Trading the imperfect double top – PART I.

The double top is not a reversal pattern

When it comes to the chart pattern of double tops, traders often look for perfection. I would like to advise against perfection; and, instead, introduce how to search for the taste of a “good enough pattern.” Imagine that prices progress in an uptrend and then suddenly find resistance. Prices pull backs then turns north again, Trading the imperfect double top – PART I.

Trend Division Line

The web of lines in trading - an SPX case study

Traders can profit from a set of lines that enables them to tell apart a trend from a correction. This discernment is essential when it comes to adjusting our trading strategy to the current market condition. What is more, these easy to draw lines represent a thinking process aimed at the proper assessment of the Trend Division Line

NZDUSD Trading Signal Was “Against the Odds”

...echoing in the background noise of a casino

One core flaw traders make is when they use support and resistance levels, trend lines or Elliott waves alone – in other words, only “Context type” of ideas. Others traders fancy near term price action or candlesticks analysis alone, and they miss the forest for the trees by relying totally on the right side of NZDUSD Trading Signal Was “Against the Odds”

You have an opportunity to spend the next week learning how you can spot high-confidence trade setups in the charts you follow every day.

Elliott Wave International (EWI) is hosting a free Trader Education Week April 22-28. Register for this event and have instant access to 3 free trading resources from EWI Senior Instructor and Chartered Market Technician, Jeffrey Kennedy. Now you have the opportunity to be a student in his online classroom, as he takes complex technical methods and tools and breaks them down so that you can apply them to your trading immediately. Then you will receive new lessons each day during Trader Education Week — also designed to help you learn to spot high-confidence trade setups in the charts you follow every day.

Day 1 lesson: The Power of Context

Day 2 lessons: Understanding Price Gaps and  Japanese Candlesticks

Day 3 lessons: Targeting with the Wave Principle and The Key to Successful Trading

It’s one thing to listen to other people’s trading advice, but wouldn’t you rather learn how to spot trading opportunities for yourself? Don’t miss this opportunity to get new, practical lessons every day through April 28!

Register for Trader Education Week — It’s FREE!

Use the Force, Luke

Always adjust or the golf club shape trend day will grind you

I see this mistake all the time – from runners, and traders. You probably have observed the same in other type of activities as well. The proverbial salmon swimming upstream. Let me explain. I ran the Vancouver Sun Run 10K this past weekend, and there was a vivid reminder of being aware of your environment. Use the Force, Luke

Secrets To Better Trading – Video

Would you like to become a professional trader or just improve your results? What is your idea about trading for living? The mindset behind a successful trading career might surprise you. Process is more important than prediction. Repeatable work, that you do again and again, is the secret sauce of the trader. So, before you Secrets To Better Trading – Video

Oversold, Another Word for Downtrend

A ban symbol

Oversold and overbought are two technical analysis words that I’d like to ban! The phrases seem to suggest that a stock, currency or futures contract really should not decline, or advance, anymore. In an overextend wave, however, we should not attempt to expect anything rational from the highly emotional driven price trend. Wave extensions are Oversold, Another Word for Downtrend

Ultimate Edge Checklist for Traders

Trader Skillset's ultimate check list tells you what to look for in a trading system

Do your New Year’s resolutions include making more money? Possibly by improving your trading performance, or, perhaps, to transition your career towards trading? Good idea. The best advice we can give you to achieve those goals is to discover an “edge” in seven key areas. You might find these edges in a book, membership service, seminar or training course. Or you might not. You should be looking for an advantage, in the following areas, otherwise the system you follow is, quite frankly, inadequate…

How to Cope With Trader’s Stress

Eliminate day trader's stress pays out big time in performance

I just completed the 10K Christmas Run in Santa Monica, CA last weekend. My personal ambition is to fight my way back into competitive (age group) running; but, in addition to fitness, this activity also serves me in another way as a trader. To be honest, I was not always aware how much exercising might be an important performance How to Cope With Trader’s Stress

The “Point of Profit” Reference

We set price targets because they are one of the three essential variables of a setup; target (reward), point of ruin (risk) and probability. We do the math to make sure that the price level we choose as target is attainable with a probability that’s high enough. We also check whether the entry levels provide enough of a ride The “Point of Profit” Reference

