The New York Stock Exchange opened wildly today. I guess yesterday’s low beta day was an anomaly and we may now have to face the reality of large spreads on the indices being here to stay – for the moment. I took a look at the DOM and decided that it wasn’t worth slamming on my brain cells over so I decided to take the PnL that I got from other asset trading and call it a day.
I traded the British Pound early this morning and the waiting and round trips were probably what eventually wore me out and contributed to my deciding not to trade the open. Trading the British Pound was ok. There were points when I wanted to back out and reverse on some trades but I stuck to my convictions for most of them and it proved to be the difference. I am glad that I did not trade the cash open after seeing how the market absorbed that -100 point premarket. Anyone who would have thought to go in short would have gotten completely slaughtered.
It’s a rainy Friday here in the East coast. While I would have liked to take my chances in the open, I have to accept the fact that opportunities may not be there all the time especially given how different the market has been acting. I never thought I would fear a day where there was volatility but when there’s too much of a spread, that often signifies something bigger and more dangerous at work. I’m not blaming HFT or anything like that, I’m just saying that the current environment makes it dangerous for traders like myself to conduct business. Sometimes, God has a way of giving us directions. I can certainly argue that this market overall is a message being communicated to trade carefully and prudently.