Last week I pointed to the fact that we had closed within a point for the last three months. Between 216, 217 in the SPY. I said this month would decide which way it’s going to go. Half way through the Month, it looks like we are headed south. Today we saw a substantial rejection of price. This is indicative of a sideways or bearish market. The moves are violent in opposite directions and no matter which way you trade, you end up wrong. I am sure many of you look at chart of the bear market and think wow, its easy in a bear market we just trade short and make money. WRONG! Not the way it works. Market craps, you buy, it goes even lower, you panic and sell, it reverses, you buy it craps again, this time you hold in fact you a buy a little more, before you know it you are in the hole adn lost more than you were willing, a bit more you think and I will sell out. Before you know it 1/3 of your account is gone. Fuck it. You sell. Than it goes up rapidly you chase, make back a couple of bucks and sell. You did your proper mental accounting, it should drop and you will buy again and ride it up. It doesn’t it shoots up in a straight line. you revenge trade and buy AT THE TOP! By the end of the day it’s at the lows again. You walk away thinking WTF just happened? in a matter of one day You lost half your account. Most of it in minutes if not seconds.
I have seen this movie before. Believe me! I have blown out my fair share of accounts. PROUDLY! Thinking I will make big Bucks! Stop lost my ass into infinity! I have also done the opposite. Profited my ass into a blown out account! Oxymoron I know but believe me till you see it for yourself. You won’t believe it. How did I profit my way to a blown out account? Here is the way it goes. You take profits, profits, profits, hundreds of them. For thousands and thousands of dollars. I mean Huge wins! Life is good. BUT! You keep your losers going. Day after day, week after week and before you know it. PUFF! You are selling at massive losses tens of thousands to stay solvent. hope you will stay solvent long enough to buy on the way up. Even if it’s one puny little lot. Eventually it turns, so with your puny little profits you add 2 lots, than 3, and suddenly PUFF! A spike lower and your Gone! $2.59 cents. WOW! You just wasted days weeks from your life banking massive profits only to be blown out by one bad trade.
So! Do you understand now WHY I said I am selling everything from my personal account in stocks and taking my basketball and going home to shoot free throws in my back yard? I refuse to give my money back chasing the wack jobs who will react to every stupid news that comes out. I’ve had 8 long years to buy stocks and be happy. I am satisfied! I wanted to buy a little yesterday at 4% down. It wen’t 3.75% I missed. SO WHAT! ZERO FUCKS GIVEN that it shot up. Today, Mike had a Victory Video talking about cockroahes. As soon as he posted it, to the minute. Mr. Market turned and tanked! This is not Mike’s fault. This is a Market problem. Not a Mike problem. Mike should have been right today in a bull market. He wasn’t. Because the Market is FUCKED! I have talked about it extensively. I will keep talking about it. Because you need to learn to recognize it for yourselves. Which is why I post so much. Honestly i feel bad at times. But its far better than learning on your own the hard way. Psych plays, Fuckery, Dirty Diapers all mean something. Today my friend Carl spotted a fuckery play with the AUD/USD. Dollar went up AUD went even higher. WTF OVER!?!? Yea. If it’s not acting right from the beginning almost tick for tick that should clue you in that something is off and to stay away. Fuckery! Not if you have a long term position on of course.
In conclusion, I feel like we are going to go lower. I have felt it for a while now. I see all these indications all over the place. Much as i did in 2006/7. Timing it is difficult. But I don’t have to time it. I control time. Because i am the one who makes a choice to expose myself to the market and how much. Just as you do. I am trying to give you concept and application at the same time. As you watch it unfold live before your eyes. My advice is for you to sit on your hands or trade extremely small. Better yet, paper trade, and watch how my story above plays out for you. It will amaze you. Only than will you realize what I mean.
lastly, I will be giving you small tools and Technics in the days ahead. 😉 take care have a great weekend! 😉
Author Jim Boukis
Good piece…I agree with ‘sideways’, and Yellen does too: Today in Boston she laid out “deepening concern at the Fed that U.S. economic potential is slipping and aggressive steps may be needed to rebuild it.”
I’m either waiting to re-enter oil for the long term (that OPEC deal is the key here), or I’ll consider shorting the S&P and taking whatever profit comes to me without being picky and without over reacting to day-to-day moves based on the emotions of other traders or funds.