ocaptain

The Market is NOT the Economy

Education
EASYMARKETS:DOWUSD   US 30 (DOW) / US Dollar
Good day, Traders! This week I came across the following headline from a major newspaper: "Stocks Suffer Worst Quarter in 2 Years Amid War, Inflation." It was a surprise to me, because, the majority of the traders that I know didn't miss a beat... March was a great month for trading, just as February was a great month, and so was January! Why is that? 

Simply put, the Market is NOT the Economy.
  • It doesn't matter is there is a pandemic,
  • it doesn't matter if there is a recession,
  • it doesn't matter if there is a war,
  • it doesn't matter if the tech oligarchs are censoring free speech,
  • it doesn't matter who slaps who at some celebrity event.
The market is composed of people, groups, and institutions trading products in a market whose prices are governed by Supply and Demand

Oil is at all time highs? Doesn't matter to us traders because we'll find opportunities to both buy and sell based on price action.

"The Euro is losing value?" they say? Again it doesn't matter to us traders because we will find opportunities to go both long and short when our system tells us to do so.

Should you Short the DOW because you think American Industrial companies are going to suffer the repercussions of the last 2 years of lockdowns? Again, it just doesn't matter to the experienced Trader - when the opportunity to go long or short presents itself, just like that proverbial fork in the road, we take it! 

"But Captain, you Magnificent Maven of Market Manipulation" you say, "It's impossible to predict market movement. I might as well visit my local casino and go all in on Red on the Roulette Wheel!"

That's what the so-called "experts" want us all to think - Give the "experts" your money and you will be taken care of in your retirement, right? How many professionally managed funds routinely beat the market? According to the New York Times, ZERO. According to a recent report by Business Insider, 90% of actively managed funds failed to beat the market. 

If these Ivy League "professionals" spending their entire day trying to beat the market consistently FAIL, Why is it that consistently profitable traders succeed? Because we traders are following those who MOVE the market. 

When we traders follow a system that works, and we then develop the ability to "work the system" we get to do what very few people get to do: consistently generate reliable income in the market regardless of economic conditions, regardless of who is in the White House, regardless of what society tells you can or cannot do based on your age, race, or economic status... that's the beauty of being a trader... Freedom.

Until we meet again, Trade well!

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