Archive for the ‘Uncategorized’ Category

PostHeaderIcon Top Trading Tweets of the Week


PostHeaderIcon Ten Reasons For This Crazy $SPY Move

A lot of traders get very confused when the market goes from fear and risk off to new all time highs in a matter of 10 trading days. Here are some causes and reasons for these types of strong movements that seem to come out of nowhere.

  1. When there is maximum fear about the Ukraine, Gaza, and Iraq the weak hands are already in risk off mode, they are already out because they do not want to be risk on going into a geopolitical  mess on the weekend. These are known events already priced in, that was the supposed reason for the pullback to begin with.

  2. With the weakest hands already out they have nothing they can do but chase later at higher prices when the world does not end over the weekend.

  3. Longer term swing traders are waiting at key moving averages like the 100 day and 30 RSI, once in they are not getting out without a move far below those levels. They are strong hands that help decrease selling pressure.

  4. The reality is that it is the holders of the current market positions that matter, if their not giving up their seat on the bull bus the seats to get on later get more expensive as those already int eh market had great entries and want to stay in and ride their winner. So selling pressure is not on the position holders, the buying pressure is on the traders missing the move.

  5. A lot of traders love to short all time highs and over bought extended markets, they think it can’t go any higher, they are wrong, it can at the right time. The shorts end up being the ones that have to buy and push prices higher as their stops are hit.

  6. With two other previous attempts at all time highs the third break out works many times because there were two other previous opportunities for profit taking and that leaves less sellers to exit the third time around.

  7. At all time highs there are not stops being hit just profits being taken that is not much pressure and provides an easier move up.

  8. Every current holder of $SPY is in a profit so the majority are letting their winner run with no pressure on them to sell.

  9. Round numbers act as magnets many times and $SPY $200 is an inevitable magnet.

  10. Don’t fight the FED, they have printing presses.


PostHeaderIcon The Anatomy Of A Good Trade in 10 Steps

  1. You learn the markets you are trading, you study the volatility and price history of your trading vehicle.

  2. Traders must have the discipline to write a trading plan before they trade and then have the emotional and ego control to follow it.

  3. Look to take entries in the direction of the trend for your time frame.

  4.  You must find high probability set up entries that put the odds of winning in your favor. It can be a moving average break, break out, gap, or RSI level etc.

  5. Getting a small confirmation move in your favor before entering a trade improves your probabilities of success.

  6. You take entries on trades that either give you a high probability winning percentage or the odds are that your winning trades will be bigger than your losing trades.

  7. Before you enter you look at the price level what is outside of the noise in your time frame that if price goes there the odds are that you are wrong. You set your stop loss at that level. Position size based on that stop level. Your loss if you are wrong should not be more than 1% of your total trading capital.

  8. If your trade is a winner then trail your stop up with a short term moving average, a key price support level, or a previous days low. Maximize your winning trades, big wins will make you more profitable. 

  9. Do not over expose your capital to too many trades on at one time. Always ask yourself how much you will lose if all the trades go against you at once. Trading things that are not correlated can bring down your total risk most of the time.

  10. Learn what you are good at in trading and do more of that. Learn from your winning trades and losing trades and seek to find that trading system that you can execute and stick with without much internal struggle.

PostHeaderIcon Test


PostHeaderIcon Ten Inevitable Steps Traders Will Go Through Before Success

Guest post from trader Charles King:

There are only a few “guarantees” in trading. They are as follows:

1. You will lose money.
2. You may pick a bottom or a top once or twice, but you won’t hang on through the whipsaws enough to make any decent profit, and your losses will always outweigh your winners.
3. You will ride an emotional roller coaster more intense than when you first hit puberty.
4. You will get excited when you win.
5. You will get pissed when you lose.
6. You will get more pissed and trade worse when you don’t reflect and learn.
7. You’ll cry.
8. You will stop all of that s&*^ just listed.
9. You will be profitable.
10. It will have all been worth it.