trading

trading

Wednesday 31 August 2011

Nasdaq 100 tested 50 day moving average.

Isolating strong stocks when the market is weakest is a very simple idea that works. When most everything in the market is getting trashed, look for the stocks that refuse to go down. There has to be a reason for it. When the market resolves itself back to the upside, these are the names that will potentially become the strongest stocks very quickly.

First, overall breath has improved enough and there are some buy set ups showing up.
I see 50 day test across the board.
Second, remember, any significant selling here would change the picture quickly.
Third, go day by day and stay flexible and focused on your plan and execution.


Sunday 28 August 2011

Looking at the week ahead.


Stay alert and patient here as the market is chewing and spiting lots of traders now. For the week ahead just stay patient and focused on risk control if you are going to get engaged. Studies suggesting higher than normal volatility to continue.

Friday 26 August 2011

Trading range.



I am impressed with the market this week as yesterday morning it squeezed out the shorts at the open and this morning is scared out the nervous longs. Those who are trading are chasing which adds scale to these swings.


Tuesday 23 August 2011

Turnaround Tuesday.

Today we had a powerful rally and a first step necessary to provide a clue that the lows have some chance of holding. As we always do in these reversals, we will need to see additional follow through for confirmation, and we want to see robust performance in leading stocks accompanying the follow through day.

Monday 22 August 2011

P.G. Trading Tribe starting in September 2011.


The Trading Tribe

is an association of people who commit to excellence,
personal growth, and supporting and receiving support from each other.

The members of the Trading Tribe 
trade roles, becoming, in turn senders and receivers for each other.





Mastery Includes

Sunday 21 August 2011

Looking at the week ahead.



We have a negative seasonal bias for Monday and neutral the rest of the week.


There is  a positive bias after Jackson Hole meeting and an end of month type rally is common.


Bernanke's speech on Friday is a major market catalyst.


I believe there is no low-risk, high-reward trade in ether direction at this time and expecting higher than normal volatility to continue for some time.


There is lots of noise around us and we must focus on price/volume action rather than listening about fundamentals, technicals and sentiment. Focus on price action alone, it will let you know when and what to do.


I like this quote : "Rather than focusing on what you might have done,  focus on what you can and will do instead." 


Make it a great week !

Friday 19 August 2011

Silver trade.



Silver has lagged gold over the last month, but usually will outperform gold by a factor of 2 to 4 times in an uptrend, and drop faster than gold by 2 to 4 times in a downtrend. Since silver can be considered a hybrid metal, as both an investment metal and an industrial metal, this explains why while silver has not fallen while other industrial commodities have plunged. A new buy point in silver is at intermediate high of 41.19 in SLV. Keep in mind that should the stock market have another meltdown, the price of silver would get hurt more than the price of gold. So always keep your sell stops in line with your risk tolerance levels, and position size accordingly.




The information contained herein is for educational purposes only and is not, and should not be construed as an offer to hold, sell or an offer to buy any securities.


Thursday 18 August 2011

Some simple solutions presented by Dr. Tharp whose work I recommend to anyone wanting to expend their knowledge about trading

When you are stuck, the more effort you put into trying to un-stick yourself, the worse off you become. It’s a little like being stuck in quicksand—the more you struggle the quicker you sink. The first solution is always to relax and often move slightly in the direction that is opposite to what your instincts tell you. For example, a pilot going into a nosedive must first push gently into the dive to get air flowing under the wings properly. At that point he can begin to control the airplane. Similarly, when you start to skid in your car, you must first steer into the skid until you gain control over the car—which our natural reaction is to do the opposite.

If you are stuck in your goal of becoming an excellent trader, try doing the opposite of your instincts. If you must take a trade, make it okay not to take the trade. Instead, move toward working on your emotions.

The second solution is to focus on what you want. When you focus on limitations, you feel the emotions of the stop sign or the limitation. When you focus on what you want to achieve, then you begin to see possibilities and new resources that open you up. What is your focus?


Finally, the third solution is to focus on being what you want to be. If you want to be a great trader, don’t focus on what they have or do, focus on their state of being. What is it like to be a great trader? What is it like to step into their shoes?

Daily view SP-500.

                                              We are in a downtrend. Be short or out.

Remember, No Position Is A Position Neutral.

If your plan calls for taking a step back and waiting you must listen, observe and wait for the market conditions to become conducive to your strategy. If you don't have a plan then it's time to create one for yourself. If you need help, ask for it.
Look at the SP-500 chart above.
There's nothing magical about technical analysis--at least the way
I approach it. The market went sideways for most of the year. It
broke down out of that range. On rallies, those who bought during
that range will likely look to get out. It's human nature. That
selling will cause the market to drop.

