SWAG Trading System By Jared Odulio

I watch this video yesterday "The SWAG Trading System" and worth noting.

His technique is just a combination of four indicator.
1. Parabolic SAR - This is to spot the trend (If down trend or up trend)
2. EMA 13 - Trigger (Buy if EMA 13 is about to cross SMA 20 "from under")
3. SMA 20 - Base (Sell if EMA 13 is about to Cross SMA 20 "from above")
4. MFI (Money Flow Index) - To spot where the money is flowing (If the money is flowing out "downward" or flowing in "upward"). The indicators also include determining if the stock is oversold or overbought.

Below is the replay of his video on Soul of the Market Easter Sunday Special.

Update: 02 April 2016

Soul Of The Market Weekender Post Market Review April 01, 2016

Good Luck!

What Is Your Personality as a Trader? Check below website

Somebody posted this website wherein after answering the posted queries an assessment would be given as to your personality as a trader.

Anyway, it says that I am a Planning Trader

Wanna check yours? Try this site too. Just for fun.

http://www.tharptradertest.com/

Money Flow Index (MFI)

Introduction

The Money Flow Index (MFI) is an oscillator that uses both price and volume to measure buying and selling pressure. Created by Gene Quong and Avrum Soudack, MFI is also known as volume-weighted RSI. MFI starts with the typical price for each period. Money flow is positive when the typical price rises (buying pressure) and negative when the typical price declines (selling pressure). A ratio of positive and negative money flow is then plugged into an RSI formula to create an oscillator that moves between zero and one hundred. As a momentum oscillator tied to volume, the Money Flow Index (MFI) is best suited to identify reversals and price extremes with a variety of signals.

Calculation

There are a several steps involved in the Money Flow Index calculation. The example below is based on a 14-period Money Flow Index, which is the default setting in SharpCharts and the setting recommended by the creators.

Patient Investors Can Reap Big Profits By Finding The Saucer Base

While a good cup with handle takes at least seven weeks to form, a saucer pattern built by a superb stock can take shape over several months or a year or more (Rob Schreckhise/Shutterstock)

Too Much Hype Can Kill You: Idea on How to Consider a Trade

Here we go, another reading about stock hype. Just re-sharing in my blog.

Whenever we go to groceries to buy pork, fish, vegetable or canned goods. We always do meticulous check whether it’s in pristine quality or not. When we go shopping may it be new for a new shoes, shirt, bag or gadgets. We make sure that it’s in 100% mint condition, no dents, no defects whatsoever. But, why is it that when we buy a stock. We just buy what we we’re told to without even raising a question.

This story goes to all who doesn’t know what their doing here in the Market.

Victims of Hype in Philippine Stock Market

This was shared in Facebook and seems to be worth noting. Apparently, I am myself attest that there are a lot of hypers in all social media such as Facebook, Twitter, Instagram and etc. It's hard to filter who is saying correct or not but what I can say is educate yourself so that there is no need to be swayed by some Experts kuno. Be the master itself and stop being a newbie.

VICTIMS OF HYPE

By: The Responsible Trader

Part 1: Intro

                Most of the time, we have been approached to help traders whose trading accounts are either  “IPIT” (trading account caught in a bad position) or “SUNOG” (trading account burned) saying that they got into the situation because they are VOH – Victims of Hype.  We would like to state that we are not purporting ourselves to be trading doctors who hold the panacea for all trading ills.  We try our best to share knowledge and information to help traders but we definitely cannot save a dying trading account.

                An ounce of prevention is better than a pound of cure.  To avoid getting burned, we offer the following advice.

                Your first Buy into any stock, either blue chip or speculative should be a test buy, never an “ALL IN”, whether you generated the trading idea on your own or it was given to you by a guru. Much more so if you got the advice from a guru.  The most irresponsible advice I have seen from a  guru is to go ALL IN (unless your guru tells you he has reliable inside information).

                Why do a test buy?  You never can tell whether the position you are taking is going to be a “Good Buy” or a “Good-Bye.”

                What do we consider as a “Good Buy?”  If  your test buy moves in your favor by 3% to 5% within 5 days,  then you may consider adding in tranches.  What do we consider as “Good Bye?” If your test buy moves against you by 2%  within the same time frame you can say “Good Bye”, cut your losses and limit it to just perhaps your “burger meal” budget.

