After Action Review for Week of 8/4

I said in my weekly analysis for Aug 4 - Aug 8 that I was bullish for the week.

But as I was going through my ER2 trades for the week, I can't help but noticed that I had only 2 long trades and the rest were shorts.

On a really bullish day like yesterday, all my entries were shorts.

I was not alone. Out of D's 3 trades, he went long only on one of them, and it was the least profitable of the 3.

I can't say with certainty that D was influenced by me, but I am not going to deny that it would have been extremely difficult for him to ignore my skepticism towards market's extreme optimism yesterday in the face of all the adversities confronting it.

In fact, I felt so bearish about the market just minutes into its open (despite what I wrote hours before in my pre-market analysis), I put in a short entry just a tick below the low of the candle just seconds before market opened. In 3 minutes, I exited near the low of the day with a 1.9 point gain.

Anyone who traded the ER2 last night would recall that after its first move down, it quickly reversed and went up steeply for 45 minutes, and when it paused for a break, it was already 18 points above its open.

D went in for the ride during the first 15 minutes of that upward move, while I sat and did nothing but just watched. At 1000am EST, I drew my Fib and then continued to sit back and watch. D asked how much higher it could go. I said that it looked like it was aiming for Fib 161.8. At that level, ER2 would be at $731. But still, I found myself unable, and unbelievably unwilling to "go with the trend".

I was looking at Dow gained more than 150 points 30 minutes into the session and all the major indices going up equally fast, and yet I couldn't hit the "Ask" button. I don't know why, I just couldn't.

I guess I was waiting for a "decent" retracement (like to 38.2). And if after the pullback - if it happened - it were to move up again, I MIGHT just have given going long a consideration.

But what happened after that was that ER2 started trading in an extremely narrow range and 2 strong bearish reversal patterns (see chart below) failed to bring it down. By then, I was looking at a bullish wedge, then the wedge became a flag, and yet ER2 refused to trade out of its narrow box-range.



It was difficult to be bullish when all the bullish patterns were failing. And it was hard to ignore the bearish candlestick patterns that had formed earlier and the bearish divergence that followed.

So, technically, I was bearish. But I can't be totally bearish coz DOW and all the major indices were gaining more than 1%, and when the bullish flag was there the whole time.

I went in for 2 more trades after the one before market opened - like the first, both were shorts. It was much easier for me to be bearish than bullish.

When what was right in front of me was confusing me, I zoomed out and focused on the major trend.

To me, the major trend was bearish. At a certain point, I was wondering what the folks who were still buying at 723 and above were thinking.

Anyway, I got my biggest gain (2.9 points) for the week shorting the most bullish day of the week.

I don't know what else to say except that when it comes to trading, I've always been most comfortable whenever I trusted my intuition rather than what the news and the indices were attempting to tell me.