Reading markets is not at all unlike reading people, with all the challenges of imposing our own meanings onto conversations, overreacting to communications, and missing the essence of what is being communicated. . .
. . . the competent trader will observe a shift in markets--a breakout from a range, a slowing down of trading--and adjust expectations and actions accordingly. The trader who enters the market with a fixed directional view and sticks with that view through minute after minute, hour after hour of contrary evidence is not unlike the bore who dominates a conversation by talking exclusively about what interests him. . .
Many traders don't trade with markets; they trade at them. Their failure is not simply one of communicating, but of listening. The socially skilled conversationalist does not barge into a party conversation by immediately talking. Rather, she will hold back, listen to the ongoing conversation, and then find a point to join the flow. An emotionally unintelligent trader will not first listen to markets; his job is to trade! Like a conversationalist who thinks his only job is to talk, the trader who thinks his only job is to trade will naturally operate outside of the market's rhythms. In a very real sense, he is not trading the markets, but his need to dominate markets. Little wonder such traders experience frustration when the markets don't yield to those attempts! . . .
I always read Brett first thing in the morning. Great stuff. Now go read his whole article, it's excellent.
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