Tuesday, January 20, 2015

Top Gold Trader Talks about Volume Reversals on Smith and Wesson

Mark Leibovit recorded a 2 minute video on trading Smith and Wesson.

You can watch it here:

http://youtu.be/ugDl4WGdLss

Happy Trading
Jeffrey Gibby
Business Development Manager

Friday, January 16, 2015

011615 MS Weekly – Percentage Stop Losses Trigger HFTs

Percentage Stop Losses Trigger High Frequency Traders
Differences In Uptrend And Downtrend Trading
The uptrend and the downtrend are not mirror images of each other, nor can you use the exact same indicators, indicator period settings, or subordinate indicators.
Many retail traders assume that if they learn the upside price action, that when the trend turns down it is just the opposite price action. That is why so many retail traders struggle to exit stocks before the trend tops and runs down. In addition it is why many retail traders who try to sell short as well as options traders who buy puts, take so many losses in their trading.
If you are a position trader, you will be trading the uptrend and sideways trend. If you are a swing trader you must trade the uptrend and downtrend, and adapt for the sideways trend.
Swing traders must be able to take advantage of both the upside and downside price action, in order to net profits which are close to what a position trader can achieve. However, the position trader will generally always have far higher returns.
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The sell side or downtrend is very different from the uptrend or the sideways trend, because there are fewer Market Participants. Giant Pension and Mutual Funds do not sell short. They may buy option puts or ultra-bear ETFs as a hedging or mitigating strategy when the market goes down, because they are longer term investors.
Smaller lot investors, corporations, billionaires, other wealthy individuals, and foreign funds do not sell short.
High Frequency Trading Firms HFTs, Professional traders, and some retail traders do sell short or use options to make profits during a downtrend.
That is why the downside trend is so very different than the upside or sideways trend. The downtrend often has much steeper Angles of Descent™ immediately causing a severe drop in price, and often gaps as HFTs trigger on news events. The Downside also has larger rebounds as it bounces off of support.  
How fast the price will fall is dependent on many factors, but the most important factor is always the number of HFTs that trigger the sell-off.
The downtrend can drop with low volume, and can at times gap down through technical support levels. This is due to how and where the retail crowd and the smaller funds set their stop losses.
A common mistake that many individual investors and retail traders make is to use a percentage stop loss. Since often everyone in these groups all use the same percentage stop losses, there are many strategies used by HFTs and other professionals that cause these percentage stops to trigger. When this happens the stock usually hits the stop loss, then rebounds back up.
It is the “Cluster Order Syndrome” which triggers HFTs and other algorithms, searching for orders that are clustered around a percentage. As a stock drops, stop losses are triggered and the stock plummets.
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The chart example above shows a how a 10% stop loss triggered a huge down day. It was driven by very high Volume, which is the foot print of HFTs and sell short automated orders. These trigger on algorithms designed to locate Cluster Orders.
Summary:
The downtrend behaves very differently than the uptrend because not all of the nine Market Participants sell short. More than half of the Market Participants hold stocks for the long term.  On the downtrend algorithms dominant, and many search for anomalies in order flow called “Cluster Orders.”
When retail traders, small funds, and other groups all use the same percentage such as an 8% or the more popular 10% it creates a huge Cluster Order at that price range. Algorithms can search for these Cluster Orders and then cause huge sell downs, because of the combination of selling short AND stop losses firing off at the same time. The stock plummets within seconds often when the stop losses trigger all at once.

Trade Wisely,
C:\Users\Adrienne\Desktop\Martha Stokes CMT icon w name 175 jpg.jpg
Martha Stokes CMT and CEO of TechniTrader
www.TechniTrader.com

Instructor & Developer of TechniTrader Stock and Option Courses
This weekly stock discussion is sponsored by TechniTrader.com a MetaStock® Partner

©2015 Decisions Unlimited, Inc. dba TechniTrader. All rights reserved.
TechniTrader is also a registered trademark of Decisions Unlimited, Inc.

Disclaimer: All statements are the opinions of TechniTrader, its instructors and/or employees, and are not to be construed as anything more than an opinion. TechniTrader is not a broker or an investment advisor; it is strictly an educational service. There is risk in trading financial assets and derivatives. Due diligence is required for any investment. It should not be assumed that the methods or techniques presented cannot result in losses. Examples presented are for educational purposes only.

