I messed up. I have been so bearish for such a long time that when the market for the first time showed weakness I let my biases that it was over overtake my risk management. In my mind at the October lows there was no way we were going to breach the SPX 2000 bulltrap, let alone tag new All Time Highs. I correctly predicted a bounce and held off at the lows, even made a little bit of money going long for a few days. We got the bounce and I prematurely hopped back on the short side. I had made more money in a week on that drop than I had ever made before in my life. I got cocky. So when we got the bounce I bought back into that devilish instrument UVXY, this instrument had made me a fortune on the drop, this time around I was going to make even more. So of course I bought more than last time, the market kept rallying and UVXY collapsing so I kept buying more and more as it dropped. Averaging down and adding to a loser, rather than cutting it immediatly as the worlds greatest traders know is paramount. So QE is finally confirmed over. This is absolutely it I thought, the market is done for Finally! What happens?... We rally even more the next day. Ok painting the tape to make people think QE was a non factor in the rally I thought. Then out of the blue midnight rolls around and BAM Bank of Japan announces surprise QE out of the blue, strengthening the USD and sending futures flying to ATH. I was fucked. Here I am with my largest position, stupidly large in one of the notoriously worst instruments in the world to be holding long for any period of time, sitting at a substantial loss... I ended up selling half and eating a $5k loss. So all that money I made in that selloff a couple weeks ago has since evaporated. I could have bought a new car with my profits I made in a week, now it looks like I'll be driving my beat up old Taurus for a while..

The lesson here is to Never Fall in love with your thesis. Never outscale risk in hopes of making more, Never 'double down' these are habits of gamblers. Cut losses immediately. If the price action does not act as you hypothesised your thesis was Wrong so GTFO Immediately!

Do I think that now is the time to load up longs? Absolutely not, but I do not know what the market is going to do. I do not know how high it will continue to go. I do not know when it will crash. I must not fool myself into thinking I do. It's good to be aware of what is going on, but central banks are blatantly manipulating the market right now and fighting them is a fruitless battle.

I remain with a bearish bias and still maintain when this QE bubble pops it will be violent and devastating to the market but the keyword is When and I simply do not know when that will be..

All you can do is manage Risk/Reward, sometimes the best thing to do is stay out of the market altogether and remain in cash if there are no favorable Risk/Reward setups.

Just remember to never fall in love with your thesis because one week you will be brilliant and the next a fool in this business. Markets are not rational and thus relying on what you deem to be 'logic' can be dangerous.

Manage Risk/Reward and if you are wrong, cut your losses quickly before they become large losses.

I made a ton of money, almost tripled my account and in two weeks lost nearly 50%. I'll make it all back and more but now I must make 100% just to reach the previous heights I had attained 2 weeks ago which is not exactly a walk in the park..

I placed my first Forex trade today. Short Euro.USD After the federal reserves meeting confirmed the end of QE I decided to finally place a trade that I have been wanting to put on for some time. I am speculating that because the fed is no longer increasing the money supply through its quantitative easing program, the USD will experience deflation and increase in value. Europe is still doing its bastardized form of QE and from what I hear is incredibly weak/on the brink or in horrendous recessions. America is the best house on the block currently.

Anyways I was looking at the chart of the EUR.USD and around the time I started getting bearish on the stock market around June was the same time the Euro began drastically weakening and USD started gaining strength. This has revealed to me that the smart money has been positioning for the end of QE all along, not through selling equities, but by selling the Euro.

This has taught me that watching currencies is a good way to glean insight into the macro picture, how investors are feeling about the economic environment of the different parts of the world. They say that the Bond market is the smart money to it's half retarded schizophrenic cousin the Equities market. If thats the case, the Forex market is the wise old man behind the curtain running the show.

Holy Fuck the Bulls are strong. Easy come, easy go. I gained and lost $30k in a few weeks. This trading business has some serious ups and downs. I need to get better at not trading and staying in cash.

Fed meeting tomorrow...

The market has been the most volatile I have seen it since I started trading almost two years ago. Perhaps I have taken on the tone of a permabear around late summer as I keep pounding the table on how this rally at some point is likely to end and drop hard. Im really not a permabear. I will make money going long or short but I try to have a longterm vision.

