When to Press the Gas
Is it time?
“Press the gas when conditions are in your favor.”
You’ve probably heard that a hundred times. But what does it actually mean?
There are times in this game when you press the gas and times when you don’t. The distinction is everything, this is what separates people who consistently make money in the market from those who don’t.
If you’re trading with the same size and frequency no matter the market environment, you’re making a big mistake and likely won’t last long as a market participant.
The past few months have emphasized that. You need to be “in tune” with the market and know when exactly you should scale up, or scale down. That’s the goal of this article.
Now don’t get me wrong, there are opportunities in a choppy market and we’ve been able to take advantage. Whether it’s buying DELL, MRVL, AKAM, or CRCL, we’ve made good progress.
I also added another position today and alerted subscribers in the chat because the market continues to act “different.” This is now the second week in a row we added exposure the same exact day we got a bullish headline.
Before the headline even came out.
We don’t control headlines but what we do control is when we choose to be aggressive. That should come when the odds are moving in our favor and the market conditions are acting as a tailwind, not when the market environment is facing headwinds.
The market environment has faced plenty of headwinds lately, that could be shifting...
In case you missed it, I’ve published two very important and timely articles.
The methodology and ideology in these two articles is what led me to buy stocks early last week, I strongly suggest reading. I think these are two of my best and most important articles I’ve written since starting this Substack.
It’s not important to buy stocks at the very bottom, but it is important to notice character changes and shifts in the market + individual names. These two articles outline how you can do that effectively.
In the remainder of this article I’m going to discuss what to look for as a signal to press the gas and trade more often with larger size, what I like to see, what to look for as a signal to lay off and scale back, annotated charts and examples of healthy + unhealthy market environments, how to identify when conditions are starting to shift in our favor, and much more.
I believe this article will be just as important as the two articles listed above, and the three of these combined will make you much more prepared for the eventual market turn.