Unfortunately, my nostrils are blocked at the moment. Another mediocre week saw my balance dip back below the 50,000 level.

Trades? I shorted Microsoft, something that is fast becoming a weekly event. Like my previous attempts over the last few weeks, this one didn't work out either. I shorted just below $29.50, placing my stop just above $30. The stock was facing a fair bit of technical resistance in this general area and had enjoyed a minor run-up in advance of the release of Halo 3, it's blockbuster Xbox game. I was hoping for a small sell-off after all the hype about Halo sales died down. Anyway, the position immediately went against me, reaching a high of $29.85 on Wednesday.

Price came back to touch the $29.50 area and I exited with a small loss.

I thought of holding onto this short. While I entered a little early, the stock's behaviour on Wednesday was pretty much what I foresaw . . . an early rise following news that Halo 3 had notched up $170m in first day sales (the "biggest day in US entertainment history", to quote Microsoft), followed by a midday sell-off. The fact that Microsoft was giving up its gains at the same time that the Nasdaq was gaining was another sign that the 'sell the news' effect was in play. My general strategy, however, is to exit near break-even if a position that has gone against me comes back to the initial entry point. As a result, I decided to play it safe and take a small loss.

I don't always follow this advice. I shorted gold last week only for the position to go against me immediately. It came back to my initial entry and I decided to hold on a little longer. I was made to pay for this complacency, with gold breaking out to new multi-year highs and stopping me out in the process.

Am I still bearish? Or will gold keep going skyward?

Both bulls and bears have good arguments. Bulls point to a strong chart and a weakening dollar.

Contrarians see an overbought commodity and sentiment levels that point to an oncoming reversal.

Ultimately, however, this is irrelevant. Traders develop a thesis about a position. The initial price moves following the trader's entry either validate or nullify that thesis. The fact that gold shot through my entry point was an indicator that the bulls were not yet out of firing power. When the price came back to my entry, I should have gratefully got out. The way I see it, a good entry point should result in the trader being in profit almost from the start. If you're not in front on day one, it's time to look again. If the position goes strongly against you only to come back to your entry, you should count your blessings and exit.

If you hold a position for months, then the above advice doesn't apply. With me, however, positions typically last days, sometimes weeks. As I say, if that's your usual time frame, you should be in profit early on.

A perfect example of a well-timed trade is my long bet on Nvidia. I bought the stock last week after it broke through the previous day's high and the momentum continued, bringing me healthy profits within hours of entry. As yet, there has been no sign of a diminution in momentum, with the stock hitting multi-year highs ($36.75) over the last week.

I took some profits as it challenged its old high ($36).

Unfortunately, my remaining position is now a very small one as I had already taken some profits the previous week (at $34.50). That was a stupid move . . . I should have waited for a challenge of $36 before taking profits but a string of losing trades had made me nervy.

I'm also long the Dow at the moment. The index has been range-bound over the last week. Tuesday saw it break the downside of that range but buyers immediately came flooding in. The impressive nature of the rebound, coupled with the strong price action of the last month, convinced me that the long side was most definitely the place to be. I went long after the Dow broke its multi-day range late Wednesday afternoon.

The initial follow-through was very healthy and I was envisaging decent profits but the index fell back in the last half hour of trading and I'm currently at break-even.

I still think the Dow is poised for further upside but a fall back into last week's range would have me on red alert.

It says a lot about my recent trading that a badlyhandled Nvidia trade has been the sole provider of light over the last week. As I said earlier, I've been trading pretty poorly of late. In fact, I've been none too impressive since my account broke the 50,000 barrier a couple of months ago. I haven't been able to build on that, even though the market volatility of the last two months is tailormade for short-term traders.

The recent drought is something I'm familiar with. I have a habit of golden spells, where I trade like a true pro, followed by nervy and jittery times, where I'm indecisive and trade like a real newbie. Of course, market conditions have a lot to do with this also. Sometimes, they make it easy to make good money;
other times, conditions are more difficult. Still, I've no doubt that my own psychology plays a large part. It would be an exaggeration to say that I'm trading like a newbie at the moment but I'm certainly not in inspired form. This spell will end and, in time, I will once again be smelling money in the mornings.

Hopefully, it will be sooner rather than later.

Weekly gain/loss: . . . /800
Overall balance: /48,800