Happy New Near everybody!
Friday, December 30, 2011
Thursday, December 29, 2011
The market made a smooth upwards move today.
There was a big drop recorded but the bulls are determined to counter the bears threat.
And the market went up till the close.
A buy in the open and sell in the close is the trade of the day.
A classic trade that does not usually happened in this volatile market.
There was a big drop recorded but the bulls are determined to counter the bears threat.
And the market went up till the close.
A buy in the open and sell in the close is the trade of the day.
A classic trade that does not usually happened in this volatile market.
Planning for the Long Term
Are you interested in trading, but don’t have the capital to trade like you think you should? Even a talented, seasoned trader needs at least $20,000 to trade successfully. If however, you are a relatively new trader, you should plan on spending a fair amount of additional capital merely learning how to trade. In addition, it’s not enough to have $20,000 in your trading account. It must be $20,000 that you are willing to lose. Not that you would be happy losing, but it would not affect your life style. Losses are commonplace in trading, especially when first starting out. If you trade with scared money (afraid to lose $), you will always trade in a panicked state, never at ease. When you feel on edge, you’ll tend to make numerous mistakes. In any business venture, lack of capital is the primary reason for failure. Do you have $20,000 to spare? If you don’t, it’s all right. You don’t have to give up trading. There’s a lot you can do to get ready.
Ideally, it would be nice to be well capitalized and be able to learn to trade the markets like a pro, but not everyone has a spare dollars required. If you are like most people, you need to scrimp and save to build up the capital you need, and there’s no guarantee that your investment will pay off. There is however, no reason to feel disappointed. You can make a solid long-term plan. Many traders have spent years saving up capital and learning how to trade in order to capitalize on the market conditions that allowed them to make a killing.
Many people pursue trading, but as many trading coaches have observed, less than 5% seem to make it. It takes time and practice to master the markets. Many people think they can become an overnight success. But it often takes years. The difference between the ones who make it and the ones who quit in despair is a strong commitment to the field and a reasonable plan for obtaining success.
In many professions, a person must pay his or her dues before earning the right to say he or she is a seasoned professional. In business, a person doesn’t become a manager immediately. A law school graduate doesn’t become an instant partner. A medical student isn’t allowed to perform a difficult operation solo. So why should it be any different in the trading profession? It takes years of practice to become a profitable trader, and if you are like most people, you have a job already. You can’t just quit your job and pursue trading full time. You have to fit learning how to trade into your current life. It’s much like going to night school to get a graduate degree. You have to put in time and effort to study the markets and learn how to trade. In the end, it will be worth the time and effort.
What might a plan look like? First, you will need to save up trading capital. Second, you need to study the markets in order to develop an intuitive feel for how the markets move and what forces move them. Third, you have to be willing to make practice trades. The purpose of these trades is not to make profits, but to build up your intuitive skills. Fourth, you might also plan on spending money on trading books, perhaps a trading coach, or on classes to learn how to trade.
Don’t worry about learning to trade overnight. It’s going to take longer than that. Work at your own pace. It may be a while before you develop the skills to learn to trade profitably. Persistence is the key. Trading is an inherently rewarding endeavor. You should learn how to love trading, and develop a passion for it.
Once you learn to trade for the shear love of the game, you’ll be ready to tackle the challenges the markets offer.
Wednesday, December 28, 2011
Tuesday, December 27, 2011
Monday, December 26, 2011
Random thoughts from trading...
Since trading is an all alone endeavor, thinking independently and making own decision is the right way to approach the market.
Listening to others is the number one cause to lose your capital.
Trading and investing is like a job, full time presence is important otherwise you will get fired.
Trading takes time to learn and is a continuing process that's why patience is a must.
Trading is simple but it's not easy, that's why hard work and learning the market is a combination.
Learning the markets (based from experience) is important because as you reach the age of retirement or if you want to make/have your own business, you can do so at your own pace.
Trading is the right way to have a business if you don't want to deal with others, avoiding payrolls, no office/store rent, no employees/no helpers, just your own thinking (is your capital but of course you need "real capital").
Even if you are in the seventies, you can do trading at the same time help you to condition your "rotten mind?" by fighting Alzheimer's? and laziness (which is common to those retirees?).
