Why Fading The Opening Gap Is The Ideal Setup for Me
I recently had the opportunity to sit down to dinner with Scott Andrews from MastertheGap.com, and at the end of the dinner I honestly said to myself, this guy has got something here. Now there’s a lot of “gap” research and insight out there, but Scott takes it to a different level. So if you have some time, please read his article, fire away with the comments, and visit his site MastertheGap.com.
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If you are looking to become a serious trader, there are two critical questions that you must answer; “What is my primary trade setup?” and “What is my edge?”
When I started out, it seemed like every book, every website, and every trader touted a different setup – each with its own merits. But I knew that I needed a trade that fit “me” and my trading personality. After lots of searching and introspection I settled on fading (i.e. trading the opposite direction of) the opening gap in the indices (e.g. S&P 500, Dow 30, Nasdaq 100, Russell 2000). Not only do opening gaps occur daily and offer significant profit opportunity,but they have an inherent directional bias. In fact, over 70% of gaps will retrace from their opening price back to the prior session closing price that very same day, often in the first hour of trading.
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What happened to the gold market?
I think it came as a big surprise to many traders that the gold market imploded on Tuesday pushing to its lowest levels in several days.
The downward spiral was enough to trigger a daily “Trade Triangle” which moved us into the neutral camp on this market. Exiting our long gold position based on our “Trade Triangle” signals produced a very small profit or in some cases of break even trade.
So the question is: Is the sharp downward move in gold over?
In my new video I answer that question and share with you some levels I think gold will go to on the downside. I also share with you that we could be setting up for it excellent buying opportunity, if and when our “Trade Triangles” are aligned.
If you have a few minutes I strongly recommend that you take the time to watch this gold video.
You can watch this video with my compliments and there is no registration requirements. I would love to get your feedback about this video on the MarketClub Trader’s blog.
All the best,
Adam Hewison
President, INO.com
Co-Creator, MarketClub
Is Natural Gas Cheap?
Today’s guest is David Galland, the managing director of Casey Research. David’s going to give us a look through the trained eyes of the Casey Researchers at the energy sector, more specifically, natural gas. So take a look and see why David thinks cheap doesn’t always mean buy. As always, be sure to leave us a comment on your energy strategies.
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At the height of its late 2005 rally, natural gas in the U.S. was selling for just over $16/MMBtu, 350% higher than today’s price of $3.56. The oil/gas ratio, now over 18, is an all-time high… suggesting that natural gas is dirt cheap. So, it’s a buy, right?
In a phrase, not exactly. Read more
Why weekly charts are so important (new video)
Today I’m going to be looking into why weekly charts are so important in the Forex market.
I will use the EUR/USD as the example and deeply investigate the buy signal we received on this cross on Monday, July 27th. Although it’s too early to tell if this signal will be profitable, it is certainly a signal you must take if you are a disciplined follower of MarketClub’s “Trade Triangle” technology.
You can watch this video with my compliments and there is no registration requirements. I would love to get your feedback about this video on the MarketClub Trader’s blog.
All the best,
Adam Hewison
President, INO.com
Co-Creator, MarketClub
How to use trading cycles in your own trading
Everything in nature moves in cycles. . . the cycles of the seasons … night and day… tides… phases of the moon. Each year animals hibernate… geese migrate… salmon swim upstream to spawn… and every seven years lemmings run into the ocean.
While nature’s cycles are very visible, there are many cycles in the futures markets that are not quite as obvious. Often the reason some cycles are not easily seen is because the interaction of many large and small cycles makes individual cycles harder to see.
Cycles are the tendency for events to repeat themselves at more or less uniform intervals. One of the easiest cycles to see and understand is the seasonal cycle. Agricultural commodities have a repetitive annual price pattern called the seasonal price cycle. More than 70 of the time, the lowest cash prices of the year for corn, cotton and soybeans occur during the fall harvest period. Due to increased marketings, cattle and hogs also have price weakness during the fall. Wheat and oats tend to make seasonal lows during their summer harvest. Seasonal price trends are a reflection of regular annual changes in supply and demand factors caused by weather, production and demand.
