Hey Traders,
Last week, while everyone was popping champagne and celebrating the massive post-election rally, I was quietly over here waving my caution flag.
Listen, I know it’s hard to hear someone like me warn about potential pullbacks when everything seems to be going great. Nobody wants to hear the party pooper.
And believe me, I don’t take any joy in seeing traders get blindsided by the market — especially not you.
But whether you took my advice or you didn’t, here’s what I want you to do right now:
Stop.
Breathe.
And take a good, hard look at the market.
Look at the charts from last week. Look at the setup we saw during that post-election rally — the one I warned could lead to a pullback.
Mentally link those big gaps to a warning sign in your head so next time you see them you can be prepared.
I’ve shared so much with you in these pages because I want you to be ready when the market throws its curveballs.
If you’ve been following along, the only thing that really separates you from me is one thing: I’ve seen more “hands.”
What Do I Mean by That?
Think about poker.
Most people know the rules of the game. They know the common advice on when to bet, when to fold, and when to hold their cards tight.
So why are there pros who clean up at the table every time and amateurs who couldn’t win a hand even if they were the only one playing?
Sure, some folks don’t follow the basic advice.
But for the most part, what sets the pros apart is simple: experience.
They’ve seen more hands.
They’ve watched how people react in different situations.
They’ve learned to recognize patterns, even subtle ones, and they know how to adjust their play based on what they’re seeing.
That’s me with the markets.
I’ve been at this for nearly 40 years. I’ve seen more “hands” than most traders ever will. I’ve watched the market pop, drop, and do everything in between.
So when I see a massive rally like the one we saw last week, my gut tells me to get ready for what’s coming next: a pullback.
Playing the Odds
Now, here’s the thing — even if you read my warnings, I get it: You might’ve doubted yourself.
“But what if Jack’s wrong?”
“What if this time it doesn’t pull back?”
And listen, I could’ve been wrong. Nobody knows exactly what the market will do. It’s got more tricks up its sleeve than anyone can count.
But we’re not out here trying to be right 100% of the time.
Remember what I always say: We’re here to put the odds in our favor.
And odds are, when you see a rally like the one we saw, a pullback isn’t far behind.
Let’s say 1 out of 10 times, buying downside protection might feel like a waste. But the other 9 times? You’ll be glad you did it.
That’s the game we’re playing.
Moving Forward
So whether you took my advice and are breathing easy right now… or you didn’t and are licking your wounds from this downturn… I’ve got the same advice for you:
Stop. Breathe.
You’re here to trade another trade — and ultimately, that’s the name of the game.
Look at the market. Study the charts. Internalize what you’re seeing.
Because when you see big pops like the one we saw last week, odds are good you’ll see pullbacks like the one we just had.
Enjoy your weekend, folks.
We’re back in the game on Monday.
Trade well,
Jack Carter
P.S. Did you see the two hot stocks that look ready to pop?
