* From working alongside developing traders, I'd say that 90% don't/can't sustain the procedure of keeping a noun journal. Among the grouping that does journal, good over 90% of the entries are virtually themselves together with their P/L. I almost never run into mag entries devoted to figuring out markets.
* H5N1 sizable proportion of traders who remove hold been having problems are trading methods together with patterns that used to work, but are no longer operative. The inability to alter alongside changing markets affects traders intraday (when volume/volatility/trend patterns shift) together with over longer fourth dimension frames (when intermarket patterns shift).
* It's a mutual observation that traders neglect because they don't stick to their plans. My sense is different. Traders prepare plans together with merchandise patterns that precisely don't work; they're based on randomness. When the patterns don't work, traders learn frustrated together with abandon their plans. So it looks similar lack of plain of written report causes trading failure. But planning doesn't do success; audio planning does. Sticking to plans based on randomness is no virtue.
* I mentioned inwards my mass an of import constabulary of performance: In every functioning plain of note--from Olympic athletics to Broadway--performers pass to a greater extent than fourth dimension inwards exercise than inwards formal performance. That is how expertise develops. The ratio of "practice" fourth dimension (time spent on markets exterior of trading) to trading fourth dimension is a worthwhile indicator of a trader's prospective success.
* Among the predictors of trading success, a "passion for trading" is grossly overrated. The successful traders remove hold a passion for markets, which is real dissimilar from a passion for trading. Indeed, a passion for trading inwards the absence of passion for markets is a fair Definition of addiction.
* Some traders habitually expect for tops inwards a rising marketplace seat together with bottoms inwards a falling one. There's much to survive said for countertrend methods, but non when the involve to survive correct exceeds the involve to brand money.
* An underrated chemical ingredient inwards trading success is mental flexibility: the mightiness to shift views together with perceptions equally novel information learn inwards the marketplace. It takes a sure lack of ego to degree a rigid thought together with thence modify it inwards the confront of novel evidence.
* H5N1 trader I spoke alongside lately told me he was going to merchandise to a greater extent than aggressively yesteryear putting on to a greater extent than trades. Trading to a greater extent than oft is non necessarily trading to a greater extent than aggressively, together with it for certain isn't necessarily trading prudently. Trading to a greater extent than aggressively agency allocating to a greater extent than run a endangerment upper-case missive of the alphabet to item (sound) merchandise ideas. H5N1 considerable component division of traders would do goodness from trading less oft *and* to a greater extent than aggressively.
* Nice litmus examination for whatever website devoted to trading education, coaching, together with the like: If the site spends to a greater extent than fourth dimension promoting the mortal than promoting ideas, y'all remove hold a goodness sense for the site's priorities. Caveat emptor.
* Many traders neglect because they're focused on what the marketplace seat *should* survive doing, rather than on what it *is* doing. The stock marketplace seat leads, non follows, economical fundamentals. Some of the best investment opportunities compass off when markets are looking yesteryear news, positive or negative.
* Success inwards trading requires the capacity for personal investment. Too many traders unopen out their efforts, along alongside their positions, at the terminate of the day.
RELEVANT POSTS:
What Trading Teaches Us About Life
Three Steps Toward Trading Improvement
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Tuesday, August 29, 2006
Monday, August 28, 2006
Sunday, August 27, 2006
Info!! Indicator Review For April 21St
Last week's indicator review noted short-term weakness, but a longer-term blueprint of marketplace strength. With the drying upwards of selling early on inwards the week, nosotros saw buyers supply to the marketplace as well as force the major averages to a higher house long-term resistance. The give away of stocks registering fresh 20-day highs moved higher, but did non expand to a higher house levels from early on this calendar month (middle chart), but nosotros did encounter a pregnant expansion of stocks making fresh 65-day highs. The reduced give away of novel lows during marketplace weakness as well as the expansion of novel highs suggests that the marketplace has been gaining strength.
That having been said, I can't nation the moving-picture present is solely rosy for the bulls. The Cumulative Demand/Supply Index (top chart) has touched an overbought degree (+30), which has corresponded to subnormal cost gains twenty days out. In a marketplace gaining strength, that doesn't necessarily hateful we'll encounter a major cost reversal, but it does ofttimes atomic number 82 to a catamenia of consolidation as well as choppiness.
A footling to a greater extent than concerning is the relative weakness of the Cumulative NYSE TICK line, which is non confirming its early on Apr highs to this betoken (bottom chart). Influenza A virus subtype H5N1 like moving-picture present is painted past times my operate on coin flows into Dow Jones Industrial stocks. While Fri gave us the highest dollar inflows of 2008, the five-day flows are exactly barely positive. I volition live on watching the TICK work as well as dollar flows rattling carefully. Influenza A virus subtype H5N1 retreat from electrical current levels as well as a cost motion of the major stock indexes dorsum into their long-term trading hit would telephone outcry upwards this past times week's bull motion into query and, indeed, target a supply to the centre of that range.
Other indicators to a greater extent than ofttimes than non confirm the bullish activity from the past times week. As I mentioned inwards a recent Twitter post, we're straightaway seeing 68% of SPX stocks trading to a higher house their 50-day moving averages, upwards from a footling over 40% final calendar week as well as 10% at the March bottom. We convey to become dorsum to October, 2007 to uncovering a stronger reading. Similar readings are constitute with the wide listing of NYSE stocks.
Furthermore, the advance-decline lines specific to the NYSE mutual stocks as well as the SPX stocks held their March lows final calendar week as well as straightaway convey moved to multi-week highs. Also hitting multi-week highs is my mensurate of technical strength, with 3/4 of all stocks inwards my handbasket straightaway trading inwards uptrends.
The all-important trading trial is whether the intermission to a higher house long-term resistance was genuine or whether it volition plough out to live on a imitation breakout trapping the bulls. While a skillful bargain of bear witness suggests that the motion is for real, those on the sidelines may desire to await for continued forcefulness inwards the NYSE TICK as well as the coin flow numbers earlier chasing cost highs inwards a marketplace that's becoming overbought.
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That having been said, I can't nation the moving-picture present is solely rosy for the bulls. The Cumulative Demand/Supply Index (top chart) has touched an overbought degree (+30), which has corresponded to subnormal cost gains twenty days out. In a marketplace gaining strength, that doesn't necessarily hateful we'll encounter a major cost reversal, but it does ofttimes atomic number 82 to a catamenia of consolidation as well as choppiness.
A footling to a greater extent than concerning is the relative weakness of the Cumulative NYSE TICK line, which is non confirming its early on Apr highs to this betoken (bottom chart). Influenza A virus subtype H5N1 like moving-picture present is painted past times my operate on coin flows into Dow Jones Industrial stocks. While Fri gave us the highest dollar inflows of 2008, the five-day flows are exactly barely positive. I volition live on watching the TICK work as well as dollar flows rattling carefully. Influenza A virus subtype H5N1 retreat from electrical current levels as well as a cost motion of the major stock indexes dorsum into their long-term trading hit would telephone outcry upwards this past times week's bull motion into query and, indeed, target a supply to the centre of that range.
Other indicators to a greater extent than ofttimes than non confirm the bullish activity from the past times week. As I mentioned inwards a recent Twitter post, we're straightaway seeing 68% of SPX stocks trading to a higher house their 50-day moving averages, upwards from a footling over 40% final calendar week as well as 10% at the March bottom. We convey to become dorsum to October, 2007 to uncovering a stronger reading. Similar readings are constitute with the wide listing of NYSE stocks.
Furthermore, the advance-decline lines specific to the NYSE mutual stocks as well as the SPX stocks held their March lows final calendar week as well as straightaway convey moved to multi-week highs. Also hitting multi-week highs is my mensurate of technical strength, with 3/4 of all stocks inwards my handbasket straightaway trading inwards uptrends.
The all-important trading trial is whether the intermission to a higher house long-term resistance was genuine or whether it volition plough out to live on a imitation breakout trapping the bulls. While a skillful bargain of bear witness suggests that the motion is for real, those on the sidelines may desire to await for continued forcefulness inwards the NYSE TICK as well as the coin flow numbers earlier chasing cost highs inwards a marketplace that's becoming overbought.
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Saturday, August 26, 2006
Info!! Why Every Trader Should Hold Upwards An Investor
I notice ii things hitting most a large seat out of active traders:
1) They're non prepared for failure - If trading doesn't run out for them, they don't convey clear backup plans (and trading doesn't naturally Pb to other careers);
2) They're non prepared for success - If trading does run out for them, how volition they accumulate wealth over fourth dimension as well as ensure their fiscal future?
In to a greater extent than or less ways, the latter occupation is merely every bit needlelike every bit the first. Making money, asset onto money, as well as accumulating wealth are rattling dissimilar things. Just because traders brand coin doesn't hateful they know how to deploy that coin wisely to construct wealth. Indeed, I've seen many distressing outcomes amid those who convey retained a trading mindset amongst honour to fiscal planning.
If traders are going to construct a fiscal future, they demand to intend similar investors. And that's non slowly to do, when all your fiscal decision-making has been on the curt term.
Fortunately, at that topographic point are to a greater extent than or less valuable resources available to assistance traders brand the transition to becoming personal coin managers. Here are a few that convey come upwards to my attending of late:
1) The Disciplined Investor past times Andrew Horowitz - This rattling accessible mass is first-class for those needing an investment primer. Horowitz doesn't embrace the total gamut of fiscal planning (insurance, estate planning, wills), but rather focuses on the gain of wealth enhancement as well as wealth preservation opportunities via stock marketplace investing, mutual funds, as well as annuities. He begins amongst "creating a discipline", offers background on quantitative, technical, as well as fundamental investment strategies, as well as launches into of import textile on adventure management. It's clearly written as well as non at all intimidating for investment newbies. Andrew likewise maintains a blog as well as conducts frequent podcasts on investment themes.
2) Create Your Own ETF Hedge Fund past times David Fry - This is a valuable introduction to the globe of exchange-traded funds (ETFs), which are rapidly putting a multifariousness of investment options--from bonds to stocks to currencies as well as commodities--in the hands of traders. Fry is the founder of the ETF Digest site, which tracks diverse ETF portfolios as well as includes weekly podcasts related to investment inwards ETFs. Fry's key thesis is that private investors tin replicate mutual as well as successful hedge fund strategies, from long/short equities to profiting from global macro themes. At the cease of the book, he offers sample portfolios designed to encounter a multifariousness of investor needs. The mass is rattling practical as well as quite clearly written.
3) The ETF Book past times Richard A. Ferri - Ferri's mass is a detailed await at the exchange-traded fund universe, roofing diverse styles as well as choices amid ETFs as well as and thus examining portfolio administration options for ETF investors. H5N1 specially worthwhile segment of the text applies dissimilar ETF strategies to investors inwards diverse phases of their life cycle. Ferri covers both passive as well as active portfolio strategies as well as offers clear, illustrative sample portfolios. If you're e'er wondering which ETFs are available for exceptional kinds of investment, this mass pretty good covers the gamut inwards a agency that is non overly technical. Ferri has likewise written on asset allocation--an extremely of import topic amid investors.
What are to a greater extent than or less full general lessons from these books that traders tin depict upon inwards becoming to a greater extent than sharp investors? These come upwards to mind:
* You can't invest what y'all don't save - An investment programme starts amongst a cogent savings plan.
* Know your objectives - It's of import to teach a provide on your capital, as well as it's of import to ensure the provide *of* your capital. Your investment strategy should hold out tailored to your adventure tolerance, as well as that should reverberate where you're at amongst honour to fry bearing, retirement, etc.
* Know your alternatives - With a vast array of mutual funds, annuities, as well as exchange-traded funds, at that topographic point are many ways of investing nationally, internationally, inwards stocks, as well as inwards other asset classes.
* Diversify, diversify, diversify - Even the greatest investments (think residential existent estate of the concluding decade, or equities inwards China) tin lose coin quickly. Placing eggs inwards many baskets as well as ensuring that those baskets are non highly correlated inwards returns produces superior risk-adjusted returns over time.
You run for your profits; it's of import to ensure that they run for you. The average savings charge per unit of measurement inwards the US has lately drib dead negative; people are spending to a greater extent than than they earn. They convey assumed that the rise values of their homes would fund their retirements. With the recent housing decline, that supposition volition hold out called into inquiry for quite a few of those folks. For them, retirement is a potential educate wreck on the horizon.
That doesn't convey to hold out you. Saving coin as well as making it run for y'all inwards a carefully planned agency tin ensure that earnings today drib dead tomorrow's wealth of a lifetime.
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1) They're non prepared for failure - If trading doesn't run out for them, they don't convey clear backup plans (and trading doesn't naturally Pb to other careers);
2) They're non prepared for success - If trading does run out for them, how volition they accumulate wealth over fourth dimension as well as ensure their fiscal future?
In to a greater extent than or less ways, the latter occupation is merely every bit needlelike every bit the first. Making money, asset onto money, as well as accumulating wealth are rattling dissimilar things. Just because traders brand coin doesn't hateful they know how to deploy that coin wisely to construct wealth. Indeed, I've seen many distressing outcomes amid those who convey retained a trading mindset amongst honour to fiscal planning.
If traders are going to construct a fiscal future, they demand to intend similar investors. And that's non slowly to do, when all your fiscal decision-making has been on the curt term.
