Took Alexander Elder’s advice and had a 2 week break from trading so that I can have a more objective view of the markets. During this time, I’ve been coming up on my reading and I’ve been going to seminars and talks to keep in sync with the markets.
On a weekly basis, the indexes are still looking very bullish for the next 2-3 weeks. However we are starting to see weakness in the bull run. The correction in February is just the tip of the iceberg and we will be seeing more of such big corrections in the months to come.
On a daily basis, I think we might be seeing some weakness in the next few days but the markets are poised to make new highs by the end of April 2010. However I do not think we will rally above 1210 on the S&P.
As for my longer term view of the markets, I think we will close flat for the year and we will be moving sideways in a very volatile fashion for the rest of the year. We are currently very close to the top of this sideways movement now.
Monday, March 29, 2010
Sunday, March 28, 2010
WMA - Weekly market analysis, 28 March 2010
/DX ($DXY) – USD Index
On a monthly basis, the USD is in a real bull rally. I have read about some calling it a bear rally, and Russell Napier making a call that the USD is now in a real bull market for 2010 (at the start of this year). The weekly charts indicate that this rally has legs to go for another 2-3 months at least, reaching about 84 on the USD Index. Meantwhile, on a daily basis, the USD appears a little over valued and should have some moderation over the next week, likely not before a pop by Wednesday. I am looking for a monthly close of >81 for the USD Index.
Fundamentally, the USD is under a little stress from the news that Greece may be getting things under control, and some strength in the Euro. But I see this as a rally relief, with Greece looking suspiciously like another Lehman Bros – denial until the true end.
Technically, the rally seems intact, and fundamentally with the Euro being weak and at threat, all points to a good rally in the USD… I am with Russell Napier.
SPX/SPY – S&P500 Index
On a monthly basis, it appears that the rally just borne out legs to run further, and much further at that. I was at a Ben Miller talk last Thursday night, and he was really bullish! Historically, since 2003, a bearish divergence has played out spectacularly in 2008. It does look very bullish on the monthly charts…
The weekly charts had indicated a very strong bearish divergence that cumulated into a January tank in the SPX, but caught many in the know off guard and reversed to make a higher high. This higher high is a cost of accentuating the bearish divergence. I once told my friends that the higher this rally goes, the bigger the risk of a bigger tank to come. I see that… the weekly charts are not showing that the January tank was not the manifestation of the bearish divergence, but only the back of the bull. That is to say that there is more of a bull (or bear) rally to come and the bearish divergence is building up to a greater fall. I call to mind this anecdotal phrase which I came across recently, “Buy when they cry and sell when they yell”. The news have started yelling about a 52 week high, as well as having clocked the 6th UP week for the SPX… it is about time to sell perhaps, but not before allowed to do so, and that would happen with a real mania, which should be just around the corner mid next month. ALL my indicators are showing the build-up of the bearish divergence, and on the weekly charts, it would be more powerful than on the daily charts. The daily charts indicate a stall, and we are looking for March to close closer to 1152, with the concomitant pop in the USD. Thereafter, I am expecting the final leg of the rally.
/GC – Gold futures
On the weekly Gold futures chart, gold is in a mild downtrend but looks ready for a pop sometime soon, but not just yet. The daily charts show that 1088 is a formidable support, and that Gold is in a trading range. Although last Friday gold had a good pop up, I am not convinced of a real uptrend as yet. The indecisiveness of Gold can be looked upon as strength in the face of a rising dollar, but I do agree with Dr Elder (met him about 2 weeks ago) that Gold is looking for more downside in the coming months. I have my own reasons as well as you can see in the Silver charts below…
/YI – Silver futures
Despite a valiant rally from 14.50 to 17.50, Silver looks weak on the weekly charts (pun not intended). The daily chart show a clearer picture of Silver’s intent in my opinion. A recent double top was made and I am expecting silver to fall lower, possibly to 15.50. Rallies have been weak, unlike Gold, and although Silver usually follows Gold, it is having a mind of its own of late. The price action pattern of a HH-HL-LH-LL-LH is done on the weekly chart over the past 4 months and 15.00 is the trigger for a major low. Now, this may be strange, but the daily charts is mapping that pattern out also over the past month, with the trigger at 16.60 for more lows to come.
