Patience For Surviving Before Thriving


Simpler Trading Team

2 min read

Patience is needed to ride out this volatility.

The stock market started off choppy on Friday, leaning to the downside before changing direction and rallying all day to close higher across the major indexes.

At one point the Dow eclipsed a 600-point rise before closing at 31,496.30 points to gain 1.85% (adding 572 points on the day). The Nasdaq rallied to 12,920.15 points for a 1.55 % uptick while the S&P 500 led the pack with a 1.95% gain to 3,841.79 points.

Following a week filled with fast gaps down, Simpler’s traders have waded through similar choppy waters many times before and are focused on not chasing wild moves while careful to preserve capital.

This is a “trader’s market” with potential for those with a more robust risk parameter. Still, there is a collective hesitation that market lows this week are not the lowest point that signals a long run up.

Simpler’s traders continue to emphasize there is more opportunity in “getting calm and waiting.”

For this volatility, “calm” and less stressed can look like this:

  • Protect what you have
  • Stay flat/in cash
  • Wait for the right moment to strike

Relaxed, in cash, and ready is the reigning position.

Simpler’s setups will target plays with a determination for consistency through fewer, well-thought-out trades.

As this market churns along, it is displaying how money is made with patience.

A very long year still lies ahead… no matter what happens Monday.

We Saw: A strong rally to the upside – 

  • Market gaining on losses earlier in the week
  • Oil climbing higher on the day
  • Politicians fighting over stimulus

We’re Watching: For a stress-free weekend ahead of Monday –

  • How will job numbers, bond yields play next week?
  • Targeting fewer setups
  • Setups where losses won’t cause nausea