Tactical Trading

If you're a military general, planning your flanking maneuvers and whatnot, you have to excel in both strategic and tactical thinking.

Strategy represents the big picture ("we need to capture this port to keep them from importing supplies"). Meanwhile, tactics provide a way to get there. They're the short-term decisions you take in order to achieve the strategic goal ("we'll send the third division over the river first as a diversion, and then the rest of the army can get in position around the port").

Think of trading the same way. You have strategic trading ("I'm getting closer to retirement, so I'm going to lower my asset allocation in equities"). And you've got tactical trading ("there's a good market in corporate bonds now; I'll move some money in there for the next six months").

Tactical trading focuses on the short-term outlook. You're choosing the specific positions that will maximize your short-term returns. You move around as conditions change, reacting to immediate shifts in market trends.