Traders' Library Blog

LMT Bullish Gartley Pattern

A Bullish Gartley Pattern recently completed on Lockheed Martin Corp (LMT on NYSE.) The XA leg of the Gartley pattern indicates the direction of the trend and the AB=CD symmetry indicates the completion of a correction against the trend. The intent is to identify the completion of the correction at the projected D point and then to open trading positions in the direction of the trend. The trade setup was complete on December 14th, 2012 when LMT traded at 89.38 at the 1.1 line. At this point we would be looking to buy one tick above the high of the most recent low bar.   

On December 18th, our stop order to buy was hit and LMT quickly moved to hit our first two profit targets.

As seen above, the trade worked. Our favorite method of managing a trade like this is with the Single In/Scale Out method of money management as described in the book The Gartley Trading Method: New Techniques to Profit From the Market's Most Powerful Formation. To learn about this effective trade management technique, click here to watch an instructional video. To identify Gartley Patterns before they complete, check out our free introductory video course at at www.geometrictrading.com 

 

 

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FMC Bullish Gartley Pattern

Interview with a Trader: Jim Martens

Jim Martens, Senior Currency Analyst at Elliott Wave International, will be joining us at the Denver Trading Forum to discuss the popular Forex markets through the lens of the Elliott Wave Principle. Sure to be a popular session, his background in trading is just as interesting...

TL: How long have you been trading? 
JM: I've been in the business, either analyzing or trading or both for 25 years. I began working with the Elliott Wave Principle in 1985 and am currently editor of Elliott Wave International's Currency Specialty Service. I got my start working with metals traders on the Commodity Exchange Center in New York and first joined EWI in September 1993, covering a diverse list of markets from commodities to financials both domestic and international. I left EWI in 2001 to join Nexus Capital Limited, a Soros-affiliated hedge fund based in Hamilton, Bermuda, as their Technical Market Strategist. Three years later I rejoined EWI in the summer of 2004 and moved into the Currency Specialty Service.

TL: What do you trade in your account? 
JM: I mostly trade FX, though I’m always looking for opportunities. Using the Wave Principle I can quickly scan a number of markets looking for my favored set-up.

TL: How did you get started? 
JM: I've always been interested in the markets and read anything I could get my hands on about them, including Robert Prechter's book Elliott Wave Principle. But my professional start was a fluke. I was talking to a gentlemen on the phone about a different subject when I noticed there was a lot of yelling in the background. When I asked what all the commotion was he informed me that he was a gold trader on the COMEX. The discussion quickly turned to the markets and when he learned I understood the Wave Principle, he offered me a position on the spot.

TL: Was there any one person who helped to shape the trader you are today? 
JM: Robert Prechter, simply due to the introduction to the Wave Principle.

TL: Has there ever been a book that profoundly affected your trading? 
JM: Elliott Wave Principle by Robert Prechter and A.J. Frost. I first read it in the mid-80s and have read it many times since, sticking to it.

TL: If you weren’t a trader or trading educator, what do you think you would be doing? 
JM: I often ask myself the same question. When I have an answer I’ll let you know!

Catch Jim live to learn how to apply the Elliott Wave Prinicple to your Forex trading at the Denver Trading Forum on Saturday, October 22. See you there!

 

Interview with a Trader: Richard Lehman

Richard Lehman recently teamed up with fellow options trading guru Larry McMillan to release a brand-new trading book entitled Options for Volatile Markets. Sound like a book you could use on your reference shelf these days? Well, I'll do you one better and invite you to catch Lehman live at the Denver Trading Forum, where he will be reveal what he calls "The Best Way to Beat Market Madness--Bar None!"

There's no one better to lead you through today's market madness, as revealed by Lehman's insightful answers to a few questions about his luminous trading career...

TL: How long have you been trading?
RL: Since college (1970). I took a course in investments and options in my senior year of college and it profoundly moved me. I've been hooked ever since.

TL: What do you trade in your account? 
RL: ETFs and options

TL: How did you get started?
RL: When I started working at EF Hutton after grad school, I started trading in earnest. I traded stocks off my employer's fundamental research reports. My first big mistake!!

