A sign of positive movement for the regular open tomorrow.
Unless a negative reports might pop up, the market will continue its bullish reaction.
Sunday, December 4, 2011
Saturday, December 3, 2011
So You Want to Start a Business
By JAY GOLTZ
People start businesses for all kinds of reasons. Some expect to get rich, some want to be their own boss, some want to follow their passion and some want to control their own destiny (or at least try). Many have one thing in common; they fail. More than half, depending on whose number you use and how much time you give it.
When I started my business in 1978, there was very little information out there on how to start, expand and operate a small business. As a matter of fact, even the word entrepreneur was barely used, and if it was, it was often used disparagingly — as to describe the guy on the corner who was selling watches under his sleeve.
The world has changed. Today, there are countless magazines, Web sites, classes, organizations and consultants available to help the aspiring entrepreneur. Given all of these resources, the question arises: Why is the failure rate still so high? For all I know, the failure rate may even have gone up over the years, despite the fact that there are far more resources now. I believe there are three reasons.
First, many entrepreneurs learn to build a business the way some people learn to swim; they just jump in. They might have the basic skill, or even be very talented at the task at hand, whether it is baking or programming or candlestick making. What they lack is basic knowledge of marketing, management and accounting. Even though there are many resources available, they are too busy doing the task to learn how to do the basics. In this case, ignorance is not bliss; it is a ticking time bomb.
Bad management, bad accounting and ineffective marketing will suck the life out of a fledgling business if it is not corrected. I know, I was one of those jump-right-in entrepreneurs. I never had a full-time job, and I never had a mentor. Torture was more my mentor. Today, I am sorry to say, there is a further problem. Yes, there are lots more resources available to beginners, but many of those resources are close to worthless. Academic theory and self-appointed experts (who have never run a small business — except maybe into the ground) run amok. How is a beginner supposed to know whose advice to take?
Second, not everyone is wired to be an entrepreneur — just as not everyone is wired to be a social worker, a lawyer, a salesman or an accountant. The success or failure of a business has less to do with the idea and more to do with personality, drive, skill set and tenacity. Businesses don’t fail, people do. That hurts (again, I know). But failure does not make one a loser, and failure is not permanent. In fact, the lessons learned may very well be the springboard to future success. There are many entrepreneurs who have had fabulous success after fabulous failure.
Third, entrepreneurship is about risk. Sometimes it is calculated risk; sometimes it is a shot in the dark; sometimes it is delusional. This is where the current entrepreneurial fever can get dangerous. We have been led to believe that entrepreneurship is this romantic journey of discovery and creativity and believing in your dream. We all read stories about Facebook and Starbucks and countless other successes, but the large numbers of failures just slip away in the night, along with the owner’s life savings. The people behind those failures all believed in their dreams, too. Again, starting a business is risky. Even the most experienced entrepreneurs cannot always predict what will work and what won’t.
So, what is the solution? First of all, starting a business should not be like going to Las Vegas. There are things you can do to increase your odds of success. Learn enough about accounting to not be dangerous. You don’t have to become a C.P.A., but you should understand the income statement, the balance sheet, the difference between cash flow and profits, the basics of borrowing money and how to operate an accounting program. And no, I can’t do the last one — there were no computers when I started.
Do a business plan so you can see how all of the working parts go together. Go to trade shows and talk to people in similar businesses in other cities where they might be more likely to give honest feedback. And don’t confuse support with intelligent advice. Many of your friends and family will be supportive when you tell them your plan. Don’t confuse support with help. If they don’t own businesses, you are getting love, not wisdom. If you were sick, would you rather have a friend tell you you are going to be O.K. — or would you rather go to the doctor?
Naïveté in business will prove expensive. You will make mistakes, but make sure you can undo them. One mistake that is very hard to undo is going into business with a friend. It sounds like fun. It is comforting. It is probably not a good idea. If you go into business with someone, make sure it is a strategic alliance, with a clear understanding of what skills each person brings to the party. Make sure your goals are aligned. Even so, it is still probably a mistake — not because you are friends but because it is unlikely that you will stay on the same page when the problems start, which they will. Have an agreement in place that will govern the process if you decide that you want to split up.
One more thing: Going into business is risky, treacherous and demanding. But it is also invigorating, rewarding and beautiful, when it works. It is a lot like nature — with violent hurricanes and beautiful sunsets. I am not sure that you choose to be an entrepreneur; it chooses you.