Good Investing Goes Beyond the Stock Market

When people talk about investing, they almost always talk about the stock market. Heck, if you check out my archives here at The Simple Dollar, you’ll find they’re almost exclusively articles about how to get better at investing in the stock market.

And that’s great. The stock market is a fantastic way to build wealth and it should be a part of just about everyone’s long-term financial plan.

But it’s not the only option. There are other ways to invest that are not only less risky, but can offer a bigger return. Here are four of them.

1. Invest in Yourself

Why attitude is more important than IQ

Scott Barbour/Getty ImagesSuccess lies in how you handle defeat.

Basic Lesson 9: Understanding COL Financial Trade Charges

If you are engaging in stock market trading, then is very important to have the basic knowledge on how much it would cost every time you buy or sell stocks. This would help gauge the break even point for buying and selling of  stocks that should at least recover the transaction costs.

The COL Financial Trade Charges Structure:

I studied the above structure of fees that I need to pay for every COL transaction hence it guides me in planning how much would be the prospect swing in prices to cover the incurred trade cost plus the expected plan gain.

See below sample computation for reference:

Good Luck!

Highly Diversification of Stock Portfolio versus Concentrated Stock Portfolio

I back tracked my stock portfolio in my first year of stock investing versus my current stock market trading and found out that my stock portfolio initially was over diversified.  I have around 10-15 stocks even though I just have around few thousands of money in COL account. I even by stocks at around 2,000 which I realized later that shouldn't be the case in buying stocks (See Basic Lesson 9). The way I see things before is kinda different compared today. Before, I was trying to save money by investing in stocks and because of that,  I was so afraid to lose my money hence the reason of buying a lot of stocks under different industry. I don't know how to choose stocks back then as I am just relying on COL investment guide and which ever stock is popular. 

Stock Market Trading Rules in Trader's Apprentice FB Group by Senyor Roy Reyes

I have been a member if Trader Apprentice for nearly two years already and I learned a lot from them. My growth in stock market was exponentially increased since joining this group. Beware that joining this group, you would be exposed to a lot of stock hype. Be vigilant. 

One of the lesson I learned from this group is the Trading Rules on one of the group founder Roy Reyes as follows:

1. Plan your trades. Trade your plan.

2. Keep records of your trading results.

3. Keep a positive attitude, no matter how much you lose.

4. Don’t take the market home.

5. Continually set higher trading goals.

Phases of Trader Development

I just found this post in FB and worth nothing.

Basic Lesson 8: The MECHANICs of STOCK MARKET TRADING

Now that you have an account and you know how to execute BUY and SELL of stocks, I will discuss the MECHANICS of STOCK MARKET TRADING.

I started stock market out of nowhere and I used to be trigger happy pushing that BUY and SELL button. Success in Stock Market Trading do not account your frequency in buying/selling stocks or how long you hold your stock position. WHAT REALLY MATTERS IS IF YOU MADE A PROFIT OR GAIN IN STOCK MARKET. That is what matters and nothing more nothing less!!!

Everybody who goes to stock market trading wants to earn a profit/gain. They did not come to stock market just to lose money. Majority of the stock market traders with big portfolio are managed by experts in stock market so you have to prepared and fully equipped before you pull the trigger of BUY and SELL button.

The basic notion of us Filipinos especially the poor class/middle class is that we open an account in stock market so that we will multiply our money in short span of time. Guys, that is me when I first open my account. Most stock market newbies who are not prepared lose money in stocks.

Most probably, you had read the book of Bo Sanchez entitled My Maid Invests in the Stock Market (PDF Copy of Short Version) and you might assume you can also do better because they are just maid. The title of the book is quite misleading if you have not read the book. The maid made good investment decision because they had a direct mentor and you do not have. I am not advertising but you can subscribe on their group "Truly Rich Club" but what I can say is that you will never be independent if you keep relying to a mentor. Please take note that Bo Sanchez is into stock market investing while I prefer stock market trading. Anyway, I will include discussing stock market investing later so you will have an idea.

Okay too much gerger on my end but what I really want to say is Please Equipped Yourself First before plunging to this war zone of stock market. Before you execute a BUY then you should have a TRADE PLAN.

Golden Cross

What is a 'Golden Cross'

A crossover involving a security's short-term moving average (such as 15-day moving average) breaking above its long-term moving average (such as 50-day moving average) or resistance level.

