0Posted by Michael Glass on October 14, 2012 at 10:08 pm
Learn how to Trade
with Market Profile
Market Profile is a technique that is used by future and forex traders to help technicians understand the internal structure of the markets. Market Profile was a intraday trading strategies devised by J. Peter Steidlmayer. It is a way to structure market activity by using time and price. The development of time and price opportunities is then distributed within a bell shape curved chart which can then be studied. There are 3 key components to Market Profile: Value Area, Point of Control and Value Area High and Low.
Value Area is a primary component derived from the Market Profile. Value Area is intended to show the range of prices that reflect the most interest on the part of buyers and sellers. The Value Area represents the range of prices that contain 70% of a day’s trading activity.
The price that recorded the most trading activity is the Point of Control. The prices that saw the most activity.
Market Profile is defined as the study of price and volume over a period of time. Market profile on a charts shows the price action volume horizontally (on the side of a chart), as opposed to vertically (on the bottom of the chart). This technical analysis strategy shows price development, how price is moving, and the amount of volume trading at a particular price in real-time.
0Posted by Michael Glass on September 30, 2012 at 1:34 pm
#1 Mistake All Day Traders
Make in the Stock Market
Have you ever been in a trade and been stopped out just to have the market reverse and go back in the original direction you thought. Have you ever been in a position you thought would take 1 day and instead sat in a pullback for 3-5 days before making a profit. I bet it’s because you made the #1 mistake all day traders make in the stock market.
The oldest mantra in the stock market is The Trend is Your Friend. Even before all of these fancy dancy technical indicators were creators, investors used to chart and draw their own price levels of support and resistance. Watch the video to learn how these two key factors can help you avoid making the #1 mistake all day traders make in the stock market.
0Posted by Michael Glass on February 18, 2012 at 2:26 pm
How to use
Pivot Points for
Stock Market Trading
Pivot Points are technical indicators derived by calculating the average of a particular stock’s, forex pair or futures high, low and closing prices. Using pivot points as a trading strategy has been around for a long time and was originally used by floor traders. Pivot Points have become very popular with day traders because of their ability to identify support and resistance based off of the prior days price action. If price action falls below the pivot point, it may be used as a new resistance level. Conversely, if the price action rises above the pivot point, it may act as the new support level.
Currently, there are several different ways to calculate pivot points. Using some simple arithmetic and the previous days high, low and close, a series of points are plotted on a chart. These points can be used as support and resistance levels. The pivot level, support and resistance levels calculated from that are collectively known as pivot levels. You can find one of the popular sites used to help calculate pivot points by clicking here.
Some trading strategies used by traders utilizing Pivot Points are:
0Posted by Michael Glass on February 5, 2012 at 5:53 pm
Bollinger Bands vs. Keltner Bands vs. Momentum Bands
Technical Analysis Comparison
Technical Analysis is a method of evaluating stocks, futures or forex pairs by analyzing the data generated by market activity, such as past prices and volume. Day traders do not attempt to measure what the intrinsic value of a stock may be, but instead use charts and other tools to identify patterns that can predict future price action. Many day traders attempt to categorize technical indicators.
For me, I like to use certain indicators to gauge overbought and oversold conditions. I use another set of indicators the assess the strength of the markets move. I also use a set of indicators to look at the volatility of the price action. This leads us to today’s discussion of Envelope indicators.
Envelope indicators define the upper and the lower margins of the price range. The band margins shifting is determined with the market volatility. Some examples of envelope oscillators are:
Bollinger Bands consist of a center line and two price channels (bands) above and below it. The bands will expand and contract as the price action of an issue becomes volatile (expansion) or becomes bound into a tight trading pattern (contraction).
Keltner Bands are upper and lower bands that adapt to changes in volatility by using the average true range.
Momentum Bands are a variation of Bollinger Bands devised by David Elliott.
Watch the video below to learn more about these indicators and how each give a different signal to day traders.
0Posted by Michael Glass on November 5, 2011 at 12:04 pm
Weekend Stock Market
Here is our Weekend Stock Market Technical Analysis Trading Plan for Saturday, November 5th. In each video update, we attempt to identify high probability trading setups for the next week. We also look at the key market moving events of the past week including the Greece’s threat to opt out of the Eurozone’s bailout. We then pull up the charts to identify key technical analysis price levels for the S&P 500. We then look to see if some of the market leaders are pulling the market higher or lower (Apple, Amazon, Google, Goldman Sachs, Netflix and Priceline). We also try gain insight to the market’s future direction by looking at the charts for The Dollar, Gold and Crude Oil. Finally, in our education spotlight, we continue to look at what separates winning and losing traders. Today we look at the importance of developing a process for filtering your trades and using dual timeframe agreement for confirmation.
