Let’s review the big news of the week, specifically, the Fed and the ECB both trying to out-dove the other. On Tuesday, we had Mario Draghi essentially front-run the Fed on Wednesday by stating that the ECB was very open to lowering rates and additional asset purchases. What does this mean? Well, it means that … Read more
When the market gives you lemons, stop trading and start swiping. As we are all very aware of, there are times when the overall market is in chop, pulling back, or trending down. Each trader has different tactics to deal with these times such as going short, hedging, selling spreads, or just going to cash. … Read more
Let’s go back to December 2018. The market was rapidly falling, the fear was palpable, there was blood in the streets … and then what happened? The Fed capitulated on their rate hike schedule. The market cheered and rallied from a V-shaped bottom back to the previous all-time high. Everyone likes a rally, but let’s … Read more
If you took the average human, let’s say 6’ feet, or 72 inches tall, and the top of the head was the high where we began our retracement and the lows (or zero) were his feet, then the .618 retracement would be “about” where you’d find the belly button. Think of it as more of an art than a science, and of course it does differ but I’ve found it to be generally true. More importantly I’ve found it helps me remember a key retracement in the analysis of swings in the market.
There are as many trading styles, principles, and methods as there are snowflakes in a Denver blizzard. So why am I addressing this particular one? Well, because it’s extremely relevant this week. Unless you have been hiding under a market rock, you are aware that the market has now sold off fairly sharply for 2 … Read more
Let’s talk stock trends. What are a couple of things we want to see when a stock is trending? Higher highs and higher lows combined with momentum. But how do we know when the momentum in a trend is cooling off and it’s time to GTFO (Get the Funds Out)? That’s where the 10X Bars … Read more
Going into the end of last year the market saw a strong reversal back down to long term support levels. S&P went down to monthly support, and for a second looked as if it would continue to tumble. However, going into the last few days of December, the market started to bounce and confirmed support would continue to hold. At the start of 2019 we continued to show strength and have now seen a bounce to bring us close to our all time highs.
I am sure we have all heard the phrase “don’t fight the Fed”, but do we really know what that means?
2019 began just as everyone predicted, the Fed capitulating on rate hikes for the year and even hinting that a reduction in rates was possible. Of course, we’re only kidding as many traders were caught wrong-footed by the quick change in sentiment.
As we change the calendars to 2019, it is important to look forward to the next year to see what opportunities and challenges face the markets. We see 2019 as a year fraught with landmines of volatility; however, volatility is the lifeblood of trading so we want to be prepared for what may come. We … Read more