Delightful is the word i would use to describe how i feel when the market came down whole week long. Recalling how i was wrong about market moving higher in May, i made a decision to square off all my long positions to re-analyse the direction. Then i believed the market is heading down and from the way i read the market, i had a feeling 3000 and 12000 will not hold. Simply put it, if these levels hold, i would square off my shorts or should they break, i can look to short. My plan is to develop an opinion and trade in that direction while looking out for evidence that my opinion is wrong. This method is much better than "I see market up, i long, i see market red, i short" a sure way to lose money consistently. One of the question frequently asked was, when can i short? My answer is very simple, two levels we must know. Support and Resistance. Resisted at resistance or break support and we look to short. This is the only way you have the highest probability in your favour. Anything in between is best to avoid and wait patiently for the best risk/reward trade to come along. So to answer the question, yes, watch out for those support levels and pay attention to any positive news.
Technically, a rebound may happen. Watch out for sideway consolidations which may lead to another fall. The best is of course if we can have a decent rebound. This should be an excellent chance to go short. The pattern last week was obvious, "sell on strength".
Another sign that i have not witnessed during the bull run was how the crowd favourites were being sold mercilessly. Hongxin, Cosco, YZJ, Synear, Jiutian one by one these giants falling in grace.
DISCLAIMER: This is not an inducement to buy or sell. You should do your own analysis on top of my postings.