Saturday Success Story - Pet, Arizona
At MarketClub, our mission is to help you become a better trader. Our passion is creating superior trading tools to help you achieve your goals—no matter which way the markets move—we promise objective and unbiased recommendations not available from brokers.
Here’s great news from a member…
“I am a long-time investor; but, relatively new to short-term trading — In my extensive search for help with short-term trading, I have been fascinated by your MarketClub software system and all the help that you have included.
I especially like to make use of your Trade Triangles, educational videos and extensive training materials provided for the kind of guidance short-term traders, like me, can use to become more successful at pulling the trigger on timely good trades for profit accumulation .
I particularly like the trading alerts, I requested to be emailed to me, and the exciting new talking analysis feature included on each stock’s graph (all just a click away). Keep-up the good work, and keep adding your innovative new features to your already great service.” ~ Pet P., Arizona
To send your own success story, please email blog@ino.com. We wish all of our members the best and we look forward to hearing your success story.
How high can the S&P 500 go?
With the S&P 500 making new highs and as world equity markets following suit, the question becomes how high can we go?
In this short video on the S&P 500, I outline some mathematical upside target zones that I am looking at for this market.
You can watch this video with my compliments and there is no registration requirements. We would love to get your feedback about this video on our blog.
All the best,
Adam Hewison
President, INO.com
Co-Creator, MarketClub
Mental Aspects of Trading
As an added Guest Blogger bonus, Bill McCready from Futures Trading Secrets, has a very informative article on the mental aspects of trading, that I think we ALL can learn a little something from. Bill’s been trading for a long time, and a long time successfully, and his knowledge and wisdom is widely appreciated. Bill also hosts widely attended webinars that I think you’d appreciate, learn about the webinars here.
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I have decided that after ten years of posting the same trading patterns and working with hundreds of students, that the trading signals are not the problem. Most students have trouble trading mentally and emotionally. Here are the topics that are the most important.
Learning the Trading Game
The basics are the basics. Here is what you absolutely must know and master.
1. Goal Setting that is realistic and possible
2. Finding your trading edge with patience and discipline
3. Using both Fundamental (News) and Technical Analysis
4. How to see in Four Dimensions
5. Money Management and High Probability Trades
6. Using a Trading Plan and adjusting it in a Game Plan and trading it as a System
7. Why and how to avoid overtrading
8. How your past experience affects your trading
9. Setting new habits into motion for profitable trading
10. The 10 Essential Elements Necessary to Learn the Trading Game
Read more
6 Investing Rules Revisited
Today I’d like everyone to welcome Mike from The Financial Blogger. Mike’s main focus on his blog is teaching the best way to control yourself and your money at the same time. Frugality isn’t a bad word and in this lesson you’ll learn some pretty good tips. Please enjoy the article and let your voice be heard in the comments.
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If You Are Young, You Should Invest the Biggest Part of Your Portfolio into Stocks
There is an old rule saying that to determine the portion of stocks to be held in your portfolio, you simply have to take the number “100” and deduct your age. Therefore, being 27, I should hold 73% of my portfolio in stocks and only 27% in bonds and other fixed incomes. This old rule of thumb is based on the fact that the more you age, the less time you have to recuperate from a market drop.
Technically, this rule is not stupid as you should maintain a high percentage of stocks when you are young since it has been proven that stock markets perform over the long term (read more than 15 years). However, there is something stronger than rationality: emotions.
5 new trading videos you may have missed yesterday
If you missed any of my 5 new trading videos you can watch them here.
You can watch this video with my compliments and there is no registration requirements. We would love to get your feedback about this video on our blog.
All the best,
Adam Hewison
President, INO.com
Co-Creator, MarketClub
