Selling short a no no

Again today we get a lesson why I continue to stress that selling short is risky and not worth the effort. Central bank printing presses are just too big to fight. The obvious intervention this morning has probably terminated the natural drop into a daily cycle low. The PPT is going to try to protect the market from retesting the 200 DMA. They aren’t going to make the same mistake they made in December and allow the market to generate any downside momentum.

It shouldn’t be long before the Dow is making new highs. Once it does the rest of the market will soon follow.

77 thoughts on “Selling short a no no

  1. Bill

    Bullish! but as usual the same bears will come back in on Monday with the same violin ….

  2. Joe

    I went short on biotech at the opening via LABU, was going great for like 5 min. I was going to unload it but experienced computer trouble %^&*. Guess Garry wan’t kidding about the PPT. Now I am 5K under. Sell now or hold over the weekend, any ideas? coin toss?

  3. MuffinTop

    Unless!! You’re ‘Joe Sixpack’ in which case.. you should short so that the rest of us can continue to profit. There wouldn’t be a Market without you πŸ™‚ Me love you long time ‘Bangkok’ style.

  4. Ralph Wiederzane

    Seriously, where are those little pukes that come on here all the time, confidently telling everybody that everything is going down tomorrow, only to get smashed time and time again? Gary has far too much patience with them in my opinion, but I must admit it’s fun watching them get bent over day after day.

    1. Trader Cee

      Ralph, you might be getting ahead of yourself. The market has not crashed nor has it taken off today. US indices are dead flat at the moment. But European and Japanese stocks are taking a drubbing. Now go look at the charts of those others and notice that they tend to travel in the same direction at the same time. So large declines or large rises in the DAX usually also show up on these shores. That is how we get the indices all looking so symmetrical. You just got an early warning about next week is all. It is unambiguously negative that so many other exchanges were down today.

      1. Bill

        Baker Hughes reports weekly U.S. oil-rig count down by 10

        Gold and miners are reacting to this news

        1. Richard

          Just the commodity basket reaction with oil. Don’t really see any big thing here. Oil is ahead of itself.

  5. Joseph

    Confussed…….Still say were going to emini 2000 for sure or 1980 in April but I just stepped asside and looking to sell some longs next week if it goes my way…… Still think will close strong today above 2065. MY POINT….. I can say that one other very strong trader I respect who makes HUGE $$$ day trading that if I said what he made most would say I’m Full of S#&@#….. That being my Brother is saying April were going to 1950 or so then UP to 2100….. I disagree, I say down April/May or go sideways in a range then UP June/July……
    Anyhow, its just my view, I’m no Expert, Real-Estate is my thing but Smart enough to step asside and only go in or Take my brothers advise when I’m sure or my bro says very good chance of a WIN

  6. Ralph Wiederzane

    Your brother is a day trader that predicts the next month? Most day traders I know are only in positions for a few hours or a whole day at most, and the best ones don’t waste energy or capital predicting any time frame longer.

  7. Jay

    I’m not a big fan of short selling, but it worked fine for me as a trade.

    I still think Gold will *eventually* dip below $1000 an ounce. #Timestamp

  8. jacob 2

    The first day of the new quarter and what leads the market ? LABU/SBIO. A good omen for things to come and spring green. Thanks Gary …. the Bios weren’t on my radar (focused on late cyclicals) until you brought it up.

  9. pepe le pew

    sad face… I was forced to sell a fifth of my LABU holdings because CIBC doesn’t allow margin purchases on 3x ETF’s – haha go figure! The dummies shouldn’t have allowed me to buy those shares on margin in the first place! Probably for the best… had it been down 15% in the last two days instead of up, I would have a very sad face, indeed!

    Plus, the day isn’t over; it could yet collapse, and give the sad SMT subscribers a better re-entry point.

  10. Don

    Is it the PPT rescuing the market or is it hot money flowing into the US from every where else out of fear? Also, why didn’t the PPT teams in other countries rescue their markets too? I thought these central banks were working together to the same end.