Am I sure? No. No one everknows for sure but this is the logical way to play it.

It is very important to remember that the market conditions change and we are going to have plenty of opportunity to make lots of money soon. Stay patient, positive and ready as the markets can change on a dime.

Discipline to follow your rules is essential.


I believe that having discipline to follow your rules is essential.  Without specific clear and tested rules, speculators do not have any chance at success.  Why?  Because speculators without a plan are like a general without a strategy, and therefore without an actionable battle plan. Speculators without a single clear plan can only act and react, act and react, to the slings and arrows of stock market misfortune, until they are finally defeated.  - Jesse Livermore

Tuesday 16 August 2011

EU Solution-A Transaction Tax-What It Means To You.

To me, transaction taxes are like a willing, sexy women at the bar. She looks so appealing. You take her to your room, and you wind up with a disease that you can never get rid of.


Transaction taxes are taxes on liquidity. Every time a trade is placed, a tax is paid. That makes it more expensive to trade. Market participants have to widen the bid/ask spread to account for the tax. This damages the market and costs consumers more than they actually realize.




Thursday 11 August 2011

30 min. view of SP-500

Tomorrow we'll put today's reversal to the test, we'll ether extend the reversal and get a price follow-through or we'll go back to a range.

Daily view SP-500.

                             

Weekly view of SP-500.


Price of gold 1971-1982


30 min. view of SP-500

                Patterns laying the foundation for a move, But Follow Through Is Key.
                                    Observe price action first and foremost, it is telling the tale.

Back in 2008 short sale bans produced a big oversold bounce.


The bounce gave an opportunity to trade long, short-term, and unload trapped long positions.

Wednesday 10 August 2011

No follow through today.

There will be some good trades ahead of us. For now, stay focused on cash preservation and at the same time stay opportunistic.

Tuesday 9 August 2011

An extremely powerful short-squeeze sent markets scrambling higher into the close.



Further upside follow through tomorrow and/or for the rest of the week has the potential. Stay focused and see how the market reacts to today's super squeeze. Focus on the price action first and foremost and expect more volatility until the market stabilizes itself.

The markets may be setting up for a trade with a significant bullish edge.


In spite numerous factors suggesting near term reversal, for now, until the price action shows positive improvements focus is on capital preservation.

Friday 5 August 2011

Last Mohicans standing.


Remember, leaders must be shot down in order to have any meaningful rally that has potential to hold.

An old Wall Street saying has it that they don’t “ring a bell” at market bottoms.

Thinking that panic selling signals a low ?
Consider the Crash of 1987, which is the granddaddy of selling panics in U.S. stock market history. On that day, Oct. 19, the Dow dropped 22.6%. And even though the Dow bounced back impressively over the two trading sessions following that Crash — gaining 5.9% on Oct. 20 and another 10.1% on Oct. 21 — the stock market’s post-Crash low wasn’t registered until Dec. 4, more than six weeks later.
Chances are that the final low of the decline we’re experiencing will not be recognized as such until well after the fact.

Thursday 4 August 2011

Keep it simple !


Let’s keep it simple – protect yourself, never let small losses have even the remote potential to grow into large losses, remove hope and your emotion from the process, and finally stay opportunistic. Do these things and you’ll be there to profit more than you can imagine once the storm passes. We’ve been here before and we know what to do.

VIX check.

There has been virtually no safe harbor in today's market action.

For those of you who have been buying silver and gold over the last few weeks may consider taking some profit here. That is not to say they wont keep going higher over the longer term, but in the short term, they may continue to sell off as liquidity is raised to meet margin calls.
In late 2008 when the market had its slow motion crash from September through November, nothing was safe, with most stocks and commodities losing typically between 50-85% of their value peak-to-trough. Gold was perhaps the most robust out of all vehicles, but still sold off over 25% peak-to-trough.

The market seems particularly vulnerable here, so it may be prudent to keep your long exposure to precious metals on the lighter side until the dust settles and the general market stabilizes. You can then always buy back what you sold.

Is the history repeating ?

Tuesday 2 August 2011


Congress and the market's performance.

Weekly view of SP-500.


       Let's look at the big picture. The market remains stuck in a wide and loose sideways trading range. There is a head and shoulder possible formation that we need to observe and there is possible support there from which the new rally could start. We have to wait for the market to tip its hand for us to act. Although trading is an active verb, sometimes the best action is no action.