Fibonacci and Breakouts

Yggrasil shares how he spent 10-15 hours a day trying to learn stock trading. I have the same story. I am learning from the sidelines. Learning from the free stuff and then I got hold of the Blueprint. It has enlightened me greatly of the ways of stock trading.

ZF shares on the interpretation of Fibonacci retracements

• as long as FIBO is 38.% and above, bull territory (more money)
• between 38-50 is bullish bias
• between 61-50 is bearish territory: dumping or accumulating time
• 61.8-76.4% is last chance area; possible bounce play
• below 76.4% is death zone

Rayner Teo shares how to trade on breakout

• breakout with buildup: buildup he means a period of sideways trend
• higher lows into resistance or ascending triangle on trendlines (price going up)
• lower highs into support of descending triangles on trendlines (price going down)
• re-test where he illustrates when the previous support because the new resistance

Trading 212 shares on how to trade on breakout

• breakout means price moves and closes ABOVE resistance levels ad BELOW support levels
• trade range: support + resistance levels
• enter on actual breakout
• pre-set level before the breakout at previous high
• enter when candle closes above the trade range
• false breakout: when price breaks support and resistance and return back to trading range

Here is tutorial on trading retracements by Trading 212

Stop Signs and End of Trails

This post continues on how to set trail stops and when to sell. The aim of which is to avoid loss.

Rayner Teo, a Singaporean independent trader, shares on 5 stop loss techniques

• moving average: exit your position when price closes below 20 SMA
• martket structure: exit when swing low is hit
• percentage: exit with 10% change in  high is hit
• average true range: 5 ATR from the lows; slash chandelier stop
• Previous candle: trail based on the previous candle high or low

MoneyGrowers shares how to set stop loss; it is based on trade objective: momentum or bounce

• for momentum play, place stop loss at confluence of support (read below)
• bearish engulfing candle signals potential sell; the opposite bullish engulfing candle signals potential buy 
• if prices glide in 20 MA, momentum might build up

RKay shares places to place an stop loss

• recent swing high
• recent swing low

ZF shares

• During parabolic runs, hold until candle goes below the previous days's closing price
• Buy on Breakout and Set Trailing Stops
• 3rd day red candle with gap (abadoned baby sign)
• FastK at buy levels with RSI at 53 *on sample chart analysis
• It is also common to set trail stop at previous green candle or moving average or retracement

RKay shares about confluence Confluence Trading Price Action Techniques

• Confluence:  two or more levels  come together at a certain point on your chart 
• It can be a a trendline coming together at at 61.8% or 50% fibonacci level
• it can be a support level meeting a rising trendline
• it can be a Fibonacci level meeting a support level where price meet

RKay shares further that there are 4 areas or levels confluence trading can happen

1. support levels
2. resistance levels
3. fibonacci levels
4. trendlines

Mixing Trading and Traveling

The sun has dawned today. As I continue with self-studying the system of a successful trader, I finally came across an outline of the trading lessons.

Anyway, a question hit me if you need to be on the watch every time the market opens to watch your stock?

ZF shares how you can several vacations or hold a day job and still do well on the stock market

1. Create a trading plan
• are you for the small swings or big waves?
• what are your entry price, cut loss and trailing stops?
• do you have time stops when the stock you are watching isn't moving?
2. Plan ahead
• requirements of line trading is a phone/laptop and Internet connection (as most have an online broker) and so if you go to places with no Internet access then do not trade
3. Set triggers and alerts
• install a mobile app that sends you an SMS once your trigger and cut loss points are hit. Then at the time you have access to the Internet/ laptop can you post an Off-Hours (OH) order for the next trading day
• ZF used PSE Watch for this. There is also the Investagram InvestaWatcher. It's a subscription which alerts you via SMS for triggers and FB messenger for Dividend reports. It comes with a monthly subscription rate of P167 to P267 per month but paid yearly on subscribing.

Warrior Trading shares how he sets up his traveling trading station (plus vlogging gadgets?)

• 2 Lenovo gaming laptop: fast hardware; 1 laptop for all trading; 1 laptop for streaming/ chatrooms/ Youtube
• 2 Asus USB monitor
• HDMI mini monitor
• Capture card for his online streaming (HDMI port)
• Logitech Headset
• Logitech webcam 1080

Madaz Trader also shares his travel trading station

• Asus gaming laptop
• 2 Asus USB monitor; monitor stands to hold
• Logitech USB mouse
• USB Expansion hub
• Travel adapter
• prefers ethernet cable
• Logitech mechanical keyboard
• Blue Yeti microphone (if traveling locally)

You can have a minimalist traveling trading setup:

• laptop
• 1 extra USB monitor
• Internet connection

Trading is a Jungle and Trading Setup Up

This must be the third time I will say I got all the more puzzled about stock trading; I was self studying the system of a successful stock trader. Again, the flaw of not having a mentor.

On reading the blog posts, I realized that reading it from the earlier post to the latest is NOT the way to go. One post may have a more detailed explanation later on in another blog post or that there is a difficult concept might be introduced early and the explanation is on a later post. I decided to approach it in another way through labels or tags.

ZF said there are two types of play

• Momentum
• Sell on Target And Trailing Stop
• Bounce
• Sell on Resistance

Technical Analysis versus Fundamental Analysis

Lifted from Investopedia

• technical analysis
• looks at the price movement of a security and uses this data to predict future price movements
• begin their analysis with charts 
• short term approach 

• Fundamental analysis
• instead looks at economic and financial factors that influence a business
• start with a company’s financial statements 
•  long-term approach to investing 

In a Twitter twit, ZF posted the classic trend following starter setup

• 20/50/100 SMA
• MACD
• RSI