Markets move quicker than you think

One thing I've learned is that when the market realises whats up, it gets to where it needs to be quickly. People seem to think that the market will take a while to digest whats going, maybe bounce around a bit, and only then head to where it needs to be.

This view is completely and utterly wrong.

1) Post TARP > all Wall Street strategists said that after TARP was announced, there would be a bottom for the market, and the market should stabilise and maybe even rally. Because, even though in the long run stocks will go down, short term there is support. The market was not so damn (and thankfully i didnt follow their advice and go long, i was modestly short). TARP was announced on Oct 14 2008. SPX was at 1000. On Nov 20, SPX hit 750. Market was not fooled.

2) Commodities trade > I was short copper way too early and got burnt. Then it brok $3.00/lb, and I thought I could take my time to get into a short. Before I knew it, copper had plunged to $2.00. Once the market knows where it needs to be, it doesnt wait to get there.

3) End of 2008 Santa Rally > Technically this did occur. It was lower in degree than expected (SPX topped out at 940) and it happened on miniscule volume, but at least it happened. But everyone was expecting great things from this Santa Rally, but it firstly happened late (only after Christmas) and was exceptionally brief (downtrend resumed about 5 days later). The market is not dumb and will not hover above the level where it needs to be.

4) Break below Dow 7000 / SPX 700 > In Jan09, most market professionals were expecting a rally in the first few months in the year, and then weakness towards the middle of the year (I have no idea where they get these dumb ideas from).  Yet again, the market was itching to test the Nov 20 lows. It was obvious. So why should the market rally upwards, and then wait a few months before testing the lows? Anyways, I was thankfully decently short up until 780, but expected a bit of a bounce where I could reload my shorts. I fell into the trap that the other market professionals got into earlier. I thought the market would take its time to get where it needs to be. So even though I was utterly convinced in Jan09 that the SPX would hit 700 by April, I hardly rode this trade down because I thought the market will take things slowly. So I missed the move from 780 to 700, and I'm aggressively long at 700 and nervous (are we going to hit 650 this week)? I'm hoping that ADP on Wed is better than expected, so we get some relief before NFP.

Long story short. The market moves quicker than you think.