Fortunately, at that topographic point are to a greater extent than or less valuable resources available to assistance traders brand the transition to becoming personal coin managers. Here are a few that convey come upwards to my attending of late:
1) The Disciplined Investor past times Andrew Horowitz - This rattling accessible mass is first-class for those needing an investment primer. Horowitz doesn't embrace the total gamut of fiscal planning (insurance, estate planning, wills), but rather focuses on the gain of wealth enhancement as well as wealth preservation opportunities via stock marketplace investing, mutual funds, as well as annuities. He begins amongst "creating a discipline", offers background on quantitative, technical, as well as fundamental investment strategies, as well as launches into of import textile on adventure management. It's clearly written as well as non at all intimidating for investment newbies. Andrew likewise maintains a blog as well as conducts frequent podcasts on investment themes.
2) Create Your Own ETF Hedge Fund past times David Fry - This is a valuable introduction to the globe of exchange-traded funds (ETFs), which are rapidly putting a multifariousness of investment options--from bonds to stocks to currencies as well as commodities--in the hands of traders. Fry is the founder of the ETF Digest site, which tracks diverse ETF portfolios as well as includes weekly podcasts related to investment inwards ETFs. Fry's key thesis is that private investors tin replicate mutual as well as successful hedge fund strategies, from long/short equities to profiting from global macro themes. At the cease of the book, he offers sample portfolios designed to encounter a multifariousness of investor needs. The mass is rattling practical as well as quite clearly written.
3) The ETF Book past times Richard A. Ferri - Ferri's mass is a detailed await at the exchange-traded fund universe, roofing diverse styles as well as choices amid ETFs as well as and thus examining portfolio administration options for ETF investors. H5N1 specially worthwhile segment of the text applies dissimilar ETF strategies to investors inwards diverse phases of their life cycle. Ferri covers both passive as well as active portfolio strategies as well as offers clear, illustrative sample portfolios. If you're e'er wondering which ETFs are available for exceptional kinds of investment, this mass pretty good covers the gamut inwards a agency that is non overly technical. Ferri has likewise written on asset allocation--an extremely of import topic amid investors.
What are to a greater extent than or less full general lessons from these books that traders tin depict upon inwards becoming to a greater extent than sharp investors? These come upwards to mind:
* You can't invest what y'all don't save - An investment programme starts amongst a cogent savings plan.
* Know your objectives - It's of import to teach a provide on your capital, as well as it's of import to ensure the provide *of* your capital. Your investment strategy should hold out tailored to your adventure tolerance, as well as that should reverberate where you're at amongst honour to fry bearing, retirement, etc.
* Know your alternatives - With a vast array of mutual funds, annuities, as well as exchange-traded funds, at that topographic point are many ways of investing nationally, internationally, inwards stocks, as well as inwards other asset classes.
* Diversify, diversify, diversify - Even the greatest investments (think residential existent estate of the concluding decade, or equities inwards China) tin lose coin quickly. Placing eggs inwards many baskets as well as ensuring that those baskets are non highly correlated inwards returns produces superior risk-adjusted returns over time.
You run for your profits; it's of import to ensure that they run for you. The average savings charge per unit of measurement inwards the US has lately drib dead negative; people are spending to a greater extent than than they earn. They convey assumed that the rise values of their homes would fund their retirements. With the recent housing decline, that supposition volition hold out called into inquiry for quite a few of those folks. For them, retirement is a potential educate wreck on the horizon.
That doesn't convey to hold out you. Saving coin as well as making it run for y'all inwards a carefully planned agency tin ensure that earnings today drib dead tomorrow's wealth of a lifetime.
.
Friday, August 25, 2006
Info!! Perspectives In Addition To Themes For Tuesday Morning
Bill Rempel offers to a greater extent than or less valuable elaborations to my recent trading psychology post yesteryear pointing to the strengths of developing as well as trading systems. Readers know that I am a discretionary trader, but I tin vouch for the successes of those who prepare as well as tweak systems that suit to changing marketplace conditions. Bill's indicate regarding the value of trading multiple systems that perform nether varying regimes is excellent.
* It's Not Just Markets That Follow Seasonal Patterns - Thanks too to a reader for pointing me to the inquiry of physician Richard Wiseman as well as this rattling interesting study of how personality patterns--including the perception of beingness lucky!--are related to the seasons of one's birth. Given the human relationship betwixt seasonality as well as mood, including the phenomenon of seasonal affective disorder, the findings aren't then far-fetched.
* Scenario Planning equally a Guide to Action - Ray Barros continues to offering fantabulous guidance for traders, including this perspective on scenario planning. See too his scenario creation for discretionary traders.
* Valuable Perspectives - Trader Mike's recent links highlight discussions of stop-losses as well as algorithmic trading. From Abnormal Returns, we larn to a greater extent than or less rattling interesting views, including a hold off at commodities as well as bond yields as well as how seasons impact the VIX.
* Can Positive Thinking Be Irresponsible? - Thanks to a reader for bringing this inquiry report to my attention, highlighting how people edit their memories of yesteryear outcomes to justify continued gambling. It's much harder to engage inward such distortion when you're tracking your trades as well as P/L inward a mag (which may hold upwardly i argue traders don't keep journals).
* Comprehensive Psychiatry Textbook - Just received my re-create of the mammoth 5th edition of the Textbook of Psychiatry from American Psychiatric Publishing, the publishing arm of the American Psychiatric Association. With over 1700 pages, the mass features chapters from recognized experts on topics ranging from psychiatric disorders to treatments as well as the needs of particular populations. My chapter deals alongside brief therapies, including the approaches to short-term operate that I utilise alongside traders.
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* It's Not Just Markets That Follow Seasonal Patterns - Thanks too to a reader for pointing me to the inquiry of physician Richard Wiseman as well as this rattling interesting study of how personality patterns--including the perception of beingness lucky!--are related to the seasons of one's birth. Given the human relationship betwixt seasonality as well as mood, including the phenomenon of seasonal affective disorder, the findings aren't then far-fetched.
* Scenario Planning equally a Guide to Action - Ray Barros continues to offering fantabulous guidance for traders, including this perspective on scenario planning. See too his scenario creation for discretionary traders.
* Valuable Perspectives - Trader Mike's recent links highlight discussions of stop-losses as well as algorithmic trading. From Abnormal Returns, we larn to a greater extent than or less rattling interesting views, including a hold off at commodities as well as bond yields as well as how seasons impact the VIX.
* Can Positive Thinking Be Irresponsible? - Thanks to a reader for bringing this inquiry report to my attention, highlighting how people edit their memories of yesteryear outcomes to justify continued gambling. It's much harder to engage inward such distortion when you're tracking your trades as well as P/L inward a mag (which may hold upwardly i argue traders don't keep journals).
* Comprehensive Psychiatry Textbook - Just received my re-create of the mammoth 5th edition of the Textbook of Psychiatry from American Psychiatric Publishing, the publishing arm of the American Psychiatric Association. With over 1700 pages, the mass features chapters from recognized experts on topics ranging from psychiatric disorders to treatments as well as the needs of particular populations. My chapter deals alongside brief therapies, including the approaches to short-term operate that I utilise alongside traders.
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Info!! Costless Webinar This Thursday
Dear Readers,
I'm pleased to denote that, afterward the stock marketplace closed this Th (3:30 PM CT), I volition live on offering a gratis Webinar on the topic of "Reading the Psychology of the Market" hosted yesteryear Bill Duryea too the Institute of Auction Market Theory (IOAMT). I'll live on delivering the session from the Chicago Board of Trade offices of Trevor Harnett, the developer of Market Delta, who volition assistance with the program. Access to the Webinar volition live on available to those who sign upward for a gratis five-day lawsuit membership to Bill's real-time trading room. It's a swell chance to experience trading didactics inwards existent time. During the lawsuit period, every bit part of the trading room, Trevor volition live on conducting gratis educational programming regarding the purpose of Market Delta. Please depository fiscal establishment annotation that he is also offering a gratis 30-day subscription to Market Delta--an fantabulous chance to boot the tires too encounter how the computer program industrial plant across unlike marketplace conditions.
Before I launch into a description of the session, but a few disclaimers: I accept no commercial ties to IOAMT or Market Delta too accept insisted on receiving no compensation for the Webinar. Bill too Trevor offering services that I experience are of value to traders, too then I'm happy to back upward their efforts. I've been a Market Delta subscriber for years too accept establish it to live on a useful tool inwards reading volume/sentiment patterns inwards the market. Influenza A virus subtype H5N1 publish of traders accept reported positive things to me almost the real-time trading room run yesteryear Bill--particularly his integration of Market Profile, Market Delta, too intraday trading principles. From my end, the Webinar is a vehicle for offering character didactics to traders; I don't purpose it to solicit line of piece of occupation concern personally, too I don't have whatsoever compensation or consideration from IOAMT or Market Delta for my participation.
It's a shame I accept to offering such disclaimers, but it's inwards response to the crass commercialism that dominates offerings inwards "trader education". So many programs are piddling to a greater extent than than infomercials. The Th Webinar volition non live on an infomercial!
The Webinar volition run ane hr inwards length, with fourth dimension for questions/answers at the end. The focus volition live on on the psychology of the market--reading provide too postulate every bit they unfold during the trading day--not too then much on the psychology of traders themselves. Among the topics I'll acquit on upon are reading patterns across indexes too patterns inwards the NYSE TICK too Market Delta.
I accept found--personally too inwards my operate with developing traders--that Market Profile is an fantabulous conceptual framework for agreement what markets are doing too why. It's also a practical framework for thinking almost toll too book relationships too when marketplace moves are probable to extend vs. retrace. The integration of really short-term supply/demand analysis from Market Delta amongst the longer-term analysis of value from Market Profile yields many audio trading ideas too plans. The thought is to know *what* to do, but also *why* to produce it. That yields mastery.
Look forwards to seeing y'all on Thursday! As always, thank y'all for your interest--
Brett
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I'm pleased to denote that, afterward the stock marketplace closed this Th (3:30 PM CT), I volition live on offering a gratis Webinar on the topic of "Reading the Psychology of the Market" hosted yesteryear Bill Duryea too the Institute of Auction Market Theory (IOAMT). I'll live on delivering the session from the Chicago Board of Trade offices of Trevor Harnett, the developer of Market Delta, who volition assistance with the program. Access to the Webinar volition live on available to those who sign upward for a gratis five-day lawsuit membership to Bill's real-time trading room. It's a swell chance to experience trading didactics inwards existent time. During the lawsuit period, every bit part of the trading room, Trevor volition live on conducting gratis educational programming regarding the purpose of Market Delta. Please depository fiscal establishment annotation that he is also offering a gratis 30-day subscription to Market Delta--an fantabulous chance to boot the tires too encounter how the computer program industrial plant across unlike marketplace conditions.
Before I launch into a description of the session, but a few disclaimers: I accept no commercial ties to IOAMT or Market Delta too accept insisted on receiving no compensation for the Webinar. Bill too Trevor offering services that I experience are of value to traders, too then I'm happy to back upward their efforts. I've been a Market Delta subscriber for years too accept establish it to live on a useful tool inwards reading volume/sentiment patterns inwards the market. Influenza A virus subtype H5N1 publish of traders accept reported positive things to me almost the real-time trading room run yesteryear Bill--particularly his integration of Market Profile, Market Delta, too intraday trading principles. From my end, the Webinar is a vehicle for offering character didactics to traders; I don't purpose it to solicit line of piece of occupation concern personally, too I don't have whatsoever compensation or consideration from IOAMT or Market Delta for my participation.
It's a shame I accept to offering such disclaimers, but it's inwards response to the crass commercialism that dominates offerings inwards "trader education". So many programs are piddling to a greater extent than than infomercials. The Th Webinar volition non live on an infomercial!
The Webinar volition run ane hr inwards length, with fourth dimension for questions/answers at the end. The focus volition live on on the psychology of the market--reading provide too postulate every bit they unfold during the trading day--not too then much on the psychology of traders themselves. Among the topics I'll acquit on upon are reading patterns across indexes too patterns inwards the NYSE TICK too Market Delta.
I accept found--personally too inwards my operate with developing traders--that Market Profile is an fantabulous conceptual framework for agreement what markets are doing too why. It's also a practical framework for thinking almost toll too book relationships too when marketplace moves are probable to extend vs. retrace. The integration of really short-term supply/demand analysis from Market Delta amongst the longer-term analysis of value from Market Profile yields many audio trading ideas too plans. The thought is to know *what* to do, but also *why* to produce it. That yields mastery.
Look forwards to seeing y'all on Thursday! As always, thank y'all for your interest--
Brett
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Thursday, August 24, 2006
Info!! Reading Stock Marketplace Grade Psychology
During my Th Webinar, I'll accept much to a greater extent than to nation well-nigh reading marketplace psychology. Every twenty-four hr current inwards the marketplace is an auction, in addition to the toll in addition to book figures give away to us the relative involvement of buyers in addition to sellers inwards this auction. By agreement the dynamics of the auction prior to the marketplace open, nosotros tin formulate hypotheses well-nigh the coming morn merchandise in addition to cash inwards one's chips alarm to whatsoever shifts that mightiness last on inwards marketplace sentiment.
RELEVANT POSTS:
Stock Market Reversals
Tracking Market Transitions
Breakout Trades
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RELEVANT POSTS:
Stock Market Reversals
Tracking Market Transitions
Breakout Trades
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Wednesday, August 23, 2006
Info!! Webinar Update As Well As A Few Wednesday Notes
* Tomorrow's Webinar - Here's downgrades of subprime debt continue...and give-up the ghost along to weigh on markets. Hat tip to Barry Ritholtz for highlighting this informative piece on how the subprime province of affairs developed.