Participating in the market gives you longevity because learning is a continuing process - helping to sharpen the mind's thinking.
Visualizing the future and thinking ahead of the curve can give you an idea what options you want to choose in the future - and trading is one of them or I should say is on top of them (options).
So for those who want to have a goal in the future... what do you want to be?...will you let your grand sons/grand daughters just pass by you in the aisle doing nothing...I guess you need to teach them how to do trading and investing by then...have a nice night!
Since trading is an all alone endeavor, thinking independently and making own decision is the right way to approach the market.
Listening to others is the number one cause to lose your capital.
Trading and investing is like a job, full time presence is important otherwise you will get fired.
Trading takes time to learn and is a continuing process that's why patience is a must.
Trading is simple but it's not easy, that's why hard work and learning the market is a combination.
Learning the markets (based from experience) is important because as you reach the age of retirement or if you want to make/have your own business, you can do so at your own pace.
Trading is the right way to have a business if you don't want to deal with others, avoiding payrolls, no office/store rent, no employees/no helpers, just your own thinking (is your capital but of course you need "real capital").
Even if you are in the seventies, you can do trading at the same time help you to condition your "rotten mind?" by fighting Alzheimer's? and laziness (which is common to those retirees?).
Participating in the market gives you longevity because learning is a continuing process - helping to sharpen the mind's thinking.
Visualizing the future and thinking ahead of the curve can give you an idea what options you want to choose in the future - and trading is one of them or I should say is on top of them (options).
So for those who want to have a goal in the future... what do you want to be?...will you let your grand sons/grand daughters just pass by you in the aisle doing nothing...I guess you need to teach them how to do trading and investing by then...have a nice night!
Sunday, December 25, 2011
The Truth About Trading - Part II
Part II
How Amateurs Approach the Market.
edited by Carl Futia
(original source unknown)
This post is for people who are
struggling with their trading, not being profitable and finding themselves
working extremely hard to no effect.
I found very interesting a
recent post 'Who uses stop losses?' and the various replies about how stops are
necessary, professional, business-like, etc. That post and the ensuing comments
confirmed what I already knew: the retail trading crowd thinks and acts like a
flock of sheep. Books and information about trading all say the same things.
They emphasize money management, tell you that it is stupid to average down,
tell you to use stop losses, risk 1% of your account, and other common
propaganda.
The interesting thing is that
people who talk about the value of stops, money management, etc. appear to have
gotten their ideas from a book. This include the authors of those same books! It
is a never ending process, a constant recycling of bad ideas. I think that those
who write trading books that explain how to trade aren't particularly good
traders themselves. Why? I think you must embrace uncertainty to succeed as a
trader. Those who write books, teach seminars and so forth are just trying to
find a way to make money with certainty because they can't trust their own
trading to do it or because they cannot live with the ambiguity and uncertainty
of constant involvement with the market.
These ideologies that trading
books offer are accepted as trading wisdom in the community of amateur traders.
I was fed all this when I was learning to trade. But I got lucky. A very
successful trader told me early on in my career that 95% of traders fail.
Therefore, to succeed he said that you have to do the opposite of what they do,
you have to think outside of the box. I've always tried to think in a unique and
different way from other traders and I believe this is in large part responsible
for my success.
- High probability setups +
Discipline = Success
- Always use stop loss orders.
Have a specific risk-reward ratio in mind. Know exactly what you will risk in
every trade
- It is stupid to have a
risk-reward ratio of less than 1:1
- It is stupid to aim for very
high win percentages
- The entry price is the most important detail.
Almost all amateur traders buy
into this ideology. Why? These rules produce the illusion of certainty in the
market place. You know your risk and that's it. There is no chance of
becoming emotional because you failed to use a stop and therefore busted out you
brokerage account. You don't have to worry about having to explain to your
husband, wife, or friends that you are not as big an idiot as you seem to be,
that trading is still something worth doing.
But in the market certainty
doesn't exist. Any rule that produces the illusion of certainty just makes it
easier to fail as a trader.
Admittedly I went through a
phase of having a set risk-reward ratio (1:2) and risking 1% of my account, thus
calculating my position size must be (x). My stop loss was frequently hit. I was
going nowhere fast.
