Whenever I try and call a top I'm usually wrong, so I won't do that.... Any thoughts on how to trade next market moves? I still like steel copper lumber and other infrastructure plays, plus inverses if selling accelerates. Booked gains on inverses today and am mostly cash.
Most of the time when I am long the ATH (which is my way of calling a top), we correct. We're getting there. Short it, dude.
It feels a lot like year 2000, just before the .com correction, with Naz overdone and market as well.
It is rotation. You already had a top in tech and speculative stocks. Stocks that are not part of a major indices have not completed their retracement. The main indices will be kept high by the Fed and the Treasury dept. How this manipulation take place Like at the 1987 bottom they call Goldman and tell them to buy.
The only thought that came to my mind while trading today was: that 4238 high in the S&P 500 Futures just a few days ago, well, you are not going to see that again for a while (like years). I have been involved in the markets since 1997, and professionally, straight out of college, since 1998. Today was true, and painful selling. I enjoyed it
Anyone long in tech can tell you we've been in correction territory since mid February. Just ask ARK's Cathie Wood. Actually, if I use my 401k fund as a barometer, 2020 returned 98% while 2021 to-date it's struggling to hold 2.5%
I agree with you about not revisiting those highs for some time. Curious as to your general expectations then going forward during this period. I think we get more selling but a hell of a lot of chop for quote some time.
We are entering uncharted territory, as we have a whole new generation who has witnessed the markets simply go up (for like a decade, and they are very immersed in social media). Everyone is now a day-trader, or an options trader, but they truly have NO clue what they are doing. If you know what you are doing, you can milk these fuckers (God, it's a blast, and most of them will lose everything, and there will probably be even suicides, etc.), as they will try to catch a falling knife, average down, puke the position, and then the inevitable short-term bounce will take place (which will drive them insane!!!), which I will capture, and since I am not greedy, I will take the money, and I will certainly leave a lot on the table, but my focus is consistency. Ranges is what's coming next. It's ass kicking time
I personally take no pleasure in seeing others lose everything, but I agree with you that retail traders of the last couple of years (I'm one of those) have only known upward markets and are having a rude awakening with the market so far this year. I wouldn't be surprised to see 10% of the most vulnerable retail traders exit the market this year, and a larger % hold until the market trends back up enough to write off bearable losses. Then there's people like me who can weather several years if necessary to recoup and hope to turn a profit on good businesses whose share price took a serious hit, short term trades turning into long-term investments.