Price is the Ultimate Source, WSJ is entertainment

Front page of the Wall Street Journal's October 26 edition

Before boarding a recent flight to Amsterdam, I grabbed the October 24-26 weekend edition of The Wall Street Journal (WSJ). Reading the news is quite out of the ordinary for me, a full time trader who relies almost exclusively on price action. The only reason I got my hands on the paper was solely to Price is the Ultimate Source, WSJ is entertainment

Sherlock Holmes the Great Trader

US dollar and a magnifying glass

A market analyst is a bit like a detective. In order for a homicide detective to make an arrest, he needs a body, a murder weapon, motive, physical and testimonial evidence. Just like a detective, making market forecasts is all about building a solid case based on multiple types of evidence. Trader Skillset uses Elliott wave analysis as our primary Sherlock Holmes the Great Trader

What Seperates Great Traders from the Pack?

a giant ferris wheel in the evening light the methaphor of the trader's wheel

Every trader might have a different answer based on their personality and process, but we do see many common traits. Many might think that it’s an ability to analyze a chart, and while that skill is important, it might only be 10-20% of the answer. Today, we will share our evaluation checklist that defines the areas where successful traders get the edge day-by-day, setup-after-setup.

How Running Corrections are Born?

Where does the market run when we see a running correction form

We often see sideways corrections being somewhat skewed in the direction of the preceding trend leg. For example, in a bull trend the market suddenly turns down for a couple of bars (wave A) then forms a marginal higher high above the peak (wave B) and when many expect price to return at least to the How Running Corrections are Born?

Flipboard Social Magazine Logo - Follow Trader Skillset there

Sometimes it might be hard to dedicate proper focus on in depth technical tutorials or an analysis article between the opening and the closing bells. To deliver a comfy solution from now on, we present Trader Skillset as an easy to read Flipboard magazine.

We blend our Context – Momentum – Signal concept posts with a carefully curated selection of economic and political topics from the financial media. But, what is more important, we do so through the popular free Flipboard App which is optimized for tablets or smartphones providing you the flexibility and mobility to absorb the content whenever and wherever you can.

Use this link to find and follow us or just search Flipboard for Trader Skillset. Available on the App Store, Windows Store, Google Play and BlackBerry World.

Enjoy and stay connected.

S&P 500 at 2000 – How high can it go?

crosshair on the weekly S&P 500 chart

A popular topic lately is the discussion of the bull market in US stocks now that the S&P 500 is at 2000. How much further might it go? We have already covered the process we would like to see before we change from bullish to bearish in a previous post about how to identify a trend change. Personally, as a trader I S&P 500 at 2000 – How high can it go?

From Dow to Broccoli

The broccoli is a nice example of a fractal image in nature, repeating itself in self-similarity at varying scales

At the end of the 1800s Charles Dow’s market theory had already included some hints about the three phases of market trends. Deliberately I use the word “hint,” because his principles are formulated much too vaguely to build an active trading strategy with. According to Dow, the first phase is a slow up leg governed From Dow to Broccoli

Learn to Trade – Your System

market info - knowledge - wisdom

To learn to trade successfully, you need create your own systematic approach and trading plan from which you are able to make your own decisions. Successful trading requires a unique understanding of markets, core risk-taking ability, temperament, perception and even a compatible lifestyle. Trading is certainly not a product in a box that you can buy with Learn to Trade – Your System

Ideal Reversal and Continuation Signals

Traffic light tree in the dark - Tons of signals which one to choose

It takes more than a single candlestick, or pattern, to enter a trade, even if it meets an optimum set of criteria. Candlestick patterns are just one signal that we utilize to alert us when the short term price action lines up with the long term context. As Jeffrey Kennedy from Elliott Wave International puts Ideal Reversal and Continuation Signals

Three Times the Speed

Many traders have a basic understanding of momentum. But, we think most traders would benefit from three tweaks to the traditional thoughts on the topic. In fact, in our proprietary trading system, momentum helps to identify and confirm the context; and, as such, it is the link between historical prices and the short term signals. Traditional Momentum Three Times the Speed