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derek 03 Sep |
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“The greatest enemy of knowledge is not ignorance, it is the illusion of knowledge.” Stephen Hawking Between the shaky economy and the start of football season, the world is full of predictions. Throw in an Atlantic storm or two, and my pet peeve is really getting tested. Two reasons I get annoyed: 1) Why does [...]
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derek 27 Aug |
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Do we pay to watch the average athlete compete? No, even the “journeyman” professional is among the most exceptional of superior participants in the sport. What about how the average fund manager fails to beat his/her benchmark? Duh, how could they? As a group, they are the average…minus expenses, of course. We need to seek [...]
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derek 20 Aug |
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One shocking hit makes you wonder. Two might make you run. Could the offers to buy Potash and McAfee usher in a new phase, maybe even the long-awaited “stock pickers” market? I think so. Don’t get me wrong, the bear case for equities has a ton of things going for it. Secular deleveraging, cyclical profit [...]
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derek 12 Aug |
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“Any expectation about the market’s behavior that is specific, well-defined, or rigid(instead of being neutral and open-ended) is unrealistic and potentially damaging.” Mark Douglas, Trading in the Zone Ever now and then I grab a classic trading book off the shelf, and thumb through a few pages. Lately, it’s been “Trading in the Zone” by [...]
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derek 06 Aug |
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“I measure what’s going on, and I adapt to it. I try to get my ego out of the way. The market is smarter than I am, so I bend.” Martin Zweig Anyone reading my posts knows I place huge emphasis on relative strength. Not chart indicator RSI, but the comparison of one stock vs. [...]
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derek 30 Jul |
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For awhile I was posting a weekly update showing my trend measures of global asset class. Where did that go? First of all, asset class trends unfold in a slower motion than individual stocks, so a monthly list is more appropriate than a weekly. Second, identifying trends is where the homework begins…from there, it’s measuring [...]
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derek 23 Jul |
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“Men, it has been said, think in herds; and they go mad in herds, and recover their senses slowly, one by one.” Charles Mackay, Extraordinary Popular Delusions and the Madness of Crowds I can make the bear case all day long. Spiraling debt, higher taxes & regulation, real estate overhang, European austerity, Chinese tightening yada-yada. [...]
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derek 16 Jul |
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“I knew Jack Kennedy. Jack Kennedy was a friend of mine. Senator, you’re no Jack Kennedy.” Lloyd Bentsen After recent trader/investor meetings, I realize almost everyone claims to be a contrarian. Why is that? I can only speculate, but I suspect it has to do with overconfidence and anchoring. We know where prices were, and [...]
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derek 09 Jul |
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“In matters of style, swim with the current; in matters of principle, stand like a rock.” Thomas Jefferson That gem of a quote came to my inbox courtesy of Charles Kirk, [...]
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derek 02 Jul |
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I’m a huge fan of measuring market breadth. It’s the primary reason I focus on U.S. equities vs. other markets like forex, bonds, commodities, etc. I feel I have a better chance at edge when I can see beyond the stock market and look at the market of stocks. It’s so easy for any one [...]
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derek 01 Jul |
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I rely on Abnormal Returns, The Kirk Report, and Reformed Broker to curate day in and day out, but today I found too much goodness across the Internets to not share them in a post. Enjoy! The “Death Cross” is NOT a trading system. Graphic from The Chart Store and charts from John Lee Condor [...]
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derek 28 Jun |
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In prior posts, I’ve debated fundamentals vs. technicals. Inside of technical analysis, trend following vs. mean reversion is another subject of debate. I do employ mean reversion techniques to my entries and exits to improve pricing, but am firmly in the trend following camp when it comes to selection. This starts with my belief that [...]