Five Rules For Life

I like being able to bring readers something that is free but delivers tremendous value. "Five Rules For Life" is a site that fits that description. And I am not just saying that because I was asked to submit my "Five Rules"!

It is no secret to long-time readers that I am a firm believer in motivational materials and the power of positive thinking. "Five Rules For Life" combines both, and offers the reader insight into what other people from different backgrounds consider to be "the most important rules to follow for a happy, successful, and fulfilling life".

Check it out - it just launched today with around 30 submissions (including mine!)...you can literally spend an hour or two going through them and pick up some great wisdom.

And as Jon says, go that extra step and submit your "Five Rules". I can attest that it is a great process of self-introspection much akin to mapping out your goals in life.

Visit "Five Rules For Life"



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Entertainment for you

While I upgrade the blog.



Uhm, when will the update be done?



9:30 edit - OK, I think I have the blog back to about 80%. I will work on the other 20% tomorrow.

I am not done with "Blogs I Read" yet - if you think you should be on it, leave a comment.

AND VOTE IN THE TEST POLL IN THE UPPER RIGHT CORNER...there have been over 1,000 page views and 14 votes? Come on people!!!

Poll edit - OK, polls are not too popular. And the Cardinals won the poll, but the Steelers won the game. I probably won't be doing many polls in the future!

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Trader-X upgrade!

Some time in the next few days I will be upgrading the blog. It has been a long time coming - if I remember correctly, Blogger has been trying to get me to upgrade since 2007.

The process should be simple, but it will take some time to get everything back in its proper place. The good news is that once I upgrade, I should have access to some cool new features.

note - special thanks to Trader Jamie for his tutelage on upgrading.

So if things on the blog look strange between now and February 1st, it is because I am in a transition phase. Keep checking back.

It is important to note that I am doing all of this for you - the reader - but I do not plan to raise my prices. You will still get the great Trader-X wit and a site packed full of random thoughts and semi-valuable content for the low, low price of...nothing. Unless you are Dinosaur Trader - I have him convinced he has to pay $29.99/month.

Also, I can't ignore the possibility that things will go terribly wrong during the upgrade process, and the Trader-X blog will disappear into cyberspace never to be seen again. If that happens, just know I enjoyed the ride and I wish you all a long life filled with happiness and prosperity. In the immortal words of Carl Spackler:



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Viewer Mail and a few charts

I received the following email from Richard:

"I have struggled to be consistent over the past few years, and although I have seen you write more than once "focus on one or two set-ups and you can make a living", I never did. My biggest issue is thinking I always need to be in a trade, I always need to be trading, and I always have to find a set-up. But it hit me at the end of 2008 that I am good at trading a few set-ups, and if I just concentrate on those and quit trying to trade everything that comes along or worse yet force trades when I shouldn't be trading at all, I would be better off. So far so good, I've had my most profitable two months in a long time. And my losing trades have dwindled down. I just wanted to drop you a quick note and say thanks."

Thank-you Richard. Your email will probably cause some people to stop and think, and to be honest I can't add anything to it...you have delivered some great insight.

Here are a few charts for you guys to mull over.





I am posting the charts below above because they are setups that will be key to my 2009 trading. Ignore the timeframes and the specific symbols and look at the patterns - they happen every day, but people tend to miss them because they are chasing other setups or they are already in trades that are substandard (ie, trades that are not good setups...but you feel the urge to be in a trade - any trade - and you give into it).

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More Ponzi madness!!!

And yet another suspected Ponzi scheme is uncovered.

"A New York businessman sought by federal authorities in connection with a suspected $380 million Ponzi scheme has been arrested and charged...the businessman, Nicholas Cosmo, founder of Agape World in Hauppauge, surrendered at the Long Island Rail Road train station in Hicksville, N.Y."

And this is classic:

"In 1997, while working as a stockbroker at Continental Broker-Dealer Corporation in Carle Place, N.Y., Mr. Cosmo was accused of misappropriating funds, according to court records. He pleaded guilty to a single federal charge in 1999 and was sentenced to 21 months in prison and ordered to pay at least $135,000 in restitution. He was also told to undergo “extensive gambling therapy” while in prison, according to court records."

