Stock Trading Education

Stock Trading Education – More Nuggets Of Wisdom From A Trading Legend

Continuing with the Tradersworld magazine interview with Dan Zanger, let’s see how he fielded some questions related to general stock trading education and how one develops the skills required to become a world-class trader.

When asked how long he is in a position, Dan replied:

“It depends on the market and the stock. If it’s breaking out of a high level pattern I would be in the stock for a shorter period of time. Usually 3 – 5 days up to 2 weeks. If the stock has had a long base, for example 6 – 8 to 10 weeks and the market is coming off a nice correction, I might be in the stock for 10 – 15 weeks. These are things that take experience and time before you get the hang of it.”

The next question related to stock trading education was about stops and how he uses them.

Dan gave a long answer to that question. Here is the gist of his reply:

Basically, if a stock does not act right – in other words, does not “get up and go” right after a breakout – he will sell the stock right then and there. He would not even wait for the stock to come back down to the breakout point. He says if you want to make money in stocks, you have to play stocks that are moving up. If a stock breaks up and then “goes to sleep” he is out of the stock. He wants to keep his money in fast-moving stocks that are always moving up.

So with that in mind, here’s how Dan uses stops.

He will sell immediately if the stock comes back below where he bought it. If the stock turns around and breaks out again, he would just re-buy the stock. He would wait until the stock “cleared the bar” that it failed on. For example, if a stock broke out at 60 and ran up the next day to 63, then the stock got hit with bad news and came back down to 58, he would sell the stock, and not buy the stock again until it cleared 63. So at $63.10, he would be a buyer once again.

The interviewer had two more questions related to stock trading education. Here they are:

“How do you think traders can improve their skill-set?”

Dan’s answer:  “Persistence, homework, more homework and more homework is the reason for success. I feel many traders don’t put the time in. They don’t have the desire to learn. They don’t have the laser-beam focus to really zoom in with what is working, why it works, what does not work, why it did not work, and to put the years in that it really takes to learn all the stuff. People think that trading is going to be easy. They come in and get crushed after a little while. Then they say they’ll never do it again. Guess what, you’ll never do it again, and you’ll never succeed.”

And the final question related to stock trading education:

“How long does it take to make a good trader?”

Dan’s answer: “It depends, but with most people that are really successful they have been at it for 4 – 6 years at a minimum.”

(Source: Tradersworld magazine – Early summer through late fall 2006 edition).

Now, with respect to stock trading education, I totally agree with what Dan is saying. It does take a huge amount of effort and focus to be a successful trader. But I don’t necessarily agree with the time it takes to become successful.

I think what Dan is saying is that it can take that amount of time for someone “starting from scratch” and not having a clue about how to become a successful trader. So they can spend years in trial and effort in finding the “Holy Grail” system that works for them. I know I went through that long, arduous journey myself.

But if one starts with a time-tested, proven, easy-to-understand system, I think the journey can be shortened considerably. And I hope it’s not a surprise to anyone to hear me say I have such a system, and one developed through my own personal journey to stock trading success.

The basic system is what I call “Stock Fishing”. I can show anyone how – starting from scratch each day – they can find some of the best stock trade setups in a few minutes of effort each and every day. And some of these stocks are exactly the same ones Dan Zanger is buying hand over fist that day, helping to drive the price of the stock up even higher.

(See the Product Of The Day section to sign up for my Stock Fishing service, and start your own (much shorter) journey to stock trading success).

We’ll wrap up our article series with Dan Zanger in the next issue. Be sure to catch that one – I’ll let you in on how one of the greatest traders in the world uses certain kinds of options to increase his trading profits tremendously.

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And now, on to today’s business…

The markets are mixed today, with the larger caps in the green and the smaller caps in the red.

From MarketWatch:

“The U.S. labor market lost strength again in July, giving the Federal Reserve more freedom to pause next week after 17 rate hikes.”

Let’s see what stock is “leaping” today…

Stock For Review

Our Stock For Review today is LEAP – Leap Wireless International Inc.

LEAP is indeed leaping today on a nice Bullish Kicker reversal. It’s down from the high of the day, but still looking strong with a 9% move to the upside on volume 376% above normal.

I think LEAP will leap some more in the future!

