Fear of a catastrophe - a permabear's complex

Yes but sometimes we make mistakes and on this day, it would had been a major one.

However, whoever shorted on the previous day collected a fortune.

 

Most of us thought the first crash was an accident and so I bought the first selloff. Shame on me. Didnt have much to due with technicals.

 

Or at all. There hadn't been a higher low for a year. Why be long?

LC

 

if you can make enough by only trading short - i see no problem. at least as long as you can stay objective (as long as you don't see a short signal where there is none).

if you want to add long trades to your style - then try hedging maybe.

if you feel very uncomfortable in a long trade - then do yourself a favor and simply let it be.

good luck

 

Gerry,

Absolutely, I keep a set of indicators, if they don't issue a short signal, I don't trade.

Thank you for your input.

 

I thought you were a "permabear". Isn't that what you said? I mean here you and Neet are, both bear biased evidently, and you were both buying on 9/10???? Should have been a picnic for a bear, right?

Here's the bottom line. "Crashes/catastrophies" typically occur after a period of technical weakness. Just like the 9/11 situation. 9/11 was easy to avoid if you were simply paying attention to the technicals.

Now, if you were bottom picking...then you have every right to be worrying about a "catastrophy".

OldTrader

 

Old,

Maybe he became a permabear after the 9/11 incident. As far as myself, I was not trading during the 9/11 incident.

 

Thank you very much for the elaboration OldTrader.

Like he said, crashes come after a sign of technical weakness because someone always knows about the crash beforehand and positions himself for it with selling.

I wouldn't be surprised if many people knew about 9/11 before it happened (terrorist agents, cells, etc) and heavily shorted airline stocks. The SEC probably helped capture some terrorist allies by seeing who heavily shorted before 9/11. The fact is, someone knew about it, and that explains the selling and technical weakness in the charts.

Although none of us knew what was to come, the technical indicators were there and they showed bad things to come. There was clearly no reason to be long in that market.

 

Let's not deviate into conspiracy theories please

 

Historically SEPT and OCT are the weakest months for the markets. So you were fighting seasonality by trading from the long side when the attack happened.