How To Properly Trade A Breakout : New ART OF TRADING Video

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Cheers,

Ed

"I would like to summarize my experience with The Art of Trading by saying that is at the top of the list for the reason. In a year and a half of going through Zacks, The Motley Fool, Seeking Alpha, Think or Swim, Bernie Schaeffer, etc...I have never come across a site truly dedicated to educating, until now. In the 3 weeks I have been a member I have gained a wealth of information on placing stops, targets, identifying classic and short term patterns, etc...and best of all, I have real, live professionals available to talk to before I place a trade, including Stewie himself. This site is an A+++ in the world of investing, and I will be a lifetime member. Thanks Stewie!

How much have I made? I put an option contract on BIDU per Stewie's recommendation and made 50%. I bought and sold 5 options contracts of CY and made 95%...and I'm well in the green on my next two trades. Believe me, The Art of Trading pays you, not the other way around!"

Scottweberaz

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7 New Setups To Watch This Week

MPEL, PAL, KLIC, HMY, ATML, AKAM

All these picks look poised to make another move higher in the coming days.

ATML, KLIC, AKAM and MPEL : Ideally, i'd love to see a few more days of basing or sideways churning to help create a stronger 'launching pad' before lifting.

HMY and PAL look ready to move right now.

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Short And Long Setups To Watch

Hi guys,

I am still seeing LOTS of mixed signals out there. I still feel like the bounce we are seeing is of the 'dead cat' bounce variety meaning this is most likely only a simple bounce to clear some "OVER SOLD" levels before we head lower once again on the indices. This bounce phase might last a few more days before we roll over again however so please stay SHARP, NIMBLE and OPEN MINDED. ANYTHING is possible at any moment. STAY SHARP.

SHORTS setups: AVP, EBIX, HRB, PLCE, REDF

LONGS setups: WTI, BAS, DAR, HERO, NR, PDC, TRGL, SSN

Good luck traders!

Keep An Eye On Support

Good morning traders!

Keep an eye on the index charts today. NYMO chart is approaching levels where in the past it has been unsafe to be short as snap back rallies have started from these levels. Also, it makes sense to potentially look at taking some long positions as the SPX tests that all important 1300 area. SPX futures dropped to as low as 1300 in overnight trading and are thus far successfully holding. We are opening lower this morning but i would not be surprised to see the indexes close higher today and start a small bounce phase from here.

Good luck everyone!

ART OF TRADING Success Story!!

Larry started at the ART OF TRADING about 5 months ago. 

Stuck with the service and absorbed everything! He was willing to learn and stayed patient thru out the learning/growing process. 

Here's what he had to say: 

"Had a great week ( +$3,384.). Attached sheet has all the trades.  Stewie, I feel like I'm starting to "get it". Been paying more attention to risk/reward, being more discriminate in taking trades, and using options more.  Back in the day ( 1975-85 ) I was a GNMA trader for a large mortgage banker. At that time I made lots of $$ trading against option positions and thats what starting to adapt to this choppy market. (buy puts at the top of the range and calls at lower end; not trying to over think it).  I'm learning a lot from lurking in the chat room and the coaching you are providing. Feel privledged to be part of your team.  Thank you, you are making a big difference."

Larry K. 

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Awesome Day At The ART OF TRADING!!

"Stewie,

Monster day!!!!

Trades Cost Sold

SSO 177 145 = $32.00 LOSS X2 = $-64.00

BIDU 390 725= $335.00 GAIN X2 = $670.00

YOKU 220 500= $280.00 GAIN X1 = $280.00

PROFIT $886.00

PLAYED A COUPLE OF CALLS ON YOUR RECOMMENDATIONS AND THIS WAS MY DAY. GREAT CALLS!!!!"

John S.

"Booked $300 on that YOKU trade. Thanks for the awesome trade!"

GHG

"Stew,

YOKU from $43.8 to $45.07

BIDU from $127.75 to $130.01

Good day today.

Thanks!"

Jason M.

"Thanks for your hard work and all you do. You charge half what others services do, and they don't even do half the work you do. Thanks for keeping me sane in an insane market.

Regards,"

Eric L.

Great Day At The ART OF TRADING Chat Room!!

I am not trading at the moment as i continue to take my break but like any hard core trader it's hard to stay away completely! :-)

I have been in the ART OF TRADING chat room all week giving calls on market direction and certain stock plays. Some have taken my advice and benefited!

Check it out:

Attached are 4 options trades from (Gan333). Big wins with his put options coming into this morning!

"Held on to CLF short from $89, covered at $85.01 today AM. THanks for the trade, Stewie!"