  11. Greg ewanizky

    Hey Gary, no disrespect just a question. How do you account for Germany and Japan getting crushed today even though they are in on their own QE period plus their rallies out of the February low are not nearly as strong as the US. Thanks

  12. Don

    Recovery explained! Dennis Gartman has flipped from being bullish yesterday to being bearish today. Doing the opposite of what that clown says has been better than what any analyst could ever do for a trader. Looks like the market is going higher.

    1. Anthonyo

      din, absolutely right Denis FARTman is always dead wrong. He is a clown alrightm a relic, a caricature.

  13. Bill

    The Direxion Daily S&P Biotech Bull 3X ETF (LABU) is still basing, but looking better. It was up 2.29 to 27.47, or 9.1%, on 57 million shares traded. That’s the biggest volume in its history on Thursday on an up day. That’s a good sign. Watch the declining topsline, and later resistance at the 30 range, it could very well run up to 34 very quickly, and then it will really take off.

  14. james moffett

    Gary β€” stocks sold off early after employment report. Now after the Mfg report at 10 am, the market recovered and is now up. Are we still looking for a short-term top today, or is the DCL occurred and now we continue a sustained uptrend?

    1. Gary Post author

      Today was the best trigger for a move down into a DCL. At this point I’m not going to hold my breath waiting for a correction that the PPT may not allow to happen. They don’t want the S&P back below the 200 DMA.

  15. Bill

    Baker Hughes reports weekly U.S. oil-rig count down by 10

    Gold and miners are reacting to this news

  16. joseph

    Ralph…. He takes positions on options….. also day trades full time and runs a SEO cmpy.
    He usually doesn’t go longer than 2 months,,,,, he explained why but Options is just to tough for me or risky….. He also always closes most positions FRI and his target is 4_6 emini pts per day….. Does not trade Gold or Nat Gas emini as its to volatile.
    Day trading like today is soooo hard, thus why stepping aside is smart for some as to come dn from 2065 or so to 2040…..then back up to 2065 where I said early on today when we were down I believe will close at 2065 or above…… Anyhow, its just my perspective and stress to my friends and family to diversify to some sort of real-estate as a buy and hold……
    Ive seen what loosing BIG $$$ can do to families, marriages, EGO, Humility etc…..

    Take care

  17. Bill

    Feds Meister Continues to expect gradual rate hikes this year

    Did not dissent at March FOMC is Q1 data limited.
    Fed is not behind tightening curve though there are risks in waiting
    Slightly downgraded rate hike path since December.
    Now expects bit slower US growth of 2.25 – 2.5% in 2016
    Slightly lower long term neutral rates.
    Economy has shown considerable resilience.
    Expects continued inflation rebound and wage gains
    Can expect dollar to remain strong due to US growth
    Was reasonable case at March FOMC to wait for more data
    Forestalling hikes for too long risks volatility later
    Sees inflation rising gradually to Feds 2% goal

    And yes I know the FED is nothing but a mouth piece I know all the doom terminology and I know they are a corrupt organization, but unless someone has someone has another ( real ) and define it data point well this is all we have to go on…I’ve fought the Fed myself tooth and nail and lost as well…trust me.

  18. joseph

    Richard, on the Real-Estate; lets say you trade 1 contract plus leverage you need in the choice of broker account your with or are not trading the Eminis and just buy ETFs etch…. Essentially, that same 10-20k can help buy a bungalow or condo at a low 5yr mortgage at 2.5%……its slow money, long term, but it is an asset, cash, write-off, someone else is paying your mortgage, cash, tax efficiencies,….. It’s not as hard as most think with Tenants etc…. And if your handy, any labor is just you, lots of Mint Folks who will work for cash if you need to hire. Real-Estate also follows a cycle…. in 5-7 years, pull a Line of credit on the property and buy another one…… I’d stay away from condos and buy a house or a Semi detached 2 or 3 pled but its a great way to have a full time job at xyz company, Trade safely, and have some property……
    Theres my TRUMP Speech……

  19. Stevie

    After covering all my SSo shorts for a nice gain, I’m going to go 300% short if we close up today.

