How to Leverage Market Forces By Trading the News
So, what is a market force? Simply, it is a force that moves a market. Volume could be a force, or news could be a force. There are many forces that could move a market. This year we have had several different forces moving the market. tarting out, all thought the market and economy would continue to boom and the month of January was a bull. Then the fear of inflation took over and the market dropped, only to have relief of that fear, and then the fear of a trade war emerged and down it went again. But earnings are on the horizon and the expectation is that they will be good, and up the market went. Trade war, inflation, and earnings are all basically news. So let's talk about trading news.Read More
Geoffrey A. Smith
How to Capitalize on the Opening Bell
I work off of opens, not closes. At the close, you already know who won or lost. And how many of you have been able to start a race at the end? Not me. So I look at the open to see who is winning, because I want to be on the winning team. You will find that the market will hold the opens as support and resistance, and does not really care about closes. If the market is above open, bulls are in control. If the market is below the open, bears are in control.Read More
How to Be a Systematic Investor
Rules Based Investing is the process where ALL investment decisions are made via “pre-established rules” that clearly define the what, when, and why for buying and selling an investment.
It’s an approach to investing that relies on “observable” and “verifiable” evidence between the data used to make decisions and the desired outcome.Read More
A Time-Tested Technique For Minimizing Risk
There are 2 ratios that dominate professional traders’ thinking:
- The win/loss ratio of their trades.
- The risk/reward ratio of their trades.
Notice that I intentionally worded each bullet point above with the words “of their trades.” It may seem practical and objective to back test a trading system to determine these ratios, but what’s more realistic is to trade a method yourself over a significant, statistically significant number of trades, record your actual real-world results, and use these numbers as your own win/loss and risk/reward ratios.Read More
Road Map to Trading Success
“What goes up must come down spinning wheel got to go around.” - Blood, Sweat and Tears
What really makes stock prices go up or down? Is it really as simple as what goes up must come down and vice versa? How do I select stocks with the best profit potential? Stock prices are constantly fluctuating and many times there seems to be no ‘rhyme or reason’ to this constant price fluctuation. The air waves and the Internet are flooded with analysts and experts who try to predict the future price moves for stocks.
Often they have no real answers to our same questions and are just as baffled by why a stock is going up or going down. Where does that leave us? Let’s face it; to the average investor the stock market can seem complicated and confusing.Read More
Riding the Wheel
Many ‘old school’ brokerage firms put vast restriction on the use of options. One thing they might let traders do is sell ‘covered calls’ against a position. Covered calls are a great way to produce income against a portfolio of relatively low volatility stocks. They are not the only way though. One can sell ‘cash secured puts’ as a way of collecting income in stocks that one might want to own someday, or to simply produce income.Read More
How to Spot the 10 Warning Signs of an Impending Market Crash
Miles of flat dry terrain cover the landscape from east to west and north to south; the grassy plain extends for miles and it is all that the naked eye can see. With keen hearing and close attention to detail, one discerns the muted swishing of the wind as it meanders through the tall vegetation. The scene appears lifeless. Suddenly, a slight movement of the earth is felt; a tiny shake as though a distant rock has fallen or perhaps a tree (but there are no trees). A small cloud appears on the horizon.Read More
A Buffett Secret: Leverage Outside Funds
Everyone knows that “it takes money to make money.”
But not everyone has the money to leverage and, potentially even more significantly, if it is your money you stand to harm yourself and your family by risking it.Read More
4 Steps to Profit from Reversal Trades
Catching a falling knife, standing in front of a speeding train, buy low and sell high, these are just a few of the terms used (some flattering, others not) to describe the art of trading reversals. If successfully identified and executed, it can be one of the most lucrative trades that exist. But the key is how to identify, with consistency, those areas where price action is likely to change course.
I am going to share with you the process I go through to identify those trades that have the best chances for success.Read More