Have you ever been frustrated by a stock? Of course you have. I like to keep a separate paper file of stocks that just blow people’s minds and expectations and generally defy all common expectations (from a technical analysis standpoint). Not only is it a fun activity to me, but it helps me relieve stress…
Today’s market action shouldn’t have surprised active traders. Why? The indexes were showing short-term overbought conditions as well as an overextension in oscillators, combined with the testing of a newly established trading range (upper boundary). Volatility bands also showed odds strongly favored a retest of the midlines. It is frustrating for new traders to accept…
Bill Luby at the VIX and More blog posted a three-part resource and his thoughts regarding how to use the Volatility Index as a market timing tool. Specifically, he discusses how he uses its readings to trade the S&P 500 exchange traded fund SPY. His concluding thoughts caught my attention: “…I have increasingly become convinced…
Have you ever wondered why you have a difficult time applying what you learned in your peaceful room to the actual frenzy of active trading? Dr. Steenbarger discusses how to take what we study and analyze in quiet times (when the market is closed) and apply that knowledge properly when the market is open and…
Here are your major intermarket analysis charts at a quick, timesaving glance for you: First, the 10-Year Bond Price is reconfirming its downtrend: This is an example of an “Impulse Sell” trade where price makes a large impulse down, retraces back up, finds resistance at a key moving average, and then turns back down hard…
This week, AAPL, as a likely direct result of the success of its iPhone sales/hype, broke out of a triangle consolidation chart pattern. Remember the market rule “Price alternates between expansion and contraction” as supply and demand gets imbalanced following a period of quiet (rangebound) trading. Price is now extended short-term above the upper bollinger…
We managed to survive a light volume, holiday week and end the week higher in all major indexes, yet only the Nasdaq is making fresh new highs (although they are merely new 6 year highs). This tends to be good for the overall market, as it assumes that traders are taking more speculative risk in…
Active Options Trader posted a pertinent quote from coach Heather Walter entitled “I Think I Can!” He references the childhood story of “The Little Engine that Could” and describes how determination and perspective can help you achieve your goals. Often this burning desire comes after a few failures that cause us to dig deeper and…
Dr. Steenbarger recently posted a source entitled Overconfidence & Underconfidence in Trading: Biases in Processing Emotions. In the post, Dr. Brett discusses objectivity and how we process and recall experiences which lead to performance issues (usually hindrances) in the present. He shares a personal story of how he ‘felt’ relieved/good when he traded poorly and…
Happy 4th of July! The markets are setting up interesting swing patterns and are exhibiting both consolidation (which makes sense) and momentum divergences. Neither bulls nor bears are making significant headway in the last few weeks of trading, and little – except some shock – is likely move investors either way soon. The Russell and…