This may be a language barrier or something, but you cannot be "short a market the entire time" yet also "constantly trade in and out." To me, shorting a market the entire time is going short, like fib has, and staying there. And staying, and staying.
This is more of a pedantic wording. You know what I'm referring to. In regards to fib's short and hold, FROM WHAT HE CLAIMS, it's basically a martingale type strategy. I think we are due for a significant pull back in the near future, but for the strategy to work it's all a function of how much initial capital one starts off with and how often one doubles down. Another fellow posted fib's theoretical P&L calculation, he's down -3 to -5% since the start? That is not really significant， even in terms of a drawdown.
I did not see that fellow's post where it was mentioned that fib was down 2% since the start. (And yes, I caught your edit which now shows a 3-5% figure. I saw that. ) All we see is that Fib is down what seems to be $200K? This is reaching into the sim territory of Rickshaw Man. What is Fib shorting by the way? Is it stocks? I mean, what is the big deal if you short stock outright? If you got the money and want to short stuff, then go for it with a half-million dollar account or whatever. At least with stocks you can't get into margin troubles, right?
I wonder how much money has been lost by the phrases "I think" and "we are due." Due implies it is owed, and the market owes no one anything, least of all those of us who thinks it does. Not a criticism, just thinking out loud.
I've been trying to parse this line in my head, and it is not working, lol! I am suffering a brain system failure, I am tired. Nothing wrong with yer post, but damn I read the line and I suddenly had a brain freeze.
I think the reason why this fib fellow is getting bashed so intensely is because the amount of money he claims to be trading. I told him on another thread maybe actually posting the trades in his account would lead to folks easing their skepticism. Idk, I give everyone the benefit of the doubt before making a conclusion. Moving on the trade itself (I'm assuming he is shorting SPY), this isn't necessarily a bad trade. Neither smart money nor dumb money are buying this rally, nor foreign investors. The big buyer is the S&P 500 components, who bought back $227 Billion of stock in Q12019 alone. Companies always, ALWAYS buyback their stock at the top because after accumulating a large balance during the bull run, they can't do anything with it. M&A multiples are too expensive, unicorns are in a bubble (Softbank is buying up everything), earnings growth is becoming negative (EPS -3% forecast this year), hence the only option left becomes stock buyback to create inorganic growth to please investors. All it takes is one big, consistent buyer (or group of buyers) for the indexes to rise this much. Once the stock buybacks are done, we will see whether or not there is enough seat for everyone in this game of musical chairs. Like I said, what this guy posted isn't necessarily a bad trade.
What were they doing on December 24th, 2018? Were they selling everything they owned because they got burned by going long in October? And if neither smart money nor dumb money is buying this rally, how are we at pretty much the levels we were at back in October? Your analysis is wanting.
I posted a snapshot of smart money flow from my Bloomberg Terminal here Edit, courtesy of Dozu888, dumb money isn't buying either, their positioning can be found here (go to SPX500)