Market Math
Let's cut straight to the punchline: the answer is, "it turns out, quite a lot." Continuing on this week's series that attempts to break down important technical trading ideas into easily digestible pieces for everyone, let's take a look at probability and
Climax
Continuing from yesterday's post, I wanted to dig a little bit deeper into the idea of what happens when markets go too far, too fast and snap back. This concept is called overbought/oversold in the traditional technical literature, and it is one of the most important elements
Individual Traders
I f you read much of my work, you will begin to see that applying technical tools takes work; it takes a lot of time and experience to know how to apply them correctly, even if we are using relatively simple tools with a statistical edge. (Beware: most technical tools
Pullback
A look at the technical justification and support for a long trade in the Russell 2000 index, or other US indexes.
Failure Test
Despite all the good reasons for focusing on with-trend trading, the first pattern I taught in my book was a little countertrend pattern--the failure test. Why? In this case, the reason is that the pattern is clearly defined, and it's easier to make concrete rules for things like
Technical Patterns
Last week, I covered pullback trading, which is one of the most common and most important with-trend trading patterns. This week, I will dig deeper into some different patterns, but I thought it was worthwhile to first think a bit about the differences between with trend and countertrend trading. This
Nested Pullback
This is the third article in my series on pattern recognition, and the last on pullbacks. Most patterns in markets are relatively simple, and most patterns were labeled long ago. True, there are many variations and refinements on pattern names, but there just aren't that many "new&
Pullback
This is the second in a series of posts on pattern recognition, following up on yesterday's post that dealt with trading simple pullbacks. The pullback truly is one of the most useful trading patterns, and many traders find success with a program focusing on pullbacks for trade entry.
Pullback
I'm starting a short series of posts here on pattern recognition, focusing on simple patterns that I have found useful in actual trading. Some of my readers may have questions as to whether it is possible to trade profitably based on simple patterns, given that so much modern
Market Math
Reader Tom asks: I have been reading your blog for a few weeks and I don't see any mention of sentiment. I also see you trade futures but you do not talk about Commitment of Traders like on the Euro recently. Is this stuff you use but don&
General Comments
This is an obvious issue, but one that is often ignored. The argument of many academics is that you can’t make money trading; your best bet is to put your money in a diversified fund and reap the baseline drift compounded over many years. (For most investors, this is
Readers Questions
I recently received a couple questions on the same topic: people asking where the bumper music I used for the videos for my (free) trading course comes from, with a few extremely flattering guesses as to who the composer was. :) As I've said before, I was a musician