10/20/2006
1. Trade: Sold all 30 remain contracts at 0.7.
2. Evaluation: Lost again, but still keep the 30% profit, could be considered as an improvement. Of course, compared to the more than 120% profit a few days ago in the account, it is absolutely a failure.Although this sell lost money, the problem is within the buy, not the sell. It is another lesson, if not sure, do nothing.
3. Idea: The market is weired now, so the best thing I can do is just watching.
Although, I still think that before the election day, which is on Nov. 7th, the stock market should go up futher, my reasons are:
1)I think the Wall Street should do something favor the Republic;
2)I am considering the motivation of MMs from the intraday movement, if the MM's want to knock down the market, the way they played in the last week could only let those most cautious bulls leave, and those most brave bears enter, and gave them so much time to make their decision (four days). And, if the market will reverse, I expect a big, crazy up and then an intensive fluctuation followed, which is a typical movement MMs use to leave the market.
On the other side, I have to believe what I have seen in the market, which might support the idea that the uptrend is over:
1) QQQQ is weak at the most time in this week, which is a bad sign according to my experiences;
2) Although the quartly reports of most major companies are handsome, the whole market's response is really realy plain;
3) On Oct. 12nd, 13rd and 16th, I did see how excited all the bulls are and how desperate all the bears are, it is the legendary signal of reverse, if it is true this time (the market goes weak and eventually goes down from now on), I feel lucky because I experienced the moment and I can remember it, which will be a great experience for me. Since in the last a couple of years, though I was trading, I seldomly watched so closely to other's reponse to the market.
And at least, this should be true that when all the bulls are celebrating and bears suffering from their lost, the market would not go up further with large step, it either goes down almost immediately or goes up a little bit and then goes down, at least in the short term (within a week). This is a really really useful experience.
4. New idea:
Should rebuild trading methods according to the experience and lesson got from this round of trade.
