tag:blogger.com,1999:blog-1142230194392134606Tue, 13 Oct 2009 12:41:15 +0000Stock Market, Trading and Investment Psychology. Swing Trades, Position Trades, Diligent Trades.http://diligenttrader.blogspot.com/noreply@blogger.com (Diligent Trader)Blogger26125tag:blogger.com,1999:blog-1142230194392134606.post-6693148377335490725Fri, 20 Feb 2009 16:42:00 +00002009-02-20T16:46:38.873ZPrior to this week’s sell-off the market had been moving within a range. However, when the Dow Jones index closed below the 800 level last week, a strong signal was given. A psychological support level was broken on the weekly charts. If you have a good look at the weekly chart, you’ll notice that even though the index had dropped below 8000 a couple of times, it always rebounded and never http://diligenttrader.blogspot.com/2009/02/did-recent-sell-off-catch-you-unaware.htmlnoreply@blogger.com (Diligent Trader)2tag:blogger.com,1999:blog-1142230194392134606.post-1939855253980979020Sun, 07 Dec 2008 00:05:00 +00002008-12-07T00:16:40.979ZThe Thanksgiving and December rally happen frequently on the stock market. Even though the stock market trend this year has been a downward trend and stocks have fallen sharpen over the last few months, there was a strong rally during the Thanksgiving holiday week. Will the December rally also happen? No one can tell for sure. The saying “only death and taxes are certain” also applies to the http://diligenttrader.blogspot.com/2008/12/is-santa-claus-coming-to-town.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-578546445656332488Sat, 15 Nov 2008 09:15:00 +00002008-11-15T09:22:22.795ZOn Thursday the market witnessed what is known as a “key reversal day”. An upside key reversal day occurs when the market opens below (or at) the previous day’s close, falls to take out the previous day’s low and then rebounds to close above the previous day’s high. This does not happen very often and is usually a strong signal that the market is about to reverse. A key reversal day is a signal, http://diligenttrader.blogspot.com/2008/11/key-reversal-day.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-1084345185681097778Sat, 01 Nov 2008 00:33:00 +00002008-11-01T00:39:56.101ZThe markets took a massive hit during October. During the month the Dow fell by 1525 points, while the FTSE 100 fell by about 526 points, almost 11%. At one point the FTSE actually fell as low as 3750 before recovering some of the loss to close at 4377. Despite the massive selloff during October, the final week of the month produced the largest weekly rise so far this year. The FTSE 100 rose http://diligenttrader.blogspot.com/2008/11/looks-like-there-is-some-upside-on.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-232451804817697163Mon, 27 Oct 2008 14:11:00 +00002008-10-27T14:17:02.050ZI read somewhere that Ed Lampart is adding to his stake in auto parts retailer Autozone and buying shares heavily. For those who don’t know him, he is a billionaire hedge fund manager. A couple of weeks ago, Warren Buffett said in a leading US paper that it was time to buy. Does the fact that these 2 people are buying mean that it’s time for everyone to buy? In my point of view the answer is no. http://diligenttrader.blogspot.com/2008/10/what-is-good-for-goose-is-not.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-2867203601829369136Sat, 25 Oct 2008 15:28:00 +00002008-10-25T16:34:09.015+01:00There is a lot of talk around the fact that the UK might be heading into a recession. The UK's Gross Domestic Product (GDP) which measures the output of the UK economy shrank 0.5% in the third quarter. This was a greater contraction than what economists had predicted. We still haven't had two consecutive quarters of economic contraction, so “technically” we are not yet in a recession.However, http://diligenttrader.blogspot.com/2008/10/is-uk-in-recession.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-5569957416127358814Tue, 07 Oct 2008 23:31:00 +00002008-10-08T00:39:36.416+01:00The table below shows the bear markets of the last 100 years. The worst so far was the September 1929 - July 1932 when the Dow lost 89%. In the current market the Dow has lost about 33% from it's recent peak at 14,000. This just illustrates that even though share prices have fallen a lot and shares are "cheap", there is still downside potential in the market.http://diligenttrader.blogspot.com/2008/10/bear-markets-of-past-100-years.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-5022235566461380534Thu, 02 Oct 2008 12:22:00 +00002008-10-02T13:45:09.417+01:00September was a rollercoaster month in the major stock markets. Blood was shed, giants got slaughtered, fortunes were lost, and governments were forced to take emergency measures. The largest one day increase in more than a decade occurred in September, ironically, the largest one fall in more than a decade occurred within the same month. While the bulls received a whipping, the bears were http://diligenttrader.blogspot.com/2008/10/bloodbath-on-stock-market.