Groundhog Day

So, it seems P-Phil says six more weeks of winter...gee, why am I not surprised?  If any of you saw the movie Groundhog Day with Bill Murray, you recall his life relives the same day over and over again.  He changes each day but the rest of the world does not, and eventually he gets used to it.  Many times this happens in markets, too....as we get used to certain patterns playing out, we capitalize on them and basically rinse and repeat.  And wouldn't it be nice if the best trading day you have is repeated each time you wake up?  On the other hand, how about making the same mistakes over and over?  Happen to you? 

I can tell you the winners in markets identify patterns and play them  until they don't work and then move on.  My friend Helene Meisler, who writes a column for http://www.realmoney.com/ (her fabulous product is at http://secure2.thestreet.com/cap/prm.do?OID=006788), tells us over and over again to be wary of being complacent when it comes to patterns.  To quote her, 'the market teaches us lessons and how to act, then it changes on you without notice'.  It's what we do when change occurs that separates the true winners from the forever losers.  I'm not talking about a significant change, rather a conscious recognition and action to adopt to a new pattern or condition.

Pattern recognition is a key survival tool in markets.  Make sure you separate yourself from the emotions.  I hope you get a chance to read more of Helene and learn from her years of experience and lessons learned. 

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