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Thursday, May 27, 2010

I JUST READ IT FOR THE ARTICLES NOT THE PICTURES

That is what everyone always says about  Playboy, will it be true for this blog?

I am traveling and do not have my good screen capture software on this computer, so no pretty pictures until I get back home. Below is what I am looking for in the near term:

-Dollar Decline, I shorted this overnight
-Rallies in most other currencies, this would logically follow a Dollar Decline
-Gold and Silver shorts, these orders are not filled yet but are in the market below where we are  currently trading
-Stock Rally, I do not have buy signals yet but it just looks to me like we are going to bounce here. All the rallies are being sold so far, but if we get one that breaks through that selling pressure it could be a big short squeeze up day
-Crude Oil rally, it appears to have started already. This market got extremely oversold during the recent decline
-Grains Rally, a few heavy Small Spec short positions have developed in a couple of these. In general when we see that we want to trade in the opposite direction.

STOCKS

For those who buy into my expectation here, the Naz has been the strongest of the three indexes, having not taken out the crash low like the Russell and SP 500 did. As a result, focus your longs in that area. I do have buy signals in individual stocks, but not yet in the indexes themselves, so I am hesitant to fully commit on this. However, the setups I look for do not develop at every single turn. As a result, this could easily go from here due to us being in the weekly support zones. What I need to have happen is a bounce and a pullback for me to get heavily long. Will we get it? I have no idea, but I always have a plan for what I am looking for and what I will do if it develops. Until that time, I focus elsewhere in my trading. For the time being all the pivots are down, so I will not commit fully to the long side until that changes.

DOLLAR

This trade is setup very well in my world, with most of my trend indicators indicating down even though price is still strong. These types of divergences are what I look for most often, and they are in place here. As a result the mouse gets clicked. It is really that simple in my world. When the setup is there, I calculate how many contracts based on the risk per contract and enter the orders. I do not call my friends to ask them what they think, nor do I read anyone else's opinion. It is my money at stake, so it is my rules that matter to me.

I do talk with others traders often, amd we exchange views and trade setups etc.. Some of these traders are better at this than I am. However, I have never in my whole career taken a single trade just because it was recommended by someone else. I have missed some very good trades by not doing so. I do not care. I review all the trades I make by printing out the charts and keeping them in a binder. Typically after the end of each month I go back and look at what I have done, why I did it, and look for things that need improvement. I never want to be in a position where I review a trade and my notes show that I did it only because someone else told me to. There are not many breakable objects in my house that would survive that review.

I do look at markets that fellow traders point out to see if where they are looking is supported by what I do. I have at times found things I missed by this process, and gone on to take the trades because it turned out my rules were met. You never want to be too much of a know it all in anything because it will block your ability to grow and improve at your trade. There is a balance that needs to be met, between being your own person, doing what you know is right, and also being open to new ideas. There is rarely a week that goes by where I do not look at a different way of doing trades. This week might be the exception to that as I head off to the golf course.

Good trading to everyone



1 comment:

robert said...

Have fun on your vacation Chris, and thanks again for the great blog.

Whose taking care of all the abused dogs that you rescue from bad homes?