Don’t Buy This Dip for Long-Term Investing
7 Lessons from History (And Why I’m Staying Tactical for Now)
Overview:
After an incredible multi-year rally, I believe we are entering a multi-year bear market or a prolonged consolidation phase.
History doesn’t repeat exactly, but it often rhymes — and right now, the tune sounds a lot more like "stay cautious" than "back up the truck."
Here's why I think it’s still too risky to start long-term investing aggressively — and how I’m approaching it instead.
What History Tells Us After Major Rallies
I asked Grok to help put this together using data from major past declines (cross-referenced from sources like Yahoo Finance and Federal Reserve records), here’s what similar periods looked like:
Key Takeaway:
Even during bear markets, there are powerful rallies that look like recovery — only to set up bigger drops later.
Patience, timing, and discipline mattered more than "buying every dip."
The Investor Mindset Has Shifted:
From "Buy the Dip" to "Sell the Rallies"
I could be wrong (and I’ll happily adjust if the facts change), but my gut says:
this is not a safe environment for long-term buying yet.
The recent rally felt more like a series of desperate short squeezes rather than new institutional buying. Chasers are fueling the upside — not big-money investors making confident long-term bets.
👉 I was willing to go long for a short-term rally last week:
TSLA - we nailed a monster 0DTE trade on TSLA options (returns of +1000% to +2200% in a single day).
META - I alerted META 500c on Monday with META reaching 550 on Friday.
But short-term tactical plays are very different from long-term positional investing.
Right now, I see no evidence that deep, smart, patient money is piling back in expecting years of gains.
Instead, I'm preparing to get short again once the next setup appears and will participate in short term BTFD action in the meantime.
Key Takeaway:
Short-term money is still alive.
👉 Long-term money is scared to death.
A Word of Caution
(Especially from a Short-Term Trader)
Look — I’m not a long-term investor by trade.
I’m a 0DTE and momentum trader, focused on short bursts of opportunity.
That said, I’ve gotten very good at recognizing rare, no-brainer long-term buying moments.
When SPY dropped near 500 recently, it didn’t feel like one of those no-brainer moments for multi-year gains.
It felt like a bruised rally setting up — but not the kind of "back up the truck" moment like March 2009 or March 2020.
Big difference.
So What’s My Plan?
✔️ Continue trading short-term momentum — both up and down.
✔️ Watch for short squeezes to fade and set up "Sell the Rally" trades.
✔️ Stay tactical — no large, long-term bets until fear truly takes over and uncertainty is priced in.
What I’m Watching For:
Heavy insider buying
Big money stepping in aggressively
Major technical washes with capitulation (huge volume selling)
Fear indexes (VIX) spiking and staying elevated
A “giving up” feeling among investors, not just fear of missing out
Until then, I’ll keep scalping and staying nimble.
Quick Playbook:
If You Must Trade the Current Rally
Bullish: Look for 3–5 days of pullback and overnight gap downs → then consider tactical longs
Bearish: Look for multiple green days and overnight gap ups → then look for short setups
And if you want to be part of our tactical trading community — learning how we nail short-term trades like the TSLA 0DTE play — come join us.
Final Thought:
Listen to your mom.
Don’t touch the hot pan for long-term investing just yet.
Disclaimer:
This content is for educational and informational purposes only and does not constitute financial, investment, or trading advice. All opinions expressed are my own and should not be relied upon for making investment decisions. Always do your own research, and consult with a qualified financial advisor before making any investment. Trading and investing carry risk, including the risk of loss. Past performance is not indicative of future results.