Somebody in our live service asked a great question the other day. The question was: “Do you guys not like to short”? This brought up a good topic of discussion on that subject. I told him that it is my opinion that every trader has a natural long or a natural short bias when they trade. I do not think anyone can say that they carry both a long and short bias each day. Look at it like a tennis player. A good player works on both the forehand shot and the backhand shot. Obviously a tennis player prefers to use the forehand but is not against playing the backhand when needed.
Play to your strength when trading
Personally, I prefer to read charts going up from the left side of the page to the right. This doesn’t mean I am never going to take a short setup. It just means I prefer to play to my strength, which is looking for mostly long setups in the market. I also try to have a few short setups on stand-by just in case the markets have nothing working on the long side. For the last 6 months of trading, there really has not been a reason for me to focus on short setups, as the few shorts I did try never seemed to work out well.
Now that the markets have rolled over and broken trendline support and moving average support, I might need to work on my “backhand” a little bit more as it may come in handy if the sellers take back control of the major trend. Or even in a sideways choppy market, having some good short plays on the radar is a good idea.
I have seen good traders who are natural short seller’s do things like short an Inverse ETF when the market is going up because they still get paid watching the chart go down from left to right even though the market is moving up. This just illustrates a natural bias that traders often have. That person would rather play the market from the short side as that is where they are more comfortable. In other words, this left-handed player is just playing their forehand in their comfort zone. Nothing wrong with that.
When the markets get weak, I tend to gravitate to the Inverse ETF’s like SDS or QID. Being a natural long bias trader, I don’t mind those Inverse ETF’s at all when the market goes down, as I still feel I am hitting good shots with my forehand. What about you? What is your natural trading bias? Long or short?