There is Such a Thing as Trying Too Hard

The great irony of speculation and indeed virtually all forms of gambling is that a speculator's intense competitive spirit can often be the downfall. In other words, if a speculator has a background as an athlete in competitive sports, the very notion of losing or not winning is seen as somber, dark event. 

But to think of trading as akin to, say, college football, where the best teams typically go undefeated or barely lose one game, is a mistake and often promotes a toxic mindset to deepen the fall when the inevitable cold streak materializes. If anything, the best analogy would be baseball or golf, where perfection is of course a goal but not attainable--Even the very best baseball teams in history still lose at least forty games of the 162-game regular season. 

Hence, the notion of "trying too hard," which simply does not exist in sports where we were coached to give 110% effort at all times, is a puzzling one for speculators at times.

However, in a corrective market where we have violent gaps both ways, such as this morning's snapback, it is worth letting the market settle in a bit and see, for example, if the S&P's ETF, below on the 15-minute chart, can at least push over $277 to try to alleviate what is clearly a downtrend on this timeframe since the middle of last week. 

True, some relative strength names are enticing on the long side, as we discuss with Members, and large banks C WFC are green even with JPM's initial fade here after earnings, but remembering that corrective markets often open strongly only to close poorly compels us to hold off new swings until later on in the session, at a minimum. 

Such is the nature of corrective markets, where one must not mistake trading activity with accomplishment.