* More Consumer Woes in addition to Impact - Mish tracks soaring credit menu losses in addition to Calculated Risk updates estimates of housing losses.
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* More Consumer Woes in addition to Impact - Mish tracks soaring credit menu losses in addition to Calculated Risk updates estimates of housing losses.
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Tuesday, August 22, 2006
Info!! Coin Flows Into The Stock Marketplace Pose As Well As What They're Telling Us
the twoscore stocks inward my basket, drawn as from 8 S&P 500 sectors, shows 22 stocks inward uptrends, 8 neutral, together with 10 inward downtrends. Three of the x stocks inward downtrends are from the banking sector, which continues to generate credit-related concerns.
Where does this piece of occupation out us? Selling appears to hold upward drying up, but nosotros are too non seeing buyers flock into the electrical flow market. This dynamic is too apparent inward the Cumulative NYSE TICK indicator, which has been weak of late. Given this indecision, the marketplace may simply rest inward its longer-term hit saltation fashion until it receives guidance adjacent calendar week from the Fed meeting.
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Where does this piece of occupation out us? Selling appears to hold upward drying up, but nosotros are too non seeing buyers flock into the electrical flow market. This dynamic is too apparent inward the Cumulative NYSE TICK indicator, which has been weak of late. Given this indecision, the marketplace may simply rest inward its longer-term hit saltation fashion until it receives guidance adjacent calendar week from the Fed meeting.
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Monday, August 21, 2006
Info!! Anticipating Reversals Past Times Tracking Participation Inward Stock Index Moves
my weekly indicator reviews; it's too why I similar to croak on tabs on private stocks together with sectors intraday.
Very often, marketplace reversals of management are preceded yesteryear waning participation inwards moves.
Above nosotros tin come across that regulation illustrated inwards yesterday's marketplace activity inwards the Dow Jones Industrial Average (DIA) together with the xxx Dow stocks. The nautical chart tracks the number of Dow issues making fresh two-hour cost highs minus those making two-hour lows; that number is updated every 5 minutes. Only closing five-minute prices are used for the calculation.
Early inwards the morning, the Dow moved lower, bounced a bit, together with hence moved to a novel cost depression for the day. That cost depression did non present an expansion inwards the number of element stocks registering fresh novel lows. That was a alert that the spend upwardly was running out of steam.
As the marketplace reversed, novel highs steadily expanded, which kept traders inwards the trending move. Note, however, that the fresh cost highs unopen to 2 PM ET were non confirmed yesteryear the novel highs. This deterioration was a overnice enjoin for the selloff belatedly inwards the day: the ascension was running out of steam. Waning participation preceded reversal.
It is non necessary to monitor all stocks inside an index to rail participation. Tracking private sector ETFs tin move a useful strategy every bit well. In general, if I come across multiple S&P 500 sectors non participating inwards a motion to novel highs or lows inwards the ES contract, I volition move probable to accept profits if I'm riding that move, together with I'll move probable to await for spots to fade the move. Combining assessments of participation (new highs/lows) amongst readings of shifts inwards persuasion (TICK, Market Delta) tin move real effective inwards identifying directional changes inwards the indexes.
RELEVANT POSTS:
Detecting Participation inwards Breakout Moves
Participation: Influenza A virus subtype H5N1 Key Market Variable
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Very often, marketplace reversals of management are preceded yesteryear waning participation inwards moves.
Above nosotros tin come across that regulation illustrated inwards yesterday's marketplace activity inwards the Dow Jones Industrial Average (DIA) together with the xxx Dow stocks. The nautical chart tracks the number of Dow issues making fresh two-hour cost highs minus those making two-hour lows; that number is updated every 5 minutes. Only closing five-minute prices are used for the calculation.
Early inwards the morning, the Dow moved lower, bounced a bit, together with hence moved to a novel cost depression for the day. That cost depression did non present an expansion inwards the number of element stocks registering fresh novel lows. That was a alert that the spend upwardly was running out of steam.
As the marketplace reversed, novel highs steadily expanded, which kept traders inwards the trending move. Note, however, that the fresh cost highs unopen to 2 PM ET were non confirmed yesteryear the novel highs. This deterioration was a overnice enjoin for the selloff belatedly inwards the day: the ascension was running out of steam. Waning participation preceded reversal.
It is non necessary to monitor all stocks inside an index to rail participation. Tracking private sector ETFs tin move a useful strategy every bit well. In general, if I come across multiple S&P 500 sectors non participating inwards a motion to novel highs or lows inwards the ES contract, I volition move probable to accept profits if I'm riding that move, together with I'll move probable to await for spots to fade the move. Combining assessments of participation (new highs/lows) amongst readings of shifts inwards persuasion (TICK, Market Delta) tin move real effective inwards identifying directional changes inwards the indexes.
RELEVANT POSTS:
Detecting Participation inwards Breakout Moves
Participation: Influenza A virus subtype H5N1 Key Market Variable
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Sunday, August 20, 2006
Info!! Archived Webinar On Reading Marketplace Psychology
Thanks to Bill as well as Trevor for rapidly posting links to Thursday's Webinar on the IOAMT site as well as the Market Delta site. There are a few skips inwards the well as well as you lot tin nation that I'm non exclusively by my laryngitis, merely otherwise the archived session should endure pretty intelligible.
I noticed that the exceptional inwards the charts that I displayed is a flake fuzzy inwards the archived playback, as well as then I've posted the charts above. If you lot click on those, you'll run into enough of detail.
If you lot convey whatever questions near the Webinar content, experience gratis to post service them equally comments to this weblog post service as well as I'll respond to the best of my ability.
I appreciate the interest--
Brett
Info!! Coin Menses Into The Fiscal Sector
money flows for the thirty Dow Industrial stocks. By examining flows from sector to sector, nosotros tin attain a to a greater extent than refined perspective on how funds are flowing *within* the stock market. This is invaluable information for stock pickers.
Note that nosotros tin catch coin menstruum equally a catch measure, non dissimilar the NYSE TICK as well as Market Delta measures emphasized in the recent webinar. We're using action at the marketplace bid to signal an aggressiveness amidst sellers as well as action at the marketplace offering to signal initiating involvement amidst buyers. By aggregating this conduct over the course of educational activity of a 24-hour interval as well as and then examining the menstruum of funds across days, nosotros tin bring out shifts inwards catch toward stocks as well as sectors.
With that inwards mind, nosotros tin come across from the higher upward nautical chart the fiscal sector of the S&P 500 Index (XLF) plotted against a five-day moving average of coin flows for the 10 stocks nearly highly weighted inwards XLF. Those stocks are: BAC, C, JPM, AIG, WFC, GS, WB, USB, AXP, as well as MS. The nautical chart is constructed inwards Excel from information derived from Townsend's Real Tick platform.
As amongst the before post on coin menstruum amongst the Dow stocks, nosotros tin draw 2 conclusions amongst honour to the fiscal sector:
1) Outflows stimulate got been waning since the Jan marketplace low;
2) We stimulate got non seen massive dollar inflows into the sector.
To live on sure, nosotros *have* seen internet dollar inflows into the fiscal shares since the showtime of April. These inflows, however, are non equally peachy equally those nosotros saw at sector bounces inwards November, 2007 as well as belatedly January, 2008. The skilful intelligence is that steps taken past times fundamental banks as well as recapitalization efforts past times banks stimulate got stemmed selling inside the fiscal sector. The bad intelligence is that those developments stimulate got not, equally yet, led to broad-based buying of fiscal shares.
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Note that nosotros tin catch coin menstruum equally a catch measure, non dissimilar the NYSE TICK as well as Market Delta measures emphasized in the recent webinar. We're using action at the marketplace bid to signal an aggressiveness amidst sellers as well as action at the marketplace offering to signal initiating involvement amidst buyers. By aggregating this conduct over the course of educational activity of a 24-hour interval as well as and then examining the menstruum of funds across days, nosotros tin bring out shifts inwards catch toward stocks as well as sectors.
With that inwards mind, nosotros tin come across from the higher upward nautical chart the fiscal sector of the S&P 500 Index (XLF) plotted against a five-day moving average of coin flows for the 10 stocks nearly highly weighted inwards XLF. Those stocks are: BAC, C, JPM, AIG, WFC, GS, WB, USB, AXP, as well as MS. The nautical chart is constructed inwards Excel from information derived from Townsend's Real Tick platform.
As amongst the before post on coin menstruum amongst the Dow stocks, nosotros tin draw 2 conclusions amongst honour to the fiscal sector:
1) Outflows stimulate got been waning since the Jan marketplace low;
2) We stimulate got non seen massive dollar inflows into the sector.
To live on sure, nosotros *have* seen internet dollar inflows into the fiscal shares since the showtime of April. These inflows, however, are non equally peachy equally those nosotros saw at sector bounces inwards November, 2007 as well as belatedly January, 2008. The skilful intelligence is that steps taken past times fundamental banks as well as recapitalization efforts past times banks stimulate got stemmed selling inside the fiscal sector. The bad intelligence is that those developments stimulate got not, equally yet, led to broad-based buying of fiscal shares.
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Saturday, August 19, 2006
Info!! Coin Menstruation Into The Consumer Discretionary Sector
My terminal post took a await at coin flows inside the financial sector of the S&P 500 large cap stock universe. (See that post for an explanation of coin menstruum as well as how it is calculated).
The financial sector is particularly of import to marketplace sentiment, given the concerns we've had over banking company losses as well as credit quality.
A minute sector I'm next closely is the consumer discretionary stocks, which are sensitive to consumer behavior--and thus the comport upon of recession. If the stock marketplace is looking past times recession to a recovery, nosotros should come across inflows of uppercase to the consumer discretionary area. If the marketplace is anticipating deepening as well as to a greater extent than prolonged recession, however, nosotros should come across outflows from these shares.
The nautical chart higher upward depicts five-day coin flows vs. the XLY (consumer discretionary) sector ETF. The flows are based upon the 10 nearly highly weighted stocks inside XLY. These are: MCD, DIS, CMCSK, TWX, HD, NWS, TGT, LOW, NKE, as well as VIA.B.
We tin come across a designing inward the coin flows for consumer discretionary issues that is like to the i nosotros observed with financials as well as with the Dow Industrials stocks overall. Going into the Jan lows, nosotros saw consistent outflows from the consumer discretionary sector as well as and then sustained buying during slowly Jan as well as February. Outflows diminished alongside the March lows and, since early on April, we've seen resumed inflows to the sector.
This designing of waning selling see since the Jan lows is confirmed past times new high-new depression information for the stock marketplace overall as well as past times my operate on the Cumulative NYSE TICK. It is fair to enjoin that the diverse measures taken to assistance the economy, from charge per unit of measurement cuts to infusions of uppercase into banks as well as financial stimulus, cause got stemmed selling pressure level inward the market.
It is also clear, however, that these measures cause got non generated important inflows into stocks. While we've seen internet inflows to the consumer discretionary surface area since the inaugural off of April, the nearly recent toll forcefulness inward the sector has non been accompanied past times meaningful dollar flows. The Feb rally inward XLY failed when toll highs slowly inward the calendar month came on diminished uppercase inflows. H5N1 like designing may survive showing upward during April's market. XLY has moved to novel toll highs, exactly coin flows to the sector are lagging.
It is i affair to come across a drying upward of selling; it's about other to sustain buying. So far we've seen a notable decrease inward selling manifested across several see measures. Buying sentiment, on the other hand, remains muted of late--something nosotros volition necessitate to rails every bit nosotros merchandise at an of import surface area of long-term toll resistance inward the wide market.
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The financial sector is particularly of import to marketplace sentiment, given the concerns we've had over banking company losses as well as credit quality.
A minute sector I'm next closely is the consumer discretionary stocks, which are sensitive to consumer behavior--and thus the comport upon of recession. If the stock marketplace is looking past times recession to a recovery, nosotros should come across inflows of uppercase to the consumer discretionary area. If the marketplace is anticipating deepening as well as to a greater extent than prolonged recession, however, nosotros should come across outflows from these shares.
The nautical chart higher upward depicts five-day coin flows vs. the XLY (consumer discretionary) sector ETF. The flows are based upon the 10 nearly highly weighted stocks inside XLY. These are: MCD, DIS, CMCSK, TWX, HD, NWS, TGT, LOW, NKE, as well as VIA.B.
We tin come across a designing inward the coin flows for consumer discretionary issues that is like to the i nosotros observed with financials as well as with the Dow Industrials stocks overall. Going into the Jan lows, nosotros saw consistent outflows from the consumer discretionary sector as well as and then sustained buying during slowly Jan as well as February. Outflows diminished alongside the March lows and, since early on April, we've seen resumed inflows to the sector.
This designing of waning selling see since the Jan lows is confirmed past times new high-new depression information for the stock marketplace overall as well as past times my operate on the Cumulative NYSE TICK. It is fair to enjoin that the diverse measures taken to assistance the economy, from charge per unit of measurement cuts to infusions of uppercase into banks as well as financial stimulus, cause got stemmed selling pressure level inward the market.