I printed off all the trades I
ever did and analyzed them in detail, trying to find what went wrong.
I came to some
conclusions.
1. I'm buying high, I'm buying
on a higher close, buying in a late signaled uptrend rather than buying on
falling price.
2. Price is volatile. My stop
is getting hit. I can't forecast price fluctuations with enough precision to be
able to place a 5 pip stop loss.
I concluded that using a stop
loss represented my effort to predict the market's short run fluctuations, to
treat the market as if its movements were certain. But I couldn't do it.
I tried to move away from this idea and explore how I could trade without a stop loss.
I tried to move away from this idea and explore how I could trade without a stop loss.
During this learning process
the fact 95% lose was a uppermost in my mind. Whatever traders who were losers
wrote I would turn on its head and try to do the opposite. This was my way of
thinking outside the box. And I believe that you shouldn't follow the flock.
I began to see trading as an
art instead of as pure calculation. It is less about certain maths and more
about movement. It's about watching the market dance, letting it move up and
down without placing too much significance on any particular jiggle. I decide
that I just wanted to take a piece of these constant fluctuations and not try to
predict them.
I concluded that trading is not
about having a certain risk-reward, not about applying the same risk to every
opportunity, not about exiting at a pre-determined level. It is about making
adjustments as the market produces new information, as it moves move around on
your mental map of its behavior.
It's extremely hard to make
money from the common wisdom you find in trading books. But if you look past
such "wisdom" you can see trading doesn't have to be so complicated and
time-consuming. Volatility can produce profits for you without you having
to be a prophet! All the prop firm traders I know who are successful
understand and base their methods on this insight. All the successes I have had
in trading arise from this observation.
Professional traders win by
applying their own judgment and experience to judge the market's position on
their personal market maps and then letting the market's
natural volatility work for them. They don't waste their time
back testing strategies.
So how can you change your
current quest to trade for a living?
1. Read my previous post about
how to learn to trade, I seriously think if traders learn to read the markets,
they will be successful. Read the market, take in the new information is gives
you each hour and each day.
2. Try to escape from common
wisdom and general public beliefs. Start thinking outside the box, Start looking
into volatility, high win percents and try get past your human fears and
uneasiness with ambiguity. Don't use hard stops.
3. Average down and pyramid
with risk management.
4. Enter when price is
falling.... In an uptrend.
I strongly believe averaging down, as long as it isn't done due to fear or because you are losing (If done as a planned strategy) is an easy way to profit... That is from personal experience and it is expressed in my account balance.
Thanks for reading.
I strongly believe averaging down, as long as it isn't done due to fear or because you are losing (If done as a planned strategy) is an easy way to profit... That is from personal experience and it is expressed in my account balance.
Thanks for reading.
Glad to help.
It's Christmas and all traders/investors are enjoying their holidays.
Been browsing trading sites and news about the markets but most are all days old or a week and some are months old without any updates.
Probably most market participants got tired with usual up and down movement.
Can't blame the market participants for the market is a news driven direction.
Fundamentals at this time in the market just doesn't work as well as with technicals.
What work is the day to day market movement reaction.
Unless you can adjust with the unpredictable market movements and take advantage with the patterns, you can't participate with the opportunities that the market offers.
That's why day traders love the market (daily) for they can anticipate the market potentials.
Looks like some market participants got burned with the abrupt movements of the market, sometimes most big moves that affects the market happened overnight.
Most positions got stopped out during this session, that's why most traders/investors lose most of their investments.
As the year ends with a few trading days left, looking forward (next year) that volatility in the market will lessen.
Hope that economy will recover smoothly in the next coming year and the market will stabilize.
And all traders/investors can recover with the market anxiety.
Merry Christmas to all!
Been browsing trading sites and news about the markets but most are all days old or a week and some are months old without any updates.
Probably most market participants got tired with usual up and down movement.
Can't blame the market participants for the market is a news driven direction.
Fundamentals at this time in the market just doesn't work as well as with technicals.
What work is the day to day market movement reaction.
Unless you can adjust with the unpredictable market movements and take advantage with the patterns, you can't participate with the opportunities that the market offers.
That's why day traders love the market (daily) for they can anticipate the market potentials.
