Monday, February 28, 2011

The Daily Note - Best Greeting EVER

Greetings from high in the Alps, half way around the world, sure can make one's day!

Greetings from the Alps (with lines from ski-tour on avalanch... on Twitpic

Happy Trading, Living and Skiing 

The Daily Pick - FSLR - A $STUDY
©DayTrading with Anni 2011 All Rights Reserved

Thursday, February 24, 2011

The Daily Note - Cover US In Oil

I've often said that we'll rue the day we stopped drilling for oil in the USA. "We need more oil" and "we need to ween ourselves off oil": For over 35 years the debate has continued. For over 35 years we have become increasingly more dependent on oil from the Middle East. For over 35 years we've been lied to about having a lack of oil supply and being told it will take 30 years to bring a well to production. Mind you, that was said over 30 years ago.

Of course there were those who kept saying that if we lack oil, we'll use less of it. Very smart thinking obviously. We were also told that we are the largest most greedy consumers of oil. Maybe, but then we were also the biggest producers of goods that people coveted around the globe.

Then we were told we are ugly Americans, arrogant and boastful, and extremely wasteful. We were a "throw away" society that needed to be scolded and shunned and we needed to be mindful of others around the world. Then we were told to clean up our dirty air and that our dirty cars were the reason forests, rivers and fish were dying. Even though we breathed the cleanest air on the industrial planet, we saw some merit in it, cowered and gave birth to the EPA.

The holy EPA (it's blasphemy to speak of it in unholy terms, you know.) Think it stands for "Environmental Protection Agency" alas I think it's: "Everlasting Power and Arrogance"

What happened since we gave birth to the EPA? In short, hysteria took over reason; real science went out the window and popular science became logic.

  • Cheap clean nuclear energy plans had to be discarded. (No "dirty" fuel rods for our country)
  • We created MTBE and made the oil companies put it in our tanks so we could clean up our water tables later. .right on Feinstein, Boxer and EPA!!
  • We put all "mom and pop" service stations out of business in California because they could not buy gasoline from outside California sources to compete.
  • We became more dependent on oil than ever before.
  • We are now unable to drill for oil without it costing more than paying shipping from overseas.
  • We are now the 2nd largest users of oil.
  • We now pay the 1st largest user (China) to produce our goods cheaply and even though it lacks quality, therefore making us truly a throw-away society, out of need, rather than desire. 
  • We've made the middle east dictators rich but not many citizens of those countries reap the benefits. 
  • We are now blamed for the problems in the Middle East because in their eyes we are still the dirty rich Americans they envy. 
  • Lastly, we still need oil even if we had nuclear powered cars. 

Why did all this happen you ask? Because, for one, the government got involved regulating the oil production in the USA. Much like how the government got involved with regulating the loans the banks had to grant during the mid '90s, and much like how the government has gotten involved with just about every aspect of your life since the EPA was born.

I can't sugar coat it for you because there is a tax on sugar. Not to mention the price of corn just went up again to make that "cheap", dirty ethanol you've been demanding and of course the government had n o t h i n g to do with that either.

So, what to do?  We can start drilling for oil now,  so then later we can bring our troops home and let the rest of the world evolve without our meddling,  and also, finally and more importantly,  so we don't pass this mess on to our grandchildren.  In other words, we can become the nice USA the rest of the world wants us to be by just using our own oil.  Hear that, EPA?

In the meantime, we can trade the markets and hopefully  make some money to keep just a hairs-breath ahead of inflation, and be covered in oil.

Happy Trading, Living and

The Daily Pick - OIH

©DayTrading with Anni 2011 All Rights Reserved

Wednesday, February 23, 2011

The Daily Note - Rules and Discipline

Successful trading has rules; fact is everything has rules, including living. Each rule when followed  or when not followed has specific consequences; when or what, we do not know until it happens.