/CL - Crude
The weekly crude charts clearly show an uptrend that is tiring out. Having made a strong upward move in 2009, the sputtering rallies in 2010 indicate some sort of easing for a correction. It looks like there would be another 3-4 weeks of seasonal that may play out for a spike to 90, but beyond that, I doubt any further price move above 90. The indicators are showing bearish divergence building up over the past year. Recently, very bullish calls have been made on the basis of China’s economic activity but I have long been a skeptic of China, although I know it moves/leads the global economy to a limited extent. This comes from a Western interpretation of Chinese culture, where historically, all Chinese glory always crumbles at the hands of corruption. Not out to say that the current China is corrupted, but it is a strong sense that history and culture is very unlikely to change in just this generation. Back to Crude daily chart, there is a correction resulting from a bearish divergence being in force right now, and should last another week or so, looking at 77 for a base to reverse.
FXI – China Index fund (proxy for the China market)
The weekly charts show of a spectacular recovery in 2009, but late 2009 and 2010 has shown much weakness, possibly an effect of the tightening measures by the Chinese government. While the SPX has made higher highs (despite weaker indicator signals), the FXI weekly bearish divergence played out very well and never clocked a higher high, but rather 2 lower highs at best. The daily chart show a squeeze and resolution of this in the coming days should indicate the short term move.
Overall strategy for the coming week(s)
The precious metal and S&P500 together with a rallying USD is forming a coherent picture yet to be confirmed. This forms a hypothesis or plan that the market will be charting over the next few months. I previously thought that the January 2010 correction would play out as a reversal but it did not happen, and following that instead was a new 52-week high rally ensuing on weak indicator signals.
Going forward, April is one of the most bullish months, and after a small correction this week, I would not be surprised to find another leg of rally. But towards end April, I’d be even more wary again!
On a monthly basis, the USD is in a real bull rally. I have read about some calling it a bear rally, and Russell Napier making a call that the USD is now in a real bull market for 2010 (at the start of this year). The weekly charts indicate that this rally has legs to go for another 2-3 months at least, reaching about 84 on the USD Index. Meantwhile, on a daily basis, the USD appears a little over valued and should have some moderation over the next week, likely not before a pop by Wednesday. I am looking for a monthly close of >81 for the USD Index.
Fundamentally, the USD is under a little stress from the news that Greece may be getting things under control, and some strength in the Euro. But I see this as a rally relief, with Greece looking suspiciously like another Lehman Bros – denial until the true end.
Technically, the rally seems intact, and fundamentally with the Euro being weak and at threat, all points to a good rally in the USD… I am with Russell Napier.
SPX/SPY – S&P500 Index
On a monthly basis, it appears that the rally just borne out legs to run further, and much further at that. I was at a Ben Miller talk last Thursday night, and he was really bullish! Historically, since 2003, a bearish divergence has played out spectacularly in 2008. It does look very bullish on the monthly charts…
The weekly charts had indicated a very strong bearish divergence that cumulated into a January tank in the SPX, but caught many in the know off guard and reversed to make a higher high. This higher high is a cost of accentuating the bearish divergence. I once told my friends that the higher this rally goes, the bigger the risk of a bigger tank to come. I see that… the weekly charts are not showing that the January tank was not the manifestation of the bearish divergence, but only the back of the bull. That is to say that there is more of a bull (or bear) rally to come and the bearish divergence is building up to a greater fall. I call to mind this anecdotal phrase which I came across recently, “Buy when they cry and sell when they yell”. The news have started yelling about a 52 week high, as well as having clocked the 6th UP week for the SPX… it is about time to sell perhaps, but not before allowed to do so, and that would happen with a real mania, which should be just around the corner mid next month. ALL my indicators are showing the build-up of the bearish divergence, and on the weekly charts, it would be more powerful than on the daily charts. The daily charts indicate a stall, and we are looking for March to close closer to 1152, with the concomitant pop in the USD. Thereafter, I am expecting the final leg of the rally.
