Some might ask, “Why have we not been giving swing shorts in this bear market?”

The answer is twofold.

First, because of the rapid, fluid fall in the broader markets in a short 3-week period from an all-time high (25 to 35% in the majority of stocks and ETFs without a meaningful retracement), the stops would be much too far away based on our method for Swing Trading. 

The size of the move down as explained above has never happened in stock market history. What has happened is not normal. 

But day trading short opportunities have been plentiful in the Green Room. 

 
Second, with our market internal gauges at such extended bullish extremes – extremes that have never seen, a large violent counter-trend rally could happen at any moment. 

Short traders will be running over themselves to cover, which we have already seen intra-day. 

With the high VIX (Volatility Index), we have been shorting far out-of-the-money (OTM) puts and spreads on stocks, which have worked very well, allowing us to profit even if the stock falls further.

We have the current undesirable price pattern. The markets closed weak on Friday, after attempting to bottom for 3-4 days, suggesting lower prices. But to sell short here – except for day trading – is not a high probability proposition. 

We want to provide you the best trading opportunities while always having your financial future and safety as the primary focus. 

The potential reward to risk for short sales now, historically, is not good. 

 
Why will we have long trades ideas this week in the Swing and Options Trader Letter?
Because “if they trigger,” they will be “MT Shock Patterns.” 

Bullish Shocks Patterns trap the shorts sellers, forcing them to scurrying to cover. Plus, the demand coming in from bottom-fishers and institutions that have been buying already will add, creating a tradable bounce higher within the extended downward trend. 

 
We will continue to update you as the markets change.

We hope that you, your family, and friends are well in this time of concern for all.

While you spend more time at home, we have provided you with some past MT Live events for you to watch to pass the time and learn -- reinforce what you learned. Enjoy!