Support Tip: MetaStock Monitor MARCH - APRIL 13

How do I create a custom list?
Contributed by MetaStock Support

The Custom List Manager lets you create your own lists. The lists chan contain as many instruments from as many groups as you want. You can use these lists in the Power Console to view charts, run explorations, and run system tests. Here's how you can create your own custom lists:

1) To create a new custom list, click on either the "Tools" menu or click the "Manage Custom Lists" button at the bottom of the power console.


OR



2) After the Custom List Manager opens, click "New."


3) Enter a name for the list.


4) Enter symbols, one at a time, in the "Select Instrument(s)" field, clicking "Add" after each one.


OR look the instruments up (if you don't know the ticker symbol).


Search by the instrument name or symbol and options will auto populate below. Select the appropriate instrument name and click "OK."


5) Click "Save" to return to the Custom List Manager.


6) You can access your newly created Custom List by clicking on "Tools", then "Custom List Manager" or the Power Console.


OR

Power User Tip: MetaStock Monitor MARCH - APRIL 13

Bollinger Bands - Part 1
Contributed by Breakaway Training Solutions


Bollinger Bands are one of the most popular and well known indicators in the world of technical analysis. Most traders use Bollinger Bands as a way to determine market volatility. In this first video of a three part video series on Bollinger Bands, Kevin will show you how to use Bollinger Bands inside of MetaStock. He’ll cover the basics of how they’re calculated, how to interpret them and discuss some of the different types of patterns to watch for. Have a look!



For more MetaStock training, make sure to visit Breakaway Training Solutions at www.learnmetastock.com or email Breakaway Training Solutions at admin@breakawayts.com.

About Kevin Nelson

Kevin Nelson is the founder of Breakaway Training Solutions, Inc. He has spent the last 17 years becoming an expert on MetaStock software and a serious student of technical analysis while working for MetaStock. Prior to joining MetaStock in 1993, Kevin was a stockbroker for a well-known NYSE firm. In his role as Sales Manager at MetaStock, Kevin interacted extensively with MetaStock customers via phone, webinars, and public appearances. His experiences while working at MetaStock have enabled him to gain a keen understanding of the needs of technical analysts worldwide. While with MetaStock, Mr. Nelson was a featured presenter for four years. During this time, he traveled the U.S. introducing the MetaStock program to thousands of people and teaching them how to use its many features. His easy-to-understand approach is considered by many to be the best in the industry.

©Breakaway Training Solutions, Inc. 2013

Declining Volume in the Stock Market

MetaStock SPRS Series - Week 110 - TechniTrader® Stock Discussion for MetaStock Users - Declining Volume in the Stock Market - March 18, 2013
By: Martha Stokes C.M.T.

There are innumerable commentary and articles about how the US Stock Market is seeing a huge decline in volume in recent years. Certainly when you study a chart of the DJ-30 or SP-500 it is obvious that volumes are far below what they were earlier in this decade. Below is a chart of the declining volume in the Dow:


Chart 1

There is always cause and effect so the question is, “Why?” Are fewer people investing and trading, or are there fewer financial companies, or are the US financial markets in serious jeopardy? Even the Options Markets have had a huge decline in volumes. What is causing this steady decline? The real culprit is not that investors are not buying stocks. They are just not investing in Dow or S&P500 stocks as much as they did earlier. Keep in mind that 80% of the market activity is institutional. One huge factor is the fact that the financial markets are far more interwoven, complex, and there are far more Derivatives professionals and retail traders can trade. ETFs have been in huge demand, and have been on the rise as trading instruments for short term profits by the professional side.

Volumes traded in ETFs have been on the rise for more than 3 years now. Many funds are using ETFs or ETNs rather than investing in Dow or S&P500 stocks. Yes, mutual funds and pension funds must adhere to certain charter requirements but since the elimination of the “Rule of 3” (see the TechniTrader® Methodology ME10 course for a full explanation) the funds now can trade and move monies around with far less restrictions. More and more Hedge Funds and sell side institutions are buying and holding Dow and SP-500 stocks in trusts to create ETFs. Hedge Funds have become far more intricate, sophisticated, and unique. What we are seeing is that the big blue chip companies are being held more for charter or in trusts and less for short term trading activity, with fewer retail traders so volumes are declining. High Frequency Traders started rising exponentially in 2004 and peaked in 2009. HFT activity has steadily been declining as HFT firms reinvent and shift gears to other opportunities.