(Ash)

"Hi Stewie

bought 800 ZSL @ 20.91

Sold 400 ZSL @ 23.41
sold 200 ZSL @ 23.50
sold 200 ZSL @23.29

Total gains +$1,990"

(Kimia)

"I just want you to know....I've only been around your services for a couple of days. I think you have an incredible service....which is hard to find these days. You truly care about helping and give the best advice you can. If nothing else its nice to bounce ideas off of you and the others. I really appreciate it. Thank you"

(Cmonty)

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These Charts Are Setting Up For Much Lower Prices : Don't Get Complacent: The Winds Are Shifting

Precious metals setting up in bear flags now: Going LOWER

http://finviz.com/futures_charts.ashx?t=METALS&p=d1

Currencies of all sorts look set up for a push lower EXCEPT the 'most hated' US Dollar which looks to have found a bottom:

http://finviz.com/futures_charts.ashx?t=CURRENCIES&p=d1

Bonds itching to breakout soon:

http://finviz.com/futures_charts.ashx?t=BONDS&p=d1

Energies: Bear flags confirmed: heading Lower

http://finviz.com/futures_charts.ashx?t=ENERGY&p=d1

How I Trade A Breakout

Hey guys,

I just made a brand new video for you guys on HOW to properly trade a breakout. I gets tons of questions on this topic and i know there are no Black and White answers but here i explain what i typically look for when playing a breakout trade.

Remember:

1. NEVER chase a gap up. If a stock gaps UP over your trigger entry price. Do not chase it. WAIT. Look for a a potential gap fill or a mini intra day consolidation to enter new positions or even skip the trade completely for today. Look elsewhere.

2. Ideally, you wanna see the stock open LOWER then the trigger price and after a few minutes or couple of hours after the market open, you wanna see a fresh high volume breakout over the breakout price, THEN you can enter your position either manually or via BUY LIMIT order.

3. Not all breakouts work! Some will fail. So make sure you know where your stop loss will be once a breakout takes place (for short term traders: ideally a good place to put a stop loss would be the Current Day's LOWS). For SWING TRADERS: use a stop loss under a recent SWING LOW.

4. VOLUME is everything! If you see a breakout hit with HIGH VOLUME over or near the breakout price, then your confidence can rise that you might potentially be sitting on a good trade.

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"Mixed Signals" and Charts Of High Interest

Been plowing thru hundreds of charts over the weekend and the if i had to conclude my findings in one phrase it would be : "Mixed bag and NO EDGE".

Am i confident the bulls are strong and taking charge here hence we need to be in LONG and strong? NO!

Am i confident the bears will take advantage of recent weakness in commodities and numerous "leading' stocks and take this market lower? NO!

However, as a trader who has traded many kinds of market environments, i cannot help but think that the recent "UNDER THE SURFACE" action i have witnessed lately is NOT the hallmark of a 'healthy' market. Just something to be aware and NOT to be ALARMED necessarily.

JUST HAVE AN OPEN MIND, that's all!

There are way too many MIXED signals right now making trading this sort of GREY area extremely tricky.

Over the past 3-4 weeks, i have really tried my best to minimize trading activity as things become more and more uncertain. My main concern right now is minimizing BOREDOM trades as much as possible.

One of my biggest assets as a trader is my ability of minimizing "BOREDOM trades" and NOT actively trading during CHOPPY/DIRECTIONLESS market conditions.

The bottom line guys: The HIGH quality setups are lacking. The commodity liquidation we witnessed last week along with several hedge funds 'blowing up' is throwing a big question mark into the equation. PATIENCE and having an OPEN MIND of what is to come is extremely important right now. We could slowly but surely putting in a major top here or we could be just shaking a few trees ahead of a massive rally into multi year highs.

This picture is very unclear and hence patience is very important.

Respect Stop Losses!

Hey guys,

I wanted to touch on a VERY important subject tonight. When in a losing trade, it's very easy to get 'blind' and decide to not place a stop loss on a trade in the hopes it'll 'come back'. Look, i don't believe in these kinds of games. Some stocks NEVER come back. Been doing this way too long to believe in this. When you enter any trade, whether it be mine, yours or anyone else's, you must know in advance what is your risk tolerance on any particular trade. What are you willing to lose if a trade stops out completely.

Taking losses or eating a stop loss is part of this game. Gotta be able to stomach that and roll with it. Contain the bad trades quickly and once the winning trades start hitting again, you will so glad you respected the stop losses to prevent one or two bad trades from getting out of control. This is what experienced traders do and know!

RESPECT YOUR STOP LOSSES. You'll win some and you'll lose some but i am confident in the long run, if you keep to this habit, you'll come out ahead.

Ingrain this in your head till it becomes second nature.

Index and ETF Analysis: A Read On Short Term Market Direction