General Comments
I want to share a quick thought with you today--a little trick in thinking that made a big difference in my trading a few years ago. One of the problems with traders is that we can be stubborn. This happens to everyone, and no one is ever immune to it.
General Comments
[dc]O[/dc]ne of the challenges developing traders face is learning to manage positions effectively. Think about it for a minute—how many books do you know that show patterns and setups for trade entry? Now, how many do you know that focus on position management? We probably put
Breakout
Reader Greg asks this question: [dc]R[/dc]egarding your Chart of the day: Bullish Pattern in Aud/Jpy, which as you predicted broke out to the upside. My question is simple...why did you draw it like a flag and not like a range... and how did you spot
General Comments
[dc]R[/dc]eader Jayram asks, " Can you tell what is the significance of the blue & red bar coloring in your charts on the blog?" Sure, Jayram. I use various color rules on my charts, but I do not use them in any systematic fashion (for the
General Comments
Reader Andre asks two questions in response to my post on the failure test trade: It seems that you do not take in consideration any kind of volume information when analyzing the price behaviour around the support/resistance level, is that correct? (like for example the volume on the second
Failure Test
This video blog is a follow up from this post, and digs into some of the details behind the Failure Test trade in a little more depth.
Failure Test
[dc]I[/dc] want to do a small series of posts looking at some of the most important trading patterns I've used over the years. Rather than go in-depth with multiple examples, I'll keep these posts as a high level, introductory overview and will focus only
General Comments
[dc]O[/dc]ne of the main challenges for stock traders is understanding the ebb and flow of the broad market on the shortest timeframes. There is so much noise in price movement at this level, and so many instruments are traded, that it is hard to know what is
General Comments
[dc]W[/dc]hen trying to master any complex subject, it can be helpful to reduce things, as much as possible, to basic elements. Price movements in markets are very complex; so many competing influences and timeframes, combined with a good dose of randomness, conspire to hide any simple tendency
General Comments
[dc]O[/dc]ne of the advantages of using properly calibrated bands is that they can show when markets reach emotional price extremes. It should be rather unusual for a market to go from being outside one side of the band to the other, as happened on this 5 minute
General Comments
[dc]I[/dc] receive a lot of notes and messages from people who are struggling to learn to trade. One of the common threads is that many of them are discretionary traders, and they find that their decisions, made in the heat of battle, often result in the worst possible
General Comments
Traditionally, the spread of Consumer Discretionary stocks over Consumer Staples stocks has been taken to be a gauge of market sentiment—a clear expression of a cyclical sector compared to a defensive sector. Note that this is a coincident indicator, meaning that is has not led the market at major