Thursday, January 15, 2015

Is TSLA a buy? New video by top market timer, Mark Leibovit

Mark Leibovit discusses TSLA in this new VR Trader Video

http://youtu.be/PTMsTcXVEt4

Happy Trading,

Jeffrey Gibby
MetaStock Business Development

These products are not a recommendation to buy or sell, but rather a guideline to interpreting the specified analysis methods. Only investors who are aware of the risks inherent in securities trading should use this information. MetaStock in no way endorses the products and services advertised and accept no liability whatsoever for any loss arising from any use of these products or their contents.


Monday, January 12, 2015

Setup on NPS Pharmaceuticals

Top market timer Mark Leibovits reviews possible trade setups on NPSP.O

You can review this video here:

http://youtu.be/UeySJbIX8OA

Happy Trading

Jeffrey Gibby
MetaStock Business Development

These products are not a recommendation to buy or sell, but rather a guideline to interpreting the specified analysis methods. Only investors who are aware of the risks inherent in securities trading should use this information. MetaStock in no way endorses the products and services advertised and accept no liability whatsoever for any loss arising from any use of these products or their contents.




Friday, January 9, 2015

010915 MS Weekly - Options Trading Opportunities

Options Trading Opportunities
Options Follow The Stock Chart
Options Trading has suddenly become far more popular with professionals, and smaller funds learning to trade options. This means that options retail traders will find more trading volume and opportunities than have been around in nearly 10 years. It is the Renaissance of Options trading, and what the professionals want now more than anything is Stock Chart Analysis Training for Options.
Professionals realize that the secret to successful options trading has more to do with selecting the right stock to trade than choosing what option strategy to use. Professionals are learning Technical Analysis to study the stocks they are considering using in their options trading, therefore it would be wise for option retail traders to do this also.
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Interpreting the new technical candlestick patterns that have emerged over the past few years is very important. These patterns are due to the massive Financial Market Structural changes that every market has undergone, including the Options Market.
Now technical candlestick patterns include new types of sideways action. Stocks move sideways more often nowadays than they did even a decade ago. It is critical to identify early on what type of sideways pattern it is because that reveals which Market Participant Group is in control, the direction the stock is likely to take out of that sideways pattern, and most importantly the volatility AND velocity once the breakout occurs. Volatility and velocity are not the same thing. Volatility is a sideways pattern, and velocity is a sudden huge move out of the sideways pattern.
Determining when the breakout is going to occur and the direction, optimizes many options trading strategies and increases profitability trading options as well as stocks. Finding the right sideways patterns with strong energy building that will have big moves out of the sideways pattern is important.
The chart example below shows a huge gap after a lengthy sideways pattern. This sideways pattern also contains an island gap.


If you study the chart you can see that the sideways pattern became very consistent in its pattern, just moving within the range of the prior sideways pattern before the island gap. Often the price barely moved. See the very precise tight consolidation of the seven days prior to the huge gap up. These price patterns reveal a steady controlled bracketed order that is totally controlling price for those days. This is one of several footprints of the Buy Side Institutions using Dark or Twilight Pools. Being able to see this pattern, along with confirmation from giant lot indicators, reveals that this is an ideal set up for a velocity or momentum move to the upside.
Summary:
Quiet accumulation by giant lot investors is obvious in the chart, and the candlestick patterns show that these are very savvy investors using orders that bracket and control price. Dark Pools use these kinds of orders. When you can trade with the giant lot investors from the Dark Pools and you can enter with them prior to High Frequency Traders HFTs gapping price, profits are easier and more consistent.
Trade Wisely,
Martha Stokes CMT
www.TechniTrader.com


TechniTrader technical analysis using a MetaStock chart, courtesy of Innovative Market Analysis, LLC dba MetaStock


Instructor & Developer of TechniTrader Stock and Option Courses
This weekly stock discussion is sponsored by TechniTrader.com a MetaStock® Partner

©2015 Decisions Unlimited, Inc. dba TechniTrader. All rights reserved.
TechniTrader is also a registered trademark of Decisions Unlimited, Inc.

