Individual Traders
This could, perhaps, be the shortest blog post ever. I could simply answer the question with: follow your rules. Get out. But let's dig a little deeper. Before we really begin, it's important to remind ourselves that there are many ways to trade and invest successfully.
Individual Traders
The marketplace is constantly evolving. One of the biggest changes over the past decade is the proliferation of Exchange Traded Products (ETPs) that allow stock traders to trade commodities (and other financial instruments) in a stock account. Much of the traded universe of financial products is now available just by
General Comments
Markets are complicated. Market analysis is complicated. Developing a trading system certainly can be complicated. But trading cannot be complicated. The act of placing trades and evaluating results must be as streamlined and simplified as possible. Here are a few suggestions for things you can do today, with investing an
Individual Traders
This post was originally published on See It Market as part of the Market Masters series. The original post can be found here.] I am a quantitative-discretionary trader. I have made it one of my life’s goals to understand how financial markets move, to understand how to predict those
Individual Traders
I've been asked a few variations of the same interesting question recently. Here are a few examples: The one thing I keep struggling with is finding an edge I can use in a disciplined and consistent way. How do you define an edge? To me an edge can’
General Comments
I left you, at the end of yesterday's post, with some strong evidence that luck plays a big part in your trading results. Now for the good news: you are not powerless against luck. People say many different things about luck, like "luck is what happens when
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