Episode Description:

In this episode, we delve into strategies to navigate the slower summer trading season effectively. After a brief apology for missing last week’s episode due to travel, we dive into how election years typically influence market behavior, with a focus on the expected drop in volatility this summer. Here’s a breakdown of what we cover:

  1. Market Overview and Statistics:
    • Election years often have choppy first quarters, but stocks tend to rise from March to August and then again from November to year-end.
    • We expect a continuation of the bull market, but with reduced volatility, your trading frequency should decrease as well.
  2. Tips for Surviving Slower Markets:
    • Reduce Your Trading Size:
      • With the VIX at 12.9, hovering near 2024 lows, it’s crucial to decrease your trading size.
      • Less market movement means fewer opportunities. Focus on risk management rather than potential gains.
    • Be Patient and Wait for High-Quality Setups:
      • Summer markets tend to consolidate and build value without significant follow-through.
      • Avoid chasing the market and wait for prime trading opportunities.
    • Find Alternative Activities:
      • Engage in hobbies or activities outside trading to avoid boredom.
      • Whether it’s playing video games, doing market research, or picking up a new hobby, staying occupied can improve your trading mindset.
    • Explore Different Markets:
      • Consider trying out options trading or other markets, but start small and have a strategy.
      • Learning new markets can be both fun and beneficial for your trading skills.
    • Set Limits and Restrictions:
      • Moving from high to low volatility can be risky; set daily and weekly loss limits.
      • Focus on risk management and adapt your criteria accordingly.
    • Prepare for Future Opportunities:
      • Use the slower season to study and prepare for the action-packed last quarter of the year.
      • Review past election year price actions and trade those conditions live to stay sharp.

Join us as we provide practical advice and tips to make the most out of the slower summer trading season while preparing for the upcoming market volatility in the final quarter of the year.

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