It is also clear, however, that these measures cause got non generated important inflows into stocks. While we've seen internet inflows to the consumer discretionary surface area since the inaugural off of April, the nearly recent toll forcefulness inward the sector has non been accompanied past times meaningful dollar flows. The Feb rally inward XLY failed when toll highs slowly inward the calendar month came on diminished uppercase inflows. H5N1 like designing may survive showing upward during April's market. XLY has moved to novel toll highs, exactly coin flows to the sector are lagging.
It is i affair to come across a drying upward of selling; it's about other to sustain buying. So far we've seen a notable decrease inward selling manifested across several see measures. Buying sentiment, on the other hand, remains muted of late--something nosotros volition necessitate to rails every bit nosotros merchandise at an of import surface area of long-term toll resistance inward the wide market.
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Friday, August 18, 2006
Info!! A Few Sites To Banking Corporation Tally Out
Video Reviews of Market Action - Those of you lot who relish Brian Shannon's function may guide maintain noticed that Blogger unopen downward his site equally purpose of a review procedure concerning possible "spam blogs". This in 1 lawsuit happened to me in addition to tin accept quite a few days to remedy. In the interim, you lot tin uncovering Brian's review of Fri action--and his other posts--the topic of implied volatility, including sector-specific implied volatility. Using options markets to sympathise consider inwards the wide stock marketplace is quite helpful, in addition to at that topographic point are unopen to gems inwards this site.
Mentorship Blog - Ray Barros is 1 of the real few trading coaches/mentors who actively trades in addition to follows markets--and who freely shares his perspectives on markets in addition to trading. His Trading Success blog contains a release of worthwhile lessons, including this 1 on trading in addition to novel experiences.
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Mentorship Blog - Ray Barros is 1 of the real few trading coaches/mentors who actively trades in addition to follows markets--and who freely shares his perspectives on markets in addition to trading. His Trading Success blog contains a release of worthwhile lessons, including this 1 on trading in addition to novel experiences.
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Thursday, August 17, 2006
Info!! Coin Flows Into The Energy, Consumer Staples, Too Applied Scientific Discipline Sectors
consumer discretionary as well as financial sectors (see the latter post service for an explanation of the coin menses measure). Above nosotros encounter five-day average coin menses for the energy, consumer staples, as well as technology scientific discipline sectors plotted against their respective ETFs: XLE, XLP, as well as XLK.
As amongst the before posts, I drew upon the x nearly highly weighted stocks inside each of those sector ETFs to guess overall sector coin flows. The stocks chosen were:
Energy: XON, CVX, COP, SLB, OXY, DVN, RIG, APA, XTO, HAL
Consumer Staples: PG, WMT, PM, KO, CVS, PEP, KFT, MO, CL, WAG
Technology: T, MSFT, CSCO, IBM, AAPL, INTC, HPQ, GOOG, VZ, ORCL
We tin sack encounter from the altitude nautical chart of the unloose energy sector that the sector has been quite rigid inwards damage of cost action, next the describe of crude oil overall, merely that coin flows convey been lagging. We've seen internet inflows since the starting fourth dimension of April--a designing likewise noted amid the fiscal as well as consumer discretionary shares--but those inflows convey been modest. Indeed, amongst to a greater extent than or less selling inwards the unloose energy markets this past times week, flows genuinely turned negative amid the unloose energy issues of late. It's clear from the nautical chart that selling describe per unit of measurement area (outflows) has dried upwards since the Jan lows (another designing nosotros noticed inwards the prior 2 sectors reviewed), merely we've nonetheless to encounter investors devote funds aggressively to the sector.
The consumer staples sector (middle chart) gives us a dissimilar await altogether. Significant outflows from the sector convey been seen fifty-fifty next the Jan lows--a possible effect of a shift of priorities amid investors from a to a greater extent than risk-averse opinion to a to a greater extent than risk-seeking i (something we've seen of slowly inwards the Treasury market). Price of the sector ETF has lagged of late, as well as nosotros are having problem sustaining whatsoever sort of inflows to the sector.
The technology scientific discipline sector (bottom chart) shows detail strength, equally outflows convey been moderating since November, 2007 as well as inflows convey of late hitting novel highs. Once again, this may reverberate a shift inwards investor persuasion from a to a greater extent than defensive opinion toward i that favors growth-oriented names, such equally those flora inside the XLK universe. We're seeing multi-month cost highs inwards XLK, as well as those are confirmed past times coin menses strength.
From this comparison, nosotros tin sack encounter how a sector-by-sector assay out of coin flows tin sack render us amongst insights into themes pursued past times traders as well as investors. Because large transactions dominate the coin menses figures, the persuasion of institutional traders is nicely tracked past times the coin menses measure.
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As amongst the before posts, I drew upon the x nearly highly weighted stocks inside each of those sector ETFs to guess overall sector coin flows. The stocks chosen were:
Energy: XON, CVX, COP, SLB, OXY, DVN, RIG, APA, XTO, HAL
Consumer Staples: PG, WMT, PM, KO, CVS, PEP, KFT, MO, CL, WAG
Technology: T, MSFT, CSCO, IBM, AAPL, INTC, HPQ, GOOG, VZ, ORCL
We tin sack encounter from the altitude nautical chart of the unloose energy sector that the sector has been quite rigid inwards damage of cost action, next the describe of crude oil overall, merely that coin flows convey been lagging. We've seen internet inflows since the starting fourth dimension of April--a designing likewise noted amid the fiscal as well as consumer discretionary shares--but those inflows convey been modest. Indeed, amongst to a greater extent than or less selling inwards the unloose energy markets this past times week, flows genuinely turned negative amid the unloose energy issues of late. It's clear from the nautical chart that selling describe per unit of measurement area (outflows) has dried upwards since the Jan lows (another designing nosotros noticed inwards the prior 2 sectors reviewed), merely we've nonetheless to encounter investors devote funds aggressively to the sector.
The consumer staples sector (middle chart) gives us a dissimilar await altogether. Significant outflows from the sector convey been seen fifty-fifty next the Jan lows--a possible effect of a shift of priorities amid investors from a to a greater extent than risk-averse opinion to a to a greater extent than risk-seeking i (something we've seen of slowly inwards the Treasury market). Price of the sector ETF has lagged of late, as well as nosotros are having problem sustaining whatsoever sort of inflows to the sector.
The technology scientific discipline sector (bottom chart) shows detail strength, equally outflows convey been moderating since November, 2007 as well as inflows convey of late hitting novel highs. Once again, this may reverberate a shift inwards investor persuasion from a to a greater extent than defensive opinion toward i that favors growth-oriented names, such equally those flora inside the XLK universe. We're seeing multi-month cost highs inwards XLK, as well as those are confirmed past times coin menses strength.
From this comparison, nosotros tin sack encounter how a sector-by-sector assay out of coin flows tin sack render us amongst insights into themes pursued past times traders as well as investors. Because large transactions dominate the coin menses figures, the persuasion of institutional traders is nicely tracked past times the coin menses measure.
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Wednesday, August 16, 2006
Info!! Coin Flows Into The Materials, Industrials, In Addition To Wellness Attention Sectors
money flows into the energy, technology, too consumer staples stocks also every bit the consumer discretionary too financial sectors. (The latter postal service includes a detailed explanation of the coin menstruum measure).
In this post, nosotros cause got a await at five-day coin flows plotted against the materials (XLB; tiptop chart), industrials (XLI; marrow chart), too wellness tending (XLV; bottom chart) ETFs, which rails the sector components of the S&P 500 large cap stock universe.
As amongst the before posts, I've taken the x stocks well-nigh highly weighted inside those ETFs to jurist sector coin flows. Those stocks are every bit follows:
Materials: MON, DD, FCX, DOW, AA, PX, APD, NEM, NUE, X
Industrials: GE, UPS, UTX, BA, MMM, CAT, HON, EMR, DE, GD
Health Care: JNJ, PFE, MRK, ABT, WYE, MDT, LLY, GILD, AMGN, UNH
We tin dismiss run across from the tiptop nautical chart that, dissimilar the other sectors, funds cause got been consistently flowing into the materials sector, every bit the five-day average has spent much of its fourth dimension higher upwards the zilch job separating inflows from outflows. Note, however, that the well-nigh recent readings cause got been rather tepid. When XLB hitting novel cost highs ii weeks ago, coin flows were lagging. When nosotros had selling inwards the commodities terminal week, flows turned negative. This appears to last operate of a shift out of the hot commodities stocks too into to a greater extent than beaten downwards areas, such every bit financials too consumer discretionaries.
Money flows for the industrials sector line a blueprint we've noted before: waning selling pressure level since the Jan highs too internet inflows since early on April. As XLI has tested recent cost highs this past times week, coin menstruum hitting novel highs before trailing off belatedly inwards the week. The blueprint of higher lows too higher highs inwards the five-day menstruum numbers suggests that investors cause got been putting coin to piece of work inwards this area.
Finally nosotros cause got the weakest of the sectors: wellness care. Observe that, every bit the wide marketplace position has rallied of late, XLV has barely participated. Money flows cause got been rather consistently negative every bit well. We saw about inflows early on this past times week, simply those cause got hardly been impressive. It is quite probable that investors, noting the wellness tending reform ideas advanced past times the Presidential candidates, are non aggressively dedicating upper-case alphabetic lineament to this sector.
Once 1 time to a greater extent than nosotros tin dismiss run across how the menstruum of funds inwards too out of sectors captures of import marketplace position themes. This is a promising mensurate of persuasion that I'll last roofing inwards greater special inwards the future.
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In this post, nosotros cause got a await at five-day coin flows plotted against the materials (XLB; tiptop chart), industrials (XLI; marrow chart), too wellness tending (XLV; bottom chart) ETFs, which rails the sector components of the S&P 500 large cap stock universe.
As amongst the before posts, I've taken the x stocks well-nigh highly weighted inside those ETFs to jurist sector coin flows. Those stocks are every bit follows:
Materials: MON, DD, FCX, DOW, AA, PX, APD, NEM, NUE, X
Industrials: GE, UPS, UTX, BA, MMM, CAT, HON, EMR, DE, GD
Health Care: JNJ, PFE, MRK, ABT, WYE, MDT, LLY, GILD, AMGN, UNH
We tin dismiss run across from the tiptop nautical chart that, dissimilar the other sectors, funds cause got been consistently flowing into the materials sector, every bit the five-day average has spent much of its fourth dimension higher upwards the zilch job separating inflows from outflows. Note, however, that the well-nigh recent readings cause got been rather tepid. When XLB hitting novel cost highs ii weeks ago, coin flows were lagging. When nosotros had selling inwards the commodities terminal week, flows turned negative. This appears to last operate of a shift out of the hot commodities stocks too into to a greater extent than beaten downwards areas, such every bit financials too consumer discretionaries.
Money flows for the industrials sector line a blueprint we've noted before: waning selling pressure level since the Jan highs too internet inflows since early on April. As XLI has tested recent cost highs this past times week, coin menstruum hitting novel highs before trailing off belatedly inwards the week. The blueprint of higher lows too higher highs inwards the five-day menstruum numbers suggests that investors cause got been putting coin to piece of work inwards this area.
Finally nosotros cause got the weakest of the sectors: wellness care. Observe that, every bit the wide marketplace position has rallied of late, XLV has barely participated. Money flows cause got been rather consistently negative every bit well. We saw about inflows early on this past times week, simply those cause got hardly been impressive. It is quite probable that investors, noting the wellness tending reform ideas advanced past times the Presidential candidates, are non aggressively dedicating upper-case alphabetic lineament to this sector.
Once 1 time to a greater extent than nosotros tin dismiss run across how the menstruum of funds inwards too out of sectors captures of import marketplace position themes. This is a promising mensurate of persuasion that I'll last roofing inwards greater special inwards the future.
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Tuesday, August 15, 2006
Info!! Indicator Review For April 28Th
Last week's indicator review noted signs of marketplace strength, only too roughly concerns on the horizon with honor to coin flows into Dow stocks together with the cumulative NYSE TICK. This calendar week features much of the same, only with a few to a greater extent than cautionary notes regarding the cost strength.
The exceed nautical chart requires roughly explaining. I of late posted coin flows from the x nigh highly weighted stocks inside 8 S&P sectors: financial, consumer discretionary, energy, consumer staples, technology, materials, industrials, together with wellness care. I combined the coin flows from those lxxx stocks (the specific issues are identified inwards the sector posts) to locomote into at an approximate of coin flows into together with out of the S&P 500 Index.
If you lot review those sector posts, you lot tin shipping away come across that at that spot are broad variations of coin stream from sector to sector. That tells us that nosotros are non seeing coin beingness seat to operate inwards the marketplace inwards a broad-based fashion. Across the sectors, however, selling delineate per unit of measurement area (money outflow) has been waning, which you lot tin shipping away come across inwards the exceed nautical chart from the rising lows inwards the five-day stream figures. Moreover, since the outset of April, nosotros convey seen rather consistent flows into the S&P 500 stocks. To this point, flows are confirming the cost highs that we've been seeing, only at that spot are notable laggards alongside sectors--hardly a vigorous bull move.
This selective nature of the recent cost forcefulness tin shipping away live observed inwards the novel high/new depression information (middle chart). Note that, during the recent motility to cost highs inwards SPY, novel 20-day highs minus lows convey been lagging. Moreover, this non-confirmation continues to demo upwards inwards our cumulative NYSE TICK mensurate (bottom chart). Last week's indicator review highlighted the importance of the 1400 surface area every bit long-term resistance inwards the S&P 500 Index. If nosotros are to sustain a bring out inwards a higher house that level, nosotros demand to come across indications of expanding participation inwards the strength. While nosotros *are* seeing expanded coin flows across the sectors, the variability from sector to sector; the lagging number of stocks registering novel highs; together with the lagging cumulative TICK give this bull motility something of a yellowish caution light.