Looks like some market participants got burned with the abrupt movements of the market, sometimes most big moves that affects the market happened overnight.
Most positions got stopped out during this session, that's why most traders/investors lose most of their investments.
As the year ends with a few trading days left, looking forward (next year) that volatility in the market will lessen.
Hope that economy will recover smoothly in the next coming year and the market will stabilize.
And all traders/investors can recover with the market anxiety.
Merry Christmas to all!
Saturday, December 24, 2011
By John Mauldin:
• No benchmark to meet quarterly (or monthly), so you can have longer-term time horizons and different goals
• You can enter or exit a position without impacting markets.
• There is no public scrutiny of your holdings and no disclosures required, so you don’t have to worry about someone taking your ideas.
• You don’t have to limit yourself to just the largest stocks or worry about position size (this is huge).
• Cost structure, fees, and taxes are within your control.
• You can reverse errors without professional consequences – you don’t get fired for admitting a mistake.
• You can have longer-term time horizons and different goals.
And with those thoughts, good luck and good trading in 2012!
Individual Investors Have Certain Advantages Over Institutions
One final thought. Smaller investors do not realize that they possess quite a few strategic advantages – if only they would take advantage of them. Consider these small-investor pluses:• No benchmark to meet quarterly (or monthly), so you can have longer-term time horizons and different goals
• You can enter or exit a position without impacting markets.
• There is no public scrutiny of your holdings and no disclosures required, so you don’t have to worry about someone taking your ideas.
• You don’t have to limit yourself to just the largest stocks or worry about position size (this is huge).
• Cost structure, fees, and taxes are within your control.
• You can reverse errors without professional consequences – you don’t get fired for admitting a mistake.
• You can have longer-term time horizons and different goals.
And with those thoughts, good luck and good trading in 2012!
Friday, December 23, 2011
The market rolled and Santa bought the market in time for Christmas.
Buying the market in the open and sell it in the close is the right trade for today.
Though it's Friday - a usual profit taking day, what was left in the market are the investors.
Traders are already on a holiday enjoying their profits.
That's why the market went up smoothly, no volatility!
Buying the market in the open and sell it in the close is the right trade for today.
Though it's Friday - a usual profit taking day, what was left in the market are the investors.
Traders are already on a holiday enjoying their profits.
That's why the market went up smoothly, no volatility!
Showing the concluding trade that was just conducted.
The entry was at the bottom arrow and the exit was at the top arrow.
Notice the entry was at the R1 and the exit was at the R2.
A perfect classic trade of support and resistance.
A smooth trade, no noise!
Probably the HFT are already celebrating their Christmas loot.
The entry was at the bottom arrow and the exit was at the top arrow.
Notice the entry was at the R1 and the exit was at the R2.
A perfect classic trade of support and resistance.
A smooth trade, no noise!
Probably the HFT are already celebrating their Christmas loot.
Thursday, December 22, 2011
The American Dream
- Posted by Joe Fahmy
- on December 22nd, 2011
Who were they? Charles M. Schwab, president of the world’s largest steel company; Arthur Cutten, the greatest wheat speculator of his day; Richard Whitney, president of the New York Stock Exchange; Albert Fall, a member of the President’s Cabinet; Jesse Livermore, the greatest bear on Wall Street; Leon Fraser, president of the International Bank of Settlement; and Ivar Kreuger, the head of the world’s largest monopoly.
What happened to them? Schwab and Cutten both died broke; Whitney spent years of his life in Sing Sing penitentiary; Fall also spent years in prison, but was released so he could die at home; and the others—Livermore, Fraser, and Kreuger, committed suicide.”
—Donald McCullogh, Walking From The American Dream
My purpose for sharing this passage is not to depress anyone, but rather to remind us that there’s more to life than money. I realize that 2011 has been a challenging year for many traders and investors, but this is simply a reminder that family, health, spirituality, and many other things should come first before wealth accumulation. Make sure to spend time with your family and loved ones during this holiday season because that is where true wealth and happiness exists.
An even greater happiness comes from giving. Think of something that you can do during the holidays to help others, such as charity or volunteer work, and then go out and do it! Trust me, there is no amount of money that can replace the feeling of an enlightened and rejuvenated spirit. Wishing all my readers a Merry Christmas and a Happy Holiday Season!
