lthough I predominantly act in the realm of intraday time frames, I use a top-down approach that funnels information down to individual trading decisions and am heavily steeped in technical analysis.My goal is to be a technical purist, yet I let fundamental and economic releases influence my overall bias. Although I approach my investment decisions…
The Dow rose 5 points today, but that headline eliminates all the price action that occurred today. As mention yesterday, we are still trapped between the 20 and 50 period moving averages as defined support and resistance on the daily charts. The Nasdaq is also trapped: The S&P 500 sits comfortably on its moving averages…
Michelle, guest author at TraderMike’s site, posted an excellent observation regarding three different applications of “Time” in her post Time is on the Trader’s Side. A major quote: “Regard time, instead, as a wonderful and gracious friend, accommodating your need to focus and execute successful trades.” She notes that we get so stressed out because…
Believe in the power of Moving Averages! While no technical indicator is perfect, or gives totally accurate signals, moving averages can provide reliable zones of support and resistance in trending markets. Today is a unique day in the Dow Index, in that the market tested both the lower 2o period MA (for support) and the…
Today was an active day in the equity markets! The news of the day was Chairman Bernake’s testimony which rattled investors early this morning. Remember, news is difficult to predict, but the momentum action creates a predictable trade idea with high probabilities of success. Today was no different. We had a test of the most…
Dr. Brett Steenbarger posted a timely analysis entitled Traders and Information Processing: Why Traders Sabotage Themselves. This post is an absolute read. His concluding post reads: “Trading problems begin when we enter trades by one information processing system, and manage them by another.” To see what he means and learn his insights, visit the post…
Today provided a great example of how one day, your system will work and the next day, the system does not. Nevertheless, the insight is that it is crucial to follow your system, rather than take random trades and achieve random results. Compare the 15 minute charts of yesterday and today. While I trade with…
I wanted to highlight a personal post redarding a recent stop-loss experience from the 59 Cedar Street blog, which personifies experiences I have had, and I know we all have had. BP references the fear once in a trade and the almost compelling notion to move your stop to break-even once profit is achieved. I…
Readers, I just started reading Mark Douglas’ The Disciplined Trader and am gripped by the intro and first chapter and wanted to pass on the reference to those who are gripped by fear in trading. I take notes on everything I read, and in this book, I have written down so much already, and I…
I often try to mark-up the “perfect trade zones” based on my system each evening looking back at the day’s action, and today offered very little in terms of trades I identify and am comfortable taking. Today, I was chopped around as I tried to play the short side because of the strongly negative breadth…