  20. Joseph

    Hey Ralph, my call/post when we were down at 2040 level to say were going to close strong above 2065…. …. That’s a 30pt mv to the day high….
    I didn’t trade this Great call as its just to risky for me and didnt see all my signals inline, should have done it but…… Anyhow, I still say April will get to 2000 or DO 16500-16800, would love 15750 as it would be such a great lo g buy……
    IM Going to sell some of my longs Monday……

  21. Stevie

    When all you Joe six packs are buying, I’m selling.

    Just went 300% short in acct at the close. Shorted SSO at 64.56.

    1. Ralph Wiederzane

      How? You’re already broke from the last couple months! Nice shootin’, you’ll be right one of these days.

  22. Don

    The S&P ignored the rest of the world’s markets and closed up nicely today, led by the Biotechs. But I am confused, Are we supposed to be buying back into IBB or LABU after they have had a couple of strong days or wait for a sell off to occur? Gary’s subscribers are out of the bios and are probably wondering why. Is a big drop in the cards?

    1. Richard

      End of quarter, first of month, nobody going to be a hero, look what’s rallying.
      Go figure, Stevie, probably 2 or 3 more days!

        1. Gary Post author

          Reentered today when it became clear the PPT was going to prevent the DCL. Already up nicely on the trade.

    2. Stevie

      It will matter very soon.
      This is exactly the same as the last 3 massive hams.
      It will also fail like the last 3. Mathews moves are unsustainable and unhealthy. Healthy markets don’t trade like this…

      1. Gary Post author

        Again, I can’t stress this enough. Get a subscription to sentimentrader. No serious trader in the world trades without it.

      2. Anthonyo

        I think we all agree that healthy markets or otherwise known as just markets don’t exist anymore.
        There are NO “markets” in the world now.
        Now, we can sit here and gripe about it; or we can make money in them
        as they are how they are and for what they are.

  23. joseph

    Hey Stevie, thats my brothers name, Steven as well. Just be careful bro, if you do short as you are, Pls put some sort of stops and Hedge on the Bull side….. Take some of your profits if they do come your way. I do think we are coming down in April to Emini SnP 2030, then 2000…. The emini support was 2048 and then 2030……
    I AM Selling some of my longs as I said early this week……
    Dont go too crazy on this day trade thing or you may loose bro……
    I believe once we correct modestly, we will be higher year end with OIL at $55……

    Take Care

  24. MuffinTop

    Ooooooh LABU πŸ™‚

    It wouldn’t surprise me if we see LABU breach $33 first before a corrective pull-back is to take place. This is tricky.. Right now, the Market is not letting up AND we have momentum on our side in Biotech.. meaning we will very likely see more follow through next week. My advice, for those of you still waiting on the sidelines, would be to initiate a %50 position just to get you in the trade and then pull the trigger on the other half once we have a proper pull-back. We will have a pull back but there’s just no telling when with momentum on our side.

    I will say this.. I’m not convinced that LABU would follow the Market down into a DCL, so if that’s what you’re hoping for then you could be shit out of luck my friend! This week’s record volume is very telling πŸ™‚ which means instead of trying to time your entry and avoid a draw-down (tisk tisk Gary) — Focus on the bigger picture. We are currently starting Wave 4, which you can clearly see on a Weekly chart, and it should eventually tag resistance at roughly $58 [$290 for IBB] if all goes according to plan…

    … except that it never does. Currently Long @$26 — my 2 hour chart and daily chart still very bullish.

    Good luck losers, Lol!

    Ps: I will re-post this if a new chart pops up!

    1. Bill

      Spot on Muff, Gary may have made a small mistake we all do at times it happens… Such is the nature of the game obviously he seen something that spooked him… We’re only human and we are fighting aginst machines lol.

