HOW THE ADJUSTMENT BUREAU WITHIN THE FINANCIAL MARKETS IS CONSTANTLY WORKING AGAINST YOU
Between kids, work, and decompressing at the gym, I get the opportunity to watch a movie once in a great while. The Adjustment Bureau, while being an average movie, involved a concept that I found to be fascinating.
Essentially the premise is that there is a secret society of super-humans that belong to a bureau that makes sure you remain in line with your pre-determined path in life. In order to keep you on that path, there are ripples in consciousness that take place to adjust your behavior along the path you are supposed to be on. The more you deviate from the path, the more drastic the means to shake you into being on the correct path (good or bad) become.
This is a fantastic premise to apply to the financial markets. In trading and investing, the market makes a conscious effort to create ripples in your consciousness to affect future decisions.
Take for example the volatility both up and down that took place on Thursday and Friday. The effect of such a move on the consciousness of a bearish market participant is substantial. The ripple in consciousness becomes apparent the next time a large move down occurs. It will become more difficult for that bearish trader to allow his profits to run as he has seen the disastrous consequence of the last time he attempted such a feat. Bear in mind that allowing profits to run is fundamental to trading. It is the absolute correct way to trade. However, the market has now caused a ripple to occur causing you to doubt yourself and the most fundamental of trading rules.
Whereas in the film The Adjustment Bureau had both good and bad intentions for a person, the Adjustment Bureau that functions within the market has only bad intentions. In fact, it can become profitable to investigate how the market is attempting to infiltrate your consciousness in order to throw you off the correct trade. When the market is constantly attempting to infiltrate the consciousness of one side of a trade, I know that odds strongly favor a large move occurring in the direction of those the market is attempting to manipulate.
The ripples in consciousness occur on a daily basis and they are furthered through the mass of information that is at the fingertips of every trader on the planet. Every piece of information you digest places a small token within your consciousness that will effect future decisions. Every move that the market makes whether in your favor or against you also places a token with your consciousness that will cause ripples in consciousness that influence future trades.
The good traders know themselves well enough and are comfortable enough with their methodology to not allow the ripples to cause great damage. The great traders have a steel gate around their consciousness and fully realize the extents the market will go to in order to influence them. They also realize how damaging an overabundance of information can be to the psyche.
Next time you are in the middle of a trade or looking at initiating a position, keep in mind that there is indeed an Adjustment Bureau that is as ingrained in the functioning of the financial markets as the bid and ask.
Ask yourself on a consistent basis which side of the market is seeing the greatest ripples in consciousness? What could the market's intentions be with the consistent diversion? Who is the market attempting to setup and influence the greatest?
It is only when you find out who the market is attempting to manipulate the most that you find where the next big move will take place.