Aren't there supposed to be regulators who monitor this kind of thing? Between Madoff and the others, we could probably finance 10% of the TARP program with the money these people stole.

No, instead we should focus on the important things - the lack of an uptick rule is still wreaking havoc in the markets.

10:45PM edit - the New York Times printed a good piece today, "Troubled Times Bring Mini-Madoffs to Light".

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Random thoughts for a Monday

Charts

I wanted to highlight a comment Bill G. made on the previous post. He said:

"I may be in the minority, but I enjoy you posting charts without a lot of analysis. It forces me to do some work to try and see what you are seeing, and I have learned a few things over the past few weeks.

When you spell it out, most people won't get it. When you make them figure it out themselves, most will."

Bill gets it.

These charts are in honor of Bill. You can make a living trading only these setups - they happen every day, but you only need to catch a few a week (depending on your income needs, of course).





Having said that, I will start posting some analysis again in February as I have successfully accomplished my January goals.


Grocery store

I hate self-service checkouts. As it stands, I already bag and carry-out my own groceries most of the time. Now they want me to be the cashier too? And, they don't even offer me a discount on my bill. What sucks is my grocery store only leaves one or two "regular" lanes open to try and force people to use self-service. It is really starting to irritate me.


President Obama

John Stewart highlights the stupidity of Fox News:

The Daily Show With Jon StewartM - Th 11p / 10c

Fox News Fear Imbalance

Barack Obama Interview
John McCain Interview

Sarah Palin Video
Funny Election Video

And I thought this was a cool t-shirt:



note - don't forget to check my links on the right - "THINGS ON THE INTERNET THAT CAUGHT MY EYE"...I post some interesting stuff there and update it on a regular basis. If you are reading the blog in a reader or via email, you might consider clicking through to the actual site every few days.

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Become rich from stock trading!

It seems 2009 is the year of vendors telling everyone how easy it is to get rich from the stock market!

> TradingMarkets is trying to sell me an $8,000 daytrading course (only three left!)
> Michael Parness comes on my television every other commercial break telling me how he turned $4 into $9 billion (what a poorly produced commercial, by the way)
> Wizetrade is putting the marketing machine into overdrive (my favorite quote from Wizetrade - "if more people are buying a stock, it's going to go up; if more people are selling a stock than buying, it's going to go down")

The market has decimated investors and traders, so I am sure that these vendors are trying to take advantage of it by giving people hope they can get their money back...of course, they need to spend another thousand or two first!

There is no real point to this post - I just find it interesting. Have you noticed anything?




what is trader-x doing in January?

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Zombies, blogs, and charts

Laugh now - but if you are driving down the Interstate and see the warning, you better pay attention.


Blogs I read

I am going to [attempt to] revamp my Blogroll in the next week or two...the service BlogRolling has been broken since 2008, and the company itself has to win the award for most poorly run company in the history of poorly run companies.

I am going to limit my Blogroll to blogs I actually read. If I read your blog and reference you, you will be on my Blogroll. If I don't read your blog, you won't be on my blogroll (no offense intended). If you don't think I read your blog, send me an email and I will take a look at it (put Blogroll in the subject line of the email so I can spot it quickly).


Trading the "W"

Last week I made a post referencing one of Trader Jamie's posts ("Shorting the h"). I also read about a "W" and "M" pattern - I don't know if it was on Trader Jamie's blog or another blog because I forgot to save it.

edit - I am hearing Complacent Panda wrote about the "W" last week.

Regardless, I wanted to put up a chart for you to review. Yesterday the NQ futures carved out a (not so perfect but still interesting) "W" pattern with a higher low and a move to the Fibonacci extension (and beyond).

These patterns are ripe with Fibonacci ratios, so take the time to analyze them.



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Mid-week links

I have said it before, but I'll say it again - StockBee has some great stuff on his blog. If you are a swing trader using Tom C.'s strategies, look at his sector breakdowns and stocks up/down 50% plus in a month.

I just started reading Complacent Panda, and I am enjoying his blog. Check out this post for important candlestick reversal patterns.

edit - see Complacent Panda's comment (in comments) regarding a stock contest on his site.

It looks like Trader Mike is back from vacation.