      1. Gary Post author

        Just trying to avoid a drawdown if the market dropped into a DCL. If my crystal ball had been working and foreseen the intervention then of course I would have just held. But we got back in quickly this morning, and once biotech breaks out and starts to move the rally will last at least 2 months and deliver at least 20-30%. So missing a day and a half at the very beginning isn’t the end of the world.

      2. MuffinTop

        Of course.. Everything I say should be ‘taken with a grain of salt’, even when I’m beating on the trolls. We are all here to learn from one another and Gary has plenty to teach — that’s why I’m here πŸ™‚

  25. Dan

    Vix suppression is just laughable at this point. But im holding my positions. Im going on vacation and tuning out this garbage market for a month.

    1. Gary Post author

      You also desperately need to get a subscription to sentimentrader so you can start making profitable trades and quit fighting the smart money. Quit trading your emotions.

  26. Rob


    I know you say your waiting for Gold another month or so but in your view is it possible/realistic that 1200 remains a floor and final low until May?

    1. Gary Post author

      I have no idea what the final ICL will be. But I want to see some bearish sentiment extremes again before I jump back in the metals pool.

      As of today we still have a long way to go.

  27. Dab

    We might still go to All Time High on SPX just to kill the bears. But then it is most likely the end of this bull market. Saying that the “bubble phase” is ahead of us is just ridiculous. And biotech is the lagging sector. First one the fantasy stories to correct last year, last one to gain traction this year. Beware do not chase. And yes Short selling is difficult but no more difficult than buying. And NO. LABU and BIOTECH are NOT DOING ROUNDED BOTTOMS. Gold had a rounded bottom Dec-Jan. Biotech is bear flagging. And you are way too arrogant Gary with your call, not seeing other possibilities.

      1. Anthonyo

        Dab is Bad backwards… need I say more?
        Dude, you go short on Biotechs then why dont ya?

    1. RayB

      Of course Gary sees other possibilities .. he never claims to be perfect .. not sure why you or others get upset at Gary for just giving his opinion!

  28. Dab

    Look at these charts and say where do you see the market if not at the end of the bubble phase?
    And I do not mean fantasy stocks valuations like tech or bio., which is sentiment trading only. Just plain vanilla large caps stocks:

    Bubble head is ending now. You become bagholders. Your PPT does not have our back. Markets crashed 50% in 2000 and 2007. Mind this.

    1. Gary Post author

      I’ve done everything I can to show you what is happening. I’ve explained the long term cycles, I’ve shown you sentiment and I’ve shown you the COT levels.

      If you insist on trading based on your bias then there isn’t anything further I can do.

      FWIW I think we should be heading into a bear market too, but when everything else tells me I’m wrong I assume my bias is incorrect and I go with the facts.

    2. Anthonyo

      Yawn, someone flooding theboard with boring links now … sore losers with red shorst? Get it? Red shorts.

  29. Frank

    This is not the popular view, but that’s what makes this site interesting. In your world, today was the start of a new leg up for stocks. This should have been be a very strong day, like back on Feb 11, when there were 3 or 4 days of 30+ SPX pts up and breadth was 25 to 6 on Feb 12, but today was up 13 pts on EVEN BREADTH. That is weak. This is the end, not the beginning. Monday it is going down!

    1. Gary Post author

      I’m not a day trader. Monday is inconsequential to me. All I care about is where the market is going over the next two months. And I can guarantee it is going higher from here.

      1. Stevie

        It is until it isn’t.
        You were telling folks how the up and down in biotech at these prices won’t matter, but at the first sign of weakness you exited. Why?

  30. Irwin

    Did ya hear the one about the BIG merger?
    Don’t believe anything you hear.

    April Fool’s Day


  31. RayB

    Why do people get upset when Gary or others don’t see things the same way they do? This is Gary’s site and most of us come here because we value Gary’s opinion .. if you disagree with Gary, thats ok, but don’t start giving out insults just cause you don’t agree with someones opinion.

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