Stock Market Trend
Stock Market Trend Analysis Made Easy.
There’s an old saying in the stock market that the “trend is your friend”.
This means simply that, as long as you’re in sync with the stock market trend overall, and especially with individual stock trends, you should be making money in the market.
As I teach in my Trade Your Way To Wealth Quick-Start E-Class, a nicely trending stock will conform to
What is the “unbalanced force” that will cause a stock to change its trend? Well, it could come in the form of several different things – an unexpected good (or bad) earnings report, a new product announcement, another company buying it out, etc. Or it could simply be overextended or underextended above or below historical price action. But the truth of the matter is, you don’t have to know exactly what the underlying cause of the “unbalanced force” is. You have other tools at your disposal to clue you in when a stock is about to change its trend.
One of the simplest tools to use in stock trend analysis is just the use of trend lines. Simply drawing a line underneath the trending price action of a stock will tell you when the trend is violated. I do that often in our Stock Fishing Videos within our daily stock chart analysis lessons.
Candlestick analysis is a crucial tool in alerting you when the trend of a stock’s price action is about to drastically change. Any of the most common reversal signals will give you a heads-up in that area.
Finally, stochastics do a great job in giving you advance warning of a pending stock trend change. Knowing how to glance at stochastics will give you instant knowledge of the probability of a trend change.
We use just a handful of tools – including those above – to beat the market year after year. Once you learn our simple, visual system of stock chart analysis, you’ll be able to immediately tell when a stock trend change is about to happen.
And now for the second in our series of articles related to Mental Fitness For Traders…
“Mental Fitness for Traders” Series
Limiting Your Winners and Letting Your Losers Run?
by Norman Hallett, former CTA/Trader
It occupies a chapter in just about every trading book ever written.
It’s been preached by every lecturing market guru since the
Go ahead and hire a personal trading coach and likely the second thing he or she will utter will be these chosen words (right after “Trading is speculative and only risk capital should be used.”)…
And those words are…
“Limit your losses and let your winners run”.
OK. We’ve been told.
But you didn’t have to tell us. It makes perfect sense.
“On a roll”… “Go with the flow”… “Ride the wave”… “Get out while the getting’s good”… we’ve heard both sides of those golden words massaged in numerous different phrases. We get it.
During my trading and coaching days, I would re-visit students that I trained weeks or months previously and, low and behold, I would discover that many of them were actually doing the opposite...
Letting their losses run and limiting their gains!
After a while I wasn’t surprised… I would go into a refresher visit EXPECTING to see “limit/run rule” repeatedly ignored.
I would ask the students “Why?”... There were many different stories but one main theme…
All the traders, in some way, had gotten out of emotional control.
During their trainings, I had made sure that they did extensive back-testing on their systems and I did that because…
I knew that the more they tested and saw that their system would have been successful, the more they would TRUST in the system and have the strength the follow its signals, especially through rough periods.
Apparently simply back-testing and seeing “would-have-been” results wasn’t enough to keep these traders in emotional control.
What I had been missing was that these traders were taking the losing PERSONALLY!
These new traders had been seeing losing trades as reasons to let negative thoughts into their heads. A loss would mean that all the articles they read about “gambling” market traders may be true.
All the family accusations that they were crazy traders … well, that could have some merit!
This kind of negative thinking (as well as other forms of trading-related negative thinking) makes it so you don’t want to take a loss. If you take a loss, maybe your that much closer to that idiot trader that you’ve been accused of being.
So you enter a trade (after, say, coming off a losing trade) and it starts to go south.
As the market heads for your stop, you start looking around at the news, or a chart of a “sister” market or share that’s showing strength, searching for an excuse to make it OK to lift your stop.
Found it.
“Hello… Cancel Bean Ticket 4154.” … Stop Canceled.
If the market comes back, you’ll be the smart guy or gal that made the right move and turned a loser into a winner.
What you REALLY just did, however, was turn a potential winner into a potential loser.. YOU. You may have had a winning trade, but you will lose in the end.
It’s not about YOU. It’s about THE MARKET. If you don’t take your emotions out of it, you don’t have a shot.
You must see yourself as a trader not someone who is becoming a trader.
There’s very little room for mistakes in your trading.
Leverage makes sure of that.
If you are going to play in the Big Leagues, you have to do act and do what Big Leaguers do… right from the beginning.
Do all your practicing on the paper-trading playing field. Once you put your money up, you either do what your tested system tell you to do or pick a different profession.
If you’re not training mentally, you’re not giving yourself the best chance to laughing in the face of your relatives!
**Norman Hallett spent 21 years as a successful trader and CTA before starting Subconscious Training Corporation. His company developed TradingMind Software, the industry’s leading mental/emotional training tool for traders who understand the importance of being disciplined and focused in their trading.
And now, on to business…
This week in the market offers concrete proof that you must watch the action of the market each and every day. Because the way the market acts in any given day may provide all the evidence you need that it’s time to either get in or get out.
I think we saw clear evidence this week for the market bounce we’re in right now. The market index charts showing clear bottoming signals using our system of chart analysis. Individual charts of stock after stock showing candlestick reversal signals – in fact, the most I’ve seen in quite some time. This is how you put the probabilities in your favor of catching a big market bounce. But you have to remain alert at all times, especially when you are out of the market and in cash.
Here’s a stock looking especially interesting today in the market bounce…
Stock For Review
Our Stock For Review today is LQDT – Liquidity Services Inc.
LQDT is blasting out of a basing area, negating the sharp recent pullback, to say the least! Trading volume is 622% above normal.
This stock may provide lots of “liquidity” for you in the near future!
Most Recent Double-Digit Percentage Gainers In One Day…
Here are a few of the DDPG’s since our last update:
OLAB – 05/23/06: Up 14.05% in our RSVP area.
PAE – 05/24/06: Up 10.28% in our Volume Plays area.
Product Of The Day
If you’re not playing this market bounce, you’re missing out on a rare opportunity in the market to make inordinate amounts of money.
Take a look at some of the possible gains made this week, just on Tuesday alone:
Examples of market bottom bounces (5/23/06):
BLDP - Up 15.09%
PEIX - Up 16.89%
MGPI - Up 12.49%
CVM - Up 25.88%
GROW - Up 12.34%
FRGO - Up 52.25%
MAMA - Up 20.47%
AZK - Up 33.81%
PCOP - Up 26.26%
MTL - Up 18.88%
NGA - Up 11.29%
OTD - Up 11.94%
I’m teaching my Trade Your Way To Wealth Members how to find these explosive trade setups each and every day. I invite you into my
Here are some tools to help you in this area:
Trading Mind Software! Get “mentally fit” for trading in the fastest time possible.
Read more about this incredible TradingMind Software!
Market Bounce Investing Special!
Finally, I will do what I can personally to help you quickly “get up speed” with one of the most powerful – yet simple – investing and trading systems I’ve ever used.
Sign up for my Trade Your Way To Wealth Quick-Start E-Class right now, and I’ll knock off 500 bucks for the first ten students who enroll! Your success is guaranteed! If interested, click on the link below, and Tim will send you a special coupon code to sign you up immediately. Coupons are being snapped up as I am typing these words. Better hurry!
Oh, one more thing. Since the market bounce is already starting, and the stock trend is changing back to the bullish camp, I’ll personally work with you, one-on-one, to let you in on some of these explosive stock moves. I’ve never done this before except in my “I Want It All!” service.
Click here to get your special coupon code to knock off $500 from the regular price!
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posted by J. Daryl Thompson EMAIL TO A FRIEND
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