Louis' Look: Play The Hand You're Dealt

Louis Sykes
November 27, 2020

From the desk of Louis Sykes @haumicharts

I'm back with a brand new edition of the Louis' Look column to share some lessons I'm learning as an intern. You can find my last post here, where I share a handful of obscure charts most people have never seen.

Let's crack straight into it.

My first year of University is now officially over! Woop Woop!

While celebrations would normally be in order, it's a bitter-sweet ending to my freshman year.

This whole virus situation meant that I only spent a few weeks of the year on campus and in the 'University scene' - a time where you're supposed to leave home, grow out, and meet new and interesting people.

As I'm sure we can all attest to, 2020 sucks.

The point of this post isn't to complain about the hectic year we've all had. We've all done it hard this year. But in such a special time 2020 has been to us all, it's a big mistake if we don't take on a whole new arsenal of lessons that will carry us through our careers. If we can be grateful for anything this year, it's the incredible opportunity to learn all these priceless lessons.

When my final exams were coming to an end last week, I thought a lot about how we have to accept the hand that we've been dealt and play the cards as best we can.

There's no point complaining about all the things that are against you. That only erodes the limited time you have to try and improve them. If I spent all my time complaining about how unprepared Universities were in online learning throughout this whole thing, it's likely I'd be that kid going back to summer school.

And that ain't fun for anyone.

I try and tie these posts in with lessons that apply to technical analysis and markets.

So going back to the cards analogy, if all you're doing is arguing with the dealer at the poker table, you're likely to be get kicked out and lose your buy-in.

Think of the market as the dealer, and the poker player as yourself.

It's not our job as traders, investors, and analysts to argue with the market, in fact, it's quite literally the opposite. We're here to evaluate the cards we're given and play them in a way to increase our luck and win probability.

Similar to how they say in marketing: "the customer is never wrong." When it comes to technical analysis, always remember: "the market is never wrong."

Something I constantly have to remind myself as an aspiring technical analyst is that an impact of putting in the work is to not always be in a state of conviction about the market. It is a dynamic mechanism, changing every day, and is designed to fool the majority.

You don't need to have conviction on every trade you take or call you make. Nobody knows exactly what the market is going to do from here. We can simply weigh the data in front of us and determine the likelihood of different possibilities.

I think the more we accept that, the more we can pay objective attention to what's actually happening out there, as opposed to being clouded by what we think or want to happen.

But whether you're a technical analyst or not, the happiest people I know don't spend their time stressing about all the things out of their control, and I'm sure there would be many more happy portfolios out there if investors did the same.

I'm only new to all this stuff, so do I have it right? I'd be keen to hear your thoughts!

Louis

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