For example, we all know that: Stepping off a curb without looking; taking our hands off the wheel while driving; or accumulating debt can have bad consequences.  We know we are tempting fate, yet we continue to do it because  ___________  fill in the blank for yourself.  If your reasoning is that rules are meant to be broken, matters not  and if you have never done any of those in your life, I'm sure you can dig around in your lifestyle to come up with a few that will match the examples: not wearing a helmet while riding a bike fits too.

The point is in each example we are not following the rules: the rules for living or survival. But what if we commit those acts numerous times without suffering the worst consequence: dying.  We may get a good scare of two along the way but since it's nothing major, we continue to commit the acts and until it happens, we can hope and dream that the consequence will never come. Trouble is that the more often an act is committed, the more likely that the worst will eventually happen, therefore, we are taught discipline somewhere along the way of growing up, hopefully.

I, at times, think that discipline should have a test and adulthood not granted until it's mastered, but then not many  of us would ever become adults so be glad (perhaps) that life doesn't operate that way.  It does, however, dole out consequences both positive and negative depending on the degree of the rules and discipline practiced. It is why it's important that traders learn to use both hand in hand, for the best consequences and  benefits.  Rules can be ignored without discipline, and discipline can be ignored without rules, but put together they become a powerful and winning ally.

Happy Trading, Living and Dancing

The Daily Pick - NFLX

 ©DayTrading with Anni 2010 All Rights Reserved

Tuesday, February 22, 2011

The Daily Note - Like Falling in Snow

Gone are the days when I could boast not a fall on the slopes. I don't ski often enough anymore and when I do, I like to think I can ski like I did back when. However if I didn't try, I'd be bored. Thus, I realized today that I trade much like I ski: Heart full of adventure and a dose of caution, with eyes to the future which on the slopes, is the end of the run without a broken or twisted limb.

Isn't that what we all experience when we are planning a trade? Adventure, caution, eyes on the prize, and hope for no flash-crash.

Except that we fall sometimes regardless of experience or caution, and we sometimes fall on hard groomed, icy slopes or into soft snow. Presuming no major injury requiring a free ride in a toboggan, we get up, brush ourselves off and.. and .. and ..

What do we do? Stand there and freeze? Cry? Wait for a solace? Stare at the slope? Look for the snow snake? Blame the equipment? Very few skiers do, and if they do, they will likely never ski again.

No, we ski on. What's more, we look for the opportunity to correct the mistake we made that caused our fall. In other words, we work on perfecting our style and soon we are back in the adventure, with eyes on the future and we soon forget the fall.

As I said, much like a well planned trade, and the next, and the next. If you "fall" or experience a loss, do you freeze? Wait for solace? Blame the platform or broker? Look for the MM who did it to you? Very few traders do and if they do, they will likely never really learn to trade well.

Instead, be like a skier no matter which style or how much experience, after a fall, get up, and continue to trade while perfecting your style. Soon you'll be enjoying the adventure again, as you learn from the mistakes, and having fewer falls and you'll be ending in the future with a giant grin under your ski mask. Yeah, I said a ski mask, it's been cold up here!

Some day I'll write about my more memorable falls. (The ones we never forget!)
One of my favorite songs for the slopes and the markets, a reminder that mountains need valleys.

See you on the slopes

The Daily Pick - PAAS

©DayTrading with Anni 2011 All Rights Reserved

Thursday, February 17, 2011

The Daily Note - Today's Market, Yesterday's News

Is this news for you? What's happening today in the markets is already old news to many who direct (read manipulate) the markets politically and monetarly. Long before you're on the scene they have already decided where they want a stock to close for options and for the day. Do they always get their way? Pretty much they do. Their pulpit is the business news stations, the money managers and financial analysts, down to your neighborhood financial advisor who may understand less than you do if you are a daily follower of the markets on line.

Think about it. The multi millions thrown about the daily trading circles are but a drop in the bucket for some manipulators. This is the big arena, the multi billion dollar payout to the winner like in any lotto and it's getting more rich by the day. Who is going to pull the final lever is as good as a guess can be. Yet you and I  both know that when it is pulled, all the cash will pour out of this giant one-armed-bandit.

