This Isn't 2020 Anymore - ES 03/29/2021

CME_MINI:ES1!   S&P 500 E-mini Futures
ES at the daily view.

No, this doesn't mean I am back. I am currently waiting for this overseas conference call to begin.

1.5 months ago, I said that I was being cautious with my longs. My anecdotal warning sign is when I saw Lindsay Lohan and Amanda Cerny claiming to be traders too. That pullback came in very shortly after I said that. Murphy's Law. Go figure.

2021 is setting up to be the year of disappointment. Permabulls do not get their miracle returns like in 2020 - now that the FX and bond markets stepped in. Permabears do not get the crash that they dreamed of. Market condition and price action is more similar to the mid-2010s than 2020.

This is not 2020 anymore. Most new traders think the market is like 2020 with the amount of volatility . 2021 will be the year that will cull the dreamers and reward the patient traders. ES is high enough where it's away from the bigger buy zones below. However, there are also multiple historical supports below that might prevent another 2020 crash. Market breadth is also high enough where we might not see another 2020 crash in years.

ES is basically in a giant flat to upward channel that originated from the beginning of 2019.

Now, we enter into how the market usually behaves. Many boring days with bursts of volatility . New traders will learn the hard way of why they should never ignore the FOREX or bond markets as they are the bigger markets that direct the smaller stock market. New traders will also have a very harsh lesson in risk management.

Before you resort to news, ask yourself this. What would cause the top 10% of incomes to start selling their positions? The top 10% of incomes in the world own over 84% of the stock market. It's been that way for decades. COVID? People stopped caring about it for months and it was clearly a political tool. Not to mention, it's not a Black Swan event anymore if you've already been through it recently. Also, what would cause several large Wall Street hedge funds to liquidate their positions or get margin called all at once? The stock market is over $50 trillion in market cap now. $30 billion is merely 0.045% of the stock market. There is a saying, "if it's on the news, then everyone already know about it." Look at that Suez Canal incident. As you saw, that event did nothing to oil's overall price action.

If you're relying on the news, remember, most journalists are financially illiterate and aim for clickbait articles. Most journalists are also terrible at math. That's where you're getting your news from. That's basically trusting your car repairs to someone who could barely identify engine parts.

Victory will go to the traders who can adapt and be patient. Nothing less than that.
Comment: Correction: 0.06% of the stock market. That’s what I get for rushing before a meeting.


Great idea
+7 Reply
Great write up.
Nice idea.
words of wisdom
Great to read you again. Please keep rushing into meetings if this is the result. Agreed 100%
Read you soon again, hopefully
Thanks for sharing your thoughts.
Very nice understandable commentary on the state of the market! Thank you!
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