Thursday, December 20, 2007

Wheat overnight also shows good movement


The sell-off in wheat also shows good movement and reasonable good liquidity. We'll have to see what the session open looks like. I don't typically trade during the evening hours because spreads widen, especially this week. Thin pre-holiday trading has widened spreads during evening trading to 4-5 ticks. If I have to pay 4-5 ticks on entry, another 4-5 ticks at exit, plus slippage of one tick each direction, it becomes almost impossible to make a profit. Statistically, traders make their most profits on less than 5% of their trades. Most trades, the primary objective is to prevent loss. Repeated entries and exits are necessary to be in position to profit from the stronger moves.