TL: Was there any one person who helped to shape the trader you are today?
RL: Bob Prechter (of Elliott Wave fame). In the early 1980s I entered a trading contest called the National Trading Championships. I took honors as "Top Broker" in the Option Division, but came in second overall. The person who came in first was Bob Prechter. After that I made it my goal to study his technique and understand what he was doing.

TL: Has there ever been a book that profoundly affected your trading?
RL: Of course--my own! It forced me to objectively look at what I was doing and to justify it to the rest of the world. I also found that books on casino gambling offered valuable lessons on odds and discipline.

TL: If you weren’t a trader or trading educator, what do you think you would be doing?
RL: Teaching and writing more. I learned too much over the years not to share it with others.

Don't miss the opportunity to learn from Lehman's experience--join us at the Denver Trading Forum! For details and to register, visit www.tlforum.com.

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Gartley Pattern Setup Complete?

A Bullish Trend Continuation Gartley Pattern recently completed on E.I. du Pont de Nemours and Company (DD). What does TCG stand for? In The Gartley Trading Method: New Techniques to Profit from the Markets Most Powerful Formation, the Gartley Pattern is categorized into two groups; the Trend Reversal Gartley (TRG) and the Trend Continuation Gartley (TCG.) The difference between the two has to do with the price action that precedes the X point of the pattern. In H.M. Gartley's book Profits in the Stock Market, he identified a significant trend prior to the X point of the pattern.

When the market touches one of the Fibonacci levels closest to our D point projection, we have a valid Gartley Pattern setup. In the above example DD almost touches the 61.8% fibonacci retracement, and then takes off. We would have missed this trade if we only used horizontal retracement lines. However, if we apply the Beck's Emblem to this Gartley Pattern, the TCG setup would have been complete as the tip of the purple quadrilateral was close to one of the angles generated by the Beck's Emblem. The angle generated by the Beck's Emblem gives us a much better buy signal than the 61.8% fibonacci retracement. Why? Angles are always superior to horizontal levels because angles reflect both price AND time dimensions. This can be seen above by using the Beck's Emblem to find Gartley Patterns instead of simple horizontal retracement lines.

To learn more about the Gartley Pattern and Beck's Emblem go to geometrictrading.com

Gartley Pattern Lesson - Trend Reversal or Trend Continuation?

A Bullish TCG recently completed on McCormick and Company. What does TCG mean? In The Gartley Trading Method: New Techniques to Profit from the Markets Most Powerful Formation, the Gartley Pattern is categorized into two groups; the Trend Reversal Gartley (TRG) and the Trend Continuation Gartley (TCG.) The difference between the two has to do with the price action that precedes the X point of the pattern. In H.M. Gartley’s book Profits in the Stock Market, he identified a significant trend prior to X point of the pattern. He went on to describe his pattern as One of the Best Trading Opportunities and that it was similar to a head and shoulders pattern or a double top or bottom. If there was a significant down trend in McCormick prior to the X point on the chart, then the Gartley Pattern would be a TRG (Trend Reversal Gartley) and the D point would be a retest of the X point low or a double bottom. If the price action prior to the X point looks more like a correction against the existing trend (as in the case with McCormick) then the gartley pattern is a TCG (Trend Continuation Gartley.) To learn more about the Gartley Pattern and Geometric Trading Course, go to www.geometrictrading.com

The Gartley Trading Method Webinar Part II - Today Febrary 7, 2011 8:00 PM EDT!

Come join optionsXpress host Jim Rouzan and special guest Ross L. Beck for part II a three-part series on the Gartley Trading Method. Part II is entitled "The Gartley Trading Method: Exits and Money Management." This series is based on Ross’ new book The Gartley Trading Method: New Techniques to Profit from the Markets Most Powerful Formation. Part III will be presented on March 7th. This is an event that you will not want to miss! To register for Part II of the series, click here.