/GC – Gold futures
On the weekly Gold futures chart, gold is in a mild downtrend but looks ready for a pop sometime soon, but not just yet. The daily charts show that 1088 is a formidable support, and that Gold is in a trading range. Although last Friday gold had a good pop up, I am not convinced of a real uptrend as yet. The indecisiveness of Gold can be looked upon as strength in the face of a rising dollar, but I do agree with Dr Elder (met him about 2 weeks ago) that Gold is looking for more downside in the coming months. I have my own reasons as well as you can see in the Silver charts below…
/YI – Silver futures
Despite a valiant rally from 14.50 to 17.50, Silver looks weak on the weekly charts (pun not intended). The daily chart show a clearer picture of Silver’s intent in my opinion. A recent double top was made and I am expecting silver to fall lower, possibly to 15.50. Rallies have been weak, unlike Gold, and although Silver usually follows Gold, it is having a mind of its own of late. The price action pattern of a HH-HL-LH-LL-LH is done on the weekly chart over the past 4 months and 15.00 is the trigger for a major low. Now, this may be strange, but the daily charts is mapping that pattern out also over the past month, with the trigger at 16.60 for more lows to come.
/CL - Crude
The weekly crude charts clearly show an uptrend that is tiring out. Having made a strong upward move in 2009, the sputtering rallies in 2010 indicate some sort of easing for a correction. It looks like there would be another 3-4 weeks of seasonal that may play out for a spike to 90, but beyond that, I doubt any further price move above 90. The indicators are showing bearish divergence building up over the past year. Recently, very bullish calls have been made on the basis of China’s economic activity but I have long been a skeptic of China, although I know it moves/leads the global economy to a limited extent. This comes from a Western interpretation of Chinese culture, where historically, all Chinese glory always crumbles at the hands of corruption. Not out to say that the current China is corrupted, but it is a strong sense that history and culture is very unlikely to change in just this generation. Back to Crude daily chart, there is a correction resulting from a bearish divergence being in force right now, and should last another week or so, looking at 77 for a base to reverse.
FXI – China Index fund (proxy for the China market)
The weekly charts show of a spectacular recovery in 2009, but late 2009 and 2010 has shown much weakness, possibly an effect of the tightening measures by the Chinese government. While the SPX has made higher highs (despite weaker indicator signals), the FXI weekly bearish divergence played out very well and never clocked a higher high, but rather 2 lower highs at best. The daily chart show a squeeze and resolution of this in the coming days should indicate the short term move.
Overall strategy for the coming week(s)
The precious metal and S&P500 together with a rallying USD is forming a coherent picture yet to be confirmed. This forms a hypothesis or plan that the market will be charting over the next few months. I previously thought that the January 2010 correction would play out as a reversal but it did not happen, and following that instead was a new 52-week high rally ensuing on weak indicator signals.
Going forward, April is one of the most bullish months, and after a small correction this week, I would not be surprised to find another leg of rally. But towards end April, I’d be even more wary again!
Friday, March 26, 2010
DMA 26 March 2010 - Sell when they yell...
Short DMA while I am recovering from being a virus pin-cushion and in a midst of piecing together an analysis.
all I can say is that it is time for a correction... and I am looking for signs for a true reversal once again. Flipside, I could be surprised and the S&P500 will take off to 1200. Probability tells that it is less likely at least for the next week.
all I can say is that it is time for a correction... and I am looking for signs for a true reversal once again. Flipside, I could be surprised and the S&P500 will take off to 1200. Probability tells that it is less likely at least for the next week.
Monday, March 22, 2010
22 March 2010 - Bullish till the season turns
The market is divergingly bullish... it will make an unbelievable high, but beware... it can reverse really hard any time, and this time, it will be it. Seems to me like we can expect this by June.
For now, I am revamping my analyses, and the way I think and do things... it will take a short while for me to revamp.
For now, anyone reading this, be very very careful.
For now, I am revamping my analyses, and the way I think and do things... it will take a short while for me to revamp.
For now, anyone reading this, be very very careful.
Thursday, March 11, 2010
We are still going up baby! – Market Analysis for 12/03/2010 by Singaporeseeds
The uptrend since March 2009 just refuses to correct. This may mean that we are still going to continue going up OR we are at a major turning point where everything starts to turn funky (volatile) before it turns ugly. Last night after market close, futures just gapped and tanked around 10 points on the S&P futures without any news release and without any justifiable reason. The news and everyone seemed to forget this event and trading went on as usual after market open with the market rallying strongly in afternoon trade.
