Spain have lifted the World Cup, the final whistle has blown, and traders everywhere are about to enter that dangerous annual period known as “the family holiday”.
For the past few weeks, our partners have complained about us watching football every night. Soon they’ll be complaining because we’re checking the markets when we’re supposed to be lying on a beach, admiring the scenery and drinking suspiciously cheap sangria from a plastic jug.
And, if we’re honest, they may have a point.
I know we’re all dedicated professionals. We don’t want to miss the next breakout, central-bank wobble or geopolitical explosion. Markets might move without us – and traders hate the thought of somebody else making money while we’re wrestling with a beach umbrella.
But there’s nothing wrong with recharging the batteries. In fact, it’s essential.
Trading is mentally exhausting. We spend months studying charts, following economic releases and listening to politicians explain problems they helped create. Eventually, the brain needs a rest. So do the eyes. And, occasionally, so do the people who live with us.
Relationships require investment too. Unlike a badly timed position, however, you cannot always repair them by averaging down.
The markets will certainly move over the coming weeks. With participation falling during the holiday season, thinner liquidity may produce sharper and less reliable price swings. A headline that would normally shift a market by half a percent can suddenly send it charging across the screen like a waiter chasing an unpaid drinks bill.
That doesn’t mean every move deserves to be traded.
Whatever President Trump says or does, there will still be trouble around the Strait of Hormuz. Whatever economic statistics are published, central banks are unlikely to make dramatic changes without good reason. And if you’re in Britain, it doesn’t matter how many political deckchairs are rearranged – the government will probably continue borrowing money and leaving the bill for somebody else.
The artificial-intelligence giants have raised enough money to keep the machinery running for another few months. China isn’t suddenly going to abandon its habit of taking Western ideas, producing something remarkably similar and selling it back to us more cheaply. Somewhere, somebody will drop a bomb, issue a threat or hold an “emergency” press conference.
There will be noise. There is always noise.
But missing one or two market moves is unlikely to destroy your future. If stepping away makes your partner, children or grandchildren happy, why spend the holiday staring at a five-minute chart?
Whether you manage a billion-pound fund or trade a couple of contracts from the spare bedroom, go and enjoy some sunshine. Read a book. Have a swim. Eat something you cannot pronounce. Give your eyes – and everyone around you – a break.
After all those late nights watching the football, this advice is more important this year than usual.
If you’re absolutely determined to trade during the holiday period, use it as an exercise in discipline. Study the charts carefully. Identify one setup that genuinely interests you. Decide where the trade is wrong before deciding how much it might make.
Then place the order with a sensible stop and a predetermined profit target – and walk away.
Yes, actually walk away.
Go to lunch. Take the family sightseeing. Try the sangria. See what happens when you aren’t watching every tick and interfering with the position every time the market twitches.
You may discover that your analysis works perfectly well without constant supervision. You may also discover that it was completely wrong. Both outcomes are useful.
Spending more time analysing and less time tick-watching can only improve your trading. It forces you to plan, control your risk and accept that markets do not require your personal attention every thirty seconds.
That is the real holiday lesson: professional trading is not about being permanently busy. It is about knowing when the odds are in your favour – and having the discipline to do nothing when they aren’t.
Sure, I appreciate that many will depict trading from the beach as a glamorous way of life: Profits, palm trees, and pitchers of exotic drinks. But as someone who has done it, seeing your families faces when you have to run back to the hotel room to recharge the battery on your lap top, I can tell you from experience, it’s not as great as many suggest.
By the end of September, the professionals will be back, liquidity should improve and markets will return to something resembling normality – whatever “normal” means these days.
Until then, protect your capital, reduce your screen time and remember that the markets will still be waiting when you return.
And make no mistake, if you are single, taking a break is just as important.
Please note the political opinions expressed above are those of the author himself, and do not necessarily reflect the opinions of JP Fund Services AS.
The post The World Cup Is Over. Now Put Down the Charts and Prepare for the Sangria first appeared on JP Fund Services.
The post The World Cup Is Over. Now Put Down the Charts and Prepare for the Sangria first appeared on trademakers.