I think when it comes to the next really big trade, the market is a long. I've currently been positioning for this long, but I think I might be too early for that. We may have 150 - 200 points down before the long comes into play.
Here's my current plan.
In the near term, I have a day/week trading bias short. I'll use short breakout patterns and retracement patterns. My thesis is the short will be a strong leg and therefore simple trend strategies should work well. I'll keep stop losses tight and if it gives me too much trouble drop this plan and review.
If we start to slam, I am limit long 3850 with plans to aggressively build up my position if I see the formation of higher lows on small timeframes. Again, looking for a strong trend so I'll be using trend following strategies with tight stops. Ideally, I'd like to see this drop happening with news. Scary news. News that absolutely everyone understands is bad news. Could be policy related. Might be real world related - but I'd be emboldened by there being news that many people understand as having a negative tone to it.
If this rally starts and persists, I am adding to my positions all the way and trailing stops. I think we'd be into a squeeze and if you're in a squeeze you almost can't lose no matter what you do. To put it another way, if you're being squeezed no matter how cute you are with entries you almost never see profit. Thus, the same in reverse for longs. During this I'll buy all dips and breakouts and my stops will be trailed aggressively to recent lows .
If these swings happen, the big bat will have formed.
And I think we all know what I'm going to do if the big bat forms. But I'll certainly be talking more about it at the time if you do not.
**This is a sequential trade plan. Meaning one thing has to happen to trigger the other. If we were to rally breaking the expectations of phase one here, the whole trade plan would be invalid. As if we break the 3800 level**
Here's my current plan.
In the near term, I have a day/week trading bias short. I'll use short breakout patterns and retracement patterns. My thesis is the short will be a strong leg and therefore simple trend strategies should work well. I'll keep stop losses tight and if it gives me too much trouble drop this plan and review.
If we start to slam, I am limit long 3850 with plans to aggressively build up my position if I see the formation of higher lows on small timeframes. Again, looking for a strong trend so I'll be using trend following strategies with tight stops. Ideally, I'd like to see this drop happening with news. Scary news. News that absolutely everyone understands is bad news. Could be policy related. Might be real world related - but I'd be emboldened by there being news that many people understand as having a negative tone to it.
If this rally starts and persists, I am adding to my positions all the way and trailing stops. I think we'd be into a squeeze and if you're in a squeeze you almost can't lose no matter what you do. To put it another way, if you're being squeezed no matter how cute you are with entries you almost never see profit. Thus, the same in reverse for longs. During this I'll buy all dips and breakouts and my stops will be trailed aggressively to recent lows .
If these swings happen, the big bat will have formed.
And I think we all know what I'm going to do if the big bat forms. But I'll certainly be talking more about it at the time if you do not.
**This is a sequential trade plan. Meaning one thing has to happen to trigger the other. If we were to rally breaking the expectations of phase one here, the whole trade plan would be invalid. As if we break the 3800 level**
Here's the primary plan, valid above 4000.