BREAKING DOWN 'Golden Cross'

As long-term indicators carry more weight, the Golden Cross indicates a bull market on the horizon and is reinforced by high trading volumes . Additionally, the long-term moving average becomes the new support level in the rising market.

Technicians might see this cross as a sign that the market has turned in favor of the stock.

Source: http://www.investopedia.com/terms/g/goldencross.asp

Basic Lesson 7: How to SELL STOCKS using COL Financial During Trading Hours

The procedure on how to SELL stocks is just the same as buying stocks. The only difference this time is that you have stock to sell.

Just go to the same tab "Trade" then click the "Enter Order". Then follow procedure as follows:

Step 1

- I use CPG as a sample this time because I had sold my BPI already. Assuming I sell around 1,000 shares of my total CPG shares.

Basic Lesson 6: How to CANCEL STOCK ORDER During Trading Hours

If you've changed your mind regarding your buy request or sell request and it is still not executed then you can still cancel it.

Please follow diagram below for the procedure of cancellation:

- You have to click again the Trade then this time, click the View/Modify Order. 

- Remember I had executed an actual bid in Basic Lesson 5 using BPI stock code which is consistent with the above transaction. The transaction was not executed because our bid is very low in contrast to the current trading price during that period.

Basic Lesson 5: How to BUY STOCKS using COL Financial During Trading Hours

Here we go, the execution stage. How do we execute the buy and sell of stocks using COL Financial online platform?

Please follow below diagram:
STEP 1.

-As discussed in Basic Lesson 3 regarding the overview of COL Platform. You just have to click on Trade then click Enter Order then you can start buying/selling stock as follows:

Basic Lesson 4: How to Use COL Financial "QUOTES"

Below is the step by step on how to use COL quotes including the explanation of some basic stock rules:

As previously mentioned in the Basic Lesson 3 on tab No. 2., you just have to click the "Quotes Tab". As a start, we go to the specific stock query then type the specific stock code. Once you type the stock code then information about the stocks come out. Let me discuss the information that this specific query will provide.

How to Develop a Trading Brain

For traders to achieve true discipline, they need to more than just accept the idea.

Investors need the right psyche and mental strength to evaluate financial risks and trends. They need to separate from the influences that have molded their casual mindsets, whether these influences be family, society or the environment.

Most traders think being coldly rational, well-informed and experienced are all that matters, but psychologist and author Normal Welz argues none of those traits help if the brain is not appropriately programmed and tuned.

Trading discipline stems from changing behaviors to overcome mental resistances and fear that get in the way. The trading brain combines the right investment and market knowledge with the proper mental capabilities.

Traders who solely focus on the logical aspects of charts and trends will struggle with the emotions that influence and dominate the markets. The technical side is important, but traders must change their personality and release entrenched behaviors. This can take time and may require a coach, but discipline isn’t supposed to be simple to accomplish.

Source: http://www.investopedia.com/video/play/how-develop-trading-brain/?utm_source=facebook.com&utm_medium=social&utm_campaign=fb_main_page

Story of Mr. Save Now, Mr. Save Later and Mr. Chase

This story of a three college friend with same age. Their names are Mr. Save Now, Mr. Save Later and Mr. Chase.

After graduation the 3 friend start looking for a job and not see each other for a couple of years.

Fundamental Analysis Videos

It is very hard to explain fundamental analysis so I'd rather share a video explanation about it. This is to better to understand the basics of it. I am accountant hence I can read and compute a lot of financial analysis but currently, I can't judge which part is best to guide me. In the beginning, I even computed the book value, financial ratios which are fundamentally appealing but I don't understand why it is under priced in the stock market. Alternatively, I use my fundamental skills to check the future performance of the company hence I can position myself before the financial report release. It is more on a catalyst play because I think these fellow stock market traders are emotionally driven wherein an announcement about an increase in company's profit would compel them to buy the company's share hence they will force the market price of the stocks up. I use my fundamental analysis skills in par with my technical analysis skills.

Most of the stock market traders are buying stocks because of the future market value. Majority of the information can be found at the http://edge.pse.com.ph/ but is up to you to dig it up and sort it out. We are lucky that we have this kind of facility which are readily available online. I understand that you might say that there are too much information but that's the challenging part of it only. I managed to read around 10 financial statements so far because of my interest on that company. It is your choice.

