By: Larry Swing
When Stan Weinstein was first featured in the famous book, "Market Wizards: Interviews with Top Traders", by Jack Schwager, he stood out as a trader with the highest win/loss ratio. He finally revealed his method in his only book, "Secrets For Profiting in Bull and Bear Markets," for the long-term investors. This informative book covers many aspects of trading, including rules of do's and don'ts as well as a single methodology in finding the right stocks with setups to enter and exit.
This book is mainly for investor and speculator (or trader as he termed it). Investor is a person who holds a position at least 3 months while a speculator trades 2-3 times a month. This is basically not for day traders but is at least the swing and positions traders.
His method requires a few simple indicators and tools to make the method work, including: 1. 30-week moving average indicator 2. Relative strength ranking indicator 3. Volume indicator 4. Trendline drawing tool
Here are the rules he laid in finding the right stocks:
1. Identify what stage the market is in. What stage it is the market in? In the chart below, Weinstein categorizes the stages of the market, uptrend, consolidation, and downtrend, consolidation and repeat again. Stage 1 and 3 is consolidation phases while stage 2 and 4 are trending phases.
2. Search the sector with strength. Compare the sector to the overall indexes such as Dow Jones Industrial Average or the S&P 500. See image below.
The first task is the search the best sector that is outperforming the indexes (for long while underperforming the indexes for shorts). Comparing this using the charts and compare to find where the strength lies. If the index is weak or getting weaker (by either moving sideways or downwards) while the sector is getting stronger (trending upwards). The image above shows the divergence in strength between sector and index.
[Read full article]
This book is mainly for investor and speculator (or trader as he termed it). Investor is a person who holds a position at least 3 months while a speculator trades 2-3 times a month. This is basically not for day traders but is at least the swing and positions traders.
His method requires a few simple indicators and tools to make the method work, including: 1. 30-week moving average indicator 2. Relative strength ranking indicator 3. Volume indicator 4. Trendline drawing tool
Here are the rules he laid in finding the right stocks:
1. Identify what stage the market is in. What stage it is the market in? In the chart below, Weinstein categorizes the stages of the market, uptrend, consolidation, and downtrend, consolidation and repeat again. Stage 1 and 3 is consolidation phases while stage 2 and 4 are trending phases.
2. Search the sector with strength. Compare the sector to the overall indexes such as Dow Jones Industrial Average or the S&P 500. See image below.
The first task is the search the best sector that is outperforming the indexes (for long while underperforming the indexes for shorts). Comparing this using the charts and compare to find where the strength lies. If the index is weak or getting weaker (by either moving sideways or downwards) while the sector is getting stronger (trending upwards). The image above shows the divergence in strength between sector and index.
[Read full article]
1 comment:
Oi, achei teu blog pelo google tá bem interessante gostei desse post. Quando der dá uma passada pelo meu blog, é sobre camisetas personalizadas, mostra passo a passo como criar uma camiseta personalizada bem maneira. Até mais.
Post a Comment