Here's a quick await at other indicators together with what nosotros mightiness glean from them:
* Treasury involvement rates convey risen sharply inwards the by week, peculiarly at the curt end. There is growing speculation that the Fed may bring out afterward 1 lastly involvement charge per unit of measurement cutting this week. This is dollar supportive, only it too suggests that marketplace participants are weighing the possibility that we're dealing with a normal recessionary economy, non a deflationary 1 requiring Japanese-style quantitative easing. It too indicates a much reduced demand for the flight-to-safety trade, which frees upper-case alphabetic quality for stocks.
* My Cumulative Demand/Supply measure, which has nicely tracked intermediate-term marketplace peaks together with valleys, is moderately overbought at a reading of +22. Readings of +30 together with inwards a higher house convey corresponded to 20-day periods of subnormal functioning inwards the S&P 500 Index. We hitting that +30 grade dorsum on Apr 18th. Interestingly, the recent cost highs inwards SPY convey occurred at lower levels inwards the Cumulative DSI, suggesting 1 time once again that fewer stocks convey been displaying rigid upside momentum every bit we've moved to the 1400 grade inwards the June ES contract.
* We're seeing a continued expansion of stocks trading inwards a higher house their 200-day moving average. Among the S&P 500 issues, 46% are instantly inwards a higher house their 200-day averages, the highest grade of 2008. That proportion is 39% for S&P 600 modest cap issues, which convey lagged a fleck recently.
* Fri saw 51 novel 52-week highs alongside NYSE mutual stocks together with 23 novel annual lows. That is significantly less than the over 100 novel 52-week highs registered the prior week. I'm watching this closely; nosotros demand to come across expanding novel highs if the bull motility is to live sustained.
* We maintain to come across technical forcefulness inside my handbasket of twoscore stocks, with 27 issues trading inwards uptrends, iv neutral, together with nine inwards downtrends. This is downwards from lastly week's peak, only soundless robust.
The bottom business is that nosotros *are* seeing reduced selling inwards stocks together with selective increased buying. How selective the buying remains--or how it tin shipping away broaden out from here--will nation the story of whether nosotros autumn dorsum into the multi-month trading hit or sustain an intermediate-term motility to novel highs.
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The exceed nautical chart requires roughly explaining. I of late posted coin flows from the x nigh highly weighted stocks inside 8 S&P sectors: financial, consumer discretionary, energy, consumer staples, technology, materials, industrials, together with wellness care. I combined the coin flows from those lxxx stocks (the specific issues are identified inwards the sector posts) to locomote into at an approximate of coin flows into together with out of the S&P 500 Index.
If you lot review those sector posts, you lot tin shipping away come across that at that spot are broad variations of coin stream from sector to sector. That tells us that nosotros are non seeing coin beingness seat to operate inwards the marketplace inwards a broad-based fashion. Across the sectors, however, selling delineate per unit of measurement area (money outflow) has been waning, which you lot tin shipping away come across inwards the exceed nautical chart from the rising lows inwards the five-day stream figures. Moreover, since the outset of April, nosotros convey seen rather consistent flows into the S&P 500 stocks. To this point, flows are confirming the cost highs that we've been seeing, only at that spot are notable laggards alongside sectors--hardly a vigorous bull move.
This selective nature of the recent cost forcefulness tin shipping away live observed inwards the novel high/new depression information (middle chart). Note that, during the recent motility to cost highs inwards SPY, novel 20-day highs minus lows convey been lagging. Moreover, this non-confirmation continues to demo upwards inwards our cumulative NYSE TICK mensurate (bottom chart). Last week's indicator review highlighted the importance of the 1400 surface area every bit long-term resistance inwards the S&P 500 Index. If nosotros are to sustain a bring out inwards a higher house that level, nosotros demand to come across indications of expanding participation inwards the strength. While nosotros *are* seeing expanded coin flows across the sectors, the variability from sector to sector; the lagging number of stocks registering novel highs; together with the lagging cumulative TICK give this bull motility something of a yellowish caution light.
Here's a quick await at other indicators together with what nosotros mightiness glean from them:
* Treasury involvement rates convey risen sharply inwards the by week, peculiarly at the curt end. There is growing speculation that the Fed may bring out afterward 1 lastly involvement charge per unit of measurement cutting this week. This is dollar supportive, only it too suggests that marketplace participants are weighing the possibility that we're dealing with a normal recessionary economy, non a deflationary 1 requiring Japanese-style quantitative easing. It too indicates a much reduced demand for the flight-to-safety trade, which frees upper-case alphabetic quality for stocks.
* My Cumulative Demand/Supply measure, which has nicely tracked intermediate-term marketplace peaks together with valleys, is moderately overbought at a reading of +22. Readings of +30 together with inwards a higher house convey corresponded to 20-day periods of subnormal functioning inwards the S&P 500 Index. We hitting that +30 grade dorsum on Apr 18th. Interestingly, the recent cost highs inwards SPY convey occurred at lower levels inwards the Cumulative DSI, suggesting 1 time once again that fewer stocks convey been displaying rigid upside momentum every bit we've moved to the 1400 grade inwards the June ES contract.
* We're seeing a continued expansion of stocks trading inwards a higher house their 200-day moving average. Among the S&P 500 issues, 46% are instantly inwards a higher house their 200-day averages, the highest grade of 2008. That proportion is 39% for S&P 600 modest cap issues, which convey lagged a fleck recently.
* Fri saw 51 novel 52-week highs alongside NYSE mutual stocks together with 23 novel annual lows. That is significantly less than the over 100 novel 52-week highs registered the prior week. I'm watching this closely; nosotros demand to come across expanding novel highs if the bull motility is to live sustained.
* We maintain to come across technical forcefulness inside my handbasket of twoscore stocks, with 27 issues trading inwards uptrends, iv neutral, together with nine inwards downtrends. This is downwards from lastly week's peak, only soundless robust.
The bottom business is that nosotros *are* seeing reduced selling inwards stocks together with selective increased buying. How selective the buying remains--or how it tin shipping away broaden out from here--will nation the story of whether nosotros autumn dorsum into the multi-month trading hit or sustain an intermediate-term motility to novel highs.
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Info!! Musings For A Monday
as posted before today. Just looking at the information since the get-go of Nov (N = 120 trading days), it turns out that when coin flows convey been positive on the day, the adjacent hateful solar daytime inward SPY has averaged a loss of -.42% (12 up, 22 down). When coin flows convey been peculiarly negative on the day, the adjacent hateful solar daytime inward SPY has averaged a arrive at of .34% (16 up, xiii down). Moderately negative coin flows on the hateful solar daytime convey led to real apartment performance. When nosotros larn venture buying inward stocks, it's tended to non follow through, only when we've had rigid selling with stocks, it also has tended to reverse. Not an slow marketplace position for short-term tendency followers.
* Advance-Decline Perspectives - The fantabulous nautical chart higher upwards from the observations from the recent indicator review, which noted diminished participation during recent marketplace position strength. I notice Decision Point's coverage of indexes in addition to sectors quite helpful, with indicators non establish elsewhere.
* Worth Reading - The Kirk Report links many interesting themes, including solar stocks that await good; quite a listing of trading tips; in addition to a useful ETF functioning tracker. Also banking concern fit out the links from Abnormal Returns, including an interesting written report that shows how by positive sense (reinforcement) affects futurity investment decisions.
* Web 3.0? - Fascinating article on how information from blogs in addition to other sources is beingness aggregated inward existent fourth dimension to practice a novel sort of news.
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* Advance-Decline Perspectives - The fantabulous nautical chart higher upwards from the observations from the recent indicator review, which noted diminished participation during recent marketplace position strength. I notice Decision Point's coverage of indexes in addition to sectors quite helpful, with indicators non establish elsewhere.
* Worth Reading - The Kirk Report links many interesting themes, including solar stocks that await good; quite a listing of trading tips; in addition to a useful ETF functioning tracker. Also banking concern fit out the links from Abnormal Returns, including an interesting written report that shows how by positive sense (reinforcement) affects futurity investment decisions.
* Web 3.0? - Fascinating article on how information from blogs in addition to other sources is beingness aggregated inward existent fourth dimension to practice a novel sort of news.
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Monday, August 14, 2006
Info!! The Perils Of Achievement Motivation: When Traders Press Besides Difficult To Win
A deadly blueprint alongside unopen to of the best traders is to channel achievement motivation into trading *more*.
The best traders practice involve hold a potent achievement motivation in addition to move quite difficult at their craft. That achievement motility makes them abhor losing. Their impulse is to instruct for the jugular; they desire to non solely achieve, exactly attain *more*.
This motility tin hold upwards a trader's greatest weakness, however. It tin atomic number 82 to stubborness inwards taking losses, leading to outsized losses. It tin also atomic number 82 to overtrading, equally the driven trader attempts to *make* things happen. That is a detail recipe for disaster on slow, narrow days such equally yesterday, when it's piece of cake to instruct chopped upwards jumping aboard seeming trending moves.
The internet outcome is that *pressing* to attain tin involve hold the trader out of his or her game. It subverts adventure administration past times leading the trader to merchandise likewise large, without careful attending to halt loss points. It also interferes with decision-making past times leading the trader to involve hold trades without an objective edge.
A skillful analogy is the fighter who goes for the knockout on every punch, leaving himself broad opened upwards to jabs in addition to punches from the opponent. When the boxer is *too* aggressive, defensive skills move out the window. So it is with the trader.
Another analogy is the soldier inwards the battlefield. Too hyped upwards in addition to likewise aggressive, he may accuse out of his foxhole in addition to brand himself an piece of cake target for the enemy. Sometimes the best strategy is to keep command in addition to alternative off the enemy sniper-style.
How tin y'all know if this is a work for you? If y'all move on metrics of your trading results, you'll encounter that the average size of your losing trades exceeds the average size of the winners. You'll encounter that your biggest losing days are ones inwards which y'all merchandise close oft in addition to with largest size, peculiarly when the marketplace was showing no special opportunity. You'll also know past times your land of mind: traders who *press* to win typically sense high degrees of frustration when the profits don't come upwards quickly.
If these are concerns for you, self-control strategies such equally meditation in addition to biofeedback tin hold upwards tremendously helpful. How to purpose such strategies volition hold upwards the focus of my adjacent post.
RELATED POSTS:
The Most Important Skill Traders Need
Biofeedback for Performance
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The best traders practice involve hold a potent achievement motivation in addition to move quite difficult at their craft. That achievement motility makes them abhor losing. Their impulse is to instruct for the jugular; they desire to non solely achieve, exactly attain *more*.
This motility tin hold upwards a trader's greatest weakness, however. It tin atomic number 82 to stubborness inwards taking losses, leading to outsized losses. It tin also atomic number 82 to overtrading, equally the driven trader attempts to *make* things happen. That is a detail recipe for disaster on slow, narrow days such equally yesterday, when it's piece of cake to instruct chopped upwards jumping aboard seeming trending moves.
The internet outcome is that *pressing* to attain tin involve hold the trader out of his or her game. It subverts adventure administration past times leading the trader to merchandise likewise large, without careful attending to halt loss points. It also interferes with decision-making past times leading the trader to involve hold trades without an objective edge.
A skillful analogy is the fighter who goes for the knockout on every punch, leaving himself broad opened upwards to jabs in addition to punches from the opponent. When the boxer is *too* aggressive, defensive skills move out the window. So it is with the trader.
Another analogy is the soldier inwards the battlefield. Too hyped upwards in addition to likewise aggressive, he may accuse out of his foxhole in addition to brand himself an piece of cake target for the enemy. Sometimes the best strategy is to keep command in addition to alternative off the enemy sniper-style.
How tin y'all know if this is a work for you? If y'all move on metrics of your trading results, you'll encounter that the average size of your losing trades exceeds the average size of the winners. You'll encounter that your biggest losing days are ones inwards which y'all merchandise close oft in addition to with largest size, peculiarly when the marketplace was showing no special opportunity. You'll also know past times your land of mind: traders who *press* to win typically sense high degrees of frustration when the profits don't come upwards quickly.
If these are concerns for you, self-control strategies such equally meditation in addition to biofeedback tin hold upwards tremendously helpful. How to purpose such strategies volition hold upwards the focus of my adjacent post.
RELATED POSTS:
The Most Important Skill Traders Need
Biofeedback for Performance
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Sunday, August 13, 2006
Info!! Thematic Shifts Amid Stock Marketplace Sectors
Going into tomorrow's Fed announcement, we've seen meaning changes inwards sector themes. Many of the sectors that were nigh beaten downwardly during the market's selloff are forthwith performing well. Interestingly, this has occurred at the same fourth dimension that Treasuries--which had been strong during the selloff amongst the flying to quality--have sold off. It appears that nosotros accept been making a gradual shift toward risk-taking amidst stocks. This has helped the consumer discretionary, financial, together with technology scientific discipline stocks inwards particular.
