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Tag: prediction

Amazing Forecasting with Dozens of Technical Indicators

Posted on by Michael Covel

Feedback:

Hi Mike, I just had to send you this link, from a commentary on BarChart.com: http://www.barchart.com/headlines/story/1903370/grains-futures-wheat-corn-soybeans-trend-indicators. I was nothing short of amazed to read this. The guy is trying to put a case that wheat is in an uptrend, or the start of. Talk about picking bottoms! He plasters the chart with useless indicators and suggests it’s time to buy wheat. I wonder how many people take this sort of commentary and make trading decisions based on this type of analysis. Looking at the wheat chart it’s clearly been moving down for some months and now moving sideways. Any trend trader would be firmly short or out, but to suggest this is a buying opportunity? I’m sure you see this sort of stuff regularly, but this one struck me as so awful I thought I would pass it on.

Regards,
[Name]

One amazing reading of the tea leaves.

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Before the Crash Wall Street Week October 16, 1987

Posted on by Michael Covel

No particular reason to post this except that all fundamental analysis sounds the same regardless of decade:

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Parabolic Moves and Trend Following

Posted on by Michael Covel

Follow the trend to the top and get out as it is falling back down. Predicting the top is a fool’s errand. Feedback in:

James: Hi Michael, hope you are well and Asia is treating you well. You did a podcast with someone (can’t recall his name) and they mentioned taking profits in parabolic moves. Not much help I know but it is all I have. I was wondering if you could recall who it was or if you have any info for taking profits in these types of moves. More than happy to let normal moves roll over and let my trailing stop take me out but some of these parabolic moves give back too much. It is the one part where I believe I can add that extra % to my trading but have not been able to find any trading rules that adds any value. Any help [is] much appreciated. Thanks.

Covel: Don’t recall off top of my head! All good trend following trends tend to be parabolic and all are generally handled the same way. You get out after the peak, not before. I help clients more in my training/systems, but you will also see more thoughts across my books.

James: Thanks for the reply. I know I did not give you much to go on. Will keep looking.

How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

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Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.

Trading Rules: Strategies for Success

Posted on by Michael Covel

A great excerpt from “Trading Rules: Strategies for Success” by William Eng. It’s a great reminder that market prediction is a fool’s errand:

When you buy something, you want it to go up. When you sell something, you want it to go down. The chance of entering the trade correctly is small, but the chance of exiting the trade correctly is smaller. The chance of being right on both entering and exiting is the smallest. With such diminishing odds of coming through with a completely correct and, therefore, profitable trading campaign, the fewer decisions you make in the markets, the more profitable your trading should be. How many people actually get to sell at the top or buy at the bottom? At most, a handful in each reversal area. First, you must be a market follower, once the market has told you want it wants to do. If the market is a raging bull, you have no alternative but to buy. If it is bearish, you have no alternative but to sell every time you get the opportunity. Let the market tell you what to do. To do otherwise is to try to control the markets-something that is only reserved for God and natural disasters. Secondly, selling at the top and buying at the bottom does not guarantee profits. How many times have you heard of traders who managed to sell near the highs or buy near the bottoms, only to miss the ensuing move completely.

Read that back in the day. I need to see if William might appear on my podcast.

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Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.

A Great Example of How Too Much Protection Delivers Chaos — Either for Kids or Markets

Posted on by Michael Covel

Many think markets can be made safe. They truly believe there is a way to predict tomorrow and thus watch their accounts go straight up over time. Once all of the nasty unsafe stuff is cut, life becomes roses. A great example of the desire for ultimate protection can be seen in the ban of these stamps by the United States Post Office:

“With the Just Move! stamp issuance the U.S. Postal Service hoped to raise awareness about the importance of physical activity in achieving a healthy lifestyle. However, according to Linns Stamp News, the USPS will be destroying the entire press run after receiving concerns from the President’s Council on Fitness, Sports & Nutrition over alleged “unsafe” acts depicted on three of the stamps (cannonball dive, skateboarding without kneepads and a headstand without a helmet). (There’s also a batter without a batting helmet, a girl balancing on a slippery rock, and a soccer player without kneepads or shin pads.)”

Here they are:

Beam me up!

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Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.

Who Makes the Sausage? Ryan Vlastelica!

Posted on by Michael Covel

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Ever stop for a second to observe who makes the sausage? A headline written today by Reuters Ryan Vlastelica:

“NEW YORK (Reuters) – As a last-minute deal to resolve spending negotiations in Washington appeared less likely, U.S. stock investors braced for what had previously seemed remote: a shutdown of the U.S. government that could spark a major equity decline.”

That background of course allowed him to make a prediction of a major stock market decline.

Party on Garth.

Note: If you happen to be a much larger player in the media that immediately thinks I am unfairly picking on a young reporter — I could care less. The financial media matrix is gross from top to bottom. Plus, I pick on the top too.

How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

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Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.

Buying on Rumor & Selling on Fact?

Posted on by Michael Covel

A quotation from a Yahoo Finance video with Sam Stovall–Chief Equity Strategist with S&P Capital IQ:

“In the near term we will end up buying on rumor, selling on fact.”

Sounds like a great plan.

How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

Also jump in:

• Trend Following Podcast Guests
• Frequently Asked Questions
• Performance
• Research
• Markets to Trade
• Crisis Times
• Trading Technology
• About Us

Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.