Funny thing about trading: the hardest trades aren’t always the complex ones with five correlated charts and a twenty-step thesis. Often, the hardest trade is staring you right in the face.
Why? Because when something looks too obvious—when the drivers are clear, the market is reacting, and the setup feels almost too good to be true—our sophisticated trader-brains kick in. We overcomplicate. We tie ourselves in knots. We convince ourselves we have to be smarter than the crowd. So instead of just pressing the button, we sit there fading the obvious.
This is where the OODA loop comes in.
For those who missed the Air Force history class, OODA stands for Observe, Orient, Decide, Act. It was developed for fighter pilots who needed to make life-or-death decisions in seconds. In trading, it’s the same:
Observe: See what’s actually happening. Forget what you think should happen. Watch price, data, headlines, flows.
Orient: Put it in context. Does this line up with your framework? Is it consistent with macro drivers or technicals?
Decide: Don’t linger. Hesitation kills. Make the call—yes or no.
Act: Put the trade on. Not tomorrow. Not after three more charts. Now.
The loop isn’t a one-off—it’s continuous. You’re always re-observing, re-orienting, re-deciding, re-acting.
And here’s the kicker: sometimes the obvious trade is the right trade, and the OODA loop is what keeps you from talking yourself out of it.
I’ll never forget that fateful day Trump held up his “big board” of tariffs. It was a flashing neon sign: short risk now. My first thought was “Oh shite, just hit the short at market and hold.” So I did. And it worked beautifully. Later, I spoke with plenty of traders who admitted they saw it too… but they didn’t pull the trigger. They got lost in the weeds, overthinking every angle, convincing themselves it couldn’t be that easy.
That’s the danger. We forget that trading isn’t about being clever—it’s about being effective. The OODA loop keeps us from freezing or adding unnecessary complexity.
Yes, alpha is usually a slog—grinding through charts, grinding through data, grinding through positioning. But every so often, the market hands you a gift wrapped in bright paper. Don’t stare at the wrapping trying to figure out the GDP deflator. Open it.
Sometimes the best trade really is the obvious one.