I think this is just sideways chop without any clear trend. We had also been rallying on decreasing volumes. Daily volume on Thursday was one of the lowest for 2010. I’m looking at the indexes making a reversal down by next Monday. This would indicate that we are going to continue tanking. However if the indexes break the high of the month, then we are going to continue going up for a while more. It is my opinion that the market has to correct soon. The longer it takes to correct, the uglier it will be when it does.
I think this is just sideways chop without any clear trend. We had also been rallying on decreasing volumes. Daily volume on Thursday was one of the lowest for 2010. I’m looking at the indexes making a reversal down by next Monday. This would indicate that we are going to continue tanking. However if the indexes break the high of the month, then we are going to continue going up for a while more. It is my opinion that the market has to correct soon. The longer it takes to correct, the uglier it will be when it does.
Tuesday, March 9, 2010
DMA 10 March 2010 – When Hashok sat on the bull and held its horns…
Today's feature:
Hashok got the bull by the horns
My trading buddy revisited Wall Street to get a handle on things...
/DX
The dollar looks more likely to be completing a topping out pattern, with the confirmation trigger for continuation of the downtrend at 79.8. Currently, it still looks like it can go either way.
/ES or SPX
Waiting to see a 1148 breakout on the SPX to grow the little bull into a larger bull. There is 2 more days to do that and to maintain it for at least another 3 days (into next week). May be possible by USD falling as a support, unless relationship changed. However, the overbought signals are rather extreme and there needs to be even more good news to spur this forward growth.
/GC Gold
Showing latent strength to me… but I would like to see the completion of a trend change bias on the daily charts to close above 1127 today.
/CL Crude
Am still skeptically bullish about this one.
Note: Any material posted here is my sole opinion, and the opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational and discussion purposes only.
Hashok got the bull by the horns
My trading buddy revisited Wall Street to get a handle on things...
/DX
The dollar looks more likely to be completing a topping out pattern, with the confirmation trigger for continuation of the downtrend at 79.8. Currently, it still looks like it can go either way.
/ES or SPX
Waiting to see a 1148 breakout on the SPX to grow the little bull into a larger bull. There is 2 more days to do that and to maintain it for at least another 3 days (into next week). May be possible by USD falling as a support, unless relationship changed. However, the overbought signals are rather extreme and there needs to be even more good news to spur this forward growth.
/GC Gold
Showing latent strength to me… but I would like to see the completion of a trend change bias on the daily charts to close above 1127 today.
/CL Crude
Am still skeptically bullish about this one.
Note: Any material posted here is my sole opinion, and the opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational and discussion purposes only.
Pause in the uptrend – Market Analysis for 09/03/2010 by Singaporeseeds
We got the pause that I’ve been expecting from last Friday. Several indicators are now showing an impending reversal. I’m still not sure how big this reversal will be but it’s most likely that we will be getting a reversal by the end of the week. I’m actually looking at a down day today that should break and close below 1132 on S&P and 10460 on the Dow.
I’m currently on the road in UK. I will be doing lots of travelling from today onwards so my market analysis will be very brief until next Thursday when I get back to Singapore. I will be travelling from London to Manchester later today and will be travelling north everyday. We will be reaching Glasgow by Thursday evening. In the meantime, my trading buddy will be filling up the gap and will also be updating us on the markets.
I’m currently on the road in UK. I will be doing lots of travelling from today onwards so my market analysis will be very brief until next Thursday when I get back to Singapore. I will be travelling from London to Manchester later today and will be travelling north everyday. We will be reaching Glasgow by Thursday evening. In the meantime, my trading buddy will be filling up the gap and will also be updating us on the markets.
Monday, March 8, 2010
DMA 8 March 2010 – little bull dance
Over the weekend, I had squeezed some time to look at the charts for a bit as the last two days of last week were tremendously bullish. On 3rd March 2010, I already posted that there was a rebirth of a small bull, and the week ended favourable to the bull call. This confirms a bullish case for the markets, and although there was a slight deviation of the USD-market relationship, this should correct itself to find the USD in a steeper decline sooner than later. Let’s see how the charts spoke to me…
/ES
The hourly charts indicate a rally overcooked, and we can expect some moderation (retracement) in the early hours of market open today. If we take GS as a market leader and look at their hourly charts, it closed Friday with a trend change bias pattern, indicating Monday morning to be negative. However, like the E-minis (and SPX), the daily charts look bullish for more upside, although there may be some resistance.
