Can Anyone Predict Markets?

The answer is heck no. But we can WORK HARD and do a darn good job of PLANNING how when where trade setups should occur – ahead of time. ABIL was the #1 stock of the day on Friday. The TREND was UP. I had a quick trade in there, caught a very small chunk of the huge move in ABIL. To state this again, since so few are paying attention to these trading posts. Even if you are not trading small stocks, it is extremely short-sighted, and inane actually, to not have put in the effort to learn the trading concepts, skills, tools, setups, rules, probabilities which I have been sharing in these posts for the last few years. I do not always trade small stocks, and have no bias toward anything, as long as there is volatility and movement.

The main things I want to point out – my CONSTANT repeating about how you must have some QUALITY, TESTED, HONED method of determining the TREND of a stock or market – do you even know the 3 trends? – if you do not, then you should not be involved in trading. Period. Unless, or until, you put in the study work effort to learn what I am talking about with the trend. In this stock, I have been over this “simple” way to determine the trend with the small runner stocks having to do with the opening trading range. That analytical tool has been discussed multiple times with subscribers, and it is floating around on the free part of my website, do the work and find it if you are interested.

Also to point out – is demand falling into the rally, if it is, how can you spot the turn, that is explained on the chart very clearly. And what did I say on the chart – before the top was even put in:

I was looking for the next setup, and stated – there will still be a bounce. Regardless of the top.

I drew in the area with a GREEN ARROW – ahead of time – where the bounce would EVENTUALLY set up, BELOW the supp area. Yes that is a spring. Beautiful PLANNING AHEAD. Looking for the next setup. Not sitting on my rear predicting a crash in the stock like most everyone else’s approach. I was looking for a setup.

There was a clear 123 top, the backside secondary rally – the exorption. And then the bounce setup appeared below supp – for a BOUNCE – bounce has a meaning. Do you understand it? That bounce went over 10% further than I thought it would, totally wrong about that part of it.

And notice the bounce top, another 123 with a backside, for those who want to study shorting strategies. Be careful in shorting the higher high, the #3, the new high for the day or the move, short the lower highs – in general. When a rally is what you believe is the secondary rally/bounce, and you believe that the high is in for the day, that is when you MIGHT want to short the #3 or higher high, possibly average IN. I did not say average up, said average in, with still not a full position. Add on/fill out the position into a declining move, but on the rallies within that – exorption.

Start working hard at this and have a probability-based trade setup-based rules-based calm professional approach. Plan your moves. Trading is – statistics class (didn’t take it, learned it on my own), chess, blackjack, musical composition/training and sports competition/training – all in one. If you have experience in any of those, figure out how to incorporate that into your trading.

 

mm
About traderscott 1128 Articles
Trader Scott has been involved with markets for over twenty years. Initially he was an individual floor trader and member of the Midwest Stock Exchange, which then led to a much better opportunity at the Chicago Board Options Exchange. By his early 30’s, he had become very successful in markets, but a health situation caused him to back away from the grind of being a full time floor trader. During this time away from markets, Scott was completely focused on educating himself about true overall health and natural healing which remains a passion to this day. Scott returned to markets over fifteen years ago where he continues as an independent trader.

2 Comments