Today's Quote: “Bias (noun) - inclination or prejudice in favour of a particular person, thing, or viewpoint." Oxford English Dictionary.

As the market opens many traders are faced with a difficult situation. Alarms are going off, stocks they are trying to watch are running and getting away, stocks they own are falling and hitting stops. The best plays are missed and they find themselves chasing late entries. Sound familiar? A lot is to be said for having a plan and staying organized throughout the day. This is especially important during the opening half hour.

One part of this plan that you should do to help this situation is study all the information at hand and determine the direction you feel the market will be most likely to take based on the available information. We call this a ‘market bias’. For example, let us say the daily charts showed a reversal day yesterday, and things looked bullish to you this morning. The market gaps up. You may develop a bias that says you feel the most likely action would be for the market to pullback during the first 30 minutes to fill the gap, then move up the rest of the day. Naturally when you develop a bias, you must be flexible and keep reading information as it is presented to you. We never know what the market is gong to do, we can only play the odds.

So, what value is there to the bias if we don’t know for sure what will happen? Simple, it keeps you focused. If the market does as you have envisioned, you are in your trades at the right time and with confidence. It will also help keep you out of trouble. For example, in the above example, part of your bias may be to say, the you will not chase the 30-minute highs if the market refuses to pullback and fill the gap. You make this decision in the calm before the market opens, and it keeps you from chasing entries that you have determined to be unwise. Try this and see if does not help you get your ‘feeling of calm’ in the morning. Good trading.