IMO no need for anther thread as shorting is a way to protect in a bear market so it fits here. There are plenty of strategies one can deploy in a bear market from buying strong companies, shorting overvalued ones, gold, commodities, foreign stocks, any and all strategy should be considered. Bonds would be an options if inflation wasn't a problem right now.
I don't disagree that options and short selling have their risks but it all comes down to a process. No process will protect you 100% but it can work to protect you as much as possible. With options you need to consider timeline, decay, strike price, and often in options they move less with fundamentals than just buying an equity. I would never recommend as the risks are great if you don't have your own rules as I find emotion runs hotter here than just buying stocks.
Either way I have burned myself on the stove many times and have a process I follow now that saves me (as best a process can). I set tighter stops and set them right when I buy to remove emotion from the price action. Often the price goes against me and I am stomped out but what can you do? I try to use TA to identify exit/entry points where I am trying to identify where resistance/support are at. I am no expert but this has been a helpful strategy.
After opening I also now reset my stops daily which has been a bigger factor for keeping gains. I use to never do this and then I would lose money I just gained. I see where the price is at and then adjust my stop based on where things are for that day.
<< CTA? Sorry, I'm not familiar.>>
Commodity trading advisors who buy and sell stocks. They are often trend following and will execute large buy/sells based on trend. In this case the trend is down and we have support levels being breached which potentially opens them up to large scale selling. Often I pay no attention to them from a value investing standpoint, but it's good to be aware on the broad market as opportunity presents itself.
<< I'm not an expert at charts so where do you see the next level of support? And at what point did support break for QQQ?>>
I am no expert either but moving averages or Fibonacci numbers work for me to identify support/resistance. There are resources that could explain it way better than I ever could.
-Sean |
