What does “Memento Mori” mean? It is Latin for ‘remember that you must die’ [one day]. The most successful generals in ancient Rome were awarded a “triumph” entry into the capital city on their return from victorious campaigns. It was a magnificent spectacle and parade that was meant as a ceremony to honor and appreciate […]
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Options are traded on contract markets and unlike stocks there is someone short and someone long every option at all times. Options are a zero sum market as there is always a winner and a loser in every price move. Someone has to write every contract and there must be a buyer and they both
Bullish markets and bearish markets are very different in the sentiment and price dynamics. Money made in bull markets can be given back in bear markets so a bullish bias can be dangerous when a real long term bear market arrives. People tend to think of the stock market as a whole as bullish or
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The RSI indicator buy and sell signals are based on oversold and overbought conditions on a stock chart. The RSI is a measurement of price moving too far and too fast in one direction and as the RSI gets extended farther from the 50 RSI middle line the probability of a reversion to that mean
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Stock prices falling is perfectly normal in the market. Pullbacks are not something unusual or to be worried about in the stock market until they trigger a potential bear market. Stock market drop parameters: Down -5% is a pull back. Down – 10% is a correction. Down -20% is an official bear market. Down -50%
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What traits separate the minority of profitable traders from the the majority of unprofitable traders in the markets? Here are the 12 key traits I have seen and studied over the past three decades in the financial markets that separate successful traders from the unsuccessful ones that don’t make it. From the start the traders
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Guest Post by Dan @TrendSpider The Volume Indicator (RVOL) Relative Volume is calculated by taking the ratio of current volume relative to an average. It gives you a quick way to see how much volume relative to a period and which direction it is pointing in. Features for this indicator on the TrendSpider platform: Customizable
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Keltner Channels are a technical indicator shown visually as envelopes expressing the deviation in Average True Range on a chart both above and below an exponential moving average. It is very similar in principle to Bollinger Bands, which use standard deviations from a moving average to quantify the bands. The difference is that Keltner Channels
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A price action trading system is a process for using price data to make buy and sell decisions on a watch list of charts. Price action trading attempts to use entry and exit signals that have an edge by creating good risk/reward ratios that lead to profitable trading with wins that add up to more
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Traffic is driving me nuts. Am going to build a tunnel boring machine and just start digging… — Elon Musk (@elonmusk) December 17, 2016 The Boring Company has a focus on tunnel construction as its business model. It was founded by Elon Musk in December of 2016. Its current proposed infrastructure projects are underground metropolitan
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The following is a guest post from T3 Live. Greed, for the lack of a better word, is good. That’s what Gordon Gekko said in the classic 1987 film Wall Street. And indeed, a little greed goes a long way. Greed can push you to work harder to bring home a bigger paycheck. It can
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Recency bias is a cognitive based bias that gives more meaning to the most recent events that have happened versus older and more distant ones. It is a type of memory bias giving the most weight and importance to things more easily remembered due to the short time frame from occurrence. This can be seen
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(Chart courtesy of TrendSpider.com) The old Wall Street saying “Buy the rumor, sell the news” means that the best opportunity to profit from a news event is to buy into a chart early when the news is not yet priced in as it is still a potential rumor. The second part of the saying means
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The parabolic definition in terms of trading and investing refers to a parabolic move in price on a chart and comes from the mathematical term parabola. Below is what a parabola looks like and what describes a parabolic move on a price chart when you see it happening. Melikamp, CC BY-SA 3.0 <https://creativecommons.org/licenses/by-sa/3.0>, via Wikimedia
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The Parabolic SAR (stop and reverse) indicator is a technical trading tool that quantifies both trends and price reversals on a chart and can be used as a stop loss, trailing stop, or entry signal. The Parabolic SAR indicator was created as a trend following tool that allowed winning trades to run until they stopped
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Here is the top 20 list of the current most shorted stocks with the highest short interest across all major U.S. stock exchanges as of the last update. Be aware that the NASDAQ short interest is updated twice a month. Short interest data is reported on mid-month and end-of-month settlement dates for NASDAQ listed stocks. Most exchanges
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Position trading is the strategy of holding a position over a long period of time of weeks, months, or longer because a trader believes there is a high probability that it will go in their favor in that time period for a large profit. Position traders trade in a higher time frame than day traders
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In investing and trading, diversification is the process of buying positions with capital that are not 100% correlated in price movement during most market environemnts. Diversification can be as broad as investing in different types of assets or just in equities but in stocks in different sectors, market cap, or countries. In trading, diversification can
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A stop loss is set after a trade entry at the price level on a chart where a trader will accept being wrong and exit for a small loss. A stop loss should be placed at the level price should not go if the trade is correct. The point of a stop loss is to
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The alligator is the metaphor for this technical indicator. Three lines are used to create it on a price chart. Each line in the indicator is a moving average of a different time period: the 5 SMA , 8 SMA and 13 SMA. The lines represent the jaw(13), the teeth(8), and the lips(5)of the alligator.
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