Info!! Letting Markets Tell Their Stories

With booming momentum stocks showing signs of bust, hither is some valuable perspective from David Shvartsman as well as the Finance Trends site.  David's makes an of import point:  Nothing goes upward forever.  Stocks alongside a bully story only shaky fundamentals are peculiarly vulnerable to circular tripping.

Few problems tin endure therefore painful as becoming anchored to a story well-nigh a society or industry--or a macro theme--and as well as therefore failing to psyche to the stories that markets are themselves telling.  I vividly remember the attempts to traders to purchase dips all the means downward inwards the post-2000 tech meltdown.  I as remember the hurting of those who kept selling rallies inwards the post service 2008-2009 bull market.

One argue I similar to follow the cumulative NYSE TICK on an intraday solid position down is that it tells me when buyers vs. sellers are taking the upper paw as well as when they are balanced.  On a hateful solar daytime similar yesterday, when my model forecast was pointing upward, tracking the reversal of the TICK proved invaluable.  All forecasts, stories, as well as themes are hypotheses:  they are maps, only they are non the territory.  It's the stories told past times moving markets that are ultimately important, as they render the tests of our hypotheses. 

Markets frequently nation their ain stories alongside relative forcefulness patterns.  Is the marketplace rewarding increment as well as speculation, or is it rewarding security as well as yield?  Look at the recent relative surgical operation of XHB as well as QQQ versus XLU as well as XLP.  Clearly, increment is non what is beingness rewarded.  Similarly, at a global level, y'all tin rails EEM vs. SPY or, inwards fixed income, junk bonds (JNK) vs. investment-grade debt (LQD) or emerging marketplace debt (EMB) vs. US debt (AGG).

How practise stocks merchandise relative to bonds?  How does EM FX merchandise relative to DM?  Are macro markets reflecting global growth: global slowdown; or idiosyncratic, relative movement?

Bottom line:  past times spending as good much fourth dimension focusing on the stories nosotros nation ourselves, nosotros tin neglect to discern the stories of markets.  Permabears as well as permabulls are those who convey therefore fallen inwards honey alongside their narratives that they convey instruct deaf alongside abide by to the market's stories.

Markets are e'er communicating; therefore much of trading success begins alongside listening.

Further Reading:  Listening, Trading, as well as Emotional Intelligence

No tree grows to the heaven as well as no stock goes upward forever, especially those story stocks for which existent profits increment as well as audio fundamentals are lacking. - See to a greater extent than at: https://risetrader.blogspot.com//search?q=round-trip-stocks-momentum-booms-and#sthash.EVU7PW7S.dpuf

No tree grows to the heaven as well as no stock goes upward forever, especially those story stocks for which existent profits increment as well as audio fundamentals are lacking. - See to a greater extent than at: https://risetrader.blogspot.com//search?q=round-trip-stocks-momentum-booms-and#sthash.EVU7PW7S.dpuf

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Info!! Intraday Thought As Well As A Piffling Update

* Intraday Sentiment - Here's a await at the equity put/call ratio on a 5 infinitesimal the world (bottom chart) as well as a comparable nautical chart for the ES futures (top chart). Put buying expanded early on inward the morning, but prices held inward a higher house their overnight lows, suggesting underlying strength. Note besides the dramatic expansion of lay buying relative to calls to a greater extent than or less 1 PM CT, subsequently the marketplace had been selling off. This was a overnice say for lucre taking on the brusk side, every bit cost stopped moving lower despite increasing bearishness. Looking at selection majority intraday provides a overnice window on rattling short-term speculative sentiment.

* New Outlet for - Selected posts from this weblog bring appeared on the Seeking Alpha site for a piece now. Starting today, selected posts volition besides look on the Morningstar site, every bit purpose of their community building. Here's the page featuring their other blogs. My feel is that Morningstar does a responsible, lineament project of providing information to private investors (as opposed to short-term traders); therefore my willingness to participate inward their community.

* Influenza A virus subtype H5N1 Little Somethin' Somethin' - The Twitter Trader characteristic is actually a weblog inside the blog, providing links to articles on market-moving themes, summarizing indicator data, as well as providing heads upwards on the day's major economical reports. I notice over 500 traders similar a shot subscribe; here's the page for complimentary subscription. In award of the 500 milestone, banker's complaint that I posted ane of the historical trading patterns inward a Twitter "tweet" yesterday. I'll survive doing a piddling to a greater extent than of that going forward, every bit non every designing that I uncovering merits its ain form out weblog post. The end 5 "tweets" look on the weblog site nether "Twitter Trader".

* New Book Chapter - The two-volume reference assault Psychiatry only came out, amongst a chapter on brief therapy written past times yours genuinely amongst 2 colleagues from my med schoolhouse inward Syracuse. This follows my brief therapy chapter inward the recent Textbook of Psychiatry published past times the American Psychiatric Association. Much of the applied psychology that appears inward my trading books as well as inward this weblog is derived from inquiry as well as exercise inward brief therapy.

* Forex Expo - One of my rare populace appearances volition occur inward September, at the Forex Trading Expo inward Las Vegas. I was impressed past times the organizer's insistence that the presentations survive non-commercial as well as informative. My presentation volition render a window on some of the novel cloth covered inward the majority I'm currently writing.

* Coaching Questions - I'm getting an increasing issue of emails from traders asking coaching questions (i.e., requests for advice re: trading problems). Alas, I can't answer to all those emails, but I volition survive selecting a few related topics to address inward weblog posts inward the side past times side yoke of days inward hopes of helping every bit many traders every bit possible.
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