Does that imply that if you are bullish, you will always wait for short-term strength before entering a position, or will you sometimes buy on a reaction? If I am bullish, I neither buy on a reaction, nor wait for strength; I am already in. I turn bullish at the instant
my buy stop is hit, and stay bullish until my sell stop is hit. Being bullish and not being long is illogical.
Do you ever use contrary opinion as an aid to your trading? Sometimes. For example, at a recent goldbug conference, virtually all the speakers were bearish. I said to
myself, "Gold is probably near a bottom." [The market did indeed rally after that conference.]
Would you buy because of that type of input? Oh no, the trend was still down. But it might get me to lighten up my short position.
What was your most dramatic or emotional trading experience? Dramatic and emotional trading experiences tend to be negative. Pride is a great banana peel, as are hope,
fear, and greed. My biggest slip-ups occurred shortly after I got emotionally involved with positions.
How about some actual "war stories"? I prefer not to dwell on past situations. I tend to cut bad trades as soon as possible, forget them, and then
move on to new opportunities. After I bury a dead trade, I don't like to dig up the details again—at least not in print.
Maybe some evening, after dinner, sitting around a fire, off the record, deep in the Tahoe winter...
Can you describe specific trading mistakes that you learned from? I had a "thing" for silver for years. One of my first losses was in silver, as were many of my worst losses. It
seemed to get into my blood and hypnotize me. It inveigled me to pull my protective stops so as to avoid getting
bear-raided. Naturally, it would hold momentarily and then collapse some more. I got killed so many times by silver
spikes that I started thinking I was some kind of werewolf. I worked on myself with hypnosis and positive imagery. I
also avoided walks in the full moon. So far it seems to be working.