The Gartley Trading Method Webinar Series Commences January 10, 2011

Come join optionsXpress host Jim Rouzan and special guest Ross L. Beck for a three-part series on the Gartley Trading Method. Part I is an Introduction to the Gartley Pattern and is based on Ross’ new book The Gartley Trading Method: New Techniques to Profit from the Markets Most Powerful Formation. Part II will be presented on February 7th and Part III will be presented on March 7th. This is an event that you will not want to miss! To register for Part 1 of the series, click here.

"Buy the Rumor, Sell the Fact"; John Person on Current Market Conditions

"Buy the rumor, sell the fact." One of the best axioms for traders. But I have two questions:

1.) Should we be considering this mentality and applying it now to trading the stock market, especially after the S&P 500 has rallied to a high of just over 1220, which is a 9.0% year to date gain, or

2.) Should we be entering on the long side of stocks right now as the momentum is on a solid bullish path?

In order to answer this, let’s review the current events, seasonal statistics, and consensus studies, and then I want to review some technical analysis techniques.

The elections are out of the way and now we enter a period of what is called the “Lame Duck" session. This is the time period where ousted politicians are still in office until the new regime is sworn in.

12 Free Books & DVDs- Happy 4th of July

 
One of the most powerful lessons I have heard in 20 years of financial publishing is to invest in yourself. I am grateful to be able to help you, our most loyal customers, do just that with this gift. Please take advantage of this opportunity to get 12 trading courses for FREE.

There are no minimums--take one book or take them all. This offer will expire on 7/11/10 so please don't wait. You'll see that there are no gimmicks here when you click here. Which books you take are completely up to you. Your FREE items along with standard shipping charges will be added to your cart and sent to you immediately.

From John boYER, GENERAL MANAGER

Happy New Year- Our Gift to You

HAPPY NEW YEAR!

Our Gift to You - 10 FREE Trading Books & DVDs

(Just pay for Shipping)

Please take one or select all

Thank you & Have a Happy Profitable New Year,

Traders' Library

Dow convergence, bond bulls, futures for Thanksgiving, and TheHotel in Vegas

Marvelous Mondays (Kirk Report)

Interesting convergence to watch at Dow 10,500 (Corey Rosenbloom)

The bond bull (Planet Yelnick)

Holiday trading slowdown in play (Toni Hansen)

A daily breakdown of Thanksgiving week history (Quantifiable Edges)

Stocktwits (for all you new to Twitter)

Options Trader Monday Outlook: Stuffing the Futures for Thanksgiving (Seeking Alpha)

Is the dollar driving stocks or the reverse? (Kathy Lien on Greenfaucet)

Quick reads (Dr. Brett Steenbarger)

It isn't easy being green (Rick Reilly, ESPN)

16 Rock Myths- Debunked! (SPIN)

TheHotel at Mandalay (thanks for a great weekend!)

Dollar news, SP500 Peaks, and Are You Using the Right Hammer?

The Dollar and Producer Price Index (Kirk Report)**

What a strong early tick as meant in the past (Quantifiable Edges)

Run on the Dollar (Planet Yelnick- Elliott wave analysis)

Building Value Lower (Traderfeed- Dr. Brett Steenbarger)

A Look at Recent Peaks in the SP500 (afraid to trade)

The Quant View: Market in Strange Dance with Dollar (greenfaucet)

Buffalo Trader Bullish Reversal Report 11/17 (Mr. Swing)

Hammer time- are you using the right tool? (Seth Godin)

Julian Casablancas - 11th Dimension  (Trader Rock)

Some Boys are Born to Wander by Walter McDonald (Poetry Foundation)

Dave Grohl Reveals Tales Behind His Trio of Led Zeppelin Tattoos (Rolling Stone)

College Hoops Tip Off Live (ESPN)

Learning Video: Introduction to Elliott waves.

With this video I am introducing you to a series of Elliott waves analysis. We will have a look at impulse and correction waves and Elliott cycles. One of the only tools that can give you an idea as to which direction the stock price will move next is Elliott wave analysis. With short, medium, and long-term Elliott wave trend analysis, you can have a pretty good indication if price has a better chance of going up or going down in these different time periods. As an added bonus, an Elliott wave can give you some price target too. Your Elliott wave count does not have to be perfect. You will have to review counts regularly. What is important, though, is that price makes a move in the expected direction.