Jay Goltz owns five small businesses in Chicago.
Technical Analysis in Day Trading: Keep It Simple, Stupid
November 30, 2011 12:14pm
To many new stock traders, learning how to read charts can be an exciting starting point into the maze of making money from day trading stocks. There certainly is no shortage of books and websites that will teach the many methods of reading charts.
Along with the methods there are a few styles of charts you can display: bar, candlestick, line, point and figure. The amount of information on charting can be overwhelming, if you pull up even the most basic charting package today you will see it has a minimum of 50-100 indicators available. For the new stock trader it will be an amazing journey into the process of learning how to use all the fancy tools.
Every year my partners and I attend the trade shows related to trading, in addition to hosting many workshops in our NYC office. It always amazes us how many people “speak” trading and charting fluently but have no idea how to make money.
They know all the buzzwords like Fibonacci and Elliot Wave, regression analysis and exponential this and that. The problem most of these potential traders have is they think that charts give the answers. Charts don’t give answers, they give ideas.
Charts are not crystal balls that if A+B+C happen then you will make money. The multitude of indicators that are available are all derivatives of price. Meaning they lag price. Do you really need something to tell you what price did if you are watching price already? How many watches do you need to tell what time it is?
I see far too many traders load up their trading screen with five indicators on the same chart. They get three indicators telling them one thing, the other two telling them something else and then they can’t make a decisive decision because they aren’t sure which signal is the one to focus on.
At its most basic level, charts display trader sentiment and commitments. Think about it, charts are formed from actual trades. Charts tell you where other traders took a stand and what they believe about future market direction. New highs and lows are formed from these opinions. When many traders have the same opinion, you get a trend. When there is consensus, you get a trading range.
The next time you look at a chart, keep it simple. Ask yourself the only two things you need to know to make a good decision:
In other words: Is there a good idea here? Has the uptrend paused and given me a spot to get in? If so how do I measure risk? Where did the buyers step up to the plate?
Is there a support I can buy or resistance I can short? If it breaks that area, can I manage my risk? When new traders mentor with us, we ask them to come up with good ideas. The better your ideas, the more money you will make.
Keep analysis simple. You don’t want to think when you are trading, or try to figure anything out. You simply want to trade. Say your ideas out loud and see if they make sense. Tell yourself the idea as if you were trying to raise capital for the trade.
I am buying a test of a previous low is a good idea. I am getting short “because it is too high” is not a good idea. Use charts to get good ideas based on current price action; do not use charts to predict. Don’t get caught up into thinking you need to get fancy to make money.
Along with the methods there are a few styles of charts you can display: bar, candlestick, line, point and figure. The amount of information on charting can be overwhelming, if you pull up even the most basic charting package today you will see it has a minimum of 50-100 indicators available. For the new stock trader it will be an amazing journey into the process of learning how to use all the fancy tools.
Every year my partners and I attend the trade shows related to trading, in addition to hosting many workshops in our NYC office. It always amazes us how many people “speak” trading and charting fluently but have no idea how to make money.
They know all the buzzwords like Fibonacci and Elliot Wave, regression analysis and exponential this and that. The problem most of these potential traders have is they think that charts give the answers. Charts don’t give answers, they give ideas.
Charts are not crystal balls that if A+B+C happen then you will make money. The multitude of indicators that are available are all derivatives of price. Meaning they lag price. Do you really need something to tell you what price did if you are watching price already? How many watches do you need to tell what time it is?
I see far too many traders load up their trading screen with five indicators on the same chart. They get three indicators telling them one thing, the other two telling them something else and then they can’t make a decisive decision because they aren’t sure which signal is the one to focus on.
At its most basic level, charts display trader sentiment and commitments. Think about it, charts are formed from actual trades. Charts tell you where other traders took a stand and what they believe about future market direction. New highs and lows are formed from these opinions. When many traders have the same opinion, you get a trend. When there is consensus, you get a trading range.
The next time you look at a chart, keep it simple. Ask yourself the only two things you need to know to make a good decision:
- Are we trending or in a consolidation?
- Once you have clear answer to question #1, now ask yourself question #2: Is there an opportunity to make money in front of me based on the current price action.
In other words: Is there a good idea here? Has the uptrend paused and given me a spot to get in? If so how do I measure risk? Where did the buyers step up to the plate?