The market closed barely just above its opening price from yesterday's trading.
Not quite convincing for the participants.
Partly due to the approaching holidays where most of the traders/investors are on vacation.
But looks like there might be some surprising moves before the year ends.
I can sense there is an upside breakout for the market, in the short term possibly.
But most of the big moves happened in the overnight session while the major participants are still snoring.
Let's see from today's regular what might be the reaction.
Not quite convincing for the participants.
Partly due to the approaching holidays where most of the traders/investors are on vacation.
But looks like there might be some surprising moves before the year ends.
I can sense there is an upside breakout for the market, in the short term possibly.
But most of the big moves happened in the overnight session while the major participants are still snoring.
Let's see from today's regular what might be the reaction.
Wednesday, December 21, 2011
Tuesday, December 20, 2011
Monday, December 19, 2011
Sunday, December 18, 2011
Saturday, December 17, 2011
Best and Worst Stocks of 2011
By Ben Steverman | Bloomberg – 18 hours ago
The U.S. stock market returned almost nothing to investors in 2011. As of
early December, the Standard & Poor's 500 index had netted 0.9 percent --
and actually lost 1 percent if dividends aren't included.
Such poor overall performance hides some wide variations: 80 stocks in the S&P 500 returned 20 percent or more in 2011, while 43 lost more than a third of their value.
Bloomberg Rankings analyzed S&P 500 returns as of Dec. 2 to determine which stocks were best and worst to shareholders in 2011. Their results follow, starting with 2011's 5 best performers.
THE BEST STOCKS OF 2011
Cabot Oil and Gas Corp.
Such poor overall performance hides some wide variations: 80 stocks in the S&P 500 returned 20 percent or more in 2011, while 43 lost more than a third of their value.
Bloomberg Rankings analyzed S&P 500 returns as of Dec. 2 to determine which stocks were best and worst to shareholders in 2011. Their results follow, starting with 2011's 5 best performers.
THE BEST STOCKS OF 2011
Cabot Oil and Gas Corp.
Friday, December 16, 2011
Christmas rally for the market looks dim.
Only a few trading days left before Christmas and there is/are no signs the market is bouncing from its grave.
Santa has run out of money to buy the market, instead he sold the market and the bears are on clouds.
Unless Tim Geithner prints money for Santa to buy the market, the market is in jeopardy.
Today's market turn positive in the open but run out of gas after an hour or so and buried itself into the mud.
It turn sideways till the close.
An ugly trading week for the market!
Only a few trading days left before Christmas and there is/are no signs the market is bouncing from its grave.
Santa has run out of money to buy the market, instead he sold the market and the bears are on clouds.
Unless Tim Geithner prints money for Santa to buy the market, the market is in jeopardy.
Today's market turn positive in the open but run out of gas after an hour or so and buried itself into the mud.
It turn sideways till the close.
An ugly trading week for the market!
A Few Trading Lessons
- Posted by Joe Fahmy
- on December 14th, 2011
Here a few lessons from this week’s market action:
1) When you find a great number of trading setups (as I did this past weekend), let the market prove itself first before getting in aggressively.
2) Wait for a Follow-Through Day (FTD) to confirm that the market is in a new uptrend. A FTD is when the market has a convincing up day (approximately +1.5% or greater) on strong volume. This usually occurs on days 4-10 of an attempted rally. There is nothing wrong with trying to anticipate such a day (as I did over the weekend), however, you still need to wait for the day to occur.
3) It is ok to be wrong, but it is not ok to STAY wrong!
4) Even when we get confirmation of a new uptrend, don’t be in such a rush. If it’s a true rally, the market will give you plenty of time to make money. Remember, the fear of missing out is the downfall of most traders.
5) Cash is still king right now, especially because we are below both the 50-day and 200-day moving averages on the NASDAQ Composite. Keep in mind that 4 out of 5 stocks move in the general direction of the market, and right now we are still in a downtrend.
Bottom line, there is nothing wrong with forming a market opinion based on the information it gives us. The key is to wait for the market to confirm your opinion before getting aggressively involved. And finally, if you are wrong, it’s no big deal because it won’t be the first or last time it happens.
