Mike Bellafiore Interview with Michael Covel on Trend Following Radio

Michael Covel speaks with Mike Bellafiore, author of “The PlayBook”. Bellafiore trades an entirely different style than trend following, operating on a much shorter timeframe. Covel and Bellafiore discuss the real rewards to being a successful trader; passion in trading; why professional traders fail; parallels between trading and writing; Bellafiore’s history and definitions of “prop trading”; trading short timeframes and … Read More

GDX Sector

Here’s an example of using the TEA indicator as a tool to find sectors and individual stocks in play. Tomorrow, in the Options Tribe meeting, I’ll be discussing the TEA indicator in more detail. We will look at how the indicator is built, how you can install it on your platform, and the variety of uses – from managing options … Read More

TEA Trend Indicator

The TEA has fired off a big warning on SPY – The first since May 8th. The current bullish move was confirmed about a month ago and held nicely with only moderate warnings on down days. In the context of slowing momentum and an extended move; yesterday’s bearish move is a more relevant warning.   Applications I’ll be quick to … Read More

Duration: The Sixth Step to Systems Success

Number six in our seven steps is Duration. Duration represents the expected length of time in winning trades, losing trades, and all trades. Almost without exception we find that trend- and momentum-oriented signals have a shorter duration for losing signals and a longer duration for winning signals. The reverse is true for mean-reversion trades. Knowing your expected duration is important … Read More

A Fireman’s 2nd Day Trend Trend Trade (FSLR)

We received this e-mail from an SMBU Blog reader.  We hope you enjoy. So I had my first PlayBook trade today (that is, an A+ setup that I had previously seen and  wrote a detailed Playbook entry for and now I actually traded it …) The trade was a Second Day Play with Trend Trend characteristics that breaks out over pre-market … Read More

Forex Trading: When Should You Go Against The Trend?

What makes prices in a financial market system fluctuate the way they do is traders entering and exiting the market for an infinite number of reasons. Some may be getting stopped out while others may be adding to a position. We can never know for sure the reasons why they may be acting a particular way at a specific period … Read More

Sometimes Being Contrarian Means Betting on the Trend

A dip against the long-term trend offers a high probability setup for the contrarian trader to adjust options positions that haven’t been working and to put on positions that will take advantage of a possible trend resumption. In this most recent example, we can see that the price traded down to the lower band of the LRC Channel. Regardless of … Read More

Is The Trend Your Friend? Or Just An Acquaintance?

By marcp | View this Toon at ToonDoo | Create your own Toon We’ve heard it a billion times: The most effective way to trade the forex market is to trade with the trend. Like 80 years ago some fast talking high pants guy probably at the New York Stock Exchange said, “The trend is your friend, seee?” So now … Read More