General Comments
Over the past few days, I've written a bit about trading macro events and reports, and I also did a podcast episode on the subject. I shared some ideas about the kinds of events we are talking about (and today's looming FOMA at 14:00 EDT
Podcast
Every day, we are hit with economic reports, earnings for stocks, speculation, opinion, and a flood of other information. Some of these events move markets; some are non-events. How can we manage the volatility around these reports and what do they mean for the tactical/technical trader? Continuing from this
General Comments
There are so many things we can't predict; surprises, good and bad, happen. Sometimes these surprises can have a dramatic impact on our positions. One of the core tasks of trading is to respond to new developments and shifts in the market, but it's also important
Psychology
We all have ego. Everyone likes to be right, likes to be seen as intelligent, and likes to be a winner. We all hate to lose, and we hate to be wrong; traders, as a group, tend to be more competitive than the average person. These personality traits are part
Anti
Gaps are important. Gaps on charts can show powerful shifts in market dynamics, and we can identify some interesting tendencies around these gaps. Intraday traders often find an edge in fading gaps, but let's look today what happens over a longer time span. Consider the daily chart of
Podcast
Three more reader questions this week: how do we deal with runs of wins and losses? What about applying technicals to non-linear (or derived time series), and how do we translate trading strategies to options from the underlying instruments? Alan asks: Hi Adam, hope all is well. I was mulling
Trader Development
You have to be a disciplined trader. This is one of the nuggets of trading wisdom we hear constantly, and for good reason--it's true. Without discipline, we will make many mistakes in the highly competitive market environment. But it's not as simple as saying to yourself
Technical Patterns
Richard Wyckoff was one of the founding fathers of technical analysis, and one of his most useful concepts was to divide the market into an idealized cycle of accumulation, mark-up, distribution, and markdown. Though it can be difficult to apply this model in actual trading, it has many important lessons
Failure Test
Multiple timeframe analysis is almost a buzzword in technical analysis. I have been involved in markets actively for two decades, and have been an active participant in dialogue about markets for most of that time. It is interesting to see different techniques take the spotlight as groups of traders hold
Podcast
I answer three reader questions here, and stretch the boundaries of this podcast just a little bit. Igor asks: "We know that the smaller the timeframe(TF), the more random the market is, and longer TFs are less random. If you want to risk X% of your capital than
Pullback
For anyone actively trading, looking at the markets you follow is a critical part of the investment process. Whether you do this once a week, once a day, or many times a day depends on how you trade and who you are, but it is essential that you are somehow
Pullback
Let me preface this by saying two things: First, I'm bullish on global stocks over even moderately long timeframes. Technicians like to call tops, but I think this bull market could have several more years in it. However, I'm also always looking for evidence that contradicts