I believe three motivators are found in the heart of a successful speculator: an
intense desire to make a lot of money, a longing or yearning to show somebody else up, and an internal
discontent with how things are. Great big chunks of unrest seem to be an important asset for a speculator.
Although most people seek balance in their life, I have never found that very healthy; no great achievements
were ever made by perfectly normal people. Sometimes I think about living a more balanced life. That
thought usually lasts a couple of seconds. I guess my unrest will never go away, but if my lifestyle tells us
anything, it is that unrest fans the flames of a speculator’s internal fires.
I would probably trade the markets without wanting profits if it “proved” my worth to the world, to an
old girlfriend, to my parents, my brother, or even someone I cannot identify or dredge from the recesses of
my mind. Saying I am ego-driven may be correct, but it is not about bragging, it is about showing them I can
87 percent of the time we will close above the open if the dip from
the open to the low is less than 20 percent of the day’s range
15 percent time, we get these huge blast-off days if there is a dip
less than 10 percent
there is an almost zero chance of getting a large blast-off close above the opening if
price has dipped 70 percent to 80 percent below the opening
Large ranges give way, most often, to small ranges. Your objective is to establish a position in advance of large price change. It is a classic sucker play to see a market that has been hot, with large ranges for a day or two, pull in the public just before a sideways or congestion move. Most short-term traders are losers. The reason they are is that they go from one hot market to the next because they have no understanding of how the drunken sailor swaggers, how prices move across the great wasteland of their chart books. On the other hand, we who are the knowledgeable few, play just the opposite game. We look for markets that have been volatile in the past and are known for large daily ranges, but have recently produced small daily ranges because we know a large-range day is out there not too far away!
The rule is simply to buy on the open every Monday if that open is lower than Friday’s close.