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Trading Psychology and the Little Voice
I normally don’t talk about my interior life much but I’ve had a breakthrough in my trading psychology so huge I feel I have to share. For the last few months I’ve been depressed. I was aware enough of it to get on antidepressants, and while I felt better I wasn’t losing any of the…
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Fibronacci: Emergent properties of oscillating chaotic fractal systems
A lot of people have this idea that nebulous ‘market makers’ determine price, moving it up or down at whim for their own inscrutable purposes. I’ve heard people say that high-frequency trading algorithms are why Fibonacci lines work in trading. People love to attribute Intelligent Design to anything with a pattern, but in this case…
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VPA Candles: Five numbers
Anybody who tells you they have a ToS study that shows buy and sell volume is oversimplifying things: there isn’t one. For every trade there is exactly one buyer and one seller, the volume is always 50% buy, 50% sell. The only question is, did I buy from you, or did I wait for you…
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Jimmy Momo Zones: Risky Business
Way back in the early Renaissance, the use of perspective was a closely-guarded trade secret among painters. The first time it showed up was in the 1400s, and before that artists would just sort of eyeball things. It was the Uncanny Valley of orthogonals. When I first started trading the craze was Supply and Demand…
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Highs & Lows: history repeats itself
There’s this great graphic showing the ancient seashore in North America and how this 100 million year old geological feature votes Democrat. The idea is that the shoreline was a rich habitat for creatures that died and formed the rich black soil in the deep South that was perfect for growing cotton. Because of slavery…
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Sympatico: untangling Schrödinger’s bag of quantum cats
Einstein famously joked that quantum entanglement was “spooky action at a distance” because it defied common sense that anything could interact instantaneously at arbitrary distances seemingly without a connection between them, but in experiment after experiment scientists have shown that if you divide your bag of quantum cats and fling them at remote suns they…
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Yo Momo So Fat: get a real-time momentum scan in ToS
When I traded small-caps I was always a little jealous of the profitable momo traders that made enough money to justify a TradeIdeas subscription and a popper scanner that instantly alerted when a stock started gaining momentum, whether from news, technical analysis, or just plain pump and dumps. I had tried creating a custom watchlist…
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Auto Trendlines: are we there yet
I’m not sure I’ve really explained how I draw trend lines. I’ve talked about the easy bit, literally *how* to draw them, but there are a few things I’ve learned about trend lines that make price action a whole lot easier to read. For one thing, trend lines aren’t just there to be broken or…