The trouble with people and why people are not wealthy who grew up in America is so much fear of being wrong, it is not the loss of the money as much as it is the fear of just being wrong, start a business after you spent 2-3 years making a Business Plan, spend 2-3 years making Trading Plan, but I suppose thank goodness people don't have patience and just feed experienced traders their money. I want to start a good farm/ranch in 5-6 years, this is going to give me much time to make a good Farm plan, I have not even enough knowledge of it even though I have the funds, but I would lose so much cash cause I know other people would take advantage of my lack of education of it. Much much to learn, soil content, wells, certifications, finding good vet, land prices, finding customers etc...No rush in doing it the right way. Guy writes me yesterday he has dropped $150k in 9 months day trading, he has his Trading plan in his head, means no Trading Plan. He sold his business for a million and thought this was going to be so easy, why this thought of being so easy I don't know. Just cause you have some money means nothing!!! Told him to memorize McGee and Edwards chart book, maybe it slow him down. I think the traders who last long do so consistently trends or a consistent way of trading in normal markets. I have never meet anyone who looks for wild sessions and last long, perhaps I stay away from these types as I see wild days to be days I go to the movies and don't trade. Lack of volume means undue slippage, professionals are not trading, you can't do volume cause you can't get out without losing much. I think most of the time markets show it's hand long ago of topping and bottoming, triple/quad tops/bottoms, Head & Shoulder patterns. When you check out May of 2015 and after head & shoulders, bunching of highs on the weekly, so then it just a matter of waiting and doing rollovers, when you see market bottoming, do something most wont, hedge your profits with options, when price gets high enough when most say trend has changed to up, short again, look for bunching or triple tops. If you suspect a huge more, can do debit spreads in case it not huge move didn't cost much and if move goes your way-lift the short of the spread. Adding options to how I trade has brought back some of the excitement back to my trading as after many years, this is boring, options allow me to think again and TEST something new. It's Starbucks time, all have warm weekend.
I think mixing fundamentals and technicals dooms many. If fundamental you can't have deep enough pockets.. period - or you have hedging skills. If technical then there MUST have been a signal or two around 1850 that you CHOSE to ignore. The Index fundamentals are so strong in some traders heads there is actual discomfort being long... All a question of WHY you trade.
A couple of trader's have mentioned that their favored method to be "net short" the market is to simply sell calls...Granted there is always risk in doing that as well, but if you look at last year's market (as a possible template going forward), it was the same thing that we are currently witnessing...Alot of "rolling chop" with quick sharp spikes back up and then the "drift lower" once again...It basically trades like a bear market...no real catalyst to be long, but enough central bank chatter to constantly put a floor under it...
I doubt that there are many traders using fundamentals...The real "cognitive dissonance" is caused by the ever present central banks...One week they are hawkish, the next week they are dovish and this market is so hollowed out that simply jawboning can cause enormous distortions...I'd go further and say that the vertical rallies and declines we see frequently are the result of the "print or die" mentality...a binary outcome in which trader's can make reasonable cases for 2400 SP and 1600 SP (of course the former or latter gets more airplay depending on the vertical move of the day, week, month).
I'm more technical because I'm a more number crunching person. I especially don't think fundamentals should be used for trading ES, especially short term anyway. I was watching the million dollar traders show on you-tube where they were trying to use fundamentals for short term stock trading. It made good TV however I don't think it worked well for their trades.
Yea... The second "economy" or "earnings" enter your head you are thinking fundamentals..the climbing wall of worry thing. Hopefully there is enough patience to wait for the technicals to catch up.