Is there a support I can buy or resistance I can short? If it breaks that area, can I manage my risk? When new traders mentor with us, we ask them to come up with good ideas. The better your ideas, the more money you will make.
Keep analysis simple. You don’t want to think when you are trading, or try to figure anything out. You simply want to trade. Say your ideas out loud and see if they make sense. Tell yourself the idea as if you were trying to raise capital for the trade.
I am buying a test of a previous low is a good idea. I am getting short “because it is too high” is not a good idea. Use charts to get good ideas based on current price action; do not use charts to predict. Don’t get caught up into thinking you need to get fancy to make money.
| Wednesday, November 30, 2011 | |
| The Only Way to Get Rich Trading | |
| |
| Traders drawn to the allure of quick riches are virtually certain to ignore proven methods and risk parameters, destroying their accounts as a result. The only path to trading riches is via consistent profits over the long run. Many novice market timers (traders and investors) have difficulty facing a cold, hard fact about the stock market: You can’t get rich overnight. Experienced timers know this. They expect to make big profits in the long run, but they focus on making as many reasonably profitable trades as possible. They do not focus on a single, life-changing trade. Many timers also realize this, but it is hard to accept. And some are initially drawn to market timing with the hopes of making big profits quickly; the kind of money that can be used to finance a luxurious, exciting lifestyle, or money that can be used to show family and friends that one is deserving of envy or respect. However, it is dangerous to approach trading in the financial markets from this perspective. It directly contradicts the fact that it’s going to take some time before one makes enough money to support a new lifestyle or impress others. What’s Wrong with Dreaming? So what’s the harm in dreaming about making big riches? Nothing, as long as you realize that "quick riches" is just a fantasy. If you don’t, you may want to act on it. If you dream about how big wins can change your life, you may start to want to make extremely huge profits…fast. If that happens, you may be tempted to start taking measures to make those big wins by ignoring tested timing strategies which provide not only long-term profits, but also risk management to safeguard your capital. You may take riskier trades with the hope of being lucky enough to triple your capital. Or you may be tempted to stray from your timing strategy because you are "certain" you see the potential to score a big win. This is the first step to disaster for any trader, whether a novice or experienced professional. You may even abandon all risk controls because you may start to think, "Unless I can make some big money fast, market timing isn’t worth it anyway." The "get rich quick" urge is felt by all market participants. After all, we are there to make money! But this particular urge must be ignored if you value your savings. Going for the Big Win It’s important to stay modest. It is unlikely that you will be lucky enough to be set for life after only a few big trades. You will have to stay with the timing strategies for year after year, just as all seasoned, successful market timers have done. It’s vital to your very survival when trading the financial markets that you keep the proper perspective. Someday you may very well be wealthy and have an exciting lifestyle, but it isn’t going to happen tomorrow, or in the next year. See related: Why P&L Doesn’t Determine Success Sticking with a Strategy For now, just focus on the process of sticking with the strategy through good times as well as bad times. Recognize that this is a process that takes years to complete. No one creates instant wealth from trading (except for Dan Aykroyd and Eddie Murphy in the movie Trading Places). You must stand the test of time to succeed. When you take this perspective, you will be satisfied over time and realize that you are among the select few market participants who have found the path to profits. When you have traded a proven timing strategy for a few years, you will realize solid profits, and maybe over time, you will even make the kind of money that can fulfill your grandest dreams. But for now, realistic goals, discipline, and a good market timing strategy are the only things that will help you become a consistently profitable market timer. By Frank Kollar of FibTimer.com |
Friday, December 2, 2011
No trade today for there is no convincing setup/location to put an entry, except for some few shorts which are hard to execute per our trading skills.
The market today are for the HFT or the pros.
Not good for the small discretionary traders.
You will get chopped out!
Just wait when the market settles next trading day.
The market today are for the HFT or the pros.
Not good for the small discretionary traders.
You will get chopped out!
Just wait when the market settles next trading day.
The market is trending up after it zigzag from yesterday's regular trading.
It consolidates in the overnight session.
A positive jobs report was the reason the market is reacting positively.
A profitable signal to profit for the swingers who were able to position themselves last Monday.
Today's Friday trading will be the profit taking day.
Expect to make a sell off early in the open.
It consolidates in the overnight session.
A positive jobs report was the reason the market is reacting positively.
A profitable signal to profit for the swingers who were able to position themselves last Monday.
Today's Friday trading will be the profit taking day.
Expect to make a sell off early in the open.
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