Below are online videos from YouTube which discusses basic fundamental analysis:

Fundamental Analysis Stocks Part 1

Fundamental Analysis Stocks Part 2

Fundamental Analysis Stocks Part 3

Good Luck!

Slow and Steady Wins the Race

It seems that most people today are in a hurry. Rushing to get ahead everybody else. Rushing to get early to the office to avoid a memo. Rushing for promotion at the shortest time possible. Rushing to settle down and have a family. Rushing to look more matured by imitating trending styles from head to toe. Rushing to get things done according to plan.

In the world of stock trading, newbies aggressively aim for quick profits. Newbies are lured into different investment scams. Newbies are slaughtered like hogs by the pack of wolves. It happens all the time because of greed.

There is absolutely nothing wrong with the goal: "to make money in stocks in the short-term or long-term." However trading should be treated as a process and not as a race. In one way or another, you will outgrow other people who do not exert much effort in studying and developing their skills. Since it is a process, there has to be a system because this will provide a balance between the normal life and your (hidden) addiction in trading.

Remember 3Ps – Purpose, Patience, Perseverance. Lacking of any of these three qualities will make you more susceptible to greed. Do not be envious or jealous of other people’s success. Instead, focus your energies in finding better ways to overcome your own weaknesses.

You can be a good and successful trader but do not forget that there are also other aspects in life that can make your learning process more meaningful. A good character is better than a famous title and a good heart is always better than recognition.

Looking Beyond Charts: A Holistic Approach to Technical Analysis

Give one stock chart to 10 different chartists and you could have 10 varying interpretations. This is because there are biases unique to each analyst. Each has developed his or her own method(s) of judging or evaluating stocks including risk parameters. What appears attractive to a swing trader might not be acceptable for a position trader, vice versa.

A lot of traders think that Technical Analysis is just merely reading or interpreting price charts and patterns. In reality, technical analysis can also include statistical, sentiment and behavioral analysis.

Classical technical analysis use basic indicators such as chart/bar patterns, candlesticks, support and resistance, oscillators, market breadth and cycles.

Statistical analysis involves quantitative methods.

Sentiment Analysis includes psychology of market participants like insider trading and seasonality of stocks (based on macroeconomic indicators or global market conditions).

Behavioral Analysis studies market reaction like herd behavior everything that is related to emotions, expectations and biases of other market participants.

One can combine the methods mentioned above.

Every bullish interpretation can have a corresponding contradicting bearish interpretation.

Remember that there is no perfect system. The market decides on its own and therefore as a trader, you have to be prepared for both positive and negative scenarios. Risk management is vital.

Source: https://www.facebook.com/DivergentTraderVes/?fref=nf

Dancing with the Wolves

The strongest instinctive force in humans is to fight for survival. In the stock market, most people strive to make a profit.

Regardless of how many stock market trading books one reads, it will always be about the same old game. They will play with your emotions, they will mess up your logic. You will be tempted to break your own trading rules.

It is impossible to discern the ulterior motive behind every trade. However, one can already learn a lot by observing. For example, how market operators use sentiment or volume to drive stock prices up or down. This can be done by finding a group of participants (or brokers) that trade actively and act similarly. You just don't make analysis based charts and financials. Study local and foreign investors' behavior and activity.

You have to be aware of the manipulation that is currently taking place. Is it informational or transactional? Informational manipulation involves market participants/operators who spread false rumors or misleading information to influence stock prices. Transactional manipulation is also referred to as the volume play wherein market participants/operators creates an illusion of market activity by increasing trading volume and liquidity.

Will the market always be manipulated? Yes, probably in the short term but not perpetually. At some point in time there has to be a check and balance in free markets thus some securities cannot remain overvalued or undervalued forever.

Will you always be manipulated by the market makers and operators like how a predator hunts its prey?

Or are you willing to learn how to dance with the wolves?

Source: https://www.facebook.com/DivergentTraderVes/?fref=nf

Every Trader Must Follow a Rule or Die

I found this start up website same as mine but he seems to be doing well already.

His message of having a "trade rule or die" got me that makes it my next goal. I have been trading for a while but I do not have a list of trade rule. I believe I should back track my trade history and check where did I perform well so I could create my own trade rule also.

