Shorts
Why the Market Goes Against You the Second You Enter
Play the video · 0:53You buy, and it drops. You sell, and it climbs back. The market isn't watching you: it goes where the orders are, and where the options dealers' hedging is.
The obvious break and the obvious stop are where most orders sit, so that's where the price goes. Where options pile up, dealer hedging becomes a wall that slows the price: buying the break right under it is buying where the hedging sells. You don't have to guess the direction; you have to know where the brakes are before you click.
For information only. Not financial advice or an investment recommendation. Trading involves risk of loss. Risk disclosure ↗︎
Transcript
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The narration of the video, as text.
You buy, and it drops. You sell, and it climbs back. It feels like the market is watching you. It isn't.
But someone does move every time the price reaches a level. On Friday, at 10:23, the price came down to a line we had drawn before the open. It touched it, and climbed 28 points.
It isn't about you. It's about where the orders are. Where options pile up, his hedging becomes a wall that slows the price. You buy the break right under that wall. And you're buying exactly where the hedging sells.
You don't have to guess the direction. You have to know where the brakes are, and which way the hedging pushes, before you click. The full episode is on our channel.