And finally, here are some photos from Inauguration Day - A Momentous Day in Photos

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Tuesday's action - 012009

I have been posting charts in January with this explanation:

I am posting the charts below because they are setups that will be key to my 2009 trading. Ignore the timeframes and the specific symbols and look at the patterns - they happen every day, but people tend to miss them because they are chasing other setups or they are already in trades that are substandard (ie, trades that are not good setups...but you feel the urge to be in a trade - any trade - and you give into it).


Here are two more:






A new chapter

It is now official - President Obama. I have high hopes for his administration and the United States of America.



Here is the text of President Obama's inauguration speech.

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Inauguration Day humor

Trading humor

I received an email from TradingMarkets (they are still around?) trying to sell me a "Professional Daytrading for Success" course for the price of $7,500...and it is limited to 15 qualified traders, so first come first serve!

I was going to write a post about the absurdity of it, but then I decided it was not worth the time.


Non-trading humor

If you are a Star Wars fan you will love this:


Star Wars: Retold (by someone who hasn't seen it)

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Martin Luther King, Jr. (1929-1968)

"The time is always right to do what is right."

Martin Luther King, Jr.



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Weekend roundup

A chart of the "h"

Trader Jamie made a post called "Shorting the h"...to all you Artie Lange fans, it was NOT about heroin.

The "h" pattern is actually in my arsenal of simplified setups, and I will elaborate on it more when I resume posting trades in a few weeks. But I wanted to post a trade from yesterday to give you guys something to look at over the long weekend. I traded ABX yesterday, and it is a variation of Jamie's setup. It does not meet his specific criteria (and is a different timeframe), but the general pattern is similar and you can clearly see the "h".

The first chart is naked, the second chart shows Fibonacci lines plotted over the morning's high to low and the pullback to the 50% retracement. I entered a short on a break of the hanging-man candle and covered at the Fibonacci extension - which, as you can see, marked the exact bottom (magic!).






Another disturbing photo

A few days ago I posted a photo that [most likely] was Trader Jamie or Dinosaur Trader. Today I post another photo for your consideration - depending on who you thought the previous photo was, this photo is undoubtedly the other.




Looking back at the past eight years

Finally - I thought this timeline was a great recap of events over the past eight years. It is amazing to see the rise and fall of the markets as well as other events I forgot happened (Google just went public in 2004?):

What the Hell Just Happened? A Timeline of the Bush Years.

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Watch those key levels (Dow 8,000)

Remember this post from last year.

4:00PM EST edit:

Note the intraday double bottom in the DOW (perfect offsetting bars) that coincided with a test of 8,000. The ensuing bounce lifted the markets higher (~260 DOW points) and created a lot of long setups (I traded an NQ setup that yielded 30 points).



note - thoughts and prayers to the U.S. Airways crew and passengers - I hope they all made it.

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Crooks, blogs, and a stunning (disturbing?) photo

Sam Israel, Bernie Madoff, Marcus Schrenker...these are just the high-profile crooks that we know about. No doubt that for every one of these guys we hear about, there are probably ten that we don't. It is sad that these scumbags rip off people and then try to escape their responsibility like cowards.

But it is also the society we live in - a society of greed, excess, every man for himself. I mean - look at this photo:



Mr. Schrenker is all about image - the car, the plane, the wife. I wish I could get him alone in a room and do a classic Jack Bauer interrogation...but I digress.

It is disgusting. But, again, in my opinion, for every one of these guys we hear about, there are ten that we don't.

On a more positive note, Trader Jamie's blog gets better every day. If you are not reading it I have to ask - why?

On a possibly related note, the photo below may or may not be Trader Jamie. Or Dinosaur Trader.



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Simplifying is hard work

My January activity is progressing, but I underestimated the amount of focus and discipline it takes to ELIMINATE setups from you arsenal.

Regardless, I have the core setups I plan to focus on in 2009 and January has been a great month thus far. I want to do a few more weeks of trading before I resume posting setups on the blog, and I need to decide what direction I want to go with the blog as far as sharing setups and what I publish.

I hope everyone is enjoying a profitable January - keep checking back for updates.




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Weekend roundup

I only have one thing to say - Jack's back.



