I will make this simple for everyone. Big Wave Trading follows the trends. We will be wrong a lot and cut our losses when we are. Until this year, we were always right more than wrong. This year, however, we have been wrong more than right, due to the extreme go-nowhere-volatility.
Times like this leave a lot of people frozen and unable to take their signals. Not us. Today we got our signal of what to do next. The trend is down. Stocks are failing nice base patterns they were forming, banks are losing the 50 dma, ex-generals are rolling over, and 3x ETFs are seeing huge volume.
This indicates a major trend change is coming here. Will it end up with a change? We don’t know. We just take the signals. We have our sell signals. We are going short stocks and long inverse ETFs. If we are wrong, again, we will cut our losses. If we are right, then we will profit greatly. No guts, no glory. I keep it simple.
The nice bases and chart patterns in a matter of only three days to a week have nearly all been taken to the woodshed. However, some of our longs still look really good and volume was not above average on the NYSE so our new market position is not with 100% conviction. It is with 50%+ conviction and we will invest accordingly.
Don’t fight the trend. When you are wrong cut your losses. Don’t be afraid to take the next signal even if the last 10 have been wrong. Always be ready for that black swan or white swan event. Anything can and will happen. For now, the trend is back to being down. That is that.