Thursday, December 15, 2011
The market is advancing for a positive open?
I guess a buy in the open and close in the end is the play of the trade today.
The market is already oversold, nothing more to sell!
Bears are already covering in darkness and the bulls are roaring this early.
Let's see if the trend can be sustained till the close of the market.
I guess a buy in the open and close in the end is the play of the trade today.
The market is already oversold, nothing more to sell!
Bears are already covering in darkness and the bulls are roaring this early.
Let's see if the trend can be sustained till the close of the market.
Wednesday, December 14, 2011
After closing at key support yesterday, today we broke through it as investors and traders throw in the towel as hope disappears for an end of year rally.
With the bulls’ backs against the wall at the 20/50 day moving averages, we were at the point where we should have seen the bull camp mount a strong defense. And, while the probabilities were very high in my estimation, instead the sell pressure continued unabated.
What we saw today was more of the same ugly price action that continues to justify a defensive, cash-rich posture. Although greatly hesitant to do so, I must also caution that the price deterioration has now risen to the level that we’ll be fortunate if this is just another swing reversal amid the larger trading range as risk is also increasing for a crash-like fall. While I don’t say that without tremendous hesitation, I have to at least put it out there for consideration because when the market doesn’t trade the way it should and price continues to steadily deteriorate in this manner, it means we’ve got to do our job and put up every defense necessary.
Make no mistake – the market is now guilty until proven innocent. While it is still possible that we will still see an end-of-year rally just to screw those who’ve finally given up hope this options expiration week, until the price action shows significant improvement, man those battle-stations and protect your capital.
Courtesy from Kirk Report
Tuesday, December 13, 2011
The market is recovering from its slump (Monday's trading) as shown from the overnight session below.
A positive open is most likely ahead of the Fed meeting.
Expect a volatile market today's trading whereas the participants will tangle what direction the market might headed as per Fed outcome.
But whatever the Fed might come out, the participants are already used to it.
The market is a news driven sentiment anyway.
The market is in consolidation range, but I can sense it might rally before the year ends.
Santa Claus will buy the market this Christmas!
Anyway, let's see how the market will react from helicopter Ben's (Bernanke) action.
A positive open is most likely ahead of the Fed meeting.
Expect a volatile market today's trading whereas the participants will tangle what direction the market might headed as per Fed outcome.
But whatever the Fed might come out, the participants are already used to it.
The market is a news driven sentiment anyway.
The market is in consolidation range, but I can sense it might rally before the year ends.
Santa Claus will buy the market this Christmas!
Anyway, let's see how the market will react from helicopter Ben's (Bernanke) action.
Monday, December 12, 2011
The market tumbled today as shown below.
It descends from the early session and continues in the regular trading.
Lots of shorts are happy seeing the market drops from its trend.
Bulls are nervous and are selling their long position or got stopped out.
No real time trade post today.
Just watching the market dances to its tune.
It descends from the early session and continues in the regular trading.
Lots of shorts are happy seeing the market drops from its trend.
Bulls are nervous and are selling their long position or got stopped out.
No real time trade post today.
Just watching the market dances to its tune.
Saturday, December 10, 2011
The market made a smooth sailing upwards yesterday, Friday.
First, I made a pathetic scenario that it might just turn sideways.
And I was wrong and I made a mistake, that's why in the market nothing is predictable.
I traded early in the market and was able to gain 50 points plus.
Had I let my trade run till the close, it can gain a 100 points plus.
But due to some personal appointment, I need to close the trade and was out till the market close.
In trading if you cannot do it full time especially if you are tied to the market, you cannot maximize the possible market potential.
Trading/Investing is like a job, it needs full time attention too.
Showing the concluding chart last Friday below is a fine example of buy in the open and sell in the close.
It is like you open your store in the morning and close it in the afternoon.
No further doings!
First, I made a pathetic scenario that it might just turn sideways.
And I was wrong and I made a mistake, that's why in the market nothing is predictable.
I traded early in the market and was able to gain 50 points plus.
Had I let my trade run till the close, it can gain a 100 points plus.
But due to some personal appointment, I need to close the trade and was out till the market close.