Perhaps it was my foray into several hype stocks such as 3D printing, making a fortune only to watch it evaporate in a blazing crash,or buying TTWO before they made a $Billion only to watch their share price drop that has turned me into a cynic. But being in these stocks taught me an important lesson early on and that is to Never believe the hype and never believe investors are rational. What goes up must eventually come down. Assume everything is a pump and dump including the market because it pretty much is. Thats just how the market operates. Something goes up, starts gaining steam, the early money gets rich as latecomers and momentum chasers start piling in fueling the rising prices. At some point it becomes the greater fool theory. Reflexivity kicks in as peoples shortsidedness and perception that because something is going up it will continue to go up forever. This works on the downside and it works on all time frames. Just look at message board stocktwits. After an up day everyone is all bulled up. After a down day everyone is all beared up. At some point that early money is going to start to sell however. Its all imaginary paper gains and losses until you close your position. So then the price begins to drop and all of a sudden the latecomers are underwater and panicked that it will never go up again so they sell and the chain of dominos that spent months or years being setup begins to get knocked down at high velocity.

I'm not sure if markets have always had some sort of underlying factor behind movement up or down but in this one the Federal Reserve has a disgusting amount of sway in market direction. Every fed meeting they say almost nothing and the market goes crazy. I have been pounding the table for such a long time that Quantative Easing has been the life support of the bull rally. I don't think anybody could argue that it has been economic strength that has bounced us to new All Time Highs after the depths of the financial crises. The chart of the Feds Balance Sheet /SPY truly says all that you need to know about the rally.

I hear alot of Bulls arguing that the ending of QE has been known about for months and is priced in. How in the world is that possible when the balance sheet continues to expand? The last known day of POMO is next monday, only after the real end of asset buying will we see if the lack of $Billions of asset purchases weekly affect markets and normalize them to way they should be, buyers and sellers in search of price discovery.

Average Americans are not doing so hot financially. 50% of Americans make under $27k a year. Buybacks remain rampant. I heard many Bulls championing Caterpillars earnings as a bellwether of global growth ignoring the fact that their revenues were stagnant and the increase of EPS was mostly the result of $Billions in stock buybacks.

Monday is the last week of POMO in QE3. If it really ends I am convinced that the feds ponzi scheme bull rally is done for. There is a fed meeting on tuesday however, if they announce another round of QE I will become more bullish than you can imagine because Quantitative Easings ability to levitate asset prices in the face of everything else grounded in reality is astounding.

This market is stressing me out. The dow is swinging 200pts on the regular. Everybody is scared, scared it might crash, scared of missing a V shaped rally to new highs. Nobody knows what to do. QE is almost over, the last day is next monday unless they admit economic weakness and extend it, but I really thought that investors would be anticipating it by now and selling. It seems like nothing can take down the bulls. This snapback rally has been much more violent and has recovered much more than I ever expected with violent gap ups. Fakeouts, traps, confusion, turbulence.

Ebolas here one day and it's panic, gone the next and utopia, only to rear it's ugly head again out of the blue.

I had my best week ever last week and am following it up with one of my worst.Much more than usual trading, especially intraday directional bets on the market are feeling like a straight crap shoot. The business of trading is never easy but in a market environment as volatile and unpredictable as this it is especially trying.

Good luck guys and if you are making money congratulations, don't stop you earned every penny of that.

Protect your capital at all costs!

When the market forcibly changes gear into reverse and blows out its transmission I need to be ready and in a position to profit. So what kind of stocks do I want to be Short to profit from dropping share prices?

I want to have some old momentum favorites. It seems a little late for NFLX unfortunately but TSLA is still a wonderful example of irrational Exuberance

Of course new IPO momentum favorites such as GPRO and MBLY are sure to drop hard.

Lets not leave out those cash incinerating operations with laughable sky high valuations such as YELP

Keep an eye on old momentum favorites destined to return back to pennyville from whence they came such as PLUG and KNDI

Lastly there is a myraid of just plain bad companies that are already on the verge of collapsing into oblivion even in the rocking bull market such as AVP, ANF or any coal/materials/energy stock.

A Bear Market is no excuse to lose money. In fact playing the right side of the tape could even lead to a quick fortune. Good luck!

The market has already snapped back from the intense rout of selling we saw last week. Each day has felt more tepid and contrived than before. Ebola stocks, which I had been playing long with some success pummeled me today and are as good as dead. Todays pathetic volume speaks to the conviction of buyers. You can tell that bears are patiently waiting on the sidelines for a good entry. Nobody wants to short in the hole. Sure some permabulls think that was just a 'correction' but the smart money knows that the bull market has been exclusively funded by central bankers. When that money supply stops growing there is simply not enough extra money in the world to buoy stocks any longer. Bring on the Bear, I seem to thrive in volatility anyways. It's too hard to trade in calm waters, you get bullish on something, want to believe, want to hold long and it just gets wrecked. Bears always get the last laugh..

I'm looking for the 193 area around the 150dayMa to initiate shorts and position myself for a crash/new bearmarket. However it it gaps up tomorrow and starts to roll over, I may just initiate then. This contrived rally is on it's last legs.

