Saturday, February 17, 2018

Must Reading Books To Improve Your Trading

Becoming a winning trader is certainty one of the most difficult careers (90% retail investors fail). I certainly struggled at the start. It can take an average of one year to become a winning trader (but most never become one). At the start of my trading career, I didn't know where to begin and I was often clueless. I had to constantly research on my own, and my trading suffered as a result. Below, I have a few books ranked in order of importance that helped me greatly into becoming a purely technical, winning trader. The books listed below, I think will offer a boost for the losing traders and those looking for a boost!

The following 4 books are ranked in order of importance (one being the most important).

Japanese Candlestick Charting Techniques, Second Edition - Possibly the easiest and most important book on this list. This book describes candlestick patterns in detail. It has a very easy learning curve, and can do wonders to your trading. This is number one for several reasons, one reason is the simplicity of the book. Once you understand these patterns, they can do wonders to your trading. What you will ultimately learn: Understanding candlestick patterns, helps prevent you from making the easy/stupid mistakes of going long at bearish trend reversals, or going short on bullish trend reversals (as Candlesticks are the most reliable in identifying these trend changes).

Saturday, February 3, 2018

When Will The Bleeding in the Stock Market Stop?

The Market has had a parabolic bullish move in 2018. Parabolic movements in the Stock Market, is something traders need to be very wary of (see Bitcoin's latest parabolic movement ended in over a 60% correction from its all-time highs so far). As a result, I am very cautious about the Stock Market's ability to keep continuing higher in 2018.

However, in the short term, I think the Market is near a bottom. Referencing the McClellan Oscillator above, on Friday the indicator closed near the rare reading of -300 (as of Friday -273). Which means a higher than usual amount of stocks participated in this sell-off, when it hits reading this low (which is rare), the market often hits significant bottoms. Take a look at the chart for previous examples marked in August 2017. Despite my bearish outlook in the Market, expect a nice bounce due to selling exhaustion as indicated by the McClellan Oscillator rating of -273.

Sunday, January 21, 2018

Trade Opportunity in the Utilities Sector?

XLU Utilities ETF Stock Chart Technical Analysis

Reviewing my recent $IBM call that I posted in October, the stock recently hit my target of $168 before pulling back due to earnings. The good news is I have found another good risk to reward ratio trade, that I will be sharing in the next paragraph!

The utility sector has pulled back 10% from its recent highs, based on my proprietary analysis, it is worth purchasing stock (not options!) in $XLU ETF, at this price. If the trade goes wrong or takes longer than expected a quarterly dividend will help a bit.