There's a hurricane spinning out in the Gulf, and the waves have been good in front of my house. They were good enough for my 6' glassy rule to come into effect that says "If the waves are 6' and glassy, drop everything, no trading, and go surfing." Ignoring the markets today, I spent the day in childish glee that only surfing can provide. Earlier this morning, I called my local surf shop about piece of equipment, and had to listen to their surf report before speaking to an employee. The report was dated today, and said that there were ankle high waves in the Gulf, and not worth a go out. I joked with the owner, and he admitted that he usually misleads when he posts surf reports, his reason being that the number of waves are finite, and he doesn't want to increase the crowd factor from in-landers. While I respect the nobility of his intention, I wonder how often the financial press plays the same game of deliberate misdirection regarding market matters, for less than noble reasons. Since I live at the beach and pay a premium for doing so, I don't need to call a report to determine surf conditions, and get the first crack at the good waves. Living at the beach allows one access to the inside market on waves, and the locals usually get the cream. An exchange member on a floor that has active trading is much like a surfer that lives at the beach, in that he gets the first crack at the inside market, after paying the appropriate price of a membership.

As Sogi-san has said to me before, and I concur, "Many a lesson for trading in the waves as well."

Jim Sogi replies:

J SogiToday a new swell was supposed to arrive, so I headed down to the beach. When I got there the waves were small and junky. I timed it so that I would be out when high tide started coming in. Often, contrary to popular belief, the tide does not slowly seep in, it rushes in in the form of several big waves. So out there surfing junky waves all of a sudden big waves start rushing in all at once from a combination of the tide pushing in and a new swell. The big waves rush in.

It felt like that today (7/22) in the market as the new bullish swell rushed in in the afternoon all at once. Often the big up moves happen in a short time, and you got to be out there or you will miss it. Another little market lesson from surfing.

I hope you had a good session. My rule is go out no matter how junky the waves are. Then you'll be in shape for when they are epic. A lot of older guys like to wait until it's six foot and glassy, but when it is they are so out of shape they get worked. Got to surf the junk to get the goods. How many times is it junky and you're out there by yourself and all of a sudden it gets really good for an hour, then it goes away? Showing up is half the battle.





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