Most Recent Double-Digit Percentage Gainers In One Day

Here’s one happening right now:

SPC – 08/04/06: Up 14.51% (so far) in the Baffle Play section.

Product Of The Day

Shorten Your Stock Trading Education Journey! Learn how to spot the Big Movers that Dan Zanger and other superstar traders are buying that day, and which ones you should be buying too!

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Dan Zanger - Stock Chart Pattern

Stock Chart Pattern – What Is The One Trade Setup A Stock Trading Wizard Looks For Each Day?

Continuing where we left off with our article series on Dan Zanger, let’s now take a look at the stock chart patterns he looks for each day – the strongest ones in the market according to this stock trading master.

In the recent interview from Tradersworld magazine, Dan was asked how he actually determines during the night and during the day what to buy and what to sell. Is this based on stock chart patterns?

Dan replied that he does use stock chart patterns, along with the daily trading bar. But he also said that lots of stocks can have good patterns, but then they just don’t move. So it’s not enough to have scanning software that shows certain chart patterns or trade setups, but you also have to know that these stocks are moving – that they are under heavy accumulation.

So he turns the problem around. He claims you have to find what moves, and then find the chart patterns those stocks create. He admits to missing the initial big move of a stock, but then he will track it for weeks waiting for an interesting stock chart pattern to set up again.

When asked how he determines what moves a stock, Dan replied: “I go with the big funds. When the institutions are buying the stock en masse on volume I will buy the stock too. When I see a stock beginning to move on heavy volume, I will be a buyer with the other institutions. Volume is extremely important. In fact, it’s everything.”

Dan was then asked when he sees the volume coming into a stock, what chart patterns does he like to buy on?

Dan replied: “It depends. I certainly like bull flag patterns. They are my favorites. High level channels and horizontal channels work very well too. Occasionally, you will see a good cup and handle. A cup and handle is best when the stock breaks out of the handle on the day of earnings.”

Dan had these final words to say about using stock chart patterns: “The pattern alone does not guarantee a winner. This is a big fallacy for people who are trying to trade off of chart patterns. They think that patterns are the “new thing” and a no-fail system. Patterns just give you a leading indication of which stocks are ready to move. Be prepared for the failures. Be quick to cut your losses. When they really start to move big with big volume you need to really step into the stock heavy.”

(Source: Tradersworld magazine – Early summer through late fall 2006 edition).

As I mentioned yesterday, I’m a HUGE fan of Telechart Platinum software from the Worden Brothers. This software lets me find these big moving stocks on big volume at any time during the day – I just run a quick scan and the stocks are displayed in seconds.

There is some analysis involved, however. You could commit financial suicide if you simply bought all the stocks from the chart pattern scan. The scan produces about 15 – 20 stocks on average. But only 1 - 3 should actually be bought. That’s where my other services at Trade Your Way To Wealth come in.

Take my Stock Market Miracle service for example. This is actually a 2-week trial to my premium Baffle / RSVP / ARM service – which requires an investment of $1,000 a month. But you can get a taste of the premium service for a mere $100.

You’ll get a chance to invest in the premium service with proceeds snagged in two weeks from Stock Market Miracle. For example, one of our picks was up almost 40% in one day yesterday, two days after recommendation. Another one was up 24.25% in two days. And we had fun with another stock mentioned in the chat room that comes with the service – one of my “Chinese Firecrackers” - that exploded 59.7%, 87.38%, 38.41% and 8.72% in four out of five days!

So you must start out with the Telechart Platinum software. Then try out the Stock Market Miracle service, and see if you can snag one of these home run stocks that will make you a great annual return – in one day!

(See the Products Of The Day section to sign up for this software and to join us in the Stock Market Miracle).

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And now, on to today’s business…

The markets opened up on the down side, but are bouncing back strongly as I’m typing these words. That’s good news – remember, the open belongs to the amateurs, and the close belongs to the pro’s!

From MarketWatch:

“U.S. stocks turned mixed Thursday morning, as investors behaved warily a day ahead of the July monthly employment report, which is expected to be a major factor in the upcoming Federal Reserve monetary decision.”

“Guess” which stock looks good today?