Disclaimer: All statements are the opinions of TechniTrader, its instructors and/or employees, and are not to be construed as anything more than an opinion. TechniTrader is not a broker or an investment advisor; it is strictly an educational service. There is risk in trading financial assets and derivatives. Due diligence is required for any investment. It should not be assumed that the methods or techniques presented cannot result in losses. Examples presented are for educational purposes only.

Tuesday, January 6, 2015

Mark Leibovit discusses the Diamonds using VR Trader

Happy New Years!

To my fellow ETF traders, I wanted to share a video put together by Mark Leibovit of VR Trader.  Mark is a top rated market timer and being an ETF trader, I found this interesting.  So to my fellow ETF Traders:

Here's the video Mark Leibovit put together on the DIA last night.

http://youtu.be/lTgHEp_xCoQ

Thanks for using MetaStock and have a great New Year.

Jeffrey Gibby
Business Development
MetaStock

Full disclosure --  I currently am holding puts on DIA.

Friday, January 2, 2015

010215 MS Weekly - Candlestick Charts

Candlestick Charts Change With Market Structure
Automated Market Causes New Candlestick Patterns
Candlestick Charts continue to rise in popularity however most individual investors and retail traders are unaware of the fact that many of the Japanese candlestick patterns, taught in books and generally around the internet in articles no longer form or are as reliable as they were 20 years ago.
What has happened in the past 6-7 years is a dramatic shift in the overall Market Structure on the professional side. Individual investors and retail traders have not seen much change to their trading platforms, online broker accounts, or charting software. However the professional side has had a major overhaul of every facet and aspect of their trading platforms. This includes broker/dealer professional orders available to them, analytical tools, and especially their trading and investment strategies, algorithms, and automated trading systems. The changes are massive on the professional side but few individuals know about them.
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Where these huge changes are having the most impact for individuals is in how Price patterns form on charts, what Candlestick Patterns are forming, as well as how indicators behave.  These are critical areas for all Individual investors and retail traders to keep up with and to recognize, if they are not to be left behind as the evolution of the stock market internal structure continues in the next few years. The changes are only beginning and most institutions are still adapting and modifying just about everything they do in entering orders, processing orders, and share lot quantities in different trading venues.
Candlestick Charts are the first area of the stock chart that have shown major changes in patterns in the past few years. Some patterns rarely form, while others have become less reliable and inconsistent. New entry and exit signals have emerged that are not mentioned in the traditional Japanese Candlestick books because they never formed until just a few years ago. More institutions are using different buy and sell orders developed exclusively for the professional side, and individual investors and retail traders should be learning what this means for Candlestick Patterns.
One of the most common mistakes made is not identifying the very common Platform pattern, that forms often now in the automated marketplace.  Platforms develop when giant lot investor orders are placed off of the exchanges in Alternative Trading Systems ATS aka Dark Pools or Twilight Pools. The specialized orders that the ATS have developed for these giant lot investors, controls Price and Candlestick Patterns in a way that is unique.
Unfortunately many swing and momentum retail traders do not recognize this pattern and try to trade the Platform sideways action. This is one candlestick sideways pattern that causes many whipsaw trades and often chronic losses, especially for individuals who are relying upon red light/green light or other retail side trigger orders. These retail side automatic signals to buy or sell are not sophisticated enough to recognize the Platform pattern, and cause many traders to lose money trading short term. Below is a chart example of a Platform pattern.


The Platform is just one of many new Candlestick Patterns.  Most of the time price bolts out of the Platform running with strong momentum energy for excellent swing and momentum profits. Consequently it is important to not only be able to quickly identify when a Platform has started, but also to recognize when it is completing.
Trade Wisely,
Martha Stokes CMT
www.TechniTrader.com

Instructor & Developer of TechniTrader Stock and Option Courses
This weekly stock discussion is sponsored by TechniTrader.com a MetaStock® Partner

©2015 Decisions Unlimited, Inc. dba TechniTrader. All rights reserved.
TechniTrader is also a registered trademark of Decisions Unlimited, Inc.

Disclaimer: All statements are the opinions of TechniTrader, its instructors and/or employees, and are not to be construed as anything more than an opinion. TechniTrader is not a broker or an investment advisor; it is strictly an educational service. There is risk in trading financial assets and derivatives. Due diligence is required for any investment. It should not be assumed that the methods or techniques presented cannot result in losses. Examples presented are for educational purposes only.