The daily ES charts indicate more upside to follow with perhaps a slower pace on increase over the week. I expect this week to be closing up, and am looking out for a breakout and maintantence of that breakout on a resistance level. That would seal the bullish case for the markets.
The weekly charts look very bullish in my opinion, and implies a likely resumption of the rally.
/CL
The daily charts speak of a continued rally, especially if the daily close should be >83 for more than 3 days. However, there is a risk of a possible head and shoulders pattern formation with the current prices at the peak of the right shoulder. This is small in probability as the indicators do not signal (yet) a likely turn in prices, plus other factors that would be discussed below. Setups indicate a resumption of the primary bull trend.
A possible black swan is USO, a highly traded ETF that is supposed to follow /CL. Although the USO daily charts are bullish, there is a divergent channel pattern, with the latter forming a falling channel, and CL forming a rising channel. Furthermore, USO is just near completion of a trend change bias pattern and I would be looking for a lower high pivotal point.
For crude, I shall call this a skeptical bullish case.
/GC
Gold had been very impressive over the past few weeks, with the USD fall, it was very resilient, and opposed to Silver (/YI or SLV), GC/GLD has shown strength. In the daily charts, a trend bias change pattern formed and prices broke out of a range with a gap up last week. A small test of the range resistance turned support should be holing Gold prices up. The RSI indicator is showing strength and indicates bullishness to come in the coming week or two. 1140 and above should be the trigger for gold to rally again, but needs a fundamental factor right now to do so. 1124 is support.
The weekly charts are very bullish witht eh RSI breakout and Stochastics median bounce up. On a weekly basis, Gold needs to close above 1150, which should happen this week or two.
/6E
The Euro futures are included so that the USD/EUR relationship can be factored in. This is an important equation as the Euro is affecting the USD and Gold prices in relation to its weakness/strength. The daily charts indicate a consolidation bottom with the RSI nearing a breakout of 50. It should also breakout of the current range and with the Euro recovering some confidence, the USD should take a hit.
Fundamentally, I see this happening as Germany and France have initiated a Euro Monetary Fund. Whether this takes off or not, or if this is suffice to stop check Euro countries from going default remains to be seen. I am skeptical as this looks and sounds to me like a grand Lehman Bros.
/DX
The hourly charts for the USD futures indicate a breakdown of the range and a rebound back into the range. There appears to be a trend bias change pattern forming over the consolidation range. Therefore, I am expecting some USD recovery and then would be looking for a breakdown of the range again.
The daily charts has the RSI indicating a decisive break of the RSI trendlines either up or down, and it looks more bearish than bullish at this point.
Weekly DX charts indicate that the RSI has hit and not broken the RSI bearish resistance. Closing weekly <80.2 should indicate a very likely bear case for the USD. Taken together, this coming week’s scenario sees the USD (DX) expected to be bearish, and as a result, the SPX, Gold and Crude to resume its bullish run. Note: Any material posted here is my sole opinion, and the opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational and discussion purposes only.
/ES
The hourly charts indicate a rally overcooked, and we can expect some moderation (retracement) in the early hours of market open today. If we take GS as a market leader and look at their hourly charts, it closed Friday with a trend change bias pattern, indicating Monday morning to be negative. However, like the E-minis (and SPX), the daily charts look bullish for more upside, although there may be some resistance.
The daily ES charts indicate more upside to follow with perhaps a slower pace on increase over the week. I expect this week to be closing up, and am looking out for a breakout and maintantence of that breakout on a resistance level. That would seal the bullish case for the markets.
The weekly charts look very bullish in my opinion, and implies a likely resumption of the rally.
/CL
The daily charts speak of a continued rally, especially if the daily close should be >83 for more than 3 days. However, there is a risk of a possible head and shoulders pattern formation with the current prices at the peak of the right shoulder. This is small in probability as the indicators do not signal (yet) a likely turn in prices, plus other factors that would be discussed below. Setups indicate a resumption of the primary bull trend.
A possible black swan is USO, a highly traded ETF that is supposed to follow /CL. Although the USO daily charts are bullish, there is a divergent channel pattern, with the latter forming a falling channel, and CL forming a rising channel. Furthermore, USO is just near completion of a trend change bias pattern and I would be looking for a lower high pivotal point.