In trading if you cannot do it full time especially if you are tied to the market, you cannot maximize the possible market potential.
Trading/Investing is like a job, it needs full time attention too.
Showing the concluding chart last Friday below is a fine example of buy in the open and sell in the close.
It is like you open your store in the morning and close it in the afternoon.
No further doings!
Friday, December 9, 2011
Whatever Your Mind Can Conceive
Every bear market, every volatile market, every directionless market has a tendency to wreck havoc with otherwise good traders. Many who did so well during the bull phase, give back much if not all of there profits and more; some swear off the stock market as nothing more than a casino, never to try again. The primary reason, IMHO, is these traders have allowed others to influence their decisions, rather than learning to make their own decisions. Whether it be someone interviewed on TV, a newspaper or magazine article, even a well-meaning friend that has caused the trader to violate his or her rules. If this has happened to any of you, I say you have experienced a little bit of the school of hard-knocks, you have survived, you will make it in the long run.
Napoleon Hill (author of one of the top selling success books of all time – Think and Grow Rich) left us with one of the best affirmations of all time, “Whatever your mind can conceive and believe, it can achieve.” Do you believe, I mean really believe that you can make money trading and investing through good times and bad?
Napolean Hill began his career as a journalist. His big break came when he was asked to interview steel-magnate Andrew Carnegie. Mr. Carnegie was so impressed, that he challenged the young journalist, to research and organize the world’s first philosophy of individual achievement. The challenge took Hill 20 years to complete and in the process he interviewed every industry magnate possible. What is interesting about this story, and the reason for my bringing it up, is simply that Napolean Hill’s life was not all smooth sailing. He overcame quite a bit of adversity to become one of the best selling authors of all time. Traders must also overcome adversity.
Napoleon Hill struggled against a myriad of obstacles throughout his life. Many of which were brought on by some of the earlier choices he had made. A number of times he became broke and penniless following a highly successful venture gone sour. His personal life was as spotted as his financial life. One would think that the discovery of his many flaws would cause one to lose respect, and thus doubt the veracity of his teachings. Quite the opposite is true. When you read about the struggles of this very ‘human’ man you get a whole new perspective of respect, and the incredible resilience and persistence that he displayed repeatedly against sometimes incredible odds. Traders, especially in unkind market environments, need all the resilience and persistence we can gather and sometimes against incredible odds.
So the next time you are struggling, whether it is in the market or in other facets of your life remember the resilience and persistence of this man and also remember his famous quote “Whatever your mind can conceive and believe, it can achieve.”
The market is gaining ground from this overnight session.
It consolidates within the resistance range of the 200MA.
The market is waiting some kind of convincing sentiments to advance for a breakout.
Today is Friday, a profit taking day for the traders.
But I don't see any more profit for the taking because most of it was already taken the past two days or so.
I think from my perspective, a positional technique might be the play today.
It consolidates within the resistance range of the 200MA.
The market is waiting some kind of convincing sentiments to advance for a breakout.
Today is Friday, a profit taking day for the traders.
But I don't see any more profit for the taking because most of it was already taken the past two days or so.
I think from my perspective, a positional technique might be the play today.
Thursday, December 8, 2011
The market tumbled today due to negative reports from Europe.
Lots of selling pressure were recorded and was continuously till the close.
Don't know what's going to happen tomorrow, but we'll monitor the overnight session to find out if the downtrend will continue.
Lots of traders/investors are waiting for the Santa Claus rally, and the signal is still far fetch or not clear.
Lots of selling pressure were recorded and was continuously till the close.
Don't know what's going to happen tomorrow, but we'll monitor the overnight session to find out if the downtrend will continue.
Lots of traders/investors are waiting for the Santa Claus rally, and the signal is still far fetch or not clear.
Futures markets showing some weakness from this overnight session.
Hitting 3000 plus views from this blog was a humbling experience, though this is my nth blog that I kept currently.
Other blogs that I created also with regards to the market were deactivated.
As you go along sleeping and breathing with the market helps you educate how the market works.
Though there are more things that I need to know about the market, but it's a process and will take time.
Patience and perseverance in participating with the market is that counts.
Anyway, let's see how the market reacts today.
I don't see any big news that might impact the market except those that are coming from Europe.