What is NOT causing the decline is Dark Pool activity aka OTC Giant Lot transactions. These companies are required to have all transactions recorded and documented through the National Clearinghouse just like the exchange transactions. Another area that is adding to the decline of volume in both Big Blue chip indexed stocks and stock Options, is the shift of retail traders from stock and options trading to Forex trading. It is not that the stock market is in decline or that there is less investing, what has happened is that the vast pools of American investments are spread out across a much broader array of investing and trading instruments. If you compare the Dj-30 or SP-500 to the COMPQX (Nasdaq) you will see that the COMPQX has had minimal decline in its volumes. Below is a chart image of the COMPQX:


Chart 2

Always rely upon empirical evidence such as stock charts to confirm what you read. There is no decline in the US stock market. It is busier than ever with far more opportunities for every market participant.

Trade wisely,

Martha Stokes, C.M.T.
Member of Market Technicians Association
Master Rated Technical Analyst: Decisions Unlimited, Inc.
Instructor and Developer of TechniTrader® Stock Market Courses
http://technitrader.com
MetaStock Partner
©2013 Decisions Unlimited, Inc.

Disclaimer: All statements, whether expressed verbally or in writing are the opinions of TechniTrader, its instructors and or employees, and are not to be construed as anything more than an opinion. Student/subscribers are responsible for making their own choices and decisions regarding all purchases or sales of stocks or issues. At no time is any stock or issue on any list written or sent to a student/subscriber by TechniTrader and its employees to be construed as a recommendation to buy or sell any stock or issue. TechniTrader is not a broker or an investment advisor it is strictly an educational service.

The Most Common Mistakes Stock Traders Make

Who Is Controlling Price?

MetaStock SPRS Series - Week 109 - TechniTrader® Stock Discussion for MetaStock Users - Who Is Controlling Price? - March 11, 2013
By: Martha Stokes C.M.T.

Understanding why price is behaving the way it is at any point in a trading week is dependent upon seeing the broader scope of the market beyond the limited view of retail trading. Who has been controlling price lately? It has been retail traders, small lots, and HFTs. Recognizing their footprints is the first step, knowing how they trade habitually is the second step, and combining volume and quantity analysis with price analysis as confirmation is the third step. Once you have this information, trading becomes significantly easier, simpler, and faster. What many retail traders do not realize is that the largest lot traders and investors do not move price. When price is moving speculatively, the largest price action is often HFTs or retail, and NOT Dark Pools as many assume. As a retail trader, being able to first determine who is in control of price is a huge help because it defines quickly how price is likely to behave, what volume patterns you are likely to see, and how long the run or rally will sustain.

We are in a range bound market regardless of what news reports claim about the Dow. The Dow is a mere 30 stocks, which the giant buy side funds hold as charter stocks, and the giant sell side holds as trust fund stocks to create trading instruments to sell to small funds, retail, and the general market participants. The Dow moves on the retail side buying or selling. So those stocks seldom will move with huge gains like the underlying stocks will when news gets out that Dark Pools have accumulated. Quiet accumulation is often misused or misunderstood. It does track large lots, but there are numerous patterns within TTQA. It is not just that red bars indicates large lots distributing and green bars indicate large lots accumulating. TTQA is a sophisticated, highly sensitive indicator and it is a relational indicator to Volume and to Price. You have to use all 3 together to interpret and analyze what TTQA is saying to you, and it is always telling you more than Price and Volume alone. But it is a professional indicator and sublimely capable of revealing far more than most retail traders realize.