For crude, I shall call this a skeptical bullish case.
/GC
Gold had been very impressive over the past few weeks, with the USD fall, it was very resilient, and opposed to Silver (/YI or SLV), GC/GLD has shown strength. In the daily charts, a trend bias change pattern formed and prices broke out of a range with a gap up last week. A small test of the range resistance turned support should be holing Gold prices up. The RSI indicator is showing strength and indicates bullishness to come in the coming week or two. 1140 and above should be the trigger for gold to rally again, but needs a fundamental factor right now to do so. 1124 is support.
The weekly charts are very bullish witht eh RSI breakout and Stochastics median bounce up. On a weekly basis, Gold needs to close above 1150, which should happen this week or two.
/6E
The Euro futures are included so that the USD/EUR relationship can be factored in. This is an important equation as the Euro is affecting the USD and Gold prices in relation to its weakness/strength. The daily charts indicate a consolidation bottom with the RSI nearing a breakout of 50. It should also breakout of the current range and with the Euro recovering some confidence, the USD should take a hit.
Fundamentally, I see this happening as Germany and France have initiated a Euro Monetary Fund. Whether this takes off or not, or if this is suffice to stop check Euro countries from going default remains to be seen. I am skeptical as this looks and sounds to me like a grand Lehman Bros.
/DX
The hourly charts for the USD futures indicate a breakdown of the range and a rebound back into the range. There appears to be a trend bias change pattern forming over the consolidation range. Therefore, I am expecting some USD recovery and then would be looking for a breakdown of the range again.
The daily charts has the RSI indicating a decisive break of the RSI trendlines either up or down, and it looks more bearish than bullish at this point.
Weekly DX charts indicate that the RSI has hit and not broken the RSI bearish resistance. Closing weekly <80.2 should indicate a very likely bear case for the USD. Taken together, this coming week’s scenario sees the USD (DX) expected to be bearish, and as a result, the SPX, Gold and Crude to resume its bullish run. Note: Any material posted here is my sole opinion, and the opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational and discussion purposes only.
Sunday, March 7, 2010
Unconvinced of the rally – Market Analysis for week beginning 07/03/2010 by Singaporeseeds
The market staged a big rally on Friday when the unemployment numbers were surprisingly good. The S&P also broke its trendline and hit the monthly pivot resistance. If it breaks this resistance, we might be going up for a while more. We had been in an uptrend with decreasing volume over the past month. We are still in a bullish trend on weekly charts.
S&P daily charts with RSI
However, RSI is saying that either we are at the end of this uptrend, or we are at the initial stage of an even bigger rally. Knowing me, I’ll stick with the end of the uptrend analysis. But seeing the momentum of the market on Friday, we will need to go sideways for a few days before we can see any real sentiment turn in the markets. We will have to see how the market goes over the next days before we can get a clearer picture.
S&P daily charts with RSI
However, RSI is saying that either we are at the end of this uptrend, or we are at the initial stage of an even bigger rally. Knowing me, I’ll stick with the end of the uptrend analysis. But seeing the momentum of the market on Friday, we will need to go sideways for a few days before we can see any real sentiment turn in the markets. We will have to see how the market goes over the next days before we can get a clearer picture.
Saturday, March 6, 2010
Why And How The Wrong State Of Mind Takes Money Out Of Your Trading Account And How To Avoid This
One of the most admired qualities of successful traders and investors
is self-confidence. An abundance of it will bring results, and the
lack of it is guaranteed to kill your trading account. All successful
traders and investors agree it is one of the single most important
components of consistency and producing profitable results.
Success in any endeavour is 80% psychology and 20% action. This rule
is closely linked to and drives another 80:20 principle: 20% of the
things you do account for 80% of your results. But what leads you
to do the right 20%?
It is simply how you think. It is your attitude and frame of mind.
The quality of your actions is determined by the state of mind you
are in at any given moment.
A good way to think about this would be, every week like most traders
and investors, you probably think of several things that you need
to do in order to grow your account. Let’s say hypothetically it
was comprised of ten things to do this week. Of the ten actions,
eight of them would be either a waste of time, counter-productive
or produce insignificant results. Doing the right two actions would
get you 80% of the results you desired. This means if you did this
every week for the next 10 weeks, of the 100 possible actions, 80
of them will be a waste of time and 20 of them will get you 80% of
the results you desire.
