HS, I bought heavily puts all this week, and more today after Draghi's speech. I think probabilities are high for a big correction in Europe & US. Wait & See CM
Waited patiently for the day to come. I did buy some puts today around 7:15AM PT. Have a tight stop in case market resumes uptrend. If the market goes in my favor, then and only then will I add to my position. Never in my wildest imagination did I expect the market to rally this far from 2/11.
Hi HS, welcome back ! Yeah, markets are unpredictable, that is why it is so funny! That is why discipine is a a must-have too! I am ready to short European banks and Nasdaq IF and only IF 18th of April lows break ! IF not, better wait again for weaknesses... CM
Purely anecdotal...but...I know of so many traders, including some professional hedge fund managers who are heavy (and i mean heavy) short the stock market. I don't know anyone who is bullish the market, everyone says it's gonna drop. Kinda tells me that maybe, just maybe everyone has sold and the market is gonna go even higher. Just anecdotal , of course.
Don't you think heavy shorters have already lost their shirts? Don't you think they are neutral again, or even long? Noone can hold forever shorts positions. Easier to keep long positions, regarding hierarchy, risk control, risk budget, consensus, the herd etc. Remember 2000 : everyone said Nasdaq should be shorted, but few made it. Same story with Biotech stocks last year. CM
You don't add when you lose. You add when you win. So his opinion is of no interest. And 1 person is not the market. CM
So far the puts from April 19th have worked out. Added to shorts at close yesterday, now let's see where the day takes us.
The massive rally from February this year shook my confidence greatly. But after analyzing why the market did what it did, I have no complaints or sadness, only wisdom gained. In my own head, I knew the Nasdaq needed to make a lower high for a real correction to start taking place. The Dow already made a higher low, and as far as the Russel 2000 just blasting higher with no higher lows, there was a key ratio index which pointed at least enough to cover. At least the exact low in February I had enough experience to pinpoint the bottom, but I shouldn't have kept shorting while the market kept going higher. Maybe one jab would have been enough, and if that didn't work stop pushing same trend, at least ask why the trade did not work. I am back with a much more open mind to the markets. And I will be continuing this journal for myself, a collection of my thoughts in public. Mainly focusing on poker-esc thinking of psychology. Current situation: A lot of world indices are in a chop state, waiting for something, a clear direction. There are very bearish signs, but at the same time there are also bullish signs. The Evil Index as I called it from my blogs in the "Slope of Hope" days are indicating more bearish action to come. The VIX has been creeping up slowly and with recent news on DB, that may be why. In my own analysis, there is something going on with VIX as well as the Evil Index possibly indicating something I do not see yet on the tape. Even when the Nikkei had a nice bear trap setup on the 27th, it got shutdown at resistance today and has shot back down although still above the trap. There are still quite a few gaps left near highs on the Nikkei so there is a possibility the Nikkei may try to fill those before going back lower. However the "evil index" is telling me to at least becareful of the long side on Nikkei currently. On a naked chart however, I can see the Nasdaq going much much higher for a blast off top. Anyways poker wise, direction I do not know. Current mindframe: be neutral, and when market shows clear direction go with it.