Reader Questions: Volume and Support&Resistance
Reader Andre asks two questions in response to my post on the failure test trade: It seems that you do not take in consideration any kind of volume information when…
Video Blog: the Failure Test
This video blog is a follow up from this post, and digs into some of the details behind the Failure Test trade in a little more depth.
Trading Pattern: the Failure Test
[dc]I[/dc] want to do a small series of posts looking at some of the most important trading patterns I've used over the years. Rather than go in-depth with multiple examples,…
Chart of the Day: The need for entry triggers
This is why we have entry triggers. I posted this chart pointing out a bear flag in EL on the day marked with an arrow, suggesting that a good entry…
Chart of the Day: Russell 2000 Index
I tend to believe it's usually counterproductive to do too much in-depth technical analysis on different market cap or sector indexes. Everything is so tightly correlated anyway, so differences often…
Tracking the Stock Market Intraday
[dc]O[/dc]ne of the main challenges for stock traders is understanding the ebb and flow of the broad market on the shortest timeframes. There is so much noise in price movement…
Chart of the Day: Bear Flag in EL
The daily chart of Estee Lauder Companies Inc (NYSE: EL) shows a clear bear flag, which sets up a potential trade on any breakdown. Note that this is only a…
Two Modes of Market Behavior (1/2)
[dc]W[/dc]hen trying to master any complex subject, it can be helpful to reduce things, as much as possible, to basic elements. Price movements in markets are very complex; so many…
Chart of the Day: A Difficult Environment
[dc]O[/dc]ne of the advantages of using properly calibrated bands is that they can show when markets reach emotional price extremes. It should be rather unusual for a market to go…
Why Is Trading So Hard?
[dc]I[/dc] receive a lot of notes and messages from people who are struggling to learn to trade. One of the common threads is that many of them are discretionary traders,…
Chart of the Day: XLY/XLP spread
Traditionally, the spread of Consumer Discretionary stocks over Consumer Staples stocks has been taken to be a gauge of market sentiment—a clear expression of a cyclical sector compared to a…
Chart of the Day: EURUSD set for breakdown?
Longer-term patterns in the EURUSD are strongly supportive of a bearish trade, perhaps targeting parity or lower. This is an aggressive entry, but it is often possible to enter after…
Daily Chart: Weekly Market Structure in S&P 500
Note the weekly bear flag on the S&P 500 index. You may call it by a number of different names (wedge, pullback, anti, flag, etc.), but the concept is the…
Reader Question: What Does “Good Risk Management” Mean?
[dc]T[/dc]his, my first reader question, comes from John in Seattle: I often see and hear people talking about good risk management being a good part of trading. What does this…
Chart of the Day: Breakout Setup in DFS
Watch DFS in a breakout above resistance (roughly 34.45 – 34.75.) Resistance levels are usually not clear lines, but rather rough "zones" where selling pressure has previously been able to…
Your questions–My (attempts at) answers
[dc]J[/dc]ust an open invitation here to my readers: If you have topics for discussion, ideas for posts or series of posts, questions on the book, questions on the market or…