Jump to content

There was only one direction in which to trade S&P 500 in 2019.


Recommended Posts

Long - buy and hold - for the entire year.  Dips clearly predicted by MA crossovers.  Upon the low of each dip the correct thing to do was to add longs.  Advanced warnings of the bottoms provided by the 5MA and turning slopes of 20 and 50.  Anyone shorting the S&P 500 in 2019 is a 'goddamned fool' trading against the trend.

Buy and hold (and adding additional longs) vs. being a muppet using one minute charts.  Which would you choose?

2019-08-29_01-22-50.thumb.jpg.f9d0aa8c9e12922997f2cb1cfd421215.jpg

  • Like 1
Link to comment
Guest ShortS&P
1 hour ago, dmedin said:

Long - buy and hold - for the entire year.  Dips clearly predicted by MA crossovers.  Upon the low of each dip the correct thing to do was to add longs.  Advanced warnings of the bottoms provided by the 5MA and turning slopes of 20 and 50.  Anyone shorting the S&P 500 in 2019 is a 'goddamned fool' trading against the trend.

Buy and hold (and adding additional longs) vs. being a muppet using one minute charts.  Which would you choose?

2019-08-29_01-22-50.thumb.jpg.f9d0aa8c9e12922997f2cb1cfd421215.jpg

I think you will regret.

Link to comment

Hindsight is 20/20 as you said before @dmedin  So the question is, if you were going to trade the SP500 now, do you buy and hold?

Buy and hold sounds like an investment strategy to me rather than a trading strategy, albeit that as a longer term trader I do hold positions for some time if we are in a strong run.  As a swing trader, which is mostly what I am, the play was to buy after Christmas (which I did, after cashing my shorts on reversal signals) and cash out in early May (I actually cashed earlier than that, which was a mistake).  Then buy again in June and cash out and go short in July, I did the latter not the former.  If you bought the dip in June and held you would have been stopped out on the July reversal.  I have posted recently elsewhere that I went Long on the strong pull back after the reversal rally in early August and have swung successfully a few times so far and am now Long again but this is all tactical for me as I believe the odds favour an end to the Bull sooner rather than later.  Unless there is a confirmed breakout rally buy and hold will not work.  Typically traders do not buy and hold anyway.

So net, trading is not as simple as it seems in retrospect and other than when we get into long strong wave 3s or Cs (trend following territory), swing trading is a better strategy than buy and hold.  It is also worth noting that the markets tend to spend more time in consolidation phases than strong trends, hence swing trading is more often than not the right approach.  A trading strategy will have an exit as well as an entry part to it, even if this is something as simplistic as a trailing stop, which I never use myself.  In order to make a profit you have to cash out.  Buy and hold is not a trading strategy and for my money, at this part of the cycle, it is not even a credible investment strategy either.

Various market greats, such as Buffett for example, all say 2 things (they say many things but they all agree on these 2 at least):

  1. Buy low/sell high (reverse for Shorts naturally) - you have to sell to make money (outwith dividends of course)
  2. Don't lose money - this is about money management and risk management

Crack these 2 simple concepts and get control of your emotions and you can make it work.  Fall into the trap of retrospective recriminations and false lessons learned and you will not succeed. 

  • Like 1
Link to comment
2 hours ago, dendyver said:

Hi dmedin

I assume you are using simple moving averages?

Assuming you are acting on the 5 and 20 crosssovers, what is the role of the 50dma?

Did you not think to short the May correction?

 

I did think to ... but I didn't.  My approach should have been to use the daily and set the stop above the ATH, instead of fannying about with hourly and minute charts with tight stops that inevitably get taken out.

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • image.png

  • Posts

    • It's exciting to think about the possibilities of copy-trading. But it's like a double-edged sword: it can make you an easy profit, but it can also lead to the loss of all your money. Consequently, in order to make profits  and avoid losses, you must select the appropriate elite trader to follow. And DYOR is, in my view, the most effective technique to accomplish this.
    • Elliott Wave Analysis TradingLounge Daily Chart, 26 February 24, AAVE/ U.S. dollar(AAVEUSD) AAVEUSD Elliott Wave Technical Analysis Function: Counter Trend Mode: Corrective Structure: Zigzag Position: Wave ((B)) Direction Next higher Degrees: Wave II of Impulse Wave Cancel invalid Level: 47.34 AAVE/ U.S. dollar(AAVEUSD)Trading Strategy: Correction of wave 2 in the Zigzag pattern. Price is currently pulling back in wave B before falling again in wave C. The overall picture is still in an uptrend but is correcting to continue upward. AAVE/ U.S. dollar(AAVEUSD)Technical Indicators: The price is above the MA200 indicating an Uptrend, Wave Oscillatoris a bullish Momentum. TradingLounge Analyst: Kittiampon Somboonsod, CEWA Source : Tradinglounge.com get trial here!         Elliott Wave Analysis TradingLounge 4Hr Chart, 26 February 24, Bitcoin/ U.S. dollar(BTCUSD) AAVEUSD Elliott Wave Technical Analysis Function: Counter Trend Mode: Corrective Structure: Zigzag Position: Wave ((B)) Direction Next higher Degrees: Wave II of Impulse Wave Cancel invalid Level: 47.34 Bitcoin/ U.S. dollar(BTCUSD)Trading Strategy: Correction of wave 2 in the Zigzag pattern. Price is currently pulling back in wave B before falling again in wave C. The overall picture is still in an uptrend but is correcting to continue upward. Bitcoin/ U.S. dollar(BTCUSD)Technical Indicators: The price is above the MA200 indicating an Uptrend, Wave Oscillators a bullish Momentum.    
    • Naturally after the debut of ERC 404, it was only natural that developers would begin to take advantage of its ability to bridges the gap between fungible (ERC-20) and non-fungible (ERC-721) tokens. One such project is the Dancing Beans ($BEANS) which allows fractional ownership of hilarious meme-inspired creatures NFTs on the blockchain. About a week ago I wrote about the exponential rise of Pandora to 20,000% plus in just five days setting the bar high for competition! I also spoke about other NFT projects like CryptoPunks and Bored Ape Yacht Club but Dancing Beans brings a fresh twist with. While Focusing on fun and interactivity and community-driven approaches the Dancing Beans team is constantly listening to their fans and creating new experiences based on their feedback... For me though, the question is if Beans can follow the successful dancesteps of Pandora and make players, NFT collectors and investors dance about the figures in their wallets. With my fingers crossed, I'm inclined to hold the Beans I bought on Bitget after the recent listing and it has already gone up by 24%... What are your thoughts guys? Pandora style or nah?  
×
×
  • Create New...
us