Morning Market Thoughts

Good morning. The futures are pointing to a slightly higher open yet again, with the S&P poised to open at a new all time high. You’re never wrong when you trade with the prevailing trend. Everything else is just timing. A prevailing characteristic of this market has been breakouts that are sold into. We’ve seen it time and time again, which is why the major indexes are generally stuck in trading ranges. At some point, that’ll change. The bias is with the bulls, and the direction taken by AAPL after the product presentation this afternoon (1 pm ET) will be a major market mover. A strong move will push the Nasdaq 100 to new highs, while a selloff will drop the Nasdaq right back into the trading range.

Learn to read charts efficiently. Do you get the local newspaper delivered each morning? I do, because that’s the only job my dog Tonya loves — she saunters down the driveway each morning and picks up the paper…then carries it back into the house before retiring for the rest of the day. When I actually read it, it takes me about 5-10 minutes to get through the whole thing. Every section of the newspaper. Boom! Done!

How can I get through it so fast? Because I know what I’m looking for. I quickly scan headlines. Bam! 90% of what’s in a newspaper is just crap. It’s just filler between the ads. I recognize it without even thinking about it…and I don’t spend another second wondering whether I should read the article.

If I do see an article that I want to read, I can get absolutely everything I need from the first paragraph…and then skimming the remaining paragraphs for names or applicable words. Most time, the first paragraph is all I need to read.

Frankly, I think Tonya spends more time with the newspaper than I do, because we have a long driveway and she walks slow. But I get what I need…and it doesn’t take me very long.

Charts are like that. Every stock has a chart. If you want to look at the charts of the S&P 500, you’ve got to study 500 different pictures…or 1000 if you want to study two different time frames. It can take hours to get through them all. But if you know exactly what you’re looking for, each chart is like a headline in the paper. Just glance at it and you’ll know whether you want to look closer. You can breeze right past the crud to get to the good stuff.

Chart efficiency doesn’t require knowledge about every single pattern. It requires an intimate understanding of only the things that matter. You can learn this in my “Power Charting” course. This material teaches you what you need to know about the patterns that work. It is not a course for someone who wants to learn everything there is to know about chart patterns so that they can become a “Jack of All Trades.” This course enables you to become a “Master of One” — learn what you need to know to make money; to trade profitably; to improve your stock selection! A critical aspect of trading that is often overlooked by traders is the importance of timing on stock selection.

1. This is the right stock for me…and it’s the right time to buy it.
2. This is the right stock for me…but this chart indicates chaos, and I’m not a gambler; I’m a trader.
3. This is the right stock for me…but it is standing on very thin ice and gaining weight. No thanks.
4. This is NOT the right stock for me and I’m not going to spend another fraction of a second thinking about it. Next!

Learn to get what you need quickly, so that you can get on with the business of trading profitably.

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TODAY’S TRAINING SESSION:
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Today’s live training session begins at 11 am ET (8 am PT). We will look at the real foundation of the current market structure, as well as current trading opportunities around the Equifax data breach, and a few stocks with very profitable technical setups like Tesla (TSLA), Alibaba (BABA), and one retailer that’s paying a dividend that puts the stock in the buy zone. If you are not yet a member, grab a free trial and you can attend today.

See you in the forum.

–DAN

Market Update

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