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Market Stress Index: Introducing the MSI

There are many tools out there that attempt to quantify the emotional extremes of the market. When we created one, we had one goal: we wanted it to have an actual edge. This meant carefully researching the inputs that would go into the measure, and limiting it to...

Visualizing sector performance

As I continue to share some of the tools I use, I want to look at sectors and sector performance today. I don’t think there’s much value in looking at a price chart of say, XLE or XLF. The reality is all indexes are pretty strongly correlated and...

Nested bear flag: CHFJPY

One of the nice things about swing trading is you can have resting orders, so your alert that a pattern has triggered is an order being filled. Here’s a nice pattern to put in your trade plan: the nested flag. (I came up with that name years ago, and I still...

A daily market dashboard

I am a big fan of data visualizations that help me see what is going on in world markets. Over the years, I’ve created many versions of these, but the ones I have now are finely crafted tools that strike a great balance between depth and breadth. Early in my...

The volatility game

Take a look at the table of charts below. Each smaller chart shows the 10 largest stocks for that S&P 500 sector. They are graphed with historical (also called realized or statistical) volatility on the horizontal, and implied volatility on the vertical. The dot...

Short setup in crude oil

Here is a trade setup we published today as a MarketLife TradeLab, available to both MarketLife Premium and MarketLife Plus subscribers. We are also offering a lifetime 20% discount on MarketLife. Use the code SPRING19 and sign up today. After offering trading...

Markets stress… trader stress

Here’s a bit of a stream of consciousness post in response to today’s (5/13) market movements. First, these types of moves are often called ‘risk off’ moves because we see nearly one-sided trading in different assets—people rush to sell assets that are perceived as...

Ranges and measured moves

Here’s a quick look at two concepts that should be a part of your chartreading: ranges with pressure, and measured moves. There are two common approaches to chartreading, and I think both can be improved upon. One is to look at “big” patterns spanning many bars (think...