Be In Harmony with the Market

We make money trading when we are in harmony with the market. We are long
when the market is going up, and short (or out of) the market when it is going
down. If we bring an opinion with us while trading, we will end up fighting the
market. We keep trying to go long as the market is declining, or we keep shorting
a market that it is in a bull phase.

DON’T FIGHT THE MARKET
Fighting the market is not good for two reasons. First, we lose money. How much
we lose depends on how well we are managing our money and controlling our
risk. Second, fighting the market affects our judgment, and causes us to try to
confirm that our judgment is correct, or persist in fighting a trend so that we will
eventually prove to be correct. We figure that if we persist long enough, no matter
how long it takes, we will eventually be right.
The same can be said for being in a canoe in a river. There is a reason for leaving
your car downstream, launching your canoe upstream, and paddling downstream.
It is much easier and eminently more fun to go with flow and paddle downstream.


We could do the opposite and paddle upstream. Eventually we may even get to
our destination, but the cost would be substantial. It would take much more time,
more physical and emotional stamina, and we would be constantly fighting the
current. Reaching the goal would not be worth the cost.
Even if you ultimately make money fighting the market, it is not worth the price
you have to pay, both financially and with peace of mind.