Below were the trade rule of this proud traders for my future note:

Basic Lesson 3: Overview of COL Financial Online Platform

Once you open your account, you will receive an email from COL Financial help desk that your account has been activated including your USER Name (Account Number) and Temporary Password. Below is a sample email you should receive from the helpdesk:

(Account Number should be 8 Digit: xxxx-xxxx)

Summary: Popular Chart Indicators

Everything you learn about trading is like a tool that is being added to your forex trader’s toolbox. Your tools will give you a better chance of making good trading decisions when you use the right tool at the right time.

How to Use ADX (Average Directional Index)

The Average Directional Index, or ADX for short, is another example of an oscillator. It fluctuates from 0 to 100, with readings below 20 indicating a weak trend and readings above 50 signaling a strong trend.

Unlike the stochastic, ADX doesn’t determine whether the trend is bullish or bearish. Rather, it merely measures the strength of the current trend. Because of that, ADX is typically used to identify whether the market is ranging or starting a new trend.

Take a look at these neat charts we’ve pulled up:

How to Trade Support and Resistance

We have divided how to trade support and resistance levels into two simple ideas: the Bounce and the Break.

The Bounce

As the name suggests, one method of trading support and resistance levels is right after the bounce.

Many retail traders make the error of setting their orders directly on support and resistance levels and then just waiting to for their trade to materialize. Sure, this may work at times but this kind of trading method assumes that a support or resistance level will hold without price actually getting there yet.

You might be thinking, “Why don’t I just set an entry order right on the line? That way, I am assured the best possible price.”

When playing the bounce, we want to tilt the odds in our favor and find some sort of confirmation that the support or resistance will hold.

How to Use Momentum Indicators to Confirm a Trend

So how do we spot a trend?

The indicators that can do so have already been identified as MACD and moving averages.

These indicators will spot trends once they have been established, at the expense of delayed entry.

The bright side is that there’s less chance of being wrong.

How to Use Oscillators to Warn You of the End of a Trend

An oscillator is any object or data that moves back and forth between two points.

In other words, it’s an item that is going to always fall somewhere between point A and point B. Think of when you hit the oscillating switch on your electric fan.

Think of our technical indicators as either being “on” or “off”. More specifically, an oscillator will usually signal “buy” or “sell”, with the only exception being instances when the oscillator is not clearly at either end of the buy/sell range.

Does this sound familiar? It should!

The Stochastic, Parabolic SAR, and Relative Strength Index (RSI) are all oscillators. Each of these indicators is designed to signal a possible reversal, where the previous trend has run its course and the price is ready to change direction.

Let’s take a look at a couple of examples.

Stochastic Oscillator

Introduction

Developed by George C. Lane in the late 1950s, the Stochastic Oscillator is a momentum indicator that shows the location of the close relative to the high-low range over a set number of periods. According to an interview with Lane, the Stochastic Oscillator “doesn't follow price, it doesn't follow volume or anything like that. It follows the speed or the momentum of price. As a rule, the momentum changes direction before price.” As such, bullish and bearish divergences in the Stochastic Oscillator can be used to foreshadow reversals. This was the first, and most important, signal that Lane identified. Lane also used this oscillator to identify bull and bear set-ups to anticipate a future reversal. Because the Stochastic Oscillator is range bound, is also useful for identifying overbought and oversold levels.

How to Use Moving Averages as Dynamic Support and Resistance Levels

Another way to use moving averages is to use them as dynamic support and resistance levels.

We like to call it dynamic because it’s not like your traditional horizontal support and resistance lines. They are constantly changing depending on recent price action.

There are many traders out there who look at these moving averages as key support or resistance. These traders will buy when price dips and tests the moving average or sell if price rises and touches the moving average.

Here’s a look at the 15-minute chart of GBP/USD and pop on the 50 EMA. Let’s see if it serves as dynamic support or resistance.

How to Use Moving Average Crossovers to Enter Trades

By now, you know how to determine the trend by plotting on some moving averages on your charts. You should also know that moving averages can help you determine when a trend is about to end and reverse.

All you have to do is plop on a couple of moving averages on your chart, and wait for a crossover. If the moving averages cross over one another, it could signal that the trend is about to change soon, thereby giving you the chance to get a better entry. By having a better entry, you have the chance to bag mo’ pips!

