Dr. Steenbarger recently provided us with one of the best and most informative brief posts I have read. He shares “Ten Generalizations that Guide My Trading.” This list is like no other “top ten” or general list you may have read. Each point provides deep insight to themes that professional traders utilize in terms of…
Was today’s action surprising to anyone? To everyone? I was surprised just like everyone else. Luckily, I enter and exit the majority of my intraday trades in the first three hours of market action, but I was stunned to see the velocity and ferociousness with which the sellers drove prices down in the indexes and…
The US Dollar Index ($USD) looks ready to continue its decline, as signs of a bottom are yet to be found. Let’s view the chart briefly: Price has made a new momentum low, which has set up the “Impulse Sell” signal after price returned to the falling 20 period moving average. New momentum lows often…
Many market participants, as well as many oscillating indicators, are calling the recent market action “overextended.” By definition, price is overextended, but does this always imply a price correction because price is overextended? Absolutely not. What does overextension mean? By definition, a price overextension is evidence of extremely strong and sustained buying or selling pressure,…
Jonathan at the A Trade a Day blogspot recently posted a brief but helpful post regarding Five Career Saving Tips for New Traders. I have to emphasize two points on his list: 1)Â Start with as large an account as possible Not only does it provide you a cushion against early losses, it means that…
Typically, when the ‘higher risk,’ more speculative stocks as represented in the NASDAQ index (which is geared more for technology stocks) lead in relative strength to the “Blue Chip” longstanding, steady companies of the Dow Jones, this strength has forecast higher prices for all (major US) Indexes in the short term. We are seeing this…
StockBee recently provided a reference of thirteen articles regarding How to Trade Earnings. I won’t post each of the articles separately, and there’s not much commentary I can add, so head on over to view the posts and see how to add a potentially new tactic to your trading arsenal.
David Merkel at the Aleph Blog recently posted two interesting and very informative articles at his site: Nine Points on the International Scene Ten Points on the Funky Federal Reserve Both articles briefly address major informative facts/thoughts on the state of International Markets and interesting facts about the US Federal Reserve. Here are some selected…
Chris Perruna recently provided some thoughts on how to take profits. Should you use a stop? Should it be a hard target? What if you have multiple positions in the profit zone? “Many books attempt to explain how to take profits and several academics offer advice but most of it is fluff and biased to…
Traders frequently discuss the “Risk to Reward” ratio when entering a trade, and often cite that it must be “Three parts reward to one part risk” or the trade will be deemed unacceptable from a risk standpoint. But is this always the case? It seems logical that the higher the reward/risk ratio, the better the…