What a difference a day can make.
Even as we cheered the thoughts of hitting all-time highs, at the 4:35 mark in yesterday’s market recap video, I emphasized the need to remain diligent.
“The worst looking charts always begin as the best looking charts“.
No truer words could have been spoken as the equity markets did an about-face today and trapped any traders who got sucked into yesterday’s rally.
As I stated yesterday “If you were short or on the sidelines, this is the kind of day that hurts and probably caused a number of you to do some things you may regret later“.
This is why I stressed the importance of focusing on your process and not focusing on outcomes like trying to make money because that will cause you to chase.
Today’s short bias was apparent as the IWM gapped down and went outside inside and down on the 4H chart.
Now if you have a longer-term horizon than this is just one day and one data point. The charts have been damaged but the bulls can still keep control of the longer term uptrend if they close out the remaining trading quarter strong.
I will review all the major indices in this week’s Market Outlook which will drop this Sunday so stay tuned!
If you had a tough week take some time to reflect on the lessons learned. Try to detach from taking the results personally and instead channel those lessons into how they can improve your process.
Enjoy the weekend!