Trade The Journey

Trade The Journey

Will 2021 be better?

Top of the Morning. I hope everyone enjoyed the holidays and celebrated responsibly. I have to say this year has been weird and unpredictable. In January, we saw the first signs of a year soon to be filled with tragedy, as Laker great Kobe Bryant, his daughter, and passengers died in a helicopter crash.

If you would have told me in 2015, we’d experience a Pandemic, be asked to stay at home, and must wear masks; I would have asked if you were referring to a movie.

For the first time in my lifetime, I saw the markets involuntarily shut down to prevent further panic. I remember watching Bloomberg ticker symbols sink further and further into the red. The federal reserve swooped in and provided the needed liquidity at the time to stave off a severe downturn. Congress was also able to approve a Relief bill designed to help those affected by the lockdown, needed to slow the virus’s spread.

Technically, we’re still in lockdown as the numbers continue to surge across the country.

As the New Year approaches, I wonder if the optimism for the new year is misguided. 2020 was probably one of the worst years in human history exacerbated by the Coronavirus.

 

Racial Tension, Police Brutality, Civil Protest, the rise of hate groups, Presidential defiance, and a slowing economy are signs of the times ahead. The new year holds the promises of a new beginning and start for us as Americans to heal but will be able to?

Even if we can put the last four years into the history books and close it shut, its stories, theories, and events will leave an impression on society for years to come.

The issues ahead for the average person lie much deeper than partisan lines. Trends are underway, changing the way we interact, work, and relate to one another. Technological feats like a self-driving car, robotic employees, and artificial intelligence make the average skilled person in the work world structurally unemployable.

Don’t worry; I won’t spend too much time rehashing all of the unfortunate events in 2020. Looking on the brighter side, I spent time with my family and hone my skills as a trader through lockdowns.

Moving forward will be a challenge because the average person will feel many of the current events for years to come.

As the stock market edges higher and higher, you almost begin to wonder, what is the tipping point?

Will it be the lack of stimulus? Mutations of the Coronavirus? A defiant President?

Or will 2021 bring the much-needed relief that we need?


It wasn’t a good week, as I lost another family member to the Coronavirus. Tonight I plan to research and place another weekly option.

Weekly options have become my go-to trade because of the weekly income. A part of me still has trouble justifying earning money in the market. I remember the first profit I made on a Bullish put credit spread.

It was a weird feeling earning a profit on the option since I exerted no physical activity earning the income. Growing up, I saw my parents physically earn their monthly income, and I felt that was the right way to earn an income for a long time.

 

You sacrifice your time to earn an income.

Trading is different; you earn an income through the click of a mouse. Of course, we as traders know this isn’t true, but it is what people believe.

“You’re going to earn an income trading? I don’t think so; that’s ridiculous.”

Mentally, I have to convince myself that earning income trading is okay. To compensate for the feeling of earning an income, I trade weekly options.

Nothing wrong with receiving a weekly income, but there is something wrong with the perspective. Until I can remove these mental blocks, there will be a ceiling to my trading.

When I see self-sabotaging thoughts begin to take form, I think of a competing idea of acceptance.

“I deserve wealth because of the effort I put into gaining the knowledge and skills to trade well. There’s nothing wrong with trading for income.”

These mental blocks we have from our life experiences can hinder our trading progress. It can be hard to break away from learning trading patterns or positioning strategies, but I can assure you that identifying your psychological profile for trading is more important.

If you don’t believe you deserve the income from trading, weird things can happen, like inadvertently returning your profits to the market through ill-advised trades.

All I’m saying is that all of these factors weigh heavily on the financial instruments you select to trade. For now, I’m trading weekly options because of my psychological profile.

I know the potential risk and return of the credit spread positions I trade, which works for me.


The past week in Review:

All in All, it was a bad week. My Aunt died after contracting the Coronavirus. She was a tough cookie; she refused to be put on a ventilator and fought to stay alive. I will remember her warmth and welcoming personality.

This past week deserves a grade of “C+“. I made some bad purchases.

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