Thursday, January 31, 2013

Using Multiple Time Frames To Locate the HIGHEST Probability Trade Setups

As a technical trader/Chartist one of my "strength" is using MULTIPLE time frames to help locate the absolute HIGHEST quality trade setups. What i try and do is find the strongest setups that align in good and 'reliable" technical setups on MULTIPLE time frames for example a stock that is setting up well on the WEEKLY, DAILY and 60 minute charts make for the best setups and if executed properly, these can be nice trades. I try and make it a PROCESS where on EVERY DAY i am looking for the best setups that align on WEEKLY, DAILY, 60 minute and even 30, 15 minute time frame charts.
It all starts with the BIG PICTURE and ZOOMING down into LOWER time frames to help me "detect" patterns that are otherwise not easily recognizable in HIGHER TIME FRAMES.

Check out some RECENT example of setups i posted here on the blog, on twitter or some that i sent out to ART OF TRADING members .

Hope this helps and as always if you any questions, feel free to ask!  :


First Example: TSO 

The chart above is the original TSO Daily Chart (shared on twitter, posted on this blog and emailed to ART OF TRADING members) setup which was showing a CUP& HANDLE pattern: one of my personal favorite patterns and one of the most reliable ones i have found from my experience.

Here's the original TSO WEEKLY CHART (sent to ART OF TRADING members) which showed a very nice pattern similar to the one we saw on DAILY charts except on WEEKLY CHARTS is looked more "clean" and could see it more clearly to the trained trader's eyes.

Above chart shows the 60 minute TSO chart shows a very nice looking INVERSE CUP & HANDLE. This pattern wasn't very visible on the HIGHER TIME FRAMES but zooming down into the 60 or even 30 minutes charts, you would have able to spot some very bullish and reliable patterns to trade or at least alert/prepare you for a good move that was imminent.

Above is the updated 60 minute TSO chart AFTER the breakout.

Above is the updated TSO DAILY chart AFTER the breakout

 Above is the updated TSO WEEKLY chart AFTER the breakout.

Here's another example: TIVO

Above is the original Daily TIVO chart setup (shared on twitter, posted on this blog and emailed to ART OF TRADING members). Chart showing a decent looking ASCENDING TRIANGLE which tend to breakout to upside.

Above is the WEEKLY CHART of TIVO which shows a beautiful looking long basing pattern which broke out over 12.30 area and held it on retest. That was very important for this setup as it now creates yet another base from which it can now launch off over that 13.00 area. Strong bases make for strong(reliable) breakouts.

Above is the original 60 minute TIVO chart which was showing a solid basing pattern. Breakout was imminent. Only a matter of time. 

Above is the UPDATED TIVO weekly chart. breakout was SOLID and played out very nicely for those that played it.

Above is the updated TIVO daily chart. Notice how the MACD played a key role in spotting this setup and increasing the reliability of the play/

Updated 60 minute chart of TIVO after the breakout. 

I am going to make a new VIDEO on this topic soon but i wanted to do this blog post first as an "appetizer" to open your appetite on this very important topic especially for Technical traders.

Hope it helps.

Tuesday, January 29, 2013

Anatomy Of A Good Trading Plan

hey folks

Wanted to share with you all a written 'TRADING PLAN' which was created by one of the newer Art Of Trading members. I thought it was so simple yet thought out well enough that i wanted to share it here as i am sure many of you will find it useful and helpful. 


Sunday, January 27, 2013

10 New Setups To Watch This Week

Note: make sure to check and re-check earnings dates on these stocks. 



Wednesday, January 23, 2013

Respect Current Action By Studying Past Price Action

check out the attached SPX chart very closely. Many people are very surprised by the recent strength in the market's move up and i totally agree, its VERY hard to chase it and we ALL want a pullback to get into more aggressive longs and that WILL COME sooner or later. The purpose of this chart is to illustrate that this recent rally we saw that actually started in late December as the "fiscal cliff" fears dissipated. SPX went on a upside run in about 1 month of about 7% (see chart). 

This rally caught MANY off guard like many previous recent rallies. "Calling TOPS" becomes a very popular thing to do among traders and we are all victims of that as no one wants to be left "holding the bag" at the "top". 

Take a close look at the attached SPX chart and you quickly see that the type of rally we are seeing right now is NOT out of the norms. We have seen many like it and in most cases, we see SPX make a big run up with very minor "pullbacks". THe dips tend to be shallow and quick before new buyers come in and take it higher(much to most people's surprise). Calling tops becomes very frustrating for BEARS are want to short and reap rewards on down moves and also for BULLS who want decent dips to BUY. 

Its becomes a CHASERS market. Take a close look at what the SPX did exactly ONE YEAR ago where i recall vividly an almost identical scenario as what we are seeing right now. SPX did indeed "top out" but look at WHERE and WHEN it "topped" out! After a 16% STRAIGHT UP run(very tiny fast pullbacks) and 3-4 months after it started in late December/Early Jan. 

Are we seeing a similar scenario now?? Obviously hindsight is always a beautiful thing but as of now, i am seeing an eerily similar move to the one we saw exactly one year ago.

Let's not get ahead of ourselves and take it ONE DAY AT A TIME. Lets see where and how things go from here. My goal right now is tune out as much as "noise" as possible as everyone usually has an opinion but the only one's that matters is the MARKET'S so I'm going to trade with the market's flow by taking new trades as they emerge and setup whether it be in BULLISH or bearish patterns.
Benefit of doubt goes to the BULLS right now regardless of how "overbought" we are. Just like "oversold" can become more oversold, Overbought can become more overbought. 

Wednesday, January 9, 2013

NEW Stock Ideas To Watch

 DELL: Technically starting to show hints of a bottom. HIGHER LOWS with accompanying HIGHER VOLUME up days starting to manifest in the DELL daily chart. Keep an eye on this.

 AEGR: Strong trend up: consistent volume patterns with HIGHER Volume UP DAYS followed by small controlled low volume dips to test Moving Averages. New Breakout looks imminent.

 HOG: Who doesn't like a Harley... Enough Said!

 BYD: casino stocks have been ripping big time. See charts of WYNN, HAR, MPEL and LVS. BYD has clear resistance near the $7 spot. Volume patterns building in very bullish manner. Watch for a breakout over 7.00 to 7.10

 HP: Oil drilling sector seems to be getting some love lately. Watch for a breakout soon.

 WDC:  from the data storage sector, STX announced killer earnings today/ Could be helpful to WDC. Volume patterns showing very bullish action last few weeks.

 VALE: A Brazilian Mining play. Volume patterns healthy with big volume up days and low volume controlled pullbacks. Pulled back last few days and now appears to be stabilizing above the rising 20 day MA.
 YPF: Argentinian ADR in the Oil and gas Sector. Momentum looks strong and looks like it wants more. Fast Mover.

X: US Steel in the recently HOT steel sector. posted original setup from the $22 base breakout. Now looks to be BULL FLAGGING.

Note: make sure to check and re-check earnings dates on these stocks. 



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