Your state of mind will determine not only what you put on the list,
but even more importantly what you choose to do next. Your state of
mind will determine what you perceive to be urgent, important and a
waste of time. Your state of mind will determine what you focus on
and how you focus on it.
Learning to manage the state of your mind is one of the most important
techniques you need to master in order to succeed at trading and investing.
Why?
Because the state you are in will determine the quality of your decisions,
what you believe, what to feel and what to do next. What you do
will create the results of your business, and your results determine
your destiny.
So the bottom line is - state of mind is everything.
Whether you play golf or not, think about this. Why does virtually
every golfer complain that when they are practising on the golf
course they play their best golf, but as soon as they play against
someone or the pressure is on them, their game falls apart?
The reason being is the state they are in while playing determines
the quality of their performance and results.
Your ability to manage the state of your body and mind during
challenging times is one of the important techniques you must
learn in order to influence the quality of your trading and
investing results.
However, virtually no one knows how to turn confidence, (
or any other resourceful state) on at will. For most, it either
shows up on the day or it doesn’t! But there is a scientifically
proven way to feel whatever you want to feel, whenever you want.
If you could learn how to control the state of your mind so that
you could focus in on the right 20% of actions that produce 80%
of your results, how much time will that save you? How much more
money would you make? What else would you be able to do?
Regards,
Patrick Stockhausen, BA (Hons), MPNLP, BPNLP, DHE, NHR
is self-confidence. An abundance of it will bring results, and the
lack of it is guaranteed to kill your trading account. All successful
traders and investors agree it is one of the single most important
components of consistency and producing profitable results.
Success in any endeavour is 80% psychology and 20% action. This rule
is closely linked to and drives another 80:20 principle: 20% of the
things you do account for 80% of your results. But what leads you
to do the right 20%?
It is simply how you think. It is your attitude and frame of mind.
The quality of your actions is determined by the state of mind you
are in at any given moment.
A good way to think about this would be, every week like most traders
and investors, you probably think of several things that you need
to do in order to grow your account. Let’s say hypothetically it
was comprised of ten things to do this week. Of the ten actions,
eight of them would be either a waste of time, counter-productive
or produce insignificant results. Doing the right two actions would
get you 80% of the results you desired. This means if you did this
every week for the next 10 weeks, of the 100 possible actions, 80
of them will be a waste of time and 20 of them will get you 80% of
the results you desire.
Your state of mind will determine not only what you put on the list,
but even more importantly what you choose to do next. Your state of
mind will determine what you perceive to be urgent, important and a
waste of time. Your state of mind will determine what you focus on
and how you focus on it.
Learning to manage the state of your mind is one of the most important
techniques you need to master in order to succeed at trading and investing.
Why?
Because the state you are in will determine the quality of your decisions,
what you believe, what to feel and what to do next. What you do
will create the results of your business, and your results determine
your destiny.
So the bottom line is - state of mind is everything.
Whether you play golf or not, think about this. Why does virtually
every golfer complain that when they are practising on the golf
course they play their best golf, but as soon as they play against
someone or the pressure is on them, their game falls apart?
The reason being is the state they are in while playing determines
the quality of their performance and results.
Your ability to manage the state of your body and mind during
challenging times is one of the important techniques you must
learn in order to influence the quality of your trading and
investing results.
However, virtually no one knows how to turn confidence, (
or any other resourceful state) on at will. For most, it either
shows up on the day or it doesn’t! But there is a scientifically
proven way to feel whatever you want to feel, whenever you want.
If you could learn how to control the state of your mind so that
you could focus in on the right 20% of actions that produce 80%
of your results, how much time will that save you? How much more
money would you make? What else would you be able to do?
Regards,
Patrick Stockhausen, BA (Hons), MPNLP, BPNLP, DHE, NHR
Tuesday, March 2, 2010
DMA 3 March 2010 - rebirth of a small bull
Over the past two days, the SPX has turned bullish, and has other following markets. In fact, we saw the beginning and confirmation of the bull’s birth on Friday night when singaporeseeds and myself were discussing about the market and were exploring the E-mini tick charts. I had marked out a buy on /ES and it was a good call.
