Thursday, February 1, 2018

Out of the Short

That was a horrible trade.  I finally took the loss yesterday in the low 2820s after doubling down at 2850 last week.  It was a painful short, and it is a relief to get out of it at a somewhat decent level to regroup and wait for a better area to short.  I haven't seen a stock market trade like this so I don't mind losing in such a rare type of market.  If I had lost a similar amount in a normal market, I would be much more upset.  This is a manic stock market, so past patterns don't work as well. 

I see some strong support at 2800 area but I will pass on the longs.  I don't like getting long markets where retail is so heavily involved, they could panic sell this market into some deep, deep pullbacks.  Also, Bond yields keep rising, which is not a good sign for stocks. 


Anonymous said...

Long time reader, first time poster. Greatly appreciate all your thoughts. What trading instrument do you use to short the S&P? I share a similar opinion about the market, but not sure how to go about doing it. Apologies if you have covered this already. Thanks!

Market Owl said...

I short S&P by shorting E-mini S&P 500 futures (ES). That is the easiest and most liquid way to short S&P, providing the most leverage.

Anonymous said...

Thanks! Much appreciated! Any other trading strategies you would recommend I consider as well?