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The market dropped 1.5% on Friday after Trump threatened massive tariff increases on China.Tech stocks got hammered.

Nvidia (NVDA) fell 2%, AMD (AMD) dropped over 5%, and Tesla (TSLA) shed more than 3%. The bubble callers are out in force right now, claiming they were right all along.

Here's the problem. The S&P 500 just posted its worst decline since August, but the index is still sitting near record highs after a clean uptrend over the past few months.

The traders screaming about bubbles didn't make money on this drop. They've been sitting on the sidelines or worse, bleeding capital on short positions while the market climbed higher week after week.

Now they're pointing at one red day as vindication for missing months of gains. I call this "Big Short Syndrome."

It's destroying trading accounts across the market right now. Traders have been screaming about bubbles everywhere lately.

They claim we're in a massive bubble here, another bubble there, and the whole market is about to collapse. Most of this noise comes from traders who missed out on some of the cleanest trends the market has offered.

They're angry. They want to be proven right more than they want to make money. That's a dangerous mindset for any trader.

Trading Isn't a Hollywood Movie
 

You've probably seen the movies. Wall Street. Margin Call. The Wolf of Wall Street. The Big Short.

They're all entertaining films that paint a dramatic picture of trading and finance. None of them are PG, by the way, so watch them on your own time.

The Big Short came out in 2015. It glorified Michael Burry's legendary call on the housing collapse and how he made a fortune from it.

The movie inspired a generation of traders to look for the next big collapse. That's the problem.

The film showed Burry as a contrarian genius who saw what nobody else could see. He bet against the entire housing market when everyone thought he was crazy.

Then he was proven right and made hundreds of millions of dollars. It's a compelling narrative.

It makes for great cinema. It also creates terrible trading psychology.

Aspiring traders constantly search for their "golden ticket." They want that one massive trade that will make their career and prove they're smarter than everyone else.

They spend hours looking for the next big collapse instead of trading what's actually happening in front of them. I hate to break it to you, but that golden ticket doesn't exist.

If one trade can make or break your account, you're not trading. You're gambling.

The odds aren't in your favor when you gamble. Casinos make billions because the math works in their favor, not yours.

The same principle applies when you bet your entire account on a single directional prediction.

The Reality Behind the Big Short
 

Michael Burry was actually down quite a bit on his bet before it finally paid off. He had billions to work with, which gave him the capital to survive the drawdown.

His investors were furious with him. They wanted to pull their money out.

Some of them tried to sue him to get access to their funds. He had to lock them in to prevent redemptions.

Most retail traders don't have that luxury. They blow up their accounts waiting for their prediction to come true.

They don't have institutional capital backing them. They don't have investors they can lock in for years.

They have a few thousand or maybe a few hundred thousand dollars. One bad trade wipes them out completely.

The math is simple. Over time, you'll make far more money trading with the trend than fighting against it.

That's not my opinion. That's just how the numbers work.

Trends persist longer than most people expect. They go further than seems rational.

Fighting them is expensive.

Bubbles destroy short sellers on the way up. They pop when there's no one left to buy, but also nobody left to cover shorts (which requires buying).

The timing is nearly impossible to predict. You can be right about the eventual outcome and still lose everything because you were too early.

I've seen it happen countless times. A trader identifies what looks like an obvious bubble.

They short it with conviction. The market keeps going up.

They add to their position because they're "sure" it has to come down. The market goes up more.

Eventually, they get a margin call and blow up their account. Then, three months later, the market finally corrects and they were "right" all along.

But being right doesn't matter if you're already out of the game.

How Successful Traders Actually Approach Bubbles
 

George Soros once said that if he spots a bubble, he rushes out to buy it. He's absolutely right.

I do the same thing. Bubbles are the best place to make money, assuming you know how to manage risk.

This concept is a big part of what I teach in the Trinity Trade.

Soros understood something that most traders miss. The bubble is the opportunity.

The money gets made during the expansion phase, not by trying to perfectly time the pop. You ride the wave up with proper risk management.

You take profits along the way. You don't bet the farm on calling the exact top.

Making a small fortune during a bubble and being one of the first ones to leave the party doesn't make for good Hollywood drama. You never hear those stories.

The media doesn't write articles about traders who made consistent profits and exited before things got ugly. They write about the person who called the crash, even if that person nearly went bankrupt waiting to be proven right.

My goal isn't to sell the exact top either. My goal is to extract profit while managing risk along the way.

I want to participate in the move up. I want to take money off the table as things progress.

I want to still have capital when the trend finally reverses so I can trade the next opportunity.

The Current Opportunity
 

We still have time to take advantage of the trends that are currently forming. Friday’s drop came after Trump threatened massive tariff increases, rekindling fears about an escalation of the trade war.

This creates volatility. Volatility creates opportunity for traders who know how to manage risk.

You shouldn't ignore these opportunities by sitting on the sidelines waiting to be the hero who calls the crash. Participate in the trends.

Manage your risk. Take profits along the way.

Friday’s selloff doesn't validate the bubble callers who have been wrong for months. It creates new setups for traders who focus on price action instead of predictions.

Stop trying to be Michael Burry. Start trying to be a consistently profitable trader instead.

I'll keep you posted as this develops.

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