I know that right now there is a lot of cash pouring in. Be it from people looking for safety in the markets, seeing the economy improving  or from people who feel they've missed out this 2 + year bull ride and want a chance at it, makes not difference.  People are always eager to jump on the ride when it's obviously going their way. Yet I have to put a reminder here about how that was also the case in Feb. 2000, just before March 10th. Of course "bailout",  was not a common word then and neither was "too big to fail" or POMO.
Those three items can change this ballgame, yet nature always tends to win in the end, so being aware and being wary is a good thing.

It is fine to partake in the game as long as you know it's outcome may not be where you expect it to be. If you are just going along with the ride, good for you. Just know the vehicle are you riding in.  Like, we are warned  in California from  time to time:  There's going to be an earthquake;  just don't know where or when.

So being aware of the possibility is step one, but being prepared is the next step for survival:
  • Know where the  the supports and resistances are for the markets not just your positions.
  • Be optimistic with healthy pessimism and be a pessimist with healthy optimism.
  • You're the best judge of your future. 
  •  If it looks right,  take the chance; If it doesn't look good, don't get in;
  • "Hope" is like "Try"; "It is or it is not" just like "you do or you do not". 
  • Admit you're wrong then take action. 
  • Check your baskets and stir them frequently. Back burners can burn your cash just as easily as the front ones. ( the cooks out there know this well, do you?)
  • Do not overextend yourself or your trading capital.
  • Be liquid. Have cash at the ready in case of a freeze. 

Presently, there is a feeling of victory throughout the world as an American supported dictator falls off their perch, yet again.  While the celebration continues, there is also a continual state of upheaval fueled by it throughout the Middle East.  Do not presume the outcome, because  most reality falls a far cry from the news and, I doubt that this will be different. Don't just take comments as face value, investigate history.

Be aware and be wary that in the world, as in the markets, there is a lot of sleight of hand going on and not much will surprise you.

Happy Trading, Living and Dancing

The Daily Pick - CLF Yesterday's News Pick - Earnings Trade Pick

©DayTrading with Anni 2010 All Rights Reserved

Monday, February 14, 2011

The Daily Note - I Heart You

Happy Valentines everyone! It is another fantastic day at the markets, I can tell. Just by being alive. Nothing will stop this market.

I love fairy tales. Don't you? In fairy tales there is always a bad person (we always know who it is) An innocent person(we know who); A hero (ditto). Fairy tales also tend to start out badly and always end up happily and of course with ever after added on. Unlike in Operas, where the opposite is always true and everyone starts out hopeful and the hero and love interest die at the end.

So which kind of trader are you: The one that lives happily after or the one that dies in the end?
Your style may be the key to your outcome. But before your style can be assessed, assess your psyche. Really!! Which outcome attracts you more when you read, watch movies or fantasize about love?

Your outlook greatly influences your results because you attract what you think and it does not matter on which level you think it. Whether it is deeply buried in you consciousness or it is on the surface nagging at you daily makes no difference to the probability of the outcome, but the sooner you recognize it and incorporate it into your style, the better it will be for your trading results. That's really the long and the short of it ;).

Me, you ask? I love animated films, cartoons and fairy tales and I was also raised on, and have a great appreciation for the Opera. Yep, a mixed-up kid and at times still battling both the villain and being a martyr.

When I was young my favorite Opera was "AIDA" by Giuseppe Verdi. "Why?" my mother asked once? In response I said: "Because there is so much love in it." The story, which takes place in Egypt, is that of the hero, a victorious general who falls in love with a slave girl and refuses the hand of the king's daughter in marriage. Of course, as you may have already guessed, the ending is not a happily after, because as punishment, they are tombed alive to meet their fate.