Sylvain Vervoort
http://stocata.org/

Why the Market Refuses to Have a Serious Correction

by Jeff Greenblatt, author of Breakthrough Strategies for Predicting Any Market

We have a very interesting market, which is all over the map. It has mostly been up as this is a market that refuses to have a serious correction. Why? It is simply because the US Dollar refuses to stay up. In October, the Greenback had its very best chance to stay up as it even surged beyond the upper descending channel line which normally indicates a larger move is in the cards. But the Dollar spent 3 days retesting the channel line from the north side during the first week of November before faltering. By the time this article was turned in, the Dollar was once again beyond the channel line.

Saturday reading from new and familiar bloggers

A New Bull Market in NYX (art of contrarian trading, carl futia)

Pick 1 stock for 5 years (market folly)

Kirk Report round-up

The pyschology of this market (planet yelnick)

Visualizing the market's trend status (dr. brett steenbarger)

Indices close at new yearly highs (toni hansen)

Dip buying continues (david fry for seeking alpha)

OVIE!! Go Caps! (espn)

Where I wish I was right now....

and... 3pt favorites? I think NOT! go Ravens!

Smart Trade Digest Free Trial Issue

Packed with explosive picks, up-to-the-minute trading advice, must-have market forecasting, and the very best intelligence from today's top traders, Smart Trade Digest is the newsletter you must consult before you make another market move.

 

Don't miss the NEXT WINNING PICK!  Download your free trial to Smart Trade Digest today!

Smart Trade Digest gives you everything you need to know-the best thinking, forecasting, and analysis-from a "Who's Who" of Superstar Traders. Plus, Smart Trade Digest does all the work for you by providing trading information from multiple sources.

 You'll hear from:

-Larry McMillan
-Martin Pring
-Mary Anne and Pamela Aden
-Dennis Slothower
-Jeff Greenblatt
-Jeff Hirsch
-Price Headley
-Grace Morris
-Deron Wagner
-And many others...

 

Click here to get your free issue today!

Understanding Gann Angles

Happy Friday! Thought we'd take a minute to review Gann Angles from Clif Droke's Gann Simplified, a great little primer on the techniques of technical trader W.D. Gann. Enjoy!

CHAPTER 10 Gann Angles

Once the basic concepts of trend line support and resistance have been mastered, we can now proceed to a more advanced concept that allows for greater accuracy in market forecasting using charts. Employing a little-known technique developed by W.D. Gann, a trader can derive maximum leverage in negotiating the markets.

Michael Jardine's Monitoring the Wave Count (from New Frontiers in Fibonacci Trading)

Good day everyone! Today's selection comes from Michael Jardine's best-selling book, New Frontiers in Fibonacci Trading: Charting Techniques, Strategies, and Simple Applications. There has been renewed interest in this book, and Michael is currently working on a follow-up book due out in first quarter 2010. Enjoy and please feel free to post comments.

Reprinted from Chapter 5: 9/11: Monitoring the Wave Count

The market is dynamic. If we liken it to a pond, the major events of each day are made up of several large stones thrown into that pond. They will send out waves, and some will create a large wake. The most significant points are found where those waves and wakes cross.

Review of Jeff Greenblatt's Breakthrough Strategies for Predicting Any Market

Enjoy reading this review from Seeking Alpha contributor Radu Haraga about our author Jeff Greenblatt's book, Breakthrough Strategies for Predicting Any Market: Charting Elliott Wave, Lucas, Fibonacci, and Time for Profit. This was one of my first editorial projects here at Marketplace Books and one of my proudest accomplishments. I hope you pick up a copy and check it out yourself.

http://seekingalpha.com/instablog/375714-radu-haraga/26456-a-book-review-jeff-greenblatt-s-breakthrough-strategies-to-predicting-any-market

*Keep in mind that we do not solicit reviews from Seeking Alpha. Their contributors ask us for review copies and we send them out. What they write after that is completely up to them.... Thanks!!