0Posted by Michael Glass on October 30, 2011 at 9:46 am
Here is our Weekend Forex Technical Analysis Trading Plan to help day traders to learn how to trade Forex Currency Pairs by identifying high probability trading setups. In this video, we discuss key technical analysis price levels for USD/CHF EUR/USD GBP/USD and Gold. We look at each forex pair on multiple time frames to identify key support and resistance price levels. We also look at price levels to setup on various pairs based upon the current trend.
0Posted by Michael Glass on October 29, 2011 at 11:06 am
Weekend Stock Market
Here is our Weekend Stock Market Technical Analysis Trading Plan for Saturday, October 29th. In each video update, we attempt to identify high probability trading setups for the next week. We also look at the key market moving events of the past week including the Eurozone increasing its bailout package over 1 Trillion dollars. We then pull up the charts to identify key technical analysis price levels for the S&P 500. We then look to see if some of the market leaders are pulling the market higher or lower (Apple, Amazon, Google, Goldman Sachs, Netflix and Priceline). We also try gain insight to the market’s future direction by looking at the charts for The Dollar, Gold and Crude Oil. Finally, in our education spotlight, we continue to look at what separates winning and losing traders. Today we look at the importance of developing a process for filtering your trades and using dual timeframe agreement for confirmation.
0Posted by Michael Glass on October 20, 2011 at 9:37 pm
How to Use
Market Internals in
your Trading System
Market Internals are a group of technical indicators that traders use to gauge market sentiment. A solid understanding of market internals and the sentiment may traders derived from them gives day traders a more focused view of the market’s potential direction. They look at the New York Stock Exchange and Nasdaq and measure, in one form or the other, how traders are voting with their dollars. In other words, market internals indicators measure money flowing into and out of the market.
Some of the more popular market internals are:
VIX - is a forward looking index that usesoptions (puts and calls) to gauge investor anticipation of volatility. It is based on the S&P 500.
TRIN - is a measure of how much volume is behind advancing and declining shares developed by Richard Arms.
TICK - compares the number of stocks on the New York Stock Exchange that are rising to the number of stocks that are falling.
Advance/ Decline - The Advance/Decline Line or ‘A/D Line’ for short, is the second most important of the internals. This indicator tells us the net sum of advancing stocks minus declining stocks.
UpVolume / Down Volume - The ‘Market Breadth’ or ‘Breadth Ratio’ is a volume ratio composed of volume flowing into up stocks versus volume flowing into down stocks. The breadth ratio is expressed: Up Volume / Down Volume.
Many traders user market internals to confirm their existing trading. It is also very helping in confirming the current trend of the market. To learn more about how to setup your market internal indicators on your charts, watch the video below.
0Posted by Michael Glass on October 12, 2011 at 8:22 pm
How to Setup
your Technical Indicators
on your Charts
Technical Analysis is the predicting of future financial price action based on the review of past price movements. Similar to weather forecasting, technical analysis is NOT a guaranteed prediction about the future direction of price; however, technical analysis can help investors anticipate what is “likely” to happen to price action over time. Day Traders use a wide variety of charts and technical indicators that show price behavior over time.
Technical indicators look to predict the future price levels, or simply the current trend of price action. They do not analyze any part of the fundamental business, like earnings, revenue and profit margins. A Technical Indicator is a result of mathematical calculations based on indications of price and/or volume. The values obtained are used to forecast probable price changes. Many day traders utilize indicators as a way to time their entries and exits for trades.
Technical indicators can be found above or below the chart, and others are plotted on top of prices. The indicators help to predict where future prices are going and whether or not the stock is in an overbought oroversold condition.
Overbought: A technical condition that occurs when there has been a lot of buying and the price of the stock is considered too high and susceptible to a decline.
Oversold: A technical condition that occurs when there has been a lot ofselling and the price of the stock is considered too low and a rally in prices is anticipated.
Essentially traders use technical indicators for two things:
To generate buy and sell signals
To confirm price movement
There are two main types of indicators: leading and lagging
Watch the video below to learn more information on how to setup your technical indicators on your charts.