The backdrop: Yes, the market is at all-time highs and the Dow Jones Industrial Average has closed at a record high for nine days in a row, but that is masking a market that is ridiculously slow right now.

The SPDR S&P 500 ETF (SPY) traded 32 million shares yesterday, one of the slowest paces of the year. There’s no news flow and no follow-through on momentum stocks.

In conditions like this, momentum is not momentum any more. Stocks had great news, but lacked the volume to actually move. It’s not just as if the traders have gone on vacation for the dog days of summer, it’s as if they took their computers with them.

The problem: In times like these, traders look hard for the right set-ups, but those optimal cases aren’t working. It’s hard to walk away from good set-ups, but these are not normal market conditions.

Personally, I have a bad case of FOMO, the fear of missing out; that’s why I am stuck watching the action instead of off doing laundry or getting some exercise. But I am more selective than normal before trading anything because — without the volume and some direction — the risk-reward picture is changed. As much as I hate missing out, I hate losing money on bad trades more.

The lesson: Don’t trade the stocks that don’t have an audience. Right now, in spite of the market highs, most stocks are talking to nobody. If you find that great, optimal setup but you are the only one trading it, it’s not going to work.

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Taylor Conway is the lead day trader at PennyPro.com. He is a short-term day trader of stocks and ETFs. At the time this article was published on RagingBull.com, he was looking for something — anything — to trade. He had no open positions, options or orders in any stock or ETF.

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