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-4832835798230392361Mon, 15 Sep 2008 21:43:00 +00002008-09-15T22:46:37.863+01:00The current market turmoil has claimed a number of high profile casualties. A lot of people will be wondering what’s going to happen next. Who’s going to be the next casualty? How many “patients” are waiting on the sidelines for their number to come up? I’m sure there are still a few more to go. There are still a lot of companies that are week both technically and fundamentally, and there are http://diligenttrader.blogspot.com/2008/09/can-aig-survive-turbulence.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-2990094915716852429Mon, 15 Sep 2008 12:50:00 +00002008-09-15T13:59:22.155+01:00No disrespect to the fallen investment banks, but I can’t help saying to myself, “how are the mighty fallen”. What happened to the big guys? How could the geniuses get it wrong? These are companies that wouldn’t employ graduates with less than a second class upper. You had to go to certain schools, or business schools to qualify working for them. A few months ago Bear Sterns had to be bailed http://diligenttrader.blogspot.com/2008/09/how-are-mighty-fallen.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-6578744400528439401Tue, 09 Sep 2008 12:23:00 +00002008-09-09T13:27:40.663+01:00I saw this in the paper today. I find it very amazing that people actually fall for scams like these. The paper suggests that around 3 million British people fall for theses scams each year. It’s likely that with the current credit crunch, the number of victims is likely to increase.This report shows the desire of the average person to accumulate riches without working for it. It shows the http://diligenttrader.blogspot.com/2008/09/35bn-year-lost-to-scams.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-3867782562154511749Tue, 09 Sep 2008 08:29:00 +00002008-09-09T09:32:35.563+01:00The stock market across the world rallied on Monday because the United States government bailed out 2 of the biggest mortgage lenders in the US. The bail out offered a relief to the investors across the world because if these 2 companies had been allowed to go under it would have had a devastating effect on the US and consequently the world economy.The bail out came at a time that the bears werehttp://diligenttrader.blogspot.com/2008/09/is-this-timely-intervention-by.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-8665846959236204299Thu, 04 Sep 2008 16:22:00 +00002008-09-04T17:35:53.093+01:00The Dow index closed on Tuesday with a shooting star candlestick. A shooting star is usually an indication that the market (or an instrument) may have topped and is ready for a reversal. If you look at the Dow chart, you'll see that the index was unable to break through resistance at 11800. This level was a previous support before it became resistance, which makes the level something that a http://diligenttrader.blogspot.com/2008/09/why-market-might-be-heading-for-another.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-3670896299619123999Tue, 02 Sep 2008 12:12:00 +00002008-09-02T13:30:10.674+01:00A new month started yesterday. The new month gives another opportunity to start doing things write with regards to our trading. A disciplined trader doesn’t just trade for the kicks or excitement, but treats trading as a business. If you treat your trading as a business then you should keep records of all your trades. Records should include the reasons you took the trade, your entry point, your http://diligenttrader.blogspot.com/2008/09/its-new-month.htmlnoreply@blogger.com (Diligent Trader)1tag:blogger.com,1999:blog-1142230194392134606.post-790182867995142866Sun, 17 Aug 2008 16:05:00 +00002008-08-17T17:15:43.260+01:00It caught a lot of people by surprise but the US dollar finally decided that it was not going to stay it. Over the last 18 months the dollar had been hitting new lows against most major currencies. The state of the US economy has not helped and the continuous rise in the prices of gold and petrol have added to the demise of the dollar. However, after consolidating for a while, the dollar found ithttp://diligenttrader.blogspot.com/2008/08/us-dollar-decided-that-enough-is-enough.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-3243891975858933631Thu, 14 Aug 2008 12:31:00 +00002008-08-14T13:33:34.671+01:00If you have a harem of 40 women, you never get to know any of them very well. – Warren BuffetTo be a successful stock trader/investor you have to limit the number of shares or instruments that you trade. You cannot seize opportunities if you are trying to trade everything that is available across all markets. This might be difficult to grasp if you are a private trader, especially when you wanthttp://diligenttrader.blogspot.com/2008/08/dont-be-master-of-none.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-3490301175040046549Sun, 03 Aug 2008 15:45:00 +00002008-08-03T16:49:47.268+01:00I’d like to share my top 5 trading quotes. A lot of them relate to trading psychology as I am a big fan of psychology and believe that it’s a very important aspect of trading and if you don’t get it right, the odds are against you from the start. Here’s the list.