feeling that you recall not paying any mind to at the moment. So the painful reminder will show up as you watch that move you just "knew" would happen and see your opportunity of the trade wave goodbye. It will come back to haunt you the 2nd. 3rd, 4th, 5th, umpteenth time until you get it. What I am trying to tell you here is to pay attention to the moment, in the moment, because lessons to be learned will repeat.

On the other hand, if your chatter is arguing with you, calling you names and reminding you of every bad thing that you ever did, that tells you something too. Note also that usually your chatter is not a positive influence about the action you are planning to take. It is because the "something" usually has to do with fear of change. This is the part of you that will protect the "status quo" because although the threat of change is uncomfortable, it also threatens our conception of safety. There is always a part of us that wants to feel safe and comfortable no matter how irrational it may be.

So it's no wonder that what our logical mind says, our illogical, emotional self will battle; same as, with what our "gut" says, our logical mind will battle. These battles take place every split second we make a decision stay or change and they rage on with our without our conscious presence.

By now you have probably figured out that the analyst you are analyzing is yourself and that the way you approach yourself has a 99% percent to do with how successful you are in life and as a trader. Because you are your best friend and worst enemy, is why you have the greatest ability to overcome the failures. Imagine if you had to depend on someone else to do give you the gift of that ability. You would be dependent, but because it's up to you, you are independent.

So rather than lamenting over whether you can change or not, rejoice in your ability of recognition first, because recognizing that what you are doing is about you and no one else, is 90% of the breakthrough. The rest is the action you need to be willing to do which will take you to change and success.




Happy Trading, Living and Dancing
Anni


The Daily Pick - $DJIA



©DayTrading with Anni 2012 All Rights Reserved