It's thirty minutes into trading on Thursday and the market is very weak this morning, due to some semi talk about weak business. This spells opportunity for short-term trading. It is much easier to make money buying weakness-turning-to-strength, then buying strength-turning-to weakness. Thus, the first part of that equation, Weakness, is now in place. If the market turns up now, our system trades should work out quite well. Oh, yea, most important of all, we don't trade anything without a system trade and if we get a system trade, we take it, no matter what shape the market is in. So why even consider market weakness verus market strength?
We consider it only in the context of the size of our bets and the length we are willing to stay in a trade. In other words, in a very weak market we might take smaller wins on reduced sized trades. In a booming rally, we might be willing to stay a little longer at the party and make more sizable bets. This is the one subjective aspect of my day-trading, overall market conditions effect the trades, on size, on profit taking, but almost never on whether or not to take a system trade. We take them all.