Below are the 8 S&P 500 sectors that I rails closely, along amongst their Technical Strength reading (a mensurate of short-to-intermediate term trending) together with the per centum of stocks inside the sector trading inwards a higher house their 50-day moving averages:
Materials (XLB): -60 (54%)
Industrials (XLI): +140 (77%)
Consumer Discretionary (XLY): +360 (70%)
Consumer Staples (XLP): -120 (59%)
Energy (XLE): +240 (81%)
Health Care (XLV): -200 (51%)
Financial (XLF): +220 (65%)
Technology (XLK): +260 (70%)
Some of the sectors that had been strongest during the marketplace weakness (Consumer Staples, Materials) accept been weak of late. Consumer Discretionary shares, which had suffered amongst recession fears, accept bounced dorsum dramatically.
I volition endure watching to reckon how the Fed coming together affects these potentially of import thematic shifts.
RELEVANT POST:
Sector Money Flows
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Below are the 8 S&P 500 sectors that I rails closely, along amongst their Technical Strength reading (a mensurate of short-to-intermediate term trending) together with the per centum of stocks inside the sector trading inwards a higher house their 50-day moving averages:
Materials (XLB): -60 (54%)
Industrials (XLI): +140 (77%)
Consumer Discretionary (XLY): +360 (70%)
Consumer Staples (XLP): -120 (59%)
Energy (XLE): +240 (81%)
Health Care (XLV): -200 (51%)
Financial (XLF): +220 (65%)
Technology (XLK): +260 (70%)
Some of the sectors that had been strongest during the marketplace weakness (Consumer Staples, Materials) accept been weak of late. Consumer Discretionary shares, which had suffered amongst recession fears, accept bounced dorsum dramatically.
I volition endure watching to reckon how the Fed coming together affects these potentially of import thematic shifts.
RELEVANT POST:
Sector Money Flows
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Saturday, August 12, 2006
Info!! 3 Substitution Questions Going Into The Fed Announcement
* Have nosotros lay inward a durable bottom inward stocks? - I've been writing for a while virtually the drying upwards of stocks making novel lows equally nosotros tested the Jan lows inward March. Since that time, we've bounced nicely as well as are hugging that major resistance surface area simply about 1400 inward the S&P 500 Index. I've besides noted of belatedly that the recent marketplace forcefulness has been accompanied past times waning participation to the upside as well as uneven sector performance. We need to view the wide attain of stocks inward gear to the upside to confirm that this is to a greater extent than than simply a catch-up deed of beaten downwards stocks, sectors, as well as property classes at the expense of first-quarter winners. I'll locomote looking to view if the Fed proclamation tin generate the rising tide that lifts all boats. Conventional wisdom has stocks selling off at the prospect that the Fed may locomote finished amongst its easing; less conventional wisdom (which I prefer) suggests that such a shift inward Fed policy mightiness locomote seen equally a vote of confidence inward credit markets as well as the economy.
* Will deflation or inflation concerns dominion the markets? - Watch the fixed income markets inward the wake of the Fed announcement. Will nosotros view the risk-averse flying to quality, amongst rising Treasury prices as well as falling yields? Or volition nosotros view coin proceed to deed from security toward riskier assets, equally has occurred this past times week, amongst Treasury rates rising as well as yield spreads narrowing vs. mortgage-backed as well as high yield debt? The Fed may good offering a balanced perspective inward their controversy to save flexibility at hereafter meetings, but the bond markets volition tip us off to the market's interpretation of Fed priorities. Conventional wisdom is yet focused on weak housing, as well as fifty-fifty the taxi cab driver seems to know virtually LIBOR. Less conventional wisdom is focused on the breakout moves we've already seen inward yield spreads.
* Will sector themes mirror confidence or lack of confidence inward the economy? - I've mentioned at numerous points over the past times few months the importance of the fiscal sector as well as peculiarly the banking concern stocks. With Citi's recent deed for farther cash infusion, those stocks accept seen a recent resumption of weakness. Keep an marrow on them inward the wake of the Fed announcement. It is real hard for me to believe that we'll sustain a bull deed without confidence inward the banks. But I'm aware that conventional wisdom is besides focused on financials; less conventional wisdom besides sees the influx of funds into consumer discretionary stocks vs. staples at the same fourth dimension that commodities accept been falling as well as the USA dollar has shown a fighting of strength. I'll locomote watching the latter trends carefully equally a barometer of nascent economical confidence.
Themes as well as transitions amid themes reverberate the flows of funds inside as well as across property classes. Even short-term traders tin create goodness from standing dorsum as well as seeing where uppercase is flowing as well as why. The upcoming Fed coming together should evidence instructive inward this regard.
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* Will deflation or inflation concerns dominion the markets? - Watch the fixed income markets inward the wake of the Fed announcement. Will nosotros view the risk-averse flying to quality, amongst rising Treasury prices as well as falling yields? Or volition nosotros view coin proceed to deed from security toward riskier assets, equally has occurred this past times week, amongst Treasury rates rising as well as yield spreads narrowing vs. mortgage-backed as well as high yield debt? The Fed may good offering a balanced perspective inward their controversy to save flexibility at hereafter meetings, but the bond markets volition tip us off to the market's interpretation of Fed priorities. Conventional wisdom is yet focused on weak housing, as well as fifty-fifty the taxi cab driver seems to know virtually LIBOR. Less conventional wisdom is focused on the breakout moves we've already seen inward yield spreads.
* Will sector themes mirror confidence or lack of confidence inward the economy? - I've mentioned at numerous points over the past times few months the importance of the fiscal sector as well as peculiarly the banking concern stocks. With Citi's recent deed for farther cash infusion, those stocks accept seen a recent resumption of weakness. Keep an marrow on them inward the wake of the Fed announcement. It is real hard for me to believe that we'll sustain a bull deed without confidence inward the banks. But I'm aware that conventional wisdom is besides focused on financials; less conventional wisdom besides sees the influx of funds into consumer discretionary stocks vs. staples at the same fourth dimension that commodities accept been falling as well as the USA dollar has shown a fighting of strength. I'll locomote watching the latter trends carefully equally a barometer of nascent economical confidence.
Themes as well as transitions amid themes reverberate the flows of funds inside as well as across property classes. Even short-term traders tin create goodness from standing dorsum as well as seeing where uppercase is flowing as well as why. The upcoming Fed coming together should evidence instructive inward this regard.
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Friday, August 11, 2006
Info!! Thursday Thoughts
the position out of stocks registering fresh 20-day highs continued to lag. We had 1346 novel highs across the NYSE, NASDAQ, in addition to ASE, against 587 novel lows. If nosotros only confine the count to mutual stocks traded on the NYSE, nosotros had solely forty novel highs against xviii lows. That is good below the 100+ novel highs registered ii weeks ago.
* Lots of Good Reads - Kirk takes a look at sovereign wealth fund dominance, the side past times side bubble, frontier investment, in addition to more. Trader Mike The Big Picture displays 1 big picture when it comes to nutrient inflation.
* Tomorrow's Post - Will highlight strategies that traders tin lead maintain to heighten their self-control. As I write the novel book, I increasingly realize that traders involve concrete methods to charabanc themselves for success. I'll survive emphasizing those "how-to's" inward the weblog equally well.
* Quotables - Sharp Brains offers the Stock Market Beat on the NewsFlashr site, filtering peak tidings stories for traders.
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* Lots of Good Reads - Kirk takes a look at sovereign wealth fund dominance, the side past times side bubble, frontier investment, in addition to more. Trader Mike The Big Picture displays 1 big picture when it comes to nutrient inflation.
* Tomorrow's Post - Will highlight strategies that traders tin lead maintain to heighten their self-control. As I write the novel book, I increasingly realize that traders involve concrete methods to charabanc themselves for success. I'll survive emphasizing those "how-to's" inward the weblog equally well.
* Quotables - Sharp Brains offers the Stock Market Beat on the NewsFlashr site, filtering peak tidings stories for traders.
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Thursday, August 10, 2006
Info!! The Importance Of Keeping Score
How much produce yous know nearly your trading?
* Take the absolute value of your daily gains in addition to losses in addition to dissever them past times your full portfolio value. How much of your portfolio are yous putting at opportunity each twenty-four hours on average? 1%? 3%? fifty solid set down points? How has this changed over time? How does this alter when you're making money? Losing money?
* Take a await at the 10% of your largest trades (i.e., when you've taken the largest positions). Have those tended to survive winning trades or losers? Do yous lead maintain a greater border when you're to a greater extent than aggressive or less?
* Take a await at your trading results every bit a constituent of twenty-four hours of calendar week in addition to every bit a constituent of fourth dimension of day. Do yous merchandise improve at for sure times than others? Take a await at how yous initiatory off a day, week, or month: does this impact how yous merchandise subsequently, in addition to does that impact your overall profitability?
* Take a await at how long yous concord winning trades vs. losing trades. Do yous become out of winners quicker than losers? Do yous lead maintain a small-scale pose out of large losing trades that yous concord good beyond your average asset fourth dimension per position?
* Take a await at your trading results after a downwards twenty-four hours or a downwards week. Does beingness downwards impact your trading? Do yous merchandise improve or worse when you've lost coin the twenty-four hours or calendar week before? How nearly trading results after an upwardly twenty-four hours or week? Do yous merchandise improve or worse when you've been making money?
As I emphasized In my recent post, I mentioned ii real overnice resources for tracking your performance. Another tool yous mightiness desire to reckon to rail your functioning is the Trade Performance programme developed past times Steve Geringer. In add-on to helping traders rail their functioning every bit a constituent of appointment ranges, safety types, symbols, etc., Trade Performance doubles every bit a tool for journaling, merchandise planning, opportunity management, in addition to describe of piece of job organization planning.
Steve is making Trader Psychometrics
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* Take the absolute value of your daily gains in addition to losses in addition to dissever them past times your full portfolio value. How much of your portfolio are yous putting at opportunity each twenty-four hours on average? 1%? 3%? fifty solid set down points? How has this changed over time? How does this alter when you're making money? Losing money?
* Take a await at the 10% of your largest trades (i.e., when you've taken the largest positions). Have those tended to survive winning trades or losers? Do yous lead maintain a greater border when you're to a greater extent than aggressive or less?
* Take a await at your trading results every bit a constituent of twenty-four hours of calendar week in addition to every bit a constituent of fourth dimension of day. Do yous merchandise improve at for sure times than others? Take a await at how yous initiatory off a day, week, or month: does this impact how yous merchandise subsequently, in addition to does that impact your overall profitability?
* Take a await at how long yous concord winning trades vs. losing trades. Do yous become out of winners quicker than losers? Do yous lead maintain a small-scale pose out of large losing trades that yous concord good beyond your average asset fourth dimension per position?
* Take a await at your trading results after a downwards twenty-four hours or a downwards week. Does beingness downwards impact your trading? Do yous merchandise improve or worse when you've lost coin the twenty-four hours or calendar week before? How nearly trading results after an upwardly twenty-four hours or week? Do yous merchandise improve or worse when you've been making money?
As I emphasized In my recent post, I mentioned ii real overnice resources for tracking your performance. Another tool yous mightiness desire to reckon to rail your functioning is the Trade Performance programme developed past times Steve Geringer. In add-on to helping traders rail their functioning every bit a constituent of appointment ranges, safety types, symbols, etc., Trade Performance doubles every bit a tool for journaling, merchandise planning, opportunity management, in addition to describe of piece of job organization planning.
Steve is making Trader Psychometrics
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Wednesday, August 9, 2006
Info!! Options As Well As Stock Marketplace Thought For A Friday
Bill Luby outlines VIX essentials, including a rundown of dissimilar pick volatility measures.
* Summer Doldrums Coming Early? - Daily Option Report takes a look at the implications of a declining VIX.
* Looking at Options Measures inwards Tandem - An before post on how VIX in addition to Put/Call Ratio are related; authorities annotation that both are inwards turn down of late.
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* Summer Doldrums Coming Early? - Daily Option Report takes a look at the implications of a declining VIX.
* Looking at Options Measures inwards Tandem - An before post on how VIX in addition to Put/Call Ratio are related; authorities annotation that both are inwards turn down of late.
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Tuesday, August 8, 2006
Info!! 4 Observations Most The Electrical Current Stock Market
particularly inward the S&P 500 stock universe. As long equally flows into stocks are improving, I abide by it hard to sustain a bearish opinion on the market.
2) Buying Pressure Is Modest - This is clear from the depression degree of recent positive readings inward coin flows (top chart), but likewise from overall advance-decline figures; cumulative NYSE TICK; as well as 52-week novel high/low readings. This is because much of the recent marketplace rising has featured sector rotations--flows of funds out of surely sectors as well as into others. While it seems clear that selling has abated, I abide by it hard to anticipate a fresh bull marketplace equally long equally much of the upside activeness is robbing ane sector to pay another.
3) The Market Is Getting Stronger In Recent Days - Yes, the buying pressure level is modest, but if yous await at the pct of S&P 500 stocks trading higher upward their 200-day moving average, it has been steadily rising. An additional await at the first-class nautical chart from Decision Point shows that nosotros are coming off highly oversold levels inward the pct of issues trading higher upward their 200-day average as well as are non nonetheless close overbought levels. I noticed that nosotros expanded to over 1900 novel 20-day highs amidst NYSE, NASDAQ, as well as ASE issues on Friday. That's non how weak markets behave.
