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  • Saturday, August 06, 2005

    NYSE VS. NASDAQ Part 1

    The story behind why I trade only NYSE stocks as opposed to Nasdaq. Ok I have traded Nasdaq before and to be quite honest I didn't do very good. There were good times and there were bad times, but no real consistency.I first started trading Nasdaq as a newbie,and believe me I was definately a newbie and a sucker.I commited every mistake in the book like selling the bottoms,buying the tops,averaging down, holding on to losers and so on.The question is was it the market commiting these devastating blows to not only my trading capital,but also to my self-confidence? I can now answer that with a resounding NO!
    The market does not do anything to us as traders or investors, aside from the few shenanigans that were going on.The market is nothing but an ever repeating process of our own human behavior,aside from the program trading which even in that case often capitalizes on,once again,our own human behavioral patterns.We create the fear and greed that constantly pushes the market to a new high or a new low,we create the same emotions that cause the market to be rangebound or in a trend.The market is incapable of doing anything to us as traders or investors,it is our own perception of the information given to us that creates the market,any market for that matter. Equity markets,Bond markets,Real Estate markets,Commodities,even the corner fruit market down the street.They all come down to one single factor,human behavior.What are we willing to pay for this or that,and what are we willing to take for this or that?How much risk are we willing to take on a certain transaction?Supply and demand!Fear and greed.It comes down to how we perceive it all as individuals.
    As for my own individual perceptions on the markets I tend to lean to the NYSE equity market.After I got beat up enough in the Nasdaq markets, I came across a forced awareness,not that it was the markets fault,but my own and I needed to find help if I wanted to stay in this business of trading.A friend of mine suggested I go out to Houston,that I could be coached in trading,he obviously had enough confidence in my trading skills to help me out and point me in the right direction.So I picked up my things and hit the road,just like that.I have to admit,it was kind of rash and unexpected to everyone around me,but it was the best decision I ever made.I'm now married and trading from my home in Houston Texas and very happy. So it just so happened that this coach traded NYSE only,and would not let me touch a Nasdaq stock.It wasn't that the market was not good for me,it was that my personality was not good for that market.I learned all his strategies for trading NYSE,and learned an extensive amount of technical analysis from the traders around me.It took a little getting used to trading with the specialist and reading the nyse book,but it is a very disciplined style.I use a combination of technical analysis and reading the nyse book,and it seems I have now taken on a style of my own that fits my behavioral makeup.I would much rather watch one specialist on the nyse,than five marketmakers on the nasdaq.I have to be honest, I have not traded a nasdaq since,and feel no real need to.Some traders play both markets,some nyse,and some nasdaq. I personally like to keep my world small and focus on a few stocks.When I am not trading those stocks well then I will look for other nyse stocks to add to my list and take some of the focus off my usual suspects.I find with nyse I have a better idea of where I will get out if the trade goes against me.I find plenty of opportunity in the NYSE market, and I will admit there are times when either market is offering more than the other.I'm sure that eventually the nyse will change over to all electronic or some kind of hybrid model and I will have to change my perceptions.I believe that is happening at this moment.There really is no right or wrong market it will vary between different traders.I can apply a MACD to a nyse or a nasdaq and it will tell me the same exact thing, it's just that I perceive my own personality to fit better to the NYSE.I think perception is 95% of it, and these perceptions will determine the outcome in any market.The market involves continuous price movement, just as being a trader involves continuous learning and adaptability,that's what makes it so interesting.


    At 9:05 AM, Anonymous Anonymous said...

    If the trader in Houston that helped you takes on others as well, would you post info on how to contact him.

    At 10:56 AM, Blogger txtrader said...

    I'm not sure that he is taking on others at the moment, but I will look into it for you. Feel free to contact me at this email:

    You can email me your contact info there if you like.Thanks for the interest.


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