Archive for July, 2009

$Closing Bell: A 1,000 S&P scares the bears (AMZN, XOM, EXPE, GE, HOG, SYMC)

$market is making a convincing pause

A fantastic run to the upside, good earnings (although that is debatable-lower estimates and cost cutting), good volume. If you are a pure chartist/tecnician the next best thing to see is a light volume pause, especially one that goes sideways instead of pulling back.

Well take a look at the hourly chart of the QQQQ for the last 15 days and it is a perfect setup for a continued move to the upside.

If you did not take advantage of the the 13 day explosion (1,000 points in the DJIA) you MUST BE PREPARED with a list of stocks if we break to the upside with volume.

Even if the price action does not happen you must be ready, the potential profits could make your August P&L much nicer, it will make taking off the last week before labor day when volume dries up much easier to relax 🙂

$adjusting trade expectations

Making money is not that hard to learn how to do. KEEPING that money is the skill.

Especially during summer time you need to adjust profit targets and stop losses. Every trade is not the same. Every trade can’t possible have a one size fits all stop loss.

One of the biggest skills to learn in my opinion is when to size up or size down on a trade by trade and day by day basis.

A part of that same area is understanding when to expect more or less out of a trade. That skill comes with proper instruction for what to look for and then actually DOING IT.

The bull market trading environment is here$

Massive morning sell offs preceded by stocks getting pounded after the close the day before. Selling created by earnings reports. The next morning we get follow throught to the downside and then rally for the next three hours after we test test lows once and never push through.

As of today the NASDAQ has finished positive 14 days in a row. We are WAAAAY over due for a pull back but what is interesting to note here is buyers are stepping in intra day and short sellers are nowhere to be found.

When your trade scenarios are “just a matter of where to get long” you should not be adding to short positions no matter how great the intra day momentum.

Over all market environment must factor into how agressive to be with leverage and profit expectations. This is a huge part of learning how to make money

Market Commentary $


Earnings, earnings, earnings! We are in the heart of earnings season and there have been few companies that have disappointed. The market has responded loudly by rallying steadily. the Nasdaq on an 11 day winning streak. The old saying comes into play! “The trend is your friend”! As traders we must recognize this and trade accordingly. As much as it may seem overbought the technicals will tell us the truth. We recognize the fact that we have moved quickly to the upside which means we will have strict risk mangement skills on our long trades and cut losses quicker. We will be nimble and recognize that if selling pressure takes hold. If so, we will test the short size with smaller size and less expectations.
Call us at 212-594-8900 if you would like to discuss any of our trading programs.
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Pay Attention$

Trading is not easy, however it can be difficult if you do not pay attention.  What is the market doing and how is the stock you are trading in relation to the market responding, are questions you need to ask yourself. The market has steadily been climbing over the last 8-10 days. Logic would say we are bound to pull back, however we can not trade with opinions. we must use our technical analysis skills and determine what is the highest probability situation. With most stocks trading above their 20 and 50 daily 20EMA, it is essential to recognize that shorting the market is not the highest probability trade. This morning their was some opportunities to make money from the short side, however an astute trader would have recognized that it was just a pullback in an uptrend as we then bounced off the hourly support on most of the charts and would have used this sell off as a buying opportunity. We can never say the market has gone to far! Even though it may seem that way, the market will forever do what it does and usually defys logic.  That being said, let’s remember to always recognize the order flow and pay attention to not fight it!

$trading journal must have

July 20, 2009 2 comments

Every new trader knows to keep a trading journal; it is kind of right up there with let your profits run and cut your losses. In my experience it is one of the most powerful yet under utilized asset to a trader. Experience is everything in trading and the more you have the better you will trade. You will start to develop a “feel” for the market.

The purpose of a journal is to learn from your own progress, your own trades. My journal would have no meaning to another trader because we may need to work on completely different aspects of of our trading.

To me personally I believe the absolute must have to shoot yourself through the learning curve is recognizing what type of day unfolded to trade. In other words was it a good day to trade or was it a tough one.

From this you must ask yourself:

Did I trade according to what was available?

Did I push my trading on a tough day? This is not good. What was I focusing on?

Did I trade actively with a higher expectation for follow through on a day the market offered more for me to take? If not what was I focusing on? If I did take advantage of a good day what how can I recognize it next time?

Most new trader want to know how to make more money. The correct question to develop a good trader who can think on their own is: How do I recognize the difference between a tough day and a good one.