Eleven people died in Israel-Hezbollah clashes. Lebanese President Joseph Aoun begged the U.S. to stop Israeli strikes that killed seven on Sunday. This followed U.S.-Iran strikes that apparently everyone forgot about within forty-eight hours.
Retail traders saw the headline and panic-sold their tech positions. Then they panic-bought oil futures. Then they remembered they don't have futures accounts and went back to refreshing their Robinhood portfolios where nothing had changed except the font looked different on the new app update.
The conflict is escalating. People are dying. Presidents are making phone calls. Strikes are happening in multiple countries. None of this will appear in your quarterly earnings report unless you work for Lockheed Martin, in which case congratulations on your upcoming executive bonus.
Some guy named Brad in Michigan just moved his entire portfolio to cash because he read this headline on his lunch break. He feels very smart right now. He will buy back in three weeks from now at prices 8% higher after absolutely nothing changed except the news cycle moved on to a celebrity divorce.
The Mideast has been in conflict for longer than technical analysis has existed. Technical analysis has never predicted a single geopolitical event. Charts cannot tell you when a president will call another president. The 50-day moving average does not care about airstrikes.
Joseph Aoun called the U.S. for help. The U.S. was involved in strikes against Iran. Israel struck Lebanon. Hezbollah struck back. Traders everywhere checked their portfolios as if the VIX spiking 12% would somehow prevent the next funeral.
Your stop-loss orders won't stop the bombs, but they'll definitely stop your gains when algos hunt for liquidity during overnight sessions while you sleep through history.
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