how far could the market go down?

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ES 2750 then back up to 3050
Screen Shot 2020-03-01 at 9.13.34 AM.png
 
tommcginnis said:
• Current S&P earnings are $133.53.
• Historic average pe is ~15.
• earnings * PE-multiple = _____________

However ("...on the other hand..."), the W.H.O. head just remarked that markets should get a grip -- a helluva sign that markets will be up on Monday.
https://www.cnbc.com/2020/03/01/who-chief-on-coronavirus-global-markets-should-calm-down-see-reality.html?__source=newsletter|breakingnews
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I've seen this sentiment quite a bit and my pushback is that it inherently assumes that the denominator will remain constant. The reason the market is selling off is because quarantines and trade restrictions and people not able to go to work has serious financial implications to earnings for a lot of companies, and so the numerator is falling to match the fall that is inevitably going to happen in the denominator. There's certainly lots of room to argue that it's falling too fast and irrationally, but you gotta address that denominator in any serious discussion of that sort.
 
No one knows exactly how far the market will go down. I've yet though to have anyone on these boards or anyone else tell me they have made a long standing consistent career off of just trading the news. If someone has, I'd be interested to know.

Everyone trader I know who has been long term successful has used technical analysis in some form or another. So, really this type of environment and news just gives extra opportunities for out sized gains(if you truly have an edge).

There's certainly an argument to be made that the news / virus get's so bad that it will effect technicals due to extreme panic selling, but it hasn't yet and even if it did or that concerned you, you could simply just take your short setups only and avoid the long setups.

I know the news hasn't broken all true edges yet. Because I was 90% long last week in my real account and was profitable everyday. Separately I opened up a combine test recently and I've been 99% long in that and just a few dollars / days away from passing. Sure, I wish I had taken more shorts, but that's my own personal failure and mental block of shorting right now, working on that.

I define a true TA edge as being able to see and measure both short and long setups. Meaning if your long strategy can't be profitable in a down market and you need the market to trade in the macro direction to make you profitable, that's not really that strong of an edge.
 
S2007S said:
So here is the problem. I believe many many people have an idea that central bankers tonight will have an emergency meeting to at least comfort the market in the short term. Iffff iffff this doesnt happen tonight the futures will take a very steep dive and will be looking for at least a 4-5% decline tomorrow. maybe the fed will wait to see the futures market open and make a decision then but if they dont cut tonight like some were talking about the markets will take a dive tomorrow once again.
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You are so slow. I already posted a black monday thread on Friday.
 
trdes said:
No one knows exactly how far the market will go down. I've yet though to have anyone on these boards or anyone else tell me they have made a long standing consistent career off of just trading the news. If someone has, I'd be interested to know.

Everyone trader I know who has been long term successful has used technical analysis in some form or another. So, really this type of environment and news just gives extra opportunities for out sized gains(if you truly have an edge).

There's certainly an argument to be made that the news / virus get's so bad that it will effect technicals due to extreme panic selling, but it hasn't yet and even if it did or that concerned you, you could simply just take your short setups only and avoid the long setups.

I know the news hasn't broken all true edges yet. Because I was 90% long last week in my real account and was profitable everyday. Separately I opened up a combine test recently and I've been 99% long in that and just a few dollars / days away from passing. Sure, I wish I had taken more shorts, but that's my own personal failure and mental block of shorting right now, working on that.

I define a true TA edge as being able to see and measure both short and long setups. Meaning if your long strategy can't be profitable in a down market and you need the market to trade in the macro direction to make you profitable, that's not really that strong of an edge.
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QQQ is holding above 200dma.Of course it is possible CNBC prediction of bird flu pandemic years ago could be true LOL. And while the viurus may or may not have been a rigger against DAL sector, that sector has always been a downtrend looking for a place to happen...……………………..…………………………………………………………………………………………………. Mondays tend to be a buy day. I don't have an opinion on the DOW/DIA, except it tend to be weaker than SPY,QQQ
 
trdes said:
No one knows exactly how far the market will go down. I've yet though to have anyone on these boards or anyone else tell me they have made a long standing consistent career off of just trading the news. If someone has, I'd be interested to know.

Everyone trader I know who has been long term successful has used technical analysis in some form or another. So, really this type of environment and news just gives extra opportunities for out sized gains(if you truly have an edge).

There's certainly an argument to be made that the news / virus get's so bad that it will effect technicals due to extreme panic selling, but it hasn't yet and even if it did or that concerned you, you could simply just take your short setups only and avoid the long setups.

I know the news hasn't broken all true edges yet. Because I was 90% long last week in my real account and was profitable everyday. Separately I opened up a combine test recently and I've been 99% long in that and just a few dollars / days away from passing. Sure, I wish I had taken more shorts, but that's my own personal failure and mental block of shorting right now, working on that.

I define a true TA edge as being able to see and measure both short and long setups. Meaning if your long strategy can't be profitable in a down market and you need the market to trade in the macro direction to make you profitable, that's not really that strong of an edge.
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how can you make money with 90% long?
 
trend2009 said:
how can you make money with 90% long?
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Because it doesn't matter how much NQ or the market goes down, it only matters where you buy. I am not trying to make an obvious statement, but not sure how else to quickly or simply explain it.

I traded Sunday night long and it was extremely difficult to turn a profit, I noticed this. I barely broke even after commission and fees, but the price action was not normal at all compared to what we've been seeing. Plus information / TA I use was starting to weaken.

I didn't know we would drop 1000+ NQ points, but it did let me know three things I need to do:

#1 I need to trade lighter to allow myself more room for the the volatility

#2 I need to move to a larger time frame because there will still be long setups within the down move, but since larger charts are weakening I need to use larger charts to take a long setup. IE: If larger charts are bullish, I will go to a lower time frame to take a long, because I have increased probabilities of it working out. If large charts are weak, there's higher probability the long I take on smaller TF will produce very little or even fail completely

#3 I need to be patient on entry, understand there will be a lot more retest / break of lows than in previous weeks and I should only be taking A+ setups for longs, not just any long signal I see.


Not sure if that answers your question?
 
trend2009 said:
how can you make money with 90% long?
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I don't know how to do 90or 99% long last week + make money; if I had that kind of pin point accuracy/short term trading I would have done more longs . Made money off TZA, buy+ sell it like a long except it make money off downtrends LOL.
BUT glad I took some profits in DEC,2019, JAN, 2020, mid FEB.[SPY did go down farther than I thought, but TZA went up more than I thought it would.] QQQ is looking good long + strong above 200dma + history +1st quarter strength.
The media is so stinkin' negative + negative on DOW/DIA;
[SDOW is also up nicely even though I was not in it last week]…………………………………………………………………………………….
 
If my overnight small TVIX SQQQ UVXY VXX gaps down I'll scale out, if they gap up & stay above fri high into the close I'll buy more, fwiw

I always plan for the worst w tight stops
 
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