The professional side of the market makes great profits and most professionals are highly successful. Otherwise, they are gone quickly. The retail side has a dismal success rate. Part of the reason for this is because retail traders prefer to use what every other retail trader is using. They prefer to run with the retail crowd and use retail indicators that do not expose who is in control of price. So more often than not, they are trading against the large lots rather than with them. The ratio of pros to retail is 80/20. You need to be with the 80% and stop trading with the 20%.

Trade wisely,

Martha Stokes, C.M.T.
Member of Market Technicians Association
Master Rated Technical Analyst: Decisions Unlimited, Inc.
Instructor and Developer of TechniTrader® Stock Market Courses
http://technitrader.com
MetaStock Partner
©2013 Decisions Unlimited, Inc.

Disclaimer: All statements, whether expressed verbally or in writing are the opinions of TechniTrader, its instructors and or employees, and are not to be construed as anything more than an opinion. Student/subscribers are responsible for making their own choices and decisions regarding all purchases or sales of stocks or issues. At no time is any stock or issue on any list written or sent to a student/subscriber by TechniTrader and its employees to be construed as a recommendation to buy or sell any stock or issue. TechniTrader is not a broker or an investment advisor it is strictly an educational service.

Chuck Hughes' Prime Trade Select

Dodd Frank Act & OTC Swaps

MetaStock SPRS Series - Week 108 - TechniTrader® Stock Discussion for MetaStock Users - Dodd Frank Act & OTC Swaps - March 4, 2013
By: Martha Stokes C.M.T.

What the professionals worry about and discuss in their news feeds is totally different than what the retail side worries about and discusses incessantly in their news. The pros are currently focused on the new regulations being set in place with the Dodd Frank Act. The discussions have gone way beyond whether that is a good or bad law to how to cope with the regulations and what it means for the financial markets’ capital structures, individual professional traders’ profits, and dealers’ profits and risk. Right now, Swaps are up for some major regulation. The OTC Swap market is gargantuan. The outstanding contracts are estimated to be $600 trillion in notional value which is 40 times the US GDP. The market turnover is approximately 2.5 times a year which means there is an estimated $1,800 trillion notional value traded annually. That is a staggering amount. Swaps are a major part of profitability, risk management, hedging, and growth of the financial industry. Pros have many concerns as the OTC Swaps have been mandated to have clearing houses just as stocks and other instruments are cleared, as a means of full transparency and full documentation of the risk inherent in the financial system.

As an example, the international Banks have been holding a vast number of Interest Rate OTC Swaps. This was a hugely profitable trading strategy for them while the Feds suppressed interest rates. But without knowing exactly how many of these Swaps were out there, the risk is high that there may not be sufficient collateral in the event something started to unravel. Another big discussion is whether dealers can still make the huge profits as these OTC markets convert to more traditional and standardized systems. These are the worries of the professional side at this time. Certainly transparency in such a massive market as OTC Swaps is necessary, but margin to cover losses is a key issue.

What you need to worry about as a retail trader are those firms that are vested in Swaps and the risk these changes and mandates will create for those firms. Certainly GS, C, BAC, JPM, and other big banks, dealers, and market makers are going to see major structural changes to their Swaps trading activity and this will have a ripple effect in stocks, options, indexes, ETFs that are associated with financial services, and big banks. The retail side news is telling everyone banks are a great bargain. The Professional side is watching and waiting to see what the OTC Swap regulations truly mean for these industries’ future profitability.

Trade wisely,

Martha Stokes, C.M.T.
Member of Market Technicians Association
Master Rated Technical Analyst: Decisions Unlimited, Inc.
Instructor and Developer of TechniTrader® Stock Market Courses
http://technitrader.com
MetaStock Partner
©2013 Decisions Unlimited, Inc.

Disclaimer: All statements, whether expressed verbally or in writing are the opinions of TechniTrader, its instructors and or employees, and are not to be construed as anything more than an opinion. Student/subscribers are responsible for making their own choices and decisions regarding all purchases or sales of stocks or issues. At no time is any stock or issue on any list written or sent to a student/subscriber by TechniTrader and its employees to be construed as a recommendation to buy or sell any stock or issue. TechniTrader is not a broker or an investment advisor it is strictly an educational service.