As you may have guessed, I receive emails every day from traders of all different stripes and persuasions. I answer when I can, but often just short replies as time is a valuable commodity. But there is a recurrent question that comes up, and the question is usually raised by traders I can sense are inexperienced. They ask me when they should short this asset or that one…
My answer to that is one should never short a bull market, particularly if you are inexperienced enough to have to ask when to do it.
I have been trading for decades and I am afraid to short any of the coins these days. We are in a major bull market, so the surprises will always be to the upside. Look at that happened to DASH and ZEC yesterday. Oh my god… If you had been short either of those, even a stop loss may not have been enough to keep you from being wiped out.
I see that Bitcoin reversed yesterday EXACTLY at the time and price we had been forecasting for days. I thought about shorting it because I could see the turning point coming, but I did not. I was AFRAID to do so, knowing that there is so much money pouring into the coins these days. As it turned out, after a brief fall, XBT reversed again, and made yet another new high. Wasn’t I happy I wasn’t short!!
To summarize, there is a time and place to short. May 2017 is not the time. When you are experienced enough to know when to short, without asking anyone else’s opinion on the matter, then and only then will it be a good idea for you to trade the short side, IMHO.
What the hell happened here????? I saw the test of support at the 1×2 angle. I mentioned it in yesterday’s column, but this rally was just too much. I can’t imagine how much money went into this market in a few hours to do this. This was not mom and pop investors. This was institutional money. The game is changing. It’s not clear if there is more to come. The rally stopped just above the top of the setup, and is currently just below the 5th arc. We will have to wait and see.
The same thing happened to ZEC. This is just insane. To anyone who caught these monster rallies, my hat is off to you. I had to change my scale to accommodate the rise in this coin. At the present scale it seems there is more to go in this rally.
Ripple remains stuck in an arc pair and can’t seem to get free. An energy point approaches (red vertical line). While I suspect the low is already in, it might yet fall to test the 1×2 Gann angle (blue arrow).
Remember: The author is a trader who is subject to all manner of error in judgment. Do your own research, and be prepared to take full responsibility for your own trades.