“Yet, I can see now that my main trouble was my failure to grasp the vital difference between stock gambling and stock speculation”. –http://diligenttrader.blogspot.com/2008/08/my-top-5-favourite-quotes-on-trading.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-2116621123092884988Thu, 24 Jul 2008 21:52:00 +00002008-07-24T23:00:34.633+01:00During a fun raising event on the 18th of July 2008, President Bush made a comment about Wall Street. President Bush in trying to explain the reason behind current global financial crisis said, ”There’s no question about it. Wall Street got drunk - that’s one of the reasons I asked you to turn off the TV cameras - it got drunk and now it’s got a hangover. The question is how long will it sober http://diligenttrader.blogspot.com/2008/07/did-wall-street-get-drunk.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-6445579682189824093Mon, 21 Jul 2008 22:50:00 +00002008-07-22T00:03:56.412+01:00The intention of this article is not to insult anyone but to highlight one of the main reasons why people get mediocre results in trading.Albert Einstein defined insanity as “doing the same thing over and over again and expecting different results”. It’s amazing how many people want a different result in various areas of their life but are not ready to make the change from within. People want to http://diligenttrader.blogspot.com/2008/07/are-you-insane.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-8690582955317510583Tue, 15 Jul 2008 22:01:00 +00002008-07-15T23:22:55.392+01:00I’d like to share some trading principles. These 10 principles are the top 10 from a list of 50 principles that was compiled from a pamphlet printed 30 years ago entitled “How Young Millionaires Trade Commodities” and these principles still apply in today’s market. Whether you trade commodities, stocks, indices or forex, these principles apply.1. Use money you can afford to lose - don't trade http://diligenttrader.blogspot.com/2008/07/10-trading-principles.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-4239099102201770634Thu, 10 Jul 2008 23:17:00 +00002008-07-15T23:29:26.228+01:00I received a phone call from a woman claiming to work for a brokerage firm in Zurich. She claimed to have many high income clients like me, and had an investment opportunity that had just come up. She had news that the government was about to invest heavily in alternative energy and she could buy me some shares in an alternative energy firm that the government was going to invest in. The company http://diligenttrader.blogspot.com/2008/07/heres-tip-for-you-free-of-charge.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-4240813448226933482Sun, 06 Jul 2008 07:52:00 +00002008-07-11T13:46:47.433+01:00Last week I posted my comments on the FTSE. After publishing the chart, I wasn't sure if I had done the right thing. The charts indicated that there was still some downside, but if the market had gone against my comments, then I would have exposed my being wrong to everyone. Anyway, the index went lower, as predicted. Below is the daily chartHave a great week.http://diligenttrader.blogspot.com/2008/07/fste-index-one-week-later.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-3033410766143675548Fri, 04 Jul 2008 19:55:00 +00002008-07-04T20:57:51.539+01:00Zechariah 4 v 8 -10 : 8Moreover the word of the LORD came unto me, saying, 9The hands of Zerubbabel have laid the foundation of this house; his hands shall also finish it; and thou shalt know that the LORD of hosts hath sent me unto you. 10For who hath despised the day of small things? for they shall rejoice, and shall see the plummet in the hand of Zerubbabel with those seven; they are the http://diligenttrader.blogspot.com/2008/07/do-not-despise-days-of-small-beginnings.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-521559888401122881Sun, 29 Jun 2008 23:28:00 +00002008-06-30T00:37:21.594+01:00Share prices have been falling for a while. The short-tem and intermediate term trends are to the downside. How much lower can share prices go? Have they fallen far enough? To answer this question on has to look at the longer term charts, i.e. weekly and monthly.While looking at the daily chart of the FTSE 100, it appears to be oversold. RSI is below 30 and stochastic is below 20. Although with http://diligenttrader.blogspot.com/2008/06/how-much-more-downside-is-there-in-this.htmlnoreply@blogger.com (Diligent Trader)0tag:blogger.com,1999:blog-1142230194392134606.post-966213223977474099Sat, 28 Jun 2008 13:45:00 +00002008-06-28T14:47:54.280+01:00“A trader, in addition to studying basic conditions, remembering market precedents and keeping in mind the psychology of the outside public as well as the limitations of his brokers, must also know himself and provide against his own weaknesses.”- Jesse Livermore.I’d like to share my thoughts on this quote by Jesse Livermore. For those that do not know Jesse Livermore, he was on of the greatest http://diligenttrader.blogspot.com/2008/06/identifying-your-weakness-is-major-step.htmlnoreply@blogger.com (Diligent Trader)0