hi spanish just found this article and its from a very experienced spreadbetting trader tom hougaard but i think captures you mood have a read mate :
A month passes quickly in the markets, and it seems a long time ago when I ran into trouble.
Sizeable trouble, as my boss would say. My tale starts on a Sunday night in September. I was due to be in Liverpool for a business meeting on Monday 15 September. The US markets on the Friday before had closed on a cheerful note, and I had bought some Lehman Brothers stock, and some stock index contracts before the close. It seemed like a good idea at the time.
The markets are for the most part a 24-hour operation that close at 10pm on Friday and open at 11pm Sunday night. Part of my routine is to log into the Interactive Investor platform Sunday night to check currency prices and where the FTSE and the Dow are indicated to open.
As the quotes flashed before me, I knew I was in trouble. The news prompter on the trading platform told all I needed to know: Lehman Brothers had filed for bankruptcy, and the markets looked set to plummet.
Trading volatile markets is a bit like dealing with wild animals: anything can happen. They can be calm one minute and explode the next. In this scenario no indicators work, and rarely does technical analysis in the conventional sense work. So for all the tools available on any trading platform, I was on my own.
Panic stations
I once read that people die when they panic because the body is unable to assimilate information at a normal behavioural response level. An example is a person trying to escape a fire in a hotel, but is unable to open the door.
No matter how hard he pushes the door, he can't open it. The reason is that the door needs to be pulled and not pushed. The body can't always function rationally when it is in a state of panic. In the trading world, that is how crashes unfold.
The Interactive Investor platform called for significantly lower prices in both UK and Europe. The open would be dire, and like a driver facing an imminent threat, I responded by reflex.
I calculated my loss, which ran into the tens of thousands. I calculated how much I had left to trade with, and a strategy began to form: I would sell short stock index contracts on every small rally during the day.
You see, once a panic phase sets in, you will have the inevitable snap-back rallies, even during the day, but most likely, we would close near the lows of the day.
Trends prevail
An intra-day trading session is a microcosmos of the longer-term trend. There will be counter rallies or declines, but the trend tends to prevail. You can, for example, put on a simple moving average indicator on an hourly chart, even if you are intra-day trading. It will give you a good feel for the overall trend.
I got my meetings out of the way, and headed back to the hotel. I had kept an eye on the market during the day on my mobile phone and by the time the US market opened, the UK and Europe were already on their knees. The volatility was fierce, but the trend was unmistakably down.
Lehman brothers opened 90% lower than the close on Friday, and the loss was predictably huge. I had cashed in on selling short UK and German index contracts from the early morning trade, but my loss in Lehman brothers still overshadowed the gains.
The loss was bad, but it could have been worse. As I turned off the flashing lights of my trusted platform and licked my wounds, I consoled myself with the thought that life as a trader is a series of ups and downs, and at least I was around for another round tomorrow, unlike Lehman.
Trading volatile markets requires knowledge of the indicators, and when to trust them and when not to. A wise man (not me - a wise man never would have bought Lehman shares) once said that expertise is the result of experiences, and you get experience by getting your teeth kicked in.