Hitting 3000 plus views from this blog was a humbling experience, though this is my nth blog that I kept currently.
Other blogs that I created also with regards to the market were deactivated.
As you go along sleeping and breathing with the market helps you educate how the market works.
Though there are more things that I need to know about the market, but it's a process and will take time.
Patience and perseverance in participating with the market is that counts.
Anyway, let's see how the market reacts today.
I don't see any big news that might impact the market except those that are coming from Europe.
Wednesday, December 7, 2011
By Barry Ritholtz - November 1st, 2009, 9:00AM
Via Minyanville, we get this good version of Jesse Livermore’s trading rules, considered to be one of the best traders of all time:
Lesson Number One: Cut your losses quickly.
As soon as a trade is contemplated, a trader must know at what point in time he’ll be proven wrong and exit a position. If a trader doesn’t know his exit before he takes the entry, he might as well go to the racetrack or casino where at least the odds can be quantified.
Lesson Number Two: Confirm your judgment before going all in.
Livermore was famous for throwing out a small position and waiting for his thesis to be confirmed. Once the stock was traveling in the direction he desired, Livermore would pile on rapidly to maximize the returns.
There are several ways to buy more in a winning position — pyramiding up, buying in thirds at predetermined prices, being 100% in no more than 5% above the initial entry — but the take home is to buy in the direction of your winning trade – never when it goes against you.
Lesson Number Three: Watch leading stocks for the best action.
Livermore knew that trending issues were where the big money would be made, and to fight this reality was a loser’s game.
Lesson Number Four: Let profits ride until price action dictates otherwise.
“It never was my thinking that made the big money for me. It always was my sitting.”
One method that satisfies the desire for profit and subdues the fear of a losing trade is to take one half of your profit off at a predetermined level, put a stop at breakeven on the rest, and let it play out without micromanaging the position.
Lesson Number Five: Buy all-time new highs.
The psychological merits of buying all-time or 52-week highs are immense and shouldn’t be discounted as a part of your overall strategy.
Lesson Number Six: Use pivot points to determine trends.
When going long, traders are continually looking for confirmation by assessing the strength of a move. Higher highs and higher lows are a solid indicator that a current uptrend is merely taking a slight pause, and the odds of higher prices are in their favor. These same pivot points are integral to drawing support and resistance lines to give traders their line in the sand. Taken together, trend lines and pivot points can enlighten a trader to a change in momentum, which may change the character of a trade.
Lesson Number Seven: Control your emotions.
Our goal as traders should be to also make a critical yet honest assessment of the areas we can improve so the bottom line will support our claims of truly being seasoned traders. Adhering to the time-tested rules of Jesse Livermore would be a great start for anyone.
Tuesday, December 6, 2011
Good morning fellow traders, the market is slightly trending up.
It might consolidate for quite a while because of the resistance at 200 MA.
Might be a good time to find the right location for a long entry.
Unless some big news that might influence the market, I don't see any big reaction from the participants.
Let's see how it goes and we'll just keep watching.
It might consolidate for quite a while because of the resistance at 200 MA.
Might be a good time to find the right location for a long entry.
Unless some big news that might influence the market, I don't see any big reaction from the participants.
Let's see how it goes and we'll just keep watching.
Monday, December 5, 2011
The market turns ugly at the later part of the trading day.
It gap up early in the open pit from the Globex session and was able to maintain its momentum through the middle part of the regular trading.
Only to do a somersault act two hours before the close.
Lots of break out traders caught off guard by the sudden turn of events.
Good for the shorters, they made a good job shorting the market.
Lots of bulls got nervous from that sudden drop.
But I think that was just a reaction/pullback from the on-going trend.
It might consolidate some more prior to the big move in time for the holidays.
It gap up early in the open pit from the Globex session and was able to maintain its momentum through the middle part of the regular trading.
Only to do a somersault act two hours before the close.
Lots of break out traders caught off guard by the sudden turn of events.
Good for the shorters, they made a good job shorting the market.
Lots of bulls got nervous from that sudden drop.
But I think that was just a reaction/pullback from the on-going trend.
It might consolidate some more prior to the big move in time for the holidays.
Subscribe to:
Posts (Atom)