It is generally agreed that the markets are moved by the bears and the bulls doing battle – the war of the bears and the bulls. If markets are moved by a war, then traders must think like generals – with an army to command.

Short term traders must take it a step further and think like mercenary generals – we do not care about the ultimate outcome of the war – we only want to find an opportunity where we can deploy our troops (our trading capital), make a swift gain and retreat back into the hills to await another opportunity.

I often – no always – talk about my SRVs when I talk about trading. The reason is simple – those SRVs represent battle lines. As a mercenary general I want to only commit my troops when there is sufficient room between battle lines. As in a real war, the fiercest fighting takes place at battle lines. The stronger the battle line the fiercer the fighting and the longer it will take for the battle to move to the next battle line – in the direction of the victor in the last battle.

Short term traders, like mercenaries want to stay out of fierce fighting, strike when things are relatively calm when we are likely to lose the fewest troops (dollars) and haul our tails out before the next big battle. Big battles consume lots of troops (dollars) and we want not part of it.

My SRVs give me the edge that I need to enter the battle at the right time, capture a bit or territory (price change) and get our before the battle becomes fierce again. The SRVs also warn me when there is likely to be a lot of smaller battles that could easily go either way.

I move my troops (dollars) into and out of battle (the market) with far greater confidence when using my SRVs.

If you do not have a good feeling about sending your troops into battle, you might want to take a look at my battle strategy. In war, and in trading, the general who manages his troops best usually comes out the winner. And the winners are always the heroes.

A good short term trader thinks like a good general.

 

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The unique trading method that is Trading Between the Lines