If you have read this blog for over a month, you know I am a huge 24 fan; I have high hopes for this season (4-hour premiere Sunday and Monday night). But I am already pissed about the Tony situation - I hope it is some elaborate plot and he is not bad. Depending on how intense it is, I may not trade again until February.


Dinosaur Trader has some good links up on his Friday "Linkday" post - check it out here.


A few days ago I posted several charts and said:

I am posting the charts below because they are setups that will be key to my 2009 trading. Ignore the timeframes and the specific symbols and look at the patterns - they happen every day, but people tend to miss them because they are chasing other setups or they are already in trades that are substandard (ie, trades that are not good setups...but you feel the urge to be in a trade - any trade - and you give into it).

This chart needs to be added - it is a variation of the C&H that Trader Jamie talks about, and it usually produces big results. I am not going to go into details here, but you should study the pattern and look for similar setups on your own...there are multiple entries on this chart, and it will mean more if you discover them yourself (hint - this is a very Fibonacci intensive pattern). Actually, this example is not as well-formed as several others I traded last week, but I am too lazy to go back through my charts right now!




I will close this post with a random picture of Spider-Man and President Obama. Have a good weekend.



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A message from Tom C.

Tom C. was a frequent contributor to this blog in the past, and he had a few thoughts to share with everyone:

My posts dealing with longer-term trades were popular in the past, and I wanted to tell Trader-X readers who are interested in those type of trades that the market action from 2008 lends itself to the possibility of some great setups in 2009.

With many stocks closing near the low, I will be watching for them to rally off those levels. I plot my Fibonacci lines over the previous year's high to low*, and look for price to break through the retracement zone. The idea setup is price breaks through that level and pulls back to test it as support before rallying to the previous year's high (and hopefully the Fibonacci extension).

Of course, this is the bullish scenario - which I am hoping is the case for the health of the overall market. In the event that the bear market continues, there will still be setups - just look for price to fail at the retracement zone and turn back down to the previous year's low (and hopefully the Fibonacci extension).

You can read more about my longer-term trades here, and do a search on Tom C. for other posts.

Good luck in 2009!

*To give credit where it is due, I learned this method from Kernan at TRADEthemove.com


what is trader-x doing in January?

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X Trading

I mentioned at the end of 2008 that I was taking January to simplify my trading even more than it is...namely reducing the number of setups I scan for and trade to a small handful. 2008 was my most profitable year, but I think I can beat it in 2009 with more intense focus - while at the same time freeing up some time to pursue other personal objectives.

Instead of disappearing in January, I will make a few posts. I am not planning to spell out exactly what I am doing, but by sharing some thoughts it might spark creative thinking in you as you evaluate your own trading.

I am posting the charts below because they are setups that will be key to my 2009 trading. Ignore the timeframes and the specific symbols and look at the patterns - they happen every day, but people tend to miss them because they are chasing other setups or they are already in trades that are substandard (ie, trades that are not good setups...but you feel the urge to be in a trade - any trade - and you give into it).











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Keep a Trading Journal

Did you make any New Year's Resolutions?

Here is one related to trading - resolve to keep a trading journal and update it every day with every trade. Make a list of questions to answer about each trade, and put them into a template so you can go through and quickly answer each one...the more you simplify it, the more likely you will keep it up day after day. Here are my recommendations for questions:

1.) Why did I enter the trade?
This should cover the setup and what you saw to make you go long or short.
2.) Why did I exit the trade?
Was there a predefined target? (hint - there always should be!!!) Did you exit early because you saw something in the price action that made you think the move was over?
3.) In retrospect, would I take this trade again?
Now that you are looking at it after-hours, was it a good trade (regardless of the profit of lack of)? If the answer is no, explain why.

Of course you want to include the entry time, entry price, what your stop was, what your target was, exit time, and exit price. And always take a screen shot of the chart.

Again - keep it simple. Create a "Trading Journal" folder on your desktop and keep your notes in a single Word document. Save each chart as a .jpg and name the file with the symbol and the date for easy reference.

If you do this one thing it will probably improve your trading tenfold in 2009. The problem is, we all know what we should do - but rarely do we actually do it. Make the commitment today that you are serious about your trading, and as a result you will keep a trading journal and document every trade in 2009.

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Happy New Year!

what is trader-x doing in January?

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