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Advanced Technical Analysis of ETFs: Strategies and Market Psychology for Serious Traders by Michael Sincere, Edward Balog, Deron Wagner

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Chapter 7

15 ETFs Sold Short

Selling Short the Market—A Different Mindset

Although many technical short-selling setups are similar to technical long setups (just in reverse), trading the short side of the market is quite different from trading the long side. In particular, market rallies occur over much longer time periods than market pullbacks. Statistically, bull markets endure much longer than bear markets. For instance, it took from late 1982 until late 2007 for the Dow Jones Industrial Average to break above the 10,000-point mark and rally to its all-time high around 14,200. However, in a mere 18 months the Dow plunged 55 percent to 6,470. What took 25 years to build was cut in half in just 18 months (see Figure 7.1).

FIGURE 7.1 Long-term ...

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