Below is our portfolio 100 trading days into 2020.
We are 100 trading days into 2020 and it has been, without doubt, one of the most challenging years so far.
The year started off well, continuing from where we left off from the previous year but then turned around taking out both professional and retail positions at a rate of decline never before seen.
After that, price started to bottom and bullish momentum appeared once again. Since then the market has been battling with the cluster VI resistance zone and like many traders, we have been waiting for a break of this level. However, unlike most traders, we have been long the market while many have been standing aside for fear of a new wave down.
While we can’t say for sure if price will make a new bearish move and test or even breach the 2020 YTD lows, we can say price has been and is bullish and this is part of our reason for considering more long positions.
The markets giveth with one hand and taketh with the other. During the former, try to take advantage.
Over the years, I have seen many stand aside due to fear and then buy at almost the worst time, right at the top as a result of FOMO and then only to find the market move against them shortly after.
The only reason the market has moved up is because of big dog buying. And we should buy alongside the smart money. We don’t have the power of the institutions but our edge is we are all ninja-like nimble. We can go in and out of the market as we please where as institutions are unable to. As a result, we can be out of the market days and weeks before institutions can dump even half their stocks.
So look to the big dogs for guidance to enter into the market and indications to get out of the market.
As you know, the indication to get in was after the pivot break on April 6 2020. The year before it was the pivot break on Jan 4 2019.
For our newest members, you won’t realise this just yet but this period will have been one of the best educational experiences you will ever receive as you have seen the market as its worst.
We started our trading in 2001 and saw the market coming out of a long term bull phase and then with 911, we thought this market would get a lot worse. Now with coronavirus, 19 years ago we would probably have thought the same thing…..not today!
We must all remember, the market is a very resilient place. It is the fear of the unknown that the market dislikes. The natural progression and tendency of the stock market is up and it will try and move in that direction but along the way it will discard as many investors and traders as possible.
Trade with the trend but be alert when price starts to break pivots.
Lets go trade!