Stock For Review

Our Stock For Review today is GES – Guess ? Inc.

GES is rocketing out of a basing area today, up 4.68% on volume 314% above normal. No need to “guess” which way this stock is moving!

Most Recent Double-Digit Percentage Gainers In One Day

Here’s one happening right now:

AIRN – 08/03/06: Up 11.36% (so far) in the Baffle Play section.

Products Of The Day

Step One: Sign up to Telechart Platinum!

Sign me up for the only stock trading software I’ll ever need right now!

Step Two: Sign up to Stock Market Miracle! (And start snagging DDPGs – Double Digit Percentage Gainers – in one day!)

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Dan Zanger - Stock Trading Software

What Stock Trading Software Does A Trading Legend Use?

After taking a few weeks off for “summer vacation”, it’s time to get our Daily Market Comments going again.

Let’s continue where we left off with the article series on Dan Zanger, by taking a look at the stock trading software this superstar trader uses.

According to the interview from Tradersworld magazine, Dan uses AIQ software exclusively. This stock trading software “… leads me into finding the charts. Certainly when we have real positive charts you have very positive fundamentals as a general rule. This is what I use to find the big moving stocks. I download all day long and look every hour for stocks on the move. I also download at the end of the day to find them. The AIQ software is my priority. That’s all I use really.”

Dan goes into much more detail about the ordeal he goes through every day to find the best trade setups of the day and for the following day.

It’s a process not many traders would be willing to do.

Here’s his basic plan:

1) Scan 1,300 to 1,400 charts using a defined list of stocks.

2) Manually flip through each chart every night.

3) Put the best charts into an eSignal quote screen to trade the next day.

4) That will usually result in 50 – 60 of the leading moving stocks. He also keeps track of the strongest sectors of the market.

5) He divides the fast-moving stocks into the strong groups – usually 5 – 6 stocks in each group.

6) He is also continuously scanning during the day for new setups, looking for bullish and bearish divergences.

Now, nothing against Dan Zanger – after all, he is one of the greatest traders in the world – but this is a LOT of work every day! Seems to me you could use stock trading software to greatly narrow down your search efforts every day. Well, it turns out you can, using another piece of trading software.

I must admit I’m not familiar with AIQ. And I imagine the software may have been what Dan started out with, and he just stayed with it. But in my humble opinion, the best stock trading software money can buy is Telechart Platinum from the Worden Brothers.

Without going into lots of detail of the hundreds of features TC Platinum has, suffice it to say that I’m able to do what Dan does in a fraction of the time. I have a simple scan called “Big Movers On Big Volume” that I run often during the day. It will scan the entire universe of over 7,000 stocks and serve up the most promising trade setups to me on a silver platter. I then manually scan the charts. But instead of 1,300 – 1,400, or even 50 – 60 charts, I only need to manually scan about 25 charts at the most. This whole process takes about 15 minutes on each scan.

Yes, Telechart Platinum is the only stock trading software for me.

(See the Products Of The Day section to get your hands on this software. It is mandatory for serious traders).

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And now, on to today’s business…

The markets are in “rally” mode again today.  All indexes are solidly in the green as I’m typing these words.

From MarketWatch:

“U.S. stocks rallied Wednesday on varied positive corporate news stories, as Procter & Gamble and Time Warner zoomed higher on stronger-than-expected earnings reports and the S&P 500 struck its highest level in two months.”

Here’s a stock that looks very “sweet” today…

Stock For Review

Our Stock For Review today is IPSU – Imperial Sugar Company.

IPSU is rocketing out of a basing area today, up almost 15% on volume 199% above normal. A very “sweet” move, indeed!

Most Recent Double-Digit Percentage Gainers In One Day…

We’ve had many DDPG’s since our last update. Here are the most recent ones:

SIM – 07/31/06: Up 11.1% in the Amazing Amex Mover section.

IFO - 07/31/06: Up 15.3% in the Baffle Play section.

HEPH - 07/31/06: Up 21.73% in the RSVP Play section.

POZN - 08/02/06: Up 38.58% (so far) in the Baffle Play section.

Product Of The Day

The Only Stock Trading Software You’ll Ever Need!

Get your hands on Telechart Platinum from the Worden Brothers as soon as possible!

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