After a 14% pullback over four weeks, the NASDAQ futures (NQ1!) have retraced around 7% in just the past week and a half. The price climbed steadily into the top band of the rising channel, only to stall out. That’s where the market sent its usual message: no free rides for late bulls.

Anyone who jumped in at the start of this week, chasing momentum, is unlikely to be rewarded without some pain. That’s just how the market works — it rarely hands out profits to late entries without a shakeout. A clean V-shaped recovery is rare, especially after such a heavy selloff.

Even in the event of a major reversal, the market needs time to build a base. That usually means a trading range develops in the bottoming zone. Within that range, legs up and down are to be expected. It’s the price of admission — and a method to trap both bulls and bears.

If this rebound is the real deal, and if we even go on to make new lows first, the principle holds even stronger: the market is not going to let late bulls escape untouched. They’ll be tested — emotionally and financially.

Bottom Line: No Free Lunch for Late Bulls

Even if the market has bottomed, don’t count on a smooth ride. Expect a trading range, expect some pullbacks, and don’t expect to catch the bottom and ride it straight up. There’s more price discovery to go through before a lasting rally emerges.

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