Arete Sunday Newsletter

Skilled sailors are made by choppy seas 🌊⛵

Mar 22, 2021

Skilled sailors are made by choppy seas. Right now we are being tested by the markets and the choppy conditions. It’s easy to get whipped around in this environment. However, if you follow your process this you should not be having massive drawdowns. If you are, use this opportunity to understand the mistakes that were made and stop doing them. Simple, not easy. Remember the market is like the sea. It's not doing anything to you. Neither knows you exist. You are simply on a metaphorical boat riding the financial waves. This is the kind of market where we will have failed breakouts and stops will get triggered only to go up the next day. You do not pull stops anymore than you would want to sail into a storm. You simply pivot and go on your way. Remember, We are playing against the smartest and most disciplined people in the world. They know exactly where Investors set stops and as well know-how to trigger a breakout so that you buy and our left holding the bag when it reverses. When in Chop the simplest advice I can offer is to trade the range. Buy the dips. Sell into the rips. Be Nimble. There is always opportunity.

Certain sectors have gotten hit very hard. However, if you look across big tech FB, AMZN, NVDA, etc are down approx 15% from their highs. Not exactly a massive correction. Understand smaller capitalization companies are hurt more by rising rates than big tech. We will see new leaders emerge. Right now the XLE and XLF are rolling and the SOXX and IBB have tested supports and held. We can see the SPY and IWM test the 50-day moving averages. The QQQ broke out of their rising wedge and needs to pop back in it fast or most likely we test $304. The rejection at $324 makes this more likely. Note the SPY and IWM did not make a higher high all week long. This shows systematic selling. Key levels are on the charts.

Finally, there are three videos I made over the weekend. Top stocks for the week, NFT stocks, and a recap of the week. For the recap video, its stocks from the beginning to 54 minutes in and then indexes the rest.

Let’s look at the Indexes!

Let’s look at our stocks!

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As always all investment decisions need to be made by the individual. We all have different risk profiles.No two people trade the same. Understand the buy points, stop losses, trims are suggestions. For example on stops. I want to see it close there at the end of the day. You need to develop your own process. I am willing to help and offer feedback.

Please make sure you Subscribe to Twitter! 👈and turn on notifications. There are times my updates are timely in regard to the Newsletter. I called key levels on the $QQQ Friday as well as the $TSLA trades.

Any questions please message me.

Thank you again for all the messages telling me how this Newsletter improved your performance and made you a better trader!

The Chasing Alpha Newsletter

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