Monday 5 January 2015
First of all, an extended thank you to each of our growing subscribers, especially those
from the beginning, and more thanks to all who took the time to visit the site and read
our commentaries. We look forward to an improved 2015 market environment.
December ended with three consecutive losing trades. The selection was not out of
line. It was the use of stops, at times a difficult art, particularly in wheat, that made the
difference for the month. There is an ongoing balance to be achieved between accepting
risk and limiting it at the same, and that is where the use of stops arises.
After the stop out in wheat by just a few more cents, price turned around and rallied
for a $4,500 advance from original entry. The month of December and end of the
year hinged on few cents stop. It happens.
The last trade in cotton was allowed to reach its full stop instead of exiting 60 – 70 tics
sooner, after being stung by the wheat stop. It is truly a function of not being able to
know how any market will develop after entry. We actually thought the cotton trade
would turn out well. Oh, well.
2014 was a year of erratic performance, a reflection of the fits and starts of most of the
markets. Choosing not to trade gold and silver from the short side, [to not abet the
manipulators], and choosing to not trade the long side of the S&P e-mini, for the most
part and for the same reason, means we missed out on two solid trending markets.
There are no regrets for adhering to that choice.
2013 ended a plus $21,566, compared to the loss of $ -2,008 for 2014. For as long as
we can keep risk management reasonable, getting back on a positive track should follow
in 2015. This is not to say our aim for positive results was different for December and all
of 2014, but losses are a function of trading in a risk-inherent environment.
To a better 2015…