{"id":683,"date":"2009-05-30T13:12:15","date_gmt":"2009-05-30T18:12:15","guid":{"rendered":"http:\/\/www.smbtraining.com\/blog\/?p=683"},"modified":"2009-05-30T14:03:24","modified_gmt":"2009-05-30T19:03:24","slug":"fundamentals","status":"publish","type":"post","link":"https:\/\/www.smbtraining.com\/blog\/fundamentals","title":{"rendered":"Fundamentals"},"content":{"rendered":"

Trading is not just about reading charts, or reading the tape. \u00a0We also must understand the market’s and a stock’s \u00a0fundamentals. \u00a0We are not fundamental traders but we use fundamentals to help us increase our win rate. \u00a0For the intraday trader we use fundamentals very specifically. \u00a0Let’s discuss.<\/p>\n

We used fundamentals to help us profit in JCG yesterday. \u00a0Yesterday JCG blew out its numbers. \u00a0JCG beat on the bottom line, revenues, and going forward. Their results were better than the Street expected. \u00a0This is likely to attract new buyers to a stock. \u00a0As an intraday trader when a stock offers surprisingly positive sales numbers we trade that stock more aggressively on the long side. \u00a0When JCG shows strength on the tape we give the stock the benefit of the doubt and get long.<\/p>\n

Connor just showed his tape of DLTR from this week. \u00a0DLTR reported strong Q1 results, the tape did not show resistance until 46, bids were not dropping near 44.40 on the open, so he got long. \u00a0And he held DLTR, until he saw resistance near 46. \u00a0He used fundamentals to help him make a profitable trade.<\/p>\n

Fundamentals that I look for are: increased market share, increased margins, surprisingly good earnings. \u00a0When I see this then I trade the stock more aggressively from the long side. \u00a0I trade stocks more aggressively on the short side when their margins decrease, they lose market share, or their results are surprisingly negative.<\/p>\n

There is always a big picture to your trading day. \u00a0There is usually something that dominates the business news cycle. \u00a0What is the market most concerned with today? This week the chatter has been about the potential bubble in treasuries. \u00a0We keep an eye out for how this may weigh down the market. \u00a0Previously we were concerned with the liquidity of the banks. \u00a0Before that there was the effect that oil may have on consumers as it hovered around $130 a barrel.<\/p>\n

And as these big picture concerns get worse than we must see more evidence to get long on the tape. \u00a0As these big picture concerns find good news then we are free to trade more aggressively on the long side.<\/p>\n

I am not a fundamental trader. \u00a0But I must understand them to a certain degree. \u00a0I am not a slave to them. \u00a0They are not as important as price action, the inside market, the prints, and the volume of the stocks I am watching. \u00a0But I factor in the fundamentals to provide more color for my tape.<\/p>\n

And let’s take JCG again as an example. \u00a025 was huge resistance. \u00a0JCG is much more likely to get through this resistance because the market is strong, the tape looked strong, AND they blew out their numbers. \u00a0I combine all of the above to improve my win rate as a trader.<\/p>\n

So that is how we do it<\/a>. \u00a0Don’t forget to follow us on twitter<\/a>.<\/p>\n

Best of luck with your trading.<\/p>\n

\"jcg-05-29-091\"<\/p>\n

\"dltr-05-27-09\"<\/p>\n","protected":false},"excerpt":{"rendered":"

Trading is not just about reading charts, or reading the tape. \u00a0We also must understand the market’s and a stock’s \u00a0fundamentals. \u00a0We are not fundamental traders but we use fundamentals to help us increase our win rate. \u00a0For the intraday trader we use fundamentals very specifically. \u00a0Let’s discuss. We used fundamentals to help us profit in JCG yesterday. \u00a0Yesterday JCG … Read More<\/a><\/p>\n","protected":false},"author":144,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[4676,291,30,18],"class_list":["post-683","post","type-post","status-publish","format-standard","hentry","category-mike-bellafiore-bellas-blogs","tag-day-trading","tag-fundamentals","tag-prop-trading","tag-smb-capital","no-post-thumbnail"],"yoast_head":"\nFundamentals | SMB Training<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.smbtraining.com\/blog\/fundamentals\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Fundamentals | SMB Training\" \/>\n<meta property=\"og:description\" content=\"Trading is not just about reading charts, or reading the tape. \u00a0We also must understand the market’s and a stock’s \u00a0fundamentals. \u00a0We are not fundamental traders but we use fundamentals to help us increase our win rate. \u00a0For the intraday trader we use fundamentals very specifically. \u00a0Let’s discuss. 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