4) The Market Is Showing Underlying Long-Term Strength - We've had credit crises, a plunging dollar, a housing meltdown, concerns over investment banking concern failures, as well as an economical slowdown, but await closely at the long-term nautical chart of the S&P 500 Index (bottom chart). The recent marketplace reject has been little potatoes compared to the 2000-2003 rout. Could the economical province of affairs buy the farm worse? Could the marketplace plow tail as well as motion lower? Of course. But, for now, inward the seem upward of major bearishness as well as quite a wall of worries, the marketplace has held its ain quite well. We are exclusively almost 10% from all fourth dimension bull highs.
Bottom line: I intend we'll quest to encounter increased buying pressure level to achieve as well as sustain novel bull highs inward the wide marketplace indexes, but I likewise intend we'll quest to encounter a resumption of increased selling pressure level to accept the marketplace to fresh bear territory. With considerable sector rotation, it's a selective rally, alongside funds coming into beaten downwardly consumer discretionary, technology, as well as fiscal shares. Investors may non receive got concluded that happy days are hither again, but increasingly they're acting equally if the fiscal the world equally nosotros know it merely may non come upward to an end.
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2) Buying Pressure Is Modest - This is clear from the depression degree of recent positive readings inward coin flows (top chart), but likewise from overall advance-decline figures; cumulative NYSE TICK; as well as 52-week novel high/low readings. This is because much of the recent marketplace rising has featured sector rotations--flows of funds out of surely sectors as well as into others. While it seems clear that selling has abated, I abide by it hard to anticipate a fresh bull marketplace equally long equally much of the upside activeness is robbing ane sector to pay another.
3) The Market Is Getting Stronger In Recent Days - Yes, the buying pressure level is modest, but if yous await at the pct of S&P 500 stocks trading higher upward their 200-day moving average, it has been steadily rising. An additional await at the first-class nautical chart from Decision Point shows that nosotros are coming off highly oversold levels inward the pct of issues trading higher upward their 200-day average as well as are non nonetheless close overbought levels. I noticed that nosotros expanded to over 1900 novel 20-day highs amidst NYSE, NASDAQ, as well as ASE issues on Friday. That's non how weak markets behave.
4) The Market Is Showing Underlying Long-Term Strength - We've had credit crises, a plunging dollar, a housing meltdown, concerns over investment banking concern failures, as well as an economical slowdown, but await closely at the long-term nautical chart of the S&P 500 Index (bottom chart). The recent marketplace reject has been little potatoes compared to the 2000-2003 rout. Could the economical province of affairs buy the farm worse? Could the marketplace plow tail as well as motion lower? Of course. But, for now, inward the seem upward of major bearishness as well as quite a wall of worries, the marketplace has held its ain quite well. We are exclusively almost 10% from all fourth dimension bull highs.
Bottom line: I intend we'll quest to encounter increased buying pressure level to achieve as well as sustain novel bull highs inward the wide marketplace indexes, but I likewise intend we'll quest to encounter a resumption of increased selling pressure level to accept the marketplace to fresh bear territory. With considerable sector rotation, it's a selective rally, alongside funds coming into beaten downwardly consumer discretionary, technology, as well as fiscal shares. Investors may non receive got concluded that happy days are hither again, but increasingly they're acting equally if the fiscal the world equally nosotros know it merely may non come upward to an end.
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Monday, August 7, 2006
Info!! Trading Similar A Sniper: Blending Aggression In Addition To Self-Control
In my recent post, I outlined how a trader's really achievement motivation tin atomic number 82 to "pressing": trying hence hard to brand trades spill out that trading plans together with rules are abandoned. This ofttimes happens when traders drib dead frustrated amongst losses or irksome markets together with endeavor to brand upward for the lack of results yesteryear sizing positions besides aggressively or yesteryear taking besides many positions. Traders press when they experience pressure, whether for profits, for action, or to make competitive payoff over other traders.
The consequence is a loss of self-control, equally aggressiveness takes over together with judgment takes a dorsum seat. Successful trading may live discretionary or system-based, but it should ever live rule-governed: controlled yesteryear basic considerations of chance administration together with opportunity. Indeed, this mightiness live an apt Definition of misfortunate trading: when the ask to merchandise overwhelms the ask to save together with add together to capital.
One of my favorite posters inwards my purpose is of a armed forces sniper inwards the field, peering out from soil cover. The caption beneath the motion-picture demo reads, "The sniper's greatest weapon is a sharply honed intellect. He combines a mastery of stealth, situational awareness, ballistics together with precision shooting skills into i of the close lethal weapon systems to ever blast fearfulness into the enemy."
If the sniper became besides aggressive together with excessively bored amongst sitting inwards the plain waiting for the correct shot, he mightiness trammel from his comprehend together with start out spraying the enemy amongst fire. Most of the shots would in all probability drib dead wild, together with the out-of-control sniper would chop-chop live located together with mowed down.
No, the sniper waits for the ideal shot: "stealth" together with "situational awareness" are essential tools of the trade. Being a sniper agency combining aggression amongst exquisite self-control together with judgment. It is controlled aggression.
Over the years, I've learned to merchandise similar a sniper yesteryear non placing i merchandise afterwards only about other inwards rapid succession. When a merchandise is concluded, I drib dead apartment together with human face for a fresh setup. During the waiting time, I refresh my "situational awareness" (assessment of marketplace conditions, my ain condition), together with render to my basic trading rules.
The thought is to merchandise exclusively when I get got an unobstructed thought of the target. Everything else is waiting together with preparing, staying depression inwards a defensive posture. It's the fourth dimension betwixt those shots at the target that furnish the self-control. It is hard to press if you lot get got the fourth dimension to reassess, reload, together with render to comprehend afterwards an errant shot. With repetition, that reassessment together with reloading drib dead automatic: your default trend becomes i of self-control.
Plan. Trade. Reassess plan. Trade: It's a musical rhythm that combines the best of achievement motivation together with aggression amongst the best of judgment together with forethought. It's a beautiful feeling to excogitation i skilful trade, execute it to perfection, together with hence sit down dorsum together with human face for the side yesteryear side opportunity. Any functioning skill, honed together with executed amongst precision, is a variety of run of art. I recall the best snipers empathize that.
RELATED POSTS:
Bridging Hot together with Cold Emotional U.S.A. inwards Trading
Three Steps for Breaking Out of Frustration
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The consequence is a loss of self-control, equally aggressiveness takes over together with judgment takes a dorsum seat. Successful trading may live discretionary or system-based, but it should ever live rule-governed: controlled yesteryear basic considerations of chance administration together with opportunity. Indeed, this mightiness live an apt Definition of misfortunate trading: when the ask to merchandise overwhelms the ask to save together with add together to capital.
One of my favorite posters inwards my purpose is of a armed forces sniper inwards the field, peering out from soil cover. The caption beneath the motion-picture demo reads, "The sniper's greatest weapon is a sharply honed intellect. He combines a mastery of stealth, situational awareness, ballistics together with precision shooting skills into i of the close lethal weapon systems to ever blast fearfulness into the enemy."
If the sniper became besides aggressive together with excessively bored amongst sitting inwards the plain waiting for the correct shot, he mightiness trammel from his comprehend together with start out spraying the enemy amongst fire. Most of the shots would in all probability drib dead wild, together with the out-of-control sniper would chop-chop live located together with mowed down.
No, the sniper waits for the ideal shot: "stealth" together with "situational awareness" are essential tools of the trade. Being a sniper agency combining aggression amongst exquisite self-control together with judgment. It is controlled aggression.
Over the years, I've learned to merchandise similar a sniper yesteryear non placing i merchandise afterwards only about other inwards rapid succession. When a merchandise is concluded, I drib dead apartment together with human face for a fresh setup. During the waiting time, I refresh my "situational awareness" (assessment of marketplace conditions, my ain condition), together with render to my basic trading rules.
The thought is to merchandise exclusively when I get got an unobstructed thought of the target. Everything else is waiting together with preparing, staying depression inwards a defensive posture. It's the fourth dimension betwixt those shots at the target that furnish the self-control. It is hard to press if you lot get got the fourth dimension to reassess, reload, together with render to comprehend afterwards an errant shot. With repetition, that reassessment together with reloading drib dead automatic: your default trend becomes i of self-control.
Plan. Trade. Reassess plan. Trade: It's a musical rhythm that combines the best of achievement motivation together with aggression amongst the best of judgment together with forethought. It's a beautiful feeling to excogitation i skilful trade, execute it to perfection, together with hence sit down dorsum together with human face for the side yesteryear side opportunity. Any functioning skill, honed together with executed amongst precision, is a variety of run of art. I recall the best snipers empathize that.
RELATED POSTS:
Bridging Hot together with Cold Emotional U.S.A. inwards Trading
Three Steps for Breaking Out of Frustration
.
Sunday, August 6, 2006
Info!! Underneath The Stock Market's Sector Rotation
an before hold off at coin flows into S&P 500 stocks. I've taken the x nearly highly weighted issues inside 8 sectors (technology, energy, consumer discretionary, financial, consumer staples, materials, industrials, together with wellness care) together with summed a five-day moving average of dollar book flows into those lxxx stocks.
What nosotros run across is that, similar my recent assessment of coin flows into the Dow Industrials, selling pressure level has been abating since Jan together with we've been seeing little inflows of dollars to the marketplace since early on April. These inflows induce got been detail little over the yesteryear week, fifty-fifty every bit we've made fresh cost highs.
I induce got speculated that the argue we're seeing entirely little inflows of dollars to the marketplace is that much of the ascent has featured sector rotation: allotment of funds from for certain sectors (that had been marketplace winners during the decline) to others (that had been beaten downwardly during the decline).
To examine that rotation idea, I took a hold off at dollars flowing into together with out of sectors over the final x trading sessions (bottom chart). Dollar book catamenia is expressed inward millions of dollars for each of the 8 sectors mentioned above. What nosotros run across nearly notably is cyberspace outflows from materials, energy, together with consumer staples issues together with cyberspace inflows to applied scientific discipline together with fiscal sectors. Indeed, essentially all of the market's cyberspace inflows tin endure accounted for yesteryear the rotation out of the commodity-related themes (materials, energy) together with into technology.
On the surface, it looks every bit though in that location is piddling coin flowing into or out of the S&P 500 universe. Underneath the surface, however, we're seeing potentially of import signs of property reallocation with investors.
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What nosotros run across is that, similar my recent assessment of coin flows into the Dow Industrials, selling pressure level has been abating since Jan together with we've been seeing little inflows of dollars to the marketplace since early on April. These inflows induce got been detail little over the yesteryear week, fifty-fifty every bit we've made fresh cost highs.
I induce got speculated that the argue we're seeing entirely little inflows of dollars to the marketplace is that much of the ascent has featured sector rotation: allotment of funds from for certain sectors (that had been marketplace winners during the decline) to others (that had been beaten downwardly during the decline).
To examine that rotation idea, I took a hold off at dollars flowing into together with out of sectors over the final x trading sessions (bottom chart). Dollar book catamenia is expressed inward millions of dollars for each of the 8 sectors mentioned above. What nosotros run across nearly notably is cyberspace outflows from materials, energy, together with consumer staples issues together with cyberspace inflows to applied scientific discipline together with fiscal sectors. Indeed, essentially all of the market's cyberspace inflows tin endure accounted for yesteryear the rotation out of the commodity-related themes (materials, energy) together with into technology.
On the surface, it looks every bit though in that location is piddling coin flowing into or out of the S&P 500 universe. Underneath the surface, however, we're seeing potentially of import signs of property reallocation with investors.
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Saturday, August 5, 2006
Info!! Finding Success Inwards Trading
I simply received an electronic mail from a developing trader who similar a shot has been learning trading at an splendid proprietary trading theater inwards Chicago for the final half dozen months or so. He reported to me 2 positive events:
* He has made coin nine of the final 11 trading sessions;
* He lost coin early Friday, saw that the marketplace wasn't moving his way, reversed his positions, together with made coin on the day.
Now permit me rank yous 2 other things close this trader:
* He keeps a magazine daily amongst specific trading goals together with emails his entries to me every twenty-four hours without fail;
* He industrial plant at a theater that genuinely teaches traders how to merchandise together with industrial plant hands on amongst traders to promote their development. (Please, I am required past times confidentiality to non divulge the cite of the trader or the firm).
What that tells me is that, when you're inwards the correct trading surroundings together with when yous bring the correct run ethic, yous volition sense a steady, rising learning curve. How Can I Learn Trading?
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* He has made coin nine of the final 11 trading sessions;
* He lost coin early Friday, saw that the marketplace wasn't moving his way, reversed his positions, together with made coin on the day.
Now permit me rank yous 2 other things close this trader:
* He keeps a magazine daily amongst specific trading goals together with emails his entries to me every twenty-four hours without fail;
* He industrial plant at a theater that genuinely teaches traders how to merchandise together with industrial plant hands on amongst traders to promote their development. (Please, I am required past times confidentiality to non divulge the cite of the trader or the firm).
What that tells me is that, when you're inwards the correct trading surroundings together with when yous bring the correct run ethic, yous volition sense a steady, rising learning curve. How Can I Learn Trading?
.
Info!! Indicator Review For May 5Th
Last week's indicator review institute forcefulness inwards the stock market, but also selectivity inside that strength. That take in was virtually of late supported inwards my aspect at sector rotation inside the marketplace position rise. While we've continued to encounter rising prices--and firming of many of the indicators--the gains inwards approximately sectors (technology, financial) conduct keep been at the expense of others (materials, energy).
