In a bull market, what more often throws people off the ride isn’t a crash—it’s those seemingly reasonable reasons for a pullback.
Macroeconomic pressure, unfavorable policy signals, “it’s run up too much and should adjust”—each one, taken on its own, is enough to make people cut positions, even to reverse and short. But the problem is that in a strong trend, many of these “bad news” items only shake out holdings. Once price strengthens again, what you face isn’t the question of whether you should cut losses—it’s a higher question: would you still dare to buy back?
That’s also why repeatedly shorting in a bull market is so difficult. You don’t just have to get one pullback right—you also have to judge when it’s time to turn back long. Only after you get two consecutive calls right can you truly profit from the swing.
Conversely, always keeping spot holdings and allowing your account to experience normal drawdowns is actually doing a simpler thing: focusing your biggest effort on whether the trend has ended, rather than guessing every fluctuation.
Many people don’t ultimately make much money in a bull market—not because they failed to understand the direction, but because every time there’s chop they try to dodge it. In the end, they end up missing the real big move as well. What doesn’t get off the train early isn’t just the position size—it’s also the amount of time you remain exposed to the correct trend. Don’t keep guessing the pullbacks; stay in the trend.
Macroeconomic pressure, unfavorable policy signals, “it’s run up too much and should adjust”—each one, taken on its own, is enough to make people cut positions, even to reverse and short. But the problem is that in a strong trend, many of these “bad news” items only shake out holdings. Once price strengthens again, what you face isn’t the question of whether you should cut losses—it’s a higher question: would you still dare to buy back?
That’s also why repeatedly shorting in a bull market is so difficult. You don’t just have to get one pullback right—you also have to judge when it’s time to turn back long. Only after you get two consecutive calls right can you truly profit from the swing.
Conversely, always keeping spot holdings and allowing your account to experience normal drawdowns is actually doing a simpler thing: focusing your biggest effort on whether the trend has ended, rather than guessing every fluctuation.
Many people don’t ultimately make much money in a bull market—not because they failed to understand the direction, but because every time there’s chop they try to dodge it. In the end, they end up missing the real big move as well. What doesn’t get off the train early isn’t just the position size—it’s also the amount of time you remain exposed to the correct trend. Don’t keep guessing the pullbacks; stay in the trend.