Traders can run hot and cold. When a trader is hot, everything seems easy, every trade seems to work moments after it is put on, every exit seems to be at a good time. When a trader runs cold, it is the opposite, trades considered but not taken do well, trades entered seem to go bad the minute the fill comes through.
Right now, I feel like I am running cold. The gold puts I sold the other week, went to -50% on the value within a day or two. This morning the SPY puts I just sold are at -50% from entry. Even though odds are that both are still highly likely to be winners if held to expiration, there was 50% more in premium to be made had I timed the entry points better.
Some things that traders do when cold are reduce position size, choose from less risky positions, and work through it. Some traders will take a break from the markets to clear their heads. Traders sometimes get "punch drunk" from taking too many shots to the head. Some get emotional and try to make up for losers by taking on more risk and like the punch drunk boxer in the ring this behavior can lead to getting knocked out.
Changing the subject to bonds, last night on Nightly Business Report there was another guest saying "stay away from long term bonds." This is the second one this month on the show, loudly and publicly saying that. When so many voices are doing so on business TV, odds of a bond rally are pretty good.
Long GLD, SPY, TLT
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