Volatility is back with a vengance. Bears have dived back into the market rippling the glassy pool of complacency that had dominated the market of 2013.

Violent indecision in valuations has provided some of the best intraday trading opportunities I have ever seen. The market seems to be favoring a daytrading strategy as risk seems enormous for both parties.

The market has sold off to such an extreme that a bounce seems inevetible, the 2013 playback still ingrained in many traders heads. However the market has changed, a paradigm shift in sentiment.

We sliced right through that 200 day MA. The 200d is a strong suport level that everyone watches, even fundamental guys and I think alot of people were execting that area to hold. The level will be very important in the coming days, you can see that friday immidiatly retested it with an initial rejection. A consolidation around this area for a few days would not surprise me.

We did Sell off an awful lot, it is tough to push shorts here and there are stocks in the market that bulls may construe as bargains and do some buying.

My theory is that we get one last big rally that makes some notable lower highs. Make no mistake though, QE is ending and a bear market is right around the corner.

We may bounce or we may crash. Stay nimble. Daytrading may be the best strategy in a market like this. Take advantage of the intraday volatility and indecision. As a trader the only way we can make money is price movements and we're getting some big ones these days!

Some Long Ideas

Some Short Ideas

The Bears are rising from the dead as the prophecy is finally becoming fulfilled. 
A plague has broken out in the form of Ebola. Quantitative Easing is ending and investors are now tasked with the impossible chore of keeping the market afloat without help of massive fed intervention. Rates will inevitably begin to rise sooner or later. We have temporarily diverted a financial and economic collapse from the depths of the 2009 lows, but our economy, indeed most of the worlds economies are not healthy. American markets were the last stand, the bastion of safety. Now we are merely the best trailer in the park. You can paint the picket fence white but if the wood is already rotting and the gate is coming unhinged does it really make it look any better?
If you were looking for it, the P&F threw the signal. As scary as this seems, we have barely made a dent in the epic bull rally of the past 5 years. Things can get loose to the downside as nobody wants all their profits to vanish in a puff of smoke. 

There can be fast and furious rallies to the upside. The bulls have been so strong for so long. Now all of a sudden it seems as if everybody on the street is a raging bear and that sets the stage for a potential rally. Perhaps the markets form a H&S on the Daily chart but in my opinion rallies are to be sold into. People have been taking their profits for a while now, the small caps have already topped out and I expect the selling only to intensify as we head into the end of the year. You can hope for a nice orderly pullback but in the history of markets that's almost never how these outlier bull markets have ended. They almost always end with a massive terrifying crash into oblivion before they slowly begin to find support and build themselves up into a frenzy, only to repeat the same cycle all over again. Thus is the nature of markets. Do not fear, embrace the price action. There is money to be made as a trader Long and Short!

Gods speed fellow traders and investors. Protect your capital at all costs!

It's an all out sentiment brawl between Bulls and Bears right now. The market is moving fast and is whipsawing both parties in violent indecision.

It's times like these that you better have conviction in your overarching thesis or you will get chopped into pieces.

There are inherent limitations with technical analysis. Candlesticks are nothing but indicators of sentiment. They will show you the emotion of the moment, milestones in the neverending battle of supply and demand nothing more. If only every doji neatly marked a top or a bottom, we would all be rich. It is true that over time certain patterns will emerge but the truth is more often than not we see only what we are looking for. Confirmation Bias.

As humans we cannot predict the future. As traders we like to fool ourselves into thinking that we can.

Whatever method you use to manage risk, employ it. Charts can offer useful levels to trade against and manage risk but don't fool yourself into thinking there is any predictive power in them. As the old disclaimer says 'past results are not indicative of future performance.'

When the initial reason you got into a position has changed, fundamental or technical, be willing to adapt and get out.

I don't know what the market is going to do tommorrow. Nobody does.

My thesis is that after POMO ends, the market will sell off. If after October the fed ends QE and the market rallies, I will reasses my theory. This is my fundamental overarching thesis currently. You can pretend that you are some entity of cold rational logic, immaculately unbiased, but I wouldn't believe you. I think some level of bias can even be a good thing, call it conviction.

Chopfests like this, conviction is the only thing thats keeping you in the game.

Everyday the market is one big battleground between bulls and bears. Right now the fight is heated.

So how do you maintain conviction in your Bullish or Bearish bets while at the same time knowing the exact moment when your thesis is proven wrong allowing you to minimize drawdowns? That's the million dollar question.

What is better fundamental or technical analysis? Do either methods offer any real predictive power? Can you really ever predict the future with any certainty at all?

Speculation, the madness of men. If you want to go crazy, try trading stocks. The allure and desire of vast fortune, the fear of financial ruin. The market will make and break you, goodluck.