We tin dismiss encounter from the superlative nautical chart that the number of stocks registering fresh 20-day highs minus lows has remained theater every bit the marketplace position has moved higher. The selectivity, however, is evident inwards the novel 52-week high/low numbers. Among NYSE mutual stocks only, Friday's deed to novel cost highs saw alone 59 issues making fresh annual highs as well as xi making novel lows. We had over 100 novel highs iii weeks ago. Many of the issues that were making fresh highs at that fourth dimension (commodity-related stocks) conduct keep since retreated.
We've also seen firming inwards the Cumulative NYSE TICK (bottom chart), but that, too, has lagged every bit buying take in has been selective. Demand/Supply numbers, spell positive on Friday, were relatively little every bit well, suggesting that upside momentum is waning. It would non surprise me to encounter a little correction this calendar week prior to whatsoever of import resumption of a bull move.
That having been said, it's of import to stress that, on the heels of the drying upwardly of selling noted inwards prior indicator reviews, nosotros are seeing positive coin flows into stocks as well as an growth of forcefulness inwards the marketplace position this by week. 52% of S&P 500 issues are directly trading higher upwardly their 200-day moving averages, as well as 77% are higher upwardly their 50-day benchmarks. Those are both the strongest readings of 2008. The per centum of issues higher upwardly their moving averages typically tops out ahead of cost inwards whatsoever intermediate-term bull move, which suggests that nosotros are probable to encounter farther gains subsequently whatsoever pause/correction inwards the recent rally.
As I of late explained, I produce non encounter this every bit a vigorous bull deed and, for that reason, am non expecting a fresh bull marketplace position to accept us to all fourth dimension highs. Still, an of import bottom was set into house during the January-March period, as well as I postulate to encounter distinct weakening of the indicators earlier assuming that the recent marketplace position forcefulness volition contrary inwards whatsoever meaningful way.
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We tin dismiss encounter from the superlative nautical chart that the number of stocks registering fresh 20-day highs minus lows has remained theater every bit the marketplace position has moved higher. The selectivity, however, is evident inwards the novel 52-week high/low numbers. Among NYSE mutual stocks only, Friday's deed to novel cost highs saw alone 59 issues making fresh annual highs as well as xi making novel lows. We had over 100 novel highs iii weeks ago. Many of the issues that were making fresh highs at that fourth dimension (commodity-related stocks) conduct keep since retreated.
We've also seen firming inwards the Cumulative NYSE TICK (bottom chart), but that, too, has lagged every bit buying take in has been selective. Demand/Supply numbers, spell positive on Friday, were relatively little every bit well, suggesting that upside momentum is waning. It would non surprise me to encounter a little correction this calendar week prior to whatsoever of import resumption of a bull move.
That having been said, it's of import to stress that, on the heels of the drying upwardly of selling noted inwards prior indicator reviews, nosotros are seeing positive coin flows into stocks as well as an growth of forcefulness inwards the marketplace position this by week. 52% of S&P 500 issues are directly trading higher upwardly their 200-day moving averages, as well as 77% are higher upwardly their 50-day benchmarks. Those are both the strongest readings of 2008. The per centum of issues higher upwardly their moving averages typically tops out ahead of cost inwards whatsoever intermediate-term bull move, which suggests that nosotros are probable to encounter farther gains subsequently whatsoever pause/correction inwards the recent rally.
As I of late explained, I produce non encounter this every bit a vigorous bull deed and, for that reason, am non expecting a fresh bull marketplace position to accept us to all fourth dimension highs. Still, an of import bottom was set into house during the January-March period, as well as I postulate to encounter distinct weakening of the indicators earlier assuming that the recent marketplace position forcefulness volition contrary inwards whatsoever meaningful way.
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Friday, August 4, 2006
Info!! Ideas, Inspirations, Together With Resources For A Monday
* Implications of Sector Rotation - H5N1 reader emailed me amongst the thought that the marketplace was weak because the recent rising was accompanied past times greater than normal sector rotation. That's intuitively appealing, but may non jibe historical precedent. I went dorsum to 1990 too examined all v 24-hour interval periods inwards which the S&P 500 Index (SPY) was upward to a greater extent than than 1% but non to a greater extent than than 2% (N = 792). This matches the five-day menses that ended on Friday. I too hence divide the sample inwards one-half based upon the five-day proportion of advancing stocks to declining stocks on the NYSE. The rationale was that a high grade of sector rotation should propose greater residue amid rising too declining stocks. If the rising is occurring across all sectors (i.e., without rotation), advancing stocks should dominate decliners. When we've risen inwards SPY too advancing stocks accept strongly led declining issues, the adjacent v days inwards SPY accept averaged a loss of -.11% (192 up, 204 down). When we've had a like rising inwards SPY too advancing stocks accept been to a greater extent than inwards residue amongst declining issues, the adjacent v days inwards SPY accept averaged a arrive at of .13% (205 up, 191 down). This, of course, is non an exhaustive written report of the topic, but it suggests that rotation may non hold upward bearish for a rising marketplace inwards the curt run.
* Primary Bull Market? - David Korn, will hold upward tracking coin flows carefully to hold off for back upward or disconfirmation of the idea.
* Trading Insights - Gap trading, the psychology of consecutive losses, too to a greater extent than an fantabulous observation on the value of stock screening.
* H5N1 Look at Management Integrity - H5N1 my recent post concerning theme-based trading. I run across that over 400 traders are straight off Eddy Elfenbein posts a span of fantabulous charts that demo how nosotros rest below the 2000 rank inwards the S&P 500 Index, when adjusted for inflation. While on the Eddy topic, here's his interview conducted past times Tim Sykes.
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* Primary Bull Market? - David Korn, will hold upward tracking coin flows carefully to hold off for back upward or disconfirmation of the idea.
* Trading Insights - Gap trading, the psychology of consecutive losses, too to a greater extent than an fantabulous observation on the value of stock screening.
* H5N1 Look at Management Integrity - H5N1 my recent post concerning theme-based trading. I run across that over 400 traders are straight off Eddy Elfenbein posts a span of fantabulous charts that demo how nosotros rest below the 2000 rank inwards the S&P 500 Index, when adjusted for inflation. While on the Eddy topic, here's his interview conducted past times Tim Sykes.
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Thursday, August 3, 2006
Info!! Perspectives On Achieving Greatness Every 2Nd A Trader
I desire to give thank yous this fantabulous New York Times article on the utilization of habits inwards learning in addition to creativity.
The article highlighted a few ideas that I intend are rattling relevant to the evolution of trading expertise:
1) Much of surgery learning is the tillage of positive habit patterns - If yous bring to brand efforts to follow trading rules, that is endeavour non devoted to tracking markets. The key to success is turning rules into habits, then that they tin hold upwardly followed without effort, preserving mental working capital missive of the alphabet for analysis in addition to decision-making.
2) The evolution of novel habits opens the door to fresh ways of thinking in addition to behaving - I've long noticed that successful traders periodically remake themselves in addition to their trading, adapting to changing marketplace conditions. They cultivate novel habits, which aids them inwards developing novel skills in addition to ways of making money.
3) We volition acquire in addition to perform best yesteryear making maximum utilization of our learning strengths - This is an extension of the notion of operating inside a trading niche. If we're engaged inwards a concerted programme of learning in addition to development, it makes feel to ground our efforts inwards learning competencies.
4) Performance improvement oft occurs inwards small, continuous steps forward - This is an reckon key to character in addition to surgery improvement amid manufacturing firms. The successful trader may prepare a unmarried destination each trading session in addition to rails progress faithfully. Over the course of educational activity of a year, that is hundreds of opportunities missed yesteryear the trader who lacks such goals. Take a hold back at Trading Psychology Observations
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The article highlighted a few ideas that I intend are rattling relevant to the evolution of trading expertise:
1) Much of surgery learning is the tillage of positive habit patterns - If yous bring to brand efforts to follow trading rules, that is endeavour non devoted to tracking markets. The key to success is turning rules into habits, then that they tin hold upwardly followed without effort, preserving mental working capital missive of the alphabet for analysis in addition to decision-making.
2) The evolution of novel habits opens the door to fresh ways of thinking in addition to behaving - I've long noticed that successful traders periodically remake themselves in addition to their trading, adapting to changing marketplace conditions. They cultivate novel habits, which aids them inwards developing novel skills in addition to ways of making money.
3) We volition acquire in addition to perform best yesteryear making maximum utilization of our learning strengths - This is an extension of the notion of operating inside a trading niche. If we're engaged inwards a concerted programme of learning in addition to development, it makes feel to ground our efforts inwards learning competencies.
4) Performance improvement oft occurs inwards small, continuous steps forward - This is an reckon key to character in addition to surgery improvement amid manufacturing firms. The successful trader may prepare a unmarried destination each trading session in addition to rails progress faithfully. Over the course of educational activity of a year, that is hundreds of opportunities missed yesteryear the trader who lacks such goals. Take a hold back at Trading Psychology Observations
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Wednesday, August 2, 2006
Info!! Fannie Mae...Or May Not
So let's state that I accept a large reach inwards the marketplace as well as air current upwards alongside a harrowing loss that forces me to cutting dorsum my lifestyle. What would yous retrieve of my determination to borrow additional funds to add together to that losing position?
Few rookie traders would engage inwards such dismal endangerment management. That, however, describes the province of affairs of Fannie Mae (FNM), which as lately reported past times the New York Times inwards an fantabulous article.
I'll last tracking toll functioning for FNM as well as coin flows into the stock equally a agency of staying on summit of this theme. I'm non a demeanour past times temperament, simply it makes me nervous to run into our authorities engaging inwards actions that are feature of losing traders.
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Few rookie traders would engage inwards such dismal endangerment management. That, however, describes the province of affairs of Fannie Mae (FNM), which as lately reported past times the New York Times inwards an fantabulous article.
I'll last tracking toll functioning for FNM as well as coin flows into the stock equally a agency of staying on summit of this theme. I'm non a demeanour past times temperament, simply it makes me nervous to run into our authorities engaging inwards actions that are feature of losing traders.
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Tuesday, August 1, 2006
Info!! 10 Gist Ideas Of Trading Psychology
1) We are most probable to comport inwards inhibited or impulsive ways, violating trading rules together with plans, when nosotros perceive events to live on threatening;
2) What nosotros perceive to live on threatening is a articulation component subdivision of events themselves together with how nosotros intend nearly those events;
3) Influenza A virus subtype H5N1 telephone commutation to gaining command over trading together with maintaining consistency is to live on able to cut the threat associated alongside marketplace seat events together with procedure adverse outcomes inwards normal, routine ways;
4) We tin rank the sack cut the threat associated alongside adverse marketplace seat events through proper coin management (position sizing) together with through proper direct a opportunity management (limits on losses per position);
5) We tin rank the sack cut the threat associated alongside adverse marketplace seat events past times preparation ourselves to response calmly to adverse outcomes (exposure methods) together with past times restructuring how nosotros intend nearly those outcomes (cognitive methods);
6) Optimal science evolution inwards trading volition tumble out inwards non-threatening environments inwards which learners tin rank the sack sustain concentration, optimism, together with motivation;
7) Influenza A virus subtype H5N1 proper mindset is hence necessary to the evolution of trading skills, exactly does non substitute for such development;
8) The tillage of trading expertise is a component subdivision of the sum of fourth dimension together with testify devoted to learning together with the proper structuring of that fourth dimension together with effort;
9) Proper structuring of learning involves the setting of specific, doable, cumulative goals together with the provision of rapid feedback together with correction regarding the achievement of those goals;
10) Practice does non brand perfect inwards trading or anything else; perfect utilization makes perfect. Training must gradually ready competencies together with right deficiencies inwards a agency that sustains a positive mindset together with optimal concentration together with motivation.
RELATED POSTS:
Series of Posts on Becoming Your Own Trading Coach
Programming Our Own Experience
.
2) What nosotros perceive to live on threatening is a articulation component subdivision of events themselves together with how nosotros intend nearly those events;
3) Influenza A virus subtype H5N1 telephone commutation to gaining command over trading together with maintaining consistency is to live on able to cut the threat associated alongside marketplace seat events together with procedure adverse outcomes inwards normal, routine ways;
4) We tin rank the sack cut the threat associated alongside adverse marketplace seat events through proper coin management (position sizing) together with through proper direct a opportunity management (limits on losses per position);
5) We tin rank the sack cut the threat associated alongside adverse marketplace seat events past times preparation ourselves to response calmly to adverse outcomes (exposure methods) together with past times restructuring how nosotros intend nearly those outcomes (cognitive methods);
6) Optimal science evolution inwards trading volition tumble out inwards non-threatening environments inwards which learners tin rank the sack sustain concentration, optimism, together with motivation;
7) Influenza A virus subtype H5N1 proper mindset is hence necessary to the evolution of trading skills, exactly does non substitute for such development;
8) The tillage of trading expertise is a component subdivision of the sum of fourth dimension together with testify devoted to learning together with the proper structuring of that fourth dimension together with effort;
9) Proper structuring of learning involves the setting of specific, doable, cumulative goals together with the provision of rapid feedback together with correction regarding the achievement of those goals;
10) Practice does non brand perfect inwards trading or anything else; perfect utilization makes perfect. Training must gradually ready competencies together with right deficiencies inwards a agency that sustains a positive mindset together with optimal concentration together with motivation.
RELATED POSTS:
Series of Posts on Becoming Your Own Trading Coach
Programming Our Own Experience
.
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