I almost called my broker Monday to tell him to go completely to cash. Glad I didn’t. Probably also a sign of a bottom.
You’re exactly correct. When most Americans, who have an upside mental bias (ie, Americans are, by and large, optimists) finally throw in the towel, it is usually close to the bottom.
One of the things necessary to becoming a successful trader (as opposed to investor) is to be able to observe these emotions in one’s self, and then do exactly the *opposite* of what your instinct tells you to do.
I covered shorts earlier this week because I was feeling like “Awwww crap... I’m going to have to sell all these longs and take losses...” so I did the exact opposite: covered my shorts.
When did I put the shorts on? When I was feeling pretty darn pleased with myself.