Over the years other stories have taken it's place, yet still, the story and the music is as beautiful as ever in my heart and Verdi remains my favorite composer of the Opera.

Here is the finale Duet as I learned it:

Happy Valentines

The Daily Pick - CMG

©DayTrading with Anni 2011 All Rights Reserved

Sunday, February 6, 2011

The Daily Note - Advice to "Newbie" Traders

I am asked often about how to get started trading so I decided to publish some of my thoughts on the subject in condensed form today. Since no one person is the same or learns like another, the many approaches published by traders can be quite confusing if not overwhelming, So I decided here to keep it to the minimum as complications will naturally occur for each person as they continue the journey.

Welcome to my Trading World

We all start as "Newbies" but many make it through to be "Oldies" quickly because they do not stop and study how to stay a "Newbie" forever.

In order to survive as traders, we all need to keep new and fresh at all times and we all need to keep searching for a better understanding and a better edge. So if you are among the smart ones, you'll stay a "newbie" in spirit to keep traveling on this amazing journey.

Along the way you'll need to answer many questions about just how much stamina and patience you have and how much pain you can endure. Think of the maximum and then multiply it a thousand times and if you think that is asking too much of you, quit before you begin.

About your desire to hit the floor running, let me just say that most traders crash that way and can never return. Trading is not a race it's a game of endurance where preservation of capital is the goal and gain is the prize. You are not racing against anyone, except your own impatience.

So that said, Here is my step by step for new traders:

  1. Read and research before even looking at a trade. Everyone has their favorites and I'm no exception. Start with Trading for a Living by Dr. Alexander Elder. When you master that book and understand all aspects of it, read another one. There are many out there and I haven't read them all.
  2. Eliminate the noise. Yes, the noise of the internet until you have an idea of what they are talking about and know not to follow blindly. More easily said than done, I'm sure. Once you are familiar, you'll be able to choose much more wisely. 
  3. Become wise by learning from the mistakes others have made.
  4. Take a class. Then take another and another. It's worth the investment.
  5. Practice trading with paper money. Not with $100K that most platforms give, but with $30K. Less is a better teacher here. I don't care what others say, you need to learn how to trade. Which means technically speaking, how to set up your platform, and get to know the machinery and the peculiarities of your platform.
  6. Start a log and a journal of all your trades. Yes paper ones, Log down all the trades and write down your feelings, thoughts, observations about the trade before, during and after.
  7. Honesty will save you money. Be brutally honest with yourself every day, but do not forget to praise yourself too.
  8. When everything fails, and it will, start all over. That's when you'll be grateful that it's only paper.
  9. Learn to visualize and to meditate. This will be your most important support and ally.
  10. Give yourself time. Be patient. The above steps if done right, will take several months. And each step is worth it's time consider it savings in the bank.
  11. Once you are a 100% success on paper, and you can point to a good record start SMALL with real money . 

 When you start with real money, realize you are only beginning this list all over again and everything will   be 100% more intense because it's when you'll meet and get to know your toughest challenger: Yourself

Yes, it's as much a mind game as a technical one and the more prepared you are the easier it shall be to meet and defeat your demons.

Whatever the outcome, one thing's for sure, you are about to embark on an amazing journey.

Much Luck and
Happy Trading, Living and Dancing

©DayTrading with Anni 2011 All Rights Reserved

Friday, February 4, 2011

The Daily Note - Music & Charts List for Friday

recap of last evening's Music & Charts list for Friday:
Featuring Music by Krokus


Happy Trading, Living and Dancing

The Daily Pick - See above
©DayTrading with Anni 2010 All Rights Reserved

Wednesday, February 2, 2011

The Daily Note - JLL for a Swing

A Swing Trade set up worked well for the earnings announcement here. Once the initial day went well, take some off the table and let the remainder ride into earnings.

And so we play another swinging trade.

Happy Trading, Living and Dancing

The Daily Pick - JLL See above

©DayTrading with Anni 2011 All Rights Reserved