Guest Blogger: Smiddywesson
In the movie, First Knight, Richard Gere, who played Lancelot, is asked if he wasn't afraid that he would be killed when he fought. His answer was that he didn't fear death. In fact, in order to fight, you have to draw your opponent's blade to you. He said, "You have to learn to love the blade." There is a lot of talk on the blogosphere about the danger in today's markets, and there is a lot of fear of what is to come. I see it in this very blog, which is frequented by some very astute people. I hear a lot of desperate traders asking the same question, "What do I do next?" I don't speak for Allan, but I'm not really sure that is what this blog is all about. Sure, there are a lot of good potential plays given to us, but the majority of the content deals with teaching us something about how to find our own trades. When Allan highlights a potential trade, I pay more attention to what he sees and why he sees it, than to the end result. The reason is that I'm not looking for tips, I'm looking for knowledge, and especially wisdom. The greatest traders in history didn't put too much faith in their conclusions if they didn't look like they were going to work out, because they were real traders. It's the process that makes you successful, not the result.
So, where can one find safety in this market? How do we deal with the fear? Tips won't keep you safe, only you can keep you safe. You must know who you are. If you are following this blog, you must be interested in trading. Who are you? Are you a trader or is this just another hobby? Do you spend the majority of your waking day thinking about the markets? If you had all the money in the world would you give up trading? The answers will tell you who you are. Make up your mind now before you trade this market. Lancelot was a soldier. His craft necessarily involved mastering his fear. If you would trade these markets, if you would call yourself a trader, then you must recognize that your craft also involves the mastery of fear. You do so armed with knowledge and wisdom, trusting in the process to make you successful. Stop asking Allan for tips. Stop asking what to do next. Study the process and face your fear with full knowledge of the risks. On the other hand, you can cower in the bushes with the non-trader public. In that case, you will probably tell war stories in your old age about how you sat out the greatest maelstrom of trading in human history, only to see your account get eaten up by supposedly safe "investments", inflation, or the depreciation of the dollar.
There is no safety in today's markets. Stocks, commodities, bonds, currency, even metals are all dangerous plays now. Risk is everywhere, so you have to act. Inaction has become the most risky trade. Fortunately, if you are a trader, you can move away from the danger as it develops. You are in the very smallest percentage of the population that can survive and prosper in these dangerous times, but only if you can face the risks without being mastered by your fear. You have to learn to love the blade.