Saturday, December 18, 2010

Trade Taken At The Art Of Trading : EZPW

Got a question from a new fellow ART OF TRADING member asking what i saw in the EZPW trade to make me alert it as a long Friday afternoon: Here it is explained. Hope it makes sense!

One popular pattern i use here all the time is called A HIGHER LOW SETUP: That's when a stock that has been trending nicely with conviction. i.e.: Strong volume up days that take the stock higher cleanly and with conviction........ followed by a few days of low volume days that either move slight lower or SIDEWAYS.

Then i start to look for hints of a reversal BACK HIGHER on stronger volume indicating a strong chance that buyers are returning back into the stock, thus creating enough demand to create a HIGHER LOW and now this gives us:

A: A decent entry LOWER RISK ENTRY.

B: Gets us on board of a potential BIG winner.

C: We do not need to be too stressed out about the eventual breakout to new highs since we got in at lower prices and can potentially eliminate any trickery that often happens during breakouts caused by the breakout traders.

Hope this helps!


"Hearing your calls to avoid trading the chop is useful and has kept me from overdoing it. One of my problems is overtrading, so it helps to have a voice of reason telling me to go easy.

So, thanks for the service. I'm happy so far.



I think you're doing an excellent job. You trade your system and strengths, and wait for opportunity like a true professional trader, including sitting out when the markets are not conducive to trading. You've been very helpful and quick to respond to questions, so I think you should just keep doing things how you're doing them! And you have definitely helped me reinforce correct trading habits (like patience right now) and it is nice to get your perspective on the markets and see how it compares to my own. That has helped me learn a lot since joining your service last week!


"Hey man, I think you are doing a great job of navigating us through the ups and downs and teaching us how to react to both scenarios. Keep preaching patience and discipline because these skills are not mastered overnight.


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