How I Trade A Bear Market Playing Ping Pong

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Every day, I pick up my daughter from school at 10:00 A.M. I usually have road rage the whole way there and back. She sits in the passenger seat and white-knuckles it while I fight Chicago traffic. What she does not know is that by the time I get home, PayPal stock has already paid for another textbook.

You see, I trade PayPal almost every other day. I buy it at $44, sell it at $45, and make around $25 to $30 in profit each time. And this process will put my daughter through college. This is how I survive a bear market. I do not swing for the fences. Instead, I play ping pong.

I call it the 'Bierman Ping Pong Game.' It is the single most practical approach I can teach you right now. It’s not glamorous, but it will potentially keep you alive.

The Game Nobody Wants to Play

Most traders want home runs. They want to buy the low and ride it to the moon. That playbook is dead. The market is broken technically, fundamentally, and psychologically.

PayPal has been trading at eight times earnings. Not one hedge fund owns it. Not one active manager in the world wants to show this stock to their clients. That is exactly why it works for me. The stock is in a lock box. It bounces between the levels of $44 and $45 like a metronome.

I do not need it to go anywhere. I just need it to keep bouncing.

How the Ping Pong Game Works

The concept is simple. You find a stock trapped in a narrow range with a floor underneath it. You buy near the bottom of the range. You sell near the top. Then you do it again.

The key rules I follow every single time:

• The stock must have fundamental support underneath it. PayPal at eight times earnings is not going to zero. That valuation is the floor.

• The range must be tight enough that you can trade it in days, not weeks. If you are waiting a month for $2, you are in the wrong stock.

• You never short these names. The risk reward is too lethal. One emergency Fed cut, and you are bankrupt on the margin call.

This is not a bull market strategy. This is a survival strategy built for exactly this environment.

Adobe Proves the Same Point

I sold put spreads on Adobe stock at 235 to 240 this week. The stock has been trading at eleven times forward earnings.

Insiders have been loading the boat, while an activist investor group has been circling the company to unlock value.

I do not need Adobe to go up. I need it to sit still for three weeks. With a close above 241, I bank $250 from theta decay alone. I priced it right. That is the entire lesson.

TLT: Same Game, Different Asset

TLT is the 20-year Treasury bond ETF. I often call it one of my favorite trading vehicles because I use bond funds to generate income. You cannot invest in it. Bear markets force you to trade. Bull markets force you to invest. I say to write that down.

My approach is to buy it at $85. If it bounces to $87, I sell it. Similar to PayPal, I trade it back and forth, over and over again.

The farthest it might fall is $79. That would put the yield at 6%. I would not own it for more than a week. I wouldn't short it, either. If the Fed announces an emergency rate cut, the fund would go straight to $90 and I would get a margin call. The risk/reward ratio is just too lethal on the short side.

But as a ping pong trade, it works. Buy the call, sell the put spread, and grind. That's my method.

Why This Matters Right Now

You are in a bear market. Value stocks are the cheapest they have been since 2018. Money managers refuse to buy them.

That means these channels will persist for weeks, possibly even months. Every one of them is an opportunity to grind out profits while the rest of the market panics. I make sure the downside is mitigated on every trade. You should too.

Our system identifies exactly when these range-bound setups form and when the channel is about to break. It tells you when to play the ping pong game and when to step aside. Most traders will spend the next three months watching their accounts bleed. You do not have to be one of them.

Have a good weekend. Monday comes fast. Be ready.