If Allen Iverson made a living by having a killer crossover move, why can’t you?

How to Use Moving Averages to Find the Trend

One sweet way to use moving averages is to help you determine the trend.

The simplest way is to just plot a single moving average on the chart. When price action tends to stay above the moving average, it signals that price is in a general uptrend.

If price action tends to stay below the moving average, then it indicates that it is in a downtrend.

Japanese Candlestick Cheat Sheet

Source: http://www.babypips.com/school/elementary/japanese-candle-sticks/japanese-candlesticks-cheat-sheet.html

Summary: Fibonacci Trading

The key Fibonacci retracement levels to keep an eye on are: 23.6%, 38.2%, 50.0%, 61.8%, and 76.4%. And the levels that seem to hold the most weight are the 38.2%, 50.0%, and 61.8% levels, which are normally set as the default settings of most forex charting software.  If your trading software doesn’t have a Fib tool, no worries – we’ve got a Fibonacci calculator that can generate the levels, requiring only a few pieces of data from you!

How to Use Fibonacci to Place Your Stop so You Lose Less Money

Probably just as important as knowing where to enter or take off profits is knowing where to place your stop loss.

You can’t just enter a trade based on Fib levels without having a clue where to exit. Your account will just go up in flames and you will forever blame Fibonacci, cursing his name in Italian.

In this lesson, you’ll learn a couple of techniques to set your stops when you decide to use them trusty Fib levels. These are simple ways to set your stop and the rationale behind each method.

The first method is to set your stop just past the next Fibonacci level.

If you were planning to enter at the 38.2% Fib level, then you would place your stop beyond the 50.0% level. If you felt like the 50.0% level would hold, then you’d put your stop past the 61.8% level and so on and so forth. Simple, right?

How to Use Fibonacci Extensions to Know When to Take Profit

The next use of Fibonacci will be using them to find targets.

Gotta always keep in mind “Zombieland Rules of Survival” – When in doubt, know your way out! Let’s start with an example in an uptrend.

In an uptrend, the general idea is to take profits on a long trade at a Fibonacci Price Extension Level. You determine the Fibonacci extension levels by using three mouse clicks.

First, click on a significant Swing Low, then drag your cursor and click on the most recent Swing High. Finally, drag your cursor back down and click on any of the retracement levels.

This will display each of the Price Extension Levels showing both the ratio and corresponding price levels. Pretty neat, huh?

How to Use Fibonacci Retracement with Japanese Candlesticks

You’d know by now that you can combine the Fibonacci retracement tool with support and resistance levels and trend lines to create a simple but super awesome trading strategy.

How to combine the Fibonacci retracement tool with your knowledge of Japanese candlestick patterns.

In combining the Fibonacci retracement tool with candlestick patterns, we are actually looking for exhaustive candlesticks. If you can tell when buying or selling pressure is exhausted, it can give you a clue of when price may continue trending.

Let’s take a look at an example to make this clearer.

How to Use Fibonacci Retracement with Trend Lines

Another good tool to combine with the Fibonacci retracement tool is trend line analysis. After all, Fibonacci retracement levels work best when the market is trending, so this makes a lot of sense!

Remember that whenever a pair is in a downtrend or uptrend, traders use Fibonacci retracement levels as a way to get in on the trend. So why not look for levels where Fib levels line up right smack with the trend?

Here’s a 1-hour chart of AUD/JPY. As you can see, price has been respecting a short term rising trend line over the past couple of days.

How to Use Fibonacci Retracement with Support and Resistance

Using Fibonacci levels can be very subjective. However, there are ways that you can help tilt the odds in your favor.

While the Fibonacci retracement tool is extremely useful, it shouldn’t be used all by its lonesome self.

It’s kinda like comparing it to NBA superstar Kobe Bryant. Kobe is one of the greatest basketball players of all time, but even he couldn’t win those titles by himself. He needed some backup.

Similarly, the Fibonacci retracement tool should be used in combination with other tools. In this section, let’s take what you’ve learned so far and try to combine them to help us spot some sweet trade setups.

Are y’all ready? Let’s get this pip show on the road!

Fibonacci Retracement + Support and Resistance

One of the best ways to use the Fibonacci retracement tool is to spot potential support and resistance levels and see if they line up with Fibonacci retracement levels.