The emotional of trading

Trading is often very emotional . The market is emotional (fear and greed of course.)

If you are new to trading strategies and are stuck in the rut of ‘getting ready to get ready, to get ready.’ Still reading and reading and making excuses to yourself – be careful. As they say – you can make money or make excuses, but you can’t make both. What is the bests way to battle that – take action, when – now of course. Put on a small trade – 1 contract or 2 contracts. Get skin in the game.

Lastly it’s about the right time for my ½ year review. ½ of the 2007 calendar year is over and it is time to refresh. How am I doing so far? How is my health discipline? Am I working out and getting my heart rate up on a consistent basis? How are my relationships? (This will affect my trading of course.) How is your trading? What are my top weaknesses in trading? Are I spending enough time on your trading? What are the books that I have read so far this year? Have I gotten lazy in ny self-improvement with your trading / with your marriage? What books have I read on being a better husband or wife this year so far? (Remember how you do anything is how you everything.) Finally what are my top 5 goals for the rest of the year? Physically, mentally, spiritually, relationally etc.... What books are you going to read? What will my weigh 6 months from now?

Remember you pay a price in life – regret or discipline. Discipline weighs ounces and regret weighs tons. Decide what one you’ll pay – in advance.

Apple

The premise of Apple stock is that a major new product is going to roll out in the next few months. The product has caught the attention of the mass market and is eagerly anticipated. What would you expect from the stock?

Let’s look at a chart of the stock back in the middle of April, before the launch date of the new product was firmed up.

As you can see there was a nice uptrend over the previous year or so. Some of this stock price increase has been because of the anticipation of new products and some has been on good earnings reports. Now let’s look at what happens when the launch date of this new product is announced and the time right up to about a week before the new product launch.

The stock runs up quite nicely as the launch date approaches. What market condition are we possibly looking at? The famous “Buy on rumor, sell on news” phenomena. As you might have guessed by now, the company is Apple Computer (AAPL) and the new product is the iPhone. Let’s look at one more chart, which shows the stock right up to the close on Friday.

As you can see, the stock has been moving sideways as the actual date approached, with a little bump up the last couple of days. Where does it go from here? There is one last piece of news that still needs to come out. That is the sales numbers for the first weekend, which should be out early next week. There may get another small bump up when those numbers come out, but that the stock will likely trend back down as many traders who positioned in before the launch start to take profits.