The last two weeks has been some of the most volatile trading in the last few years, but certainly not some of the worst times. The $VIX made fresh five year highs (“fear index”) recently as well. While the daily charts of the major indexes appear fragmented and broken from a technical standpoint, the weekly…
Everyone who participates in day trading has their own perspective, setups, indicators, and rules they use that work for them. However, there are some common points that are watched by a majority of intraday traders, and it is imperative to know what they are observing and how price reacts to those key levels. I like…
We all know that it’s a great idea to keep a trading journal, but how many of us actually do it? I know you’re thinking “Not another article on trading journals! I’ve read enough already.” Even if you currently keep a trading journal, and especially if you do not keep one, I highly encourage you…
Did you know you could develop a simple trading strategy that returns winning trades 80% of the time that uses random entries?! It actually CAN be done. For those of you who are still reading, a second question that comes up is whether or not this strategy is profitable – the answer is “sometimes.” This…
All major US Indexes fell precipitously today, with the Dow, S&P, and Russell falling close to 3% in one day, while the Nasdaq fell 2%. As indicated yesterday, there were at least three sources of overhead resistance that the market – or buyers – had to overcome to lift the major indexes. As today’s action…
The markets are in a precarious position right now, from a basic level technical analysis overview. How so? First, we have had a large volatility impulse down which has made new momentum lows. We are now experiencing a ‘counterswing’ up that is being met with potential resistance overhead, which must be overcome (or ignored) by…
If you had to pick between consistent, steady small trading gains with large losses, or a handful of winning trades that result in large gains, but also consistent small losses, which would you choose? If you search yourself honestly, your answer would likely be “I prefer winning more times than losing more times in the…
Dr. Steenbarger at Trader Feed gives us something to consider in his recent post: Stocks Making New Highs: Early Sign of Market Strength? Dr. Brett provides a graphic to further his analysis and notes the relationship between the number of stocks in a selected, weighted basket making new 10-day highs or lows with the S&P…
There’s a clear theme emerging in the market action regarding intraday price movement. The majority of the price activity of the day takes place within the last hour of the trading day as traders either nervously take off positions or confidently put on large positions. The activity of the larger funds combined with panic (of…
The action of the last week casts a bearish pall not only on the charts of the major indexes, but from the readings of the sector rotation model. Let’s look at two graphs on sector rotation: The first graph measures price movement/money flow of the last 65 days (a “longer” term perspective): The brief interpretation…