Howard Lindzon tweeted this morning about the May 1st top in the markets today, noting that a long term top is in, and it got me thinking about my thoughts on that day when Osama was allegedly captured. I remember having a feeling that the next morning we’d gap up and that would be it in the short term. It was late on the east coast and when everyone woke up the next morning they’d view this has a major positive and buy..like lemmings do…while the smart money would be quietly selling their shares to them.
They say that hindsight is obvious, but I feel when I was in that moment…it was just as obvious. Ten days later my timing signal went negative as tops due take some time to form. My thinking to call it a “short term top” revolves around the concept of taking a trade and letting that trade evolve into more…or less…depending on the action of the markets. This would have been one of those instances where the short term news driven top has morphed into something so much more.