Let’s see how technically the markets are turning bullish, and how much more we can go…
/DX (USD Index)
The theme is still that the USD is king and calls the shots… although in a broad range, the markets are pre-reacting to the USD fall. The USD appears to be falling out of an overbought situation and quite possibly to mount another rally later (which should tank the markets – SPX, commodities, etc.) below is the chart of the USD in daily and hourly, which clearly shows a bracketed range. The uprising trendline on the daily /DX chart show that the uptrend is still intact with a probably breakdown of the range and then a possibly bounce off the trendline from its oversold levels. Fundamentally, this may give time, indicative that Greece still has time to delay default till April/May 2010… when that happens, the Euro should tank hard, forcing the USD to make a beautiful rally up (being wave 5 of this rally incidentally).
/CL
Crude is also very bullish on the USD decline but seems to have hit resistance. Although some analysts are predicting a break above 80, and into the 90 region, I am skeptical for now.
/GC
Unlike Crude, Gold is a laggard in this run up and is making up ground lost. Breaking out of a range, it gapped up today and keeping this gap open would be essential. The long term GC charts show that Gold may be at a pivotal point ready to rally once again. For this to happen, one would expect a case for the USD to fall. Let’s see how this turns out… and if Gold will break the dollar relationship. A good reason why this may be so is that Gold is also priced in Euros, and if the Euro is in trouble, skewing the Euro:USD relationship, Gold’s relationship with the USD may be skewed as an indirect effect.
/ES
At current time, the ES futures are looking for a breakpoint. Taking in line with the USD futures, it should be heading up later today.
SPX
In line with the USD decline, and falling out of range, the SPX should be heading upwards. It has broken out of the 50MA, and this is where the spike before the fall may come in. The Fibo target point places this current rally target near but not above the previous top. That’s not too good… and that changes my earlier outline of the SPX outlook, brining expectations in line to a possible timing in April/May (read as Grecce).
We should see a mild bounce in the USD, then followed soon by a breakdown of the range. This should push up commodities and the SPX in general, until such time the trendline for the USD is tested.
Below is a change in the expectations...
Note: Any material posted here is my sole opinion, and the opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational and discussion purposes only.
Let’s see how technically the markets are turning bullish, and how much more we can go…
/DX (USD Index)
The theme is still that the USD is king and calls the shots… although in a broad range, the markets are pre-reacting to the USD fall. The USD appears to be falling out of an overbought situation and quite possibly to mount another rally later (which should tank the markets – SPX, commodities, etc.) below is the chart of the USD in daily and hourly, which clearly shows a bracketed range. The uprising trendline on the daily /DX chart show that the uptrend is still intact with a probably breakdown of the range and then a possibly bounce off the trendline from its oversold levels. Fundamentally, this may give time, indicative that Greece still has time to delay default till April/May 2010… when that happens, the Euro should tank hard, forcing the USD to make a beautiful rally up (being wave 5 of this rally incidentally).
/CL
Crude is also very bullish on the USD decline but seems to have hit resistance. Although some analysts are predicting a break above 80, and into the 90 region, I am skeptical for now.
/GC
Unlike Crude, Gold is a laggard in this run up and is making up ground lost. Breaking out of a range, it gapped up today and keeping this gap open would be essential. The long term GC charts show that Gold may be at a pivotal point ready to rally once again. For this to happen, one would expect a case for the USD to fall. Let’s see how this turns out… and if Gold will break the dollar relationship. A good reason why this may be so is that Gold is also priced in Euros, and if the Euro is in trouble, skewing the Euro:USD relationship, Gold’s relationship with the USD may be skewed as an indirect effect.
/ES
At current time, the ES futures are looking for a breakpoint. Taking in line with the USD futures, it should be heading up later today.
SPX
In line with the USD decline, and falling out of range, the SPX should be heading upwards. It has broken out of the 50MA, and this is where the spike before the fall may come in. The Fibo target point places this current rally target near but not above the previous top. That’s not too good… and that changes my earlier outline of the SPX outlook, brining expectations in line to a possible timing in April/May (read as Grecce).
We should see a mild bounce in the USD, then followed soon by a breakdown of the range. This should push up commodities and the SPX in general, until such time the trendline for the USD is tested.
Below is a change in the expectations...
Note: Any material posted here is my sole opinion, and the opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational and discussion purposes only.
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