I am still short Indexes from last year Long Term, nature of the beast of my system, but I have learned how to use options well enough to not only hedge for loss when opening trades, but at some point when you are having Triple plus bottoms on the weeklies, better be hedging open profits. Just a matter of learning risk management.
Impressive discipline and patience. Assuming you were short the end of Dec, I would have covered around 2/18 when the indexes were showing real signs of of impulsing out of the lows. I can handle 2-5 day swings, but don't have the account size to swing the weekly patterns.
Actually, I trade monthly's based on nine year high-low, I try to capture long term of 55% plus of the nine year swing. When Commodities enter top/bottom zones, I drop down to Weekly, then Daily, then 2 minute charts looking for extremes, get long or short futures and hedge, I take a monster amount of losses in futures and why I hedge, I do eventually find the extreme highs/lows and eventually hit the homeruns after many rollovers, I add onto trades when most have said trend has changed, I am getting pretty good at knowing through charting and Bollinger bands when I need to hedge open profits and do credit spreads. Yes was short in December, road it down, in February did Put credit spreads and Debit Call spreads, still short Indexes. I been trading pretty much same system over twenty years, you learn to lose well, LOL, but comes down to risk management. You stop at some point looking at open equity swings, I would have a heart attack now. LOL I have learned to become "numb".
So it's sort of the opposite of the dream Al Brooks sells in his books, once you get your trading better you are able to see the unrealized losses of your nightmares, right? But the hope is that they never become realized? Al Brooks tells readers there is a great potential of attaining the "income of their dreams" once they "get their trading better." I hope Bernie Sanders takes these various crackers out of bizness, this trading-marketer gimmick fits better in the 20th century prior to the rise of the hyper-efficient trading bots.
Because everybody hates this bull market. I'm sure there are a lot of sour shorts right now too. The problem is most retail traders don't really have enough money to move markets. You can't fight the fed, I mean who honestly in their right mind would invest all in right now because they think the market is going way higher. At these levels you'd have to be on crack without confirmation. I also think a lot of retail traders are amateur shorts. That's why a lot of small cap stocks go to the moon because people who have no idea what they are doing short and get trapped while smarter money is buying.
Dailyfx traders have already trimmed their shorts to 4.35 of longs, down from 5.7. So as usual, they are covering too soon. But if we see sentiment extremes at tops, then we could have just seen a major top. Edit: "too soon" depends of course.
I've personally done really well with Al Brooks, he really highlighted some obvious things in the markets which I then tweaked and adapted. I go hugely offside and average aggressively, often risking more than I make, which is not something Al Brooks talks about. However he provides a good basic framework to build on, regarding trends, ranges and reversals and how to trade them. Don't take anything he 'teaches' as the only way but I'm sure most traders will find some areas of value skimming his stuff.