Friday, February 29, 2008

A Bit of Trading Perspective at the End of the Week

* Hard Jobs - I want to thank readers for their comments on the recent post concerning trading as one of the most difficult occupations. Reader Bryan, however, offers a worthwhile perspective. As difficult as trading might be, surely it is more challenging to be an educator or health care worker in an impoverished environment. And surely it is more difficult to live in a society that does not allow private property and where no one is free to voice their views on politics, economics, and world trends: where the entire concept of owning and trading assets is foreign. We are challenged as traders, but make no mistake about it: we are blessed to live in a time when a greater percentage of the world than ever is free to own, trade, and succeed financially.

* Very Promising Tool - The Newsflashr site is an excellent way to track and pull out news headlines. You see the hottest headlines on the home page, and a link cloud displays the most popular news topics. A bar at the top of the page enables searches for specific news, such as business, politics, and sports. Sweet.

* Frustration - I concur with the frustration voiced by Trader Mike in his recent post: the choppiness of trade both day to day and intraday has been wreaking havoc with many traders. I talked with a very good trader yesterday who has experienced considerable challenges trading patterns that aren't following through. I'm finding reversal trades to be the most successful, fading rallies that cannot lift the majority of stocks to new highs and vice versa. A good example occurred yesterday when we were able to get marginal highs in NQ during the AM but not elsewhere. (See Brian's worthwhile observation on QQQQ, focusing not so much on breakout as followthrough; excellent post.) I'm also seeing where trading small and holding through the chop for larger moves is working well, per my recent post.

* Learning From Example - I see Chris Perruna has linked an interview with the Trader Interviews service. I like the interview concept as a way of learning from example; Market Wizards was certainly formative in my own development. Here are interviews conducted by Dave of StockTickr.

* Good Reading - More fine links from Abnormal Returns, including a look at how analyst support is a contrary indicator and the message housing is providing re: recession. See also views from Bill Gross, Jim Rogers, and much more in Kirk's recent links. Excellent post here from The Big Picture questioning earnings forecasts.