A Week of Wild Swings: What Trades Worked, What Didn’t, and Why

Lessons and playbooks going forward

That was one of the most volatile and opportunity-filled weeks I’ve seen in my trading career.

Yes, I made a tonne of mistakes and have so many regrets.

Yes, I overtraded and lost some control.

In the aftermath, the tendency is always to feel like you should have done better.

However, it is important not to forget the historical magnitude of these moves. Your brain and playbook simply have not had enough reps to deal with such volatility. The traders I saw who crushed this week were drawing on deep experience, having been in this seat before.

It has happened, and there is so much to reflect on.

In this post, I share my main takeaways and the trades I made early this week. There is certain to be more volatility ahead, so it is important to do the work NOW and fill in the necessary gaps.

Main Takeaways:

1. When volatility spikes, cut overnights. You have absolutely no idea where this market is going. There is too much that is out of your control. That fundamental idea or candlestick pattern is not going to save you when a man can write a tweet and change the narrative of the entire world. It is clear that with so much intraday opportunity, you need to put yourself in a position to fully capitalise instead of diverting attention to putting out fires. As an example, ALL my losses came from trying to position trade into stocks for a theme no one cared about. In a sharp sell-off, everything breaks as liquidity and cash become paramount. The signs were there without hindsight on the release of the reciprocal tariffs.

2. Capitulations offer the highest EV. The most uncomfortable trades got paid, such as buying the panic on Monday and shorting the rip on Thursday in Australia. These were contrarian and not necessarily obvious at the time. Reverse engineer these days. The gap was so big and the daily so extended that the probability of a continuation leg or trend is so much lower. This is currently not a momentum market but a mean reversion market.

3. Let your market tell you what is happening. Despite the futures markets languishing on lows come 10.30 am on Monday, several stocks were trending strongly. I was too fixated on the ES, which was whipping around. Sure, the best trades are when everything aligns, but the divergence in some stocks was a sign of real strength. These names acted as the early tells, rebounding with force and leading the upswing as the broader market finally turned. Examples included HUB, LYC, MQG, ORG, PME, SGH, XRO, and WTC. Big liquid names that someone wants to own.

4. In a headline-driven market, shoot first and ask questions later. Sentiment is so jitterish that you have to make fast decisions on incomplete information. An example was a breaking news trade that Trump was considering tariffs on "pharma" companies in his next round of orders. Our desk was scrambling to work out the specific fundamentals. This is not a bad idea in itself, but the truth is there is so much panic that money will be forced to move. We are traders, not fund managers - just take the next leg.

5. In a fast market, use fast feet. With so much going on and so many moving parts, it makes no sense to be stubborn with your position. You can always get back in when right. Be ruthless with stops and respect risk. Things can blow out quickly. Auto load stops, have tickets ready, or stick a posit note above your desk with the caption "price action is the truth". Just use whatever works for you to cut when wrong. I experienced a blowout loss in S32 by being inflexible and not taking that initial loss.

6. Automation improves bandwidth and takes away decision-making. Much of the edge I saw was being able to participate in extreme gaps and liquidity-seeking algos across multi-stocks. Unless you are a keyboard ninja warrior, this is not possible without solid infrastructure. Almost all brokers now offer out-of-the-box algos. Use them to your advantage.

Capitulation Monday: a write-up

The gap down on Monday 7th April offered a rare and unique opportunity. I have shared elements of this playbook in the past here. The difference this time was that it was on a market wide scale.

What follows is my pre-open plan and end-of-day review. Having a mental roadmap ahead of time is key as it enables better execution in real time in the face of adversity.