Don’t Hate The Playa!
That’s right – tonight I’m going all old school on you foolz! Look busy y’all – Mole’s in the house!
Seriously now – you haven’t experienced excruciating pain until you’ve listened to some Kraut with a German accent trying to rap. It’s no laughing matter, so let’s just not go there. Besides, as you guys know I’m not big on rap – the old Mole likes it hard core electronic Euro trash style, he enjoys some heavy metal (Rammstein baby), and even some selected Classical (Bach simply rocks). But with some rare exceptions I stay away from rap – just not my thing. One of those few exceptions is Ice T as he’s old school and goes way back. I just can’t help but give him Mole’s seal of approval (not that he would care).
Anyway, the clip above talks about ‘the game’ and I think if Ice T would try his luck at trading he would probably catch on really quick. Because the game on the street is a bit like the game on Wall Street. Except the playaz wear suits and maybe there are less drive by shootings but in essence it’s a doggy-dog world and you only survive if you are either connected, ruthless, cunning, or can command some serious muscle. Combine some of the aforementioned and you call yourself a playa.
If you squint hard and take a few steps back then you can basically see ‘the game’ at work right on this chart. For that juicy inverse H&S has most retail schmucks pee in their concerted pants in eager anticipation. Little do they know that the market is usually a cruel mistress that eats hapless retail field mice for dessert. The box I highlighted is the cluster of tape we got since we touched that H&S neckline at the very end of the year. Retail was expecting a break out per their textbook example – which usually ignores the fact that there’s often a preceding fake out move. Plus the odds aren’t that strong on H&S formations to begin with.
See it’s all about psychology – as usual. If you went long at 1200 then you probably don’t give a rat’s rectum about a breach here. You made your money and are holding some lottery tickets for a potential move into what could amount to 1300. Sweet move if you can get it – if not – well, better luck next time. That’s how the playa thinks. The retail field mouse however went long around 1250 and is not liking the action right now. You may have heard the expression of ‘weak hands’ – that’s them. Give them a drop to 1240 and they will jump ship in droves – it’s like pressing a button.
The game is ALL about reeling in weak hands – it’s about dangling carrots. And then to do the exact opposite. And even worse – once the playa takes their money the tape usually reverses just to add insult to injury. Thank you sir, can I have another? See, you simply cannot act like a victim when trading the tape – you have to start thinking like a predator. It’s not about being paranoid – that’s counter productive. It’s about anticipating the odds of a prospective move. Since I feel generous here’s another old expression for you – I got that one from my trend trading days:
What everyone knows is not worth knowing!
Makes sense – I hope. If everyone and their mother expects that H&S to resolve then it probably won’t. You’re not the only guy/gal with a fancy charting package and a trading account, you know. That doesn’t mean the H&S formation is completely useless of course. Remember, a few days ago I expected a shake out here – sometimes that shake out comes in the form of a reversal and sometimes it’s a sideways correction. Whatever gets those retail schmucks to make emotional trading decisions. Those are the most profitable ones – for market makers 😉
Hey, as Ice T says: Don’t hate the playa – hate the game!
I have a few more charts below for my subs – please step into my badly decorated evil lair:
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