Why you must study market timing | stockbee


Why you must study market timing

When you have a process in place to determine market direction you will tend to be on right side of the moves. If the process is right and you follow it and act on the signals from your process, you can avoid big market surprises and can benefit from market moves.

This is a video I did on August 28th, 2010 on Members site based on Stockbee Market Monitor a market timing tool which I have used for last 10 years successfully.

This is how market looked on the video day:

 Daily Market Analysis August 28, 2010 Video

You know what happened next. We had one of the best rallies in a month. In 14 days market went up 10% plus. It was easy time to make money with breakouts after breakouts working. That helped me to be up 52% for the year. But the trick in profitable trading is to be ahead of the curve and not give up hard earned gains. 

On September 28th I made another video and the message this time was different. The market had made a big move. The other side of the process kicked in and the Stockbee market Monitor flashed warning signals.

This is a long video and the reason is I wanted to focus attention on market risk. It has two important messages.

Net result is catching best part of move and retaining gains. Lot of time traders get caught in a vicious circle of making gains during bullish moves and giving up those during corrections. The result is lot of account churn but no major gains. The key to getting out of such vicious cycles is to develop a market timing mechanism which suits your trading style and time frame.

As a speculator ability to determine market direction is very critical. As a speculator you are not a buy and hold and pray kind investor. The essence of  speculative mindset is to find ways and means to exploit easily tradable moves. For that you need some method to determine favorable and non favorable periods for your speculative ventures.

Market Timing is a vast area of study. At one extreme are people and academics who "claim" that it is impossible to time the market and so they advise Indexing as the best strategy. At the other end speculators spend enormous time and effort designing market timing tools and many use them successfully to exploit the market for years. That is surely not luck.

There are many ways to time the market and if you dig deep in to the subject you will find many ways in which people have designed market timing models:

  • Economic indicators based models look at macro factors to determine market direction
  • Valuation based models look at extremes in valuation or valuation zones to determine market direction
  • Breadth based models look at breadth of participating issues to determine market direction
  • Historical precedent analysis based models look at similar period in history and find most fitting periods
  • Statistical models look at if X, Y, Z happened with such frequency in the past then if todays situation is similar then what is the probability of next up or down moves
  • Chart based models look at chart patterns
  • Models like that of IBD relies on distribution days
  • Some use indicators
There are many different ways to skin the Market Timing cat. What is required for developing a timing model is thorough understanding of some of these concepts and how you can make them work. There is abundance of published material on this subject. The key really is to move from abstract idea to workable method and process.  If you can do that then it just becomes a matter of exploiting that model and process.

If you want to be a consistently profitable trader then you must spend time and effort developing a workable market timing method for your style of trading.

Are you serious about your trading?

If you are serious about your trading and want to build an enduring edge the Stockbee Member site might help you. Members tell me they have tried lot of things before coming to my site and it has offered them the most extensive and detailed methods to swing and position trade.

It is only for those who want to develop their own self sufficient trading method. It is not a stock picking service. It is service for you to build your own scans and trading method to have your own daily pick based on your method.

Be warned it will take you time to learn to trade. Learning to trade is difficult art and unless you are willing to spend months or years to perfect your strategy and also develop your mental edge you are unlikely to succeed in this game. Unless you understand that no site, no service, and no mentoring is going to work.

Why traders come to stockbee?

The member site is one of the most recommended site for learning to trade by other traders and bloggers. You will see no advertising, no hard marketing, no promotions, no free offers, no affiliate marketing, no incentive to other bloggers to promote the site, no constant twits self promoting the site, no free trial  and no tall claims of making you instantly wealthy, and yet the site attracts new  members everyday. Members come from all walks of life and all kinds of trading size and trading styles.

You will see that many trading bloggers have been using my market timing methods, scans , stock ranking lists and chart templates. They have developed their own methods based on my methods. Many paid newsletter site recommend my site to their subscriber for learning about trading and market.

Over the years thousands of traders have been members and those who benefited from the learning talk about the site to others or talk about the methods used and that is how new members learn about the site.

What will I learn in the members site?

The members site will give you in depth understanding to develop your own trading method. The emphasis is on making you self sufficient and confident of your own trading method and style.

As a member you will learn the basics of swing trading, momentum investing, growth investing and risk management.

You will learn about Stockbee Trend Intensity Breakouts method that uses momentum based swing trading to find 3 to 5 day swing trades for 8 to 40% profit.

You will learn about Stockbee Episodic Pivots Breakout method which uses Post Earnings Announcement Drift (PEAD) to find stocks that had a game changing earnings and that are likely to rally for 3 months to 12 months.

You will learn about  Stockbee Dollar Breakout method that uses momentum, range expansion and swing trading approach to find 5 to 40 dollar moves in high priced stocks.

You will learn about  Stockbee Lemonade Strategy for 401k which uses market timing and momentum to invest in 401k. You will get weekly update on how I am using the strategy on our 401k to do allocation decision.

You will learn about Stockbee Market Monitor method for market timing using breadth. It allows you to avoid risky periods in market and allows you to identify market turns. It is used for 401k allocation decisions.

You will learn about Stockbee Double Trouble method to find stock with confirmed upside momentum using anchored momentum and that are likely to continue their up move.

You will learn about Stockbee Night Time is Right Time method to find news catalyst based trade ideas for short term day trade and swing trade.

You will learn about Investor's Business Daily’s IBD 200 list and how it can be used to find swing trading candidates for explosive moves.

You will learn about Telechart 2000 and how to use it effectively to scan for swing and position trade ideas and to set up your 401k strategy.

You will learn about Jesse Livermore Range Breakout, Darvas Box setup, and many other member shared methods.

You will learn how to set up your own scans, select right kind of stocks, how to set up stops, when to enter , when to exit, how much to risk, how to track your trades and all other details about trading. You will learn about developing your own methods and not relying on others for trade ideas.

The site has hundreds of videos and trading methods and variation of methods. Members help each other in developing the methods and share actively their research and finding. A collaborative spirit allows you to get input from others on your trading ideas or problems.

The site gives you opportunity to interact with some of the most successful traders and learn from them about their trading methods. It is a vibrant community with members from different background and experience willing to help each other. The emphasis is on continuous learning and up gradation of market knowledge and setup knowledge. The members range from hedge fund employees, financial advisers, active swing traders, investors and new traders.

If you are looking to develop your own trading strategy the membership site might be for you. You have to be willing to put in the effort to build your own method. There are no silver bullets offered on members site. Every method, every scan, every nuance is detailed and all possible help is offered to design your own method.

Do you have a trial?

If you are just looking for trial you are better off trying thousands of other trading sites that offer free trial or one month trial and offer you promise of riches.

It is for those who are ready beyond the trial phase and ready to put serious months or years  of efforts to learn to trade on their own. It is for those who want to learn to find their own fish.

The free blog has all the details about the methods I trade and if you go through the posts highlighted in the sidebar you will learn about them.

How can I become a member?

To sign up go to www.stockbee.biz and follow the sign up process. The site uses Paypal for payment processing.


Blogger said...

I like to watch the market leaders's action to study the strength of the market. On the days when market indexes not doing so well, I look at the leaders. If they are holding well, I would not be concerned. For instances in the current cycle, I watch how FFIV, BIDU, AAPL, RVBD, VMW, AKAM, APKT NFLX are doing. The leaders may be different at different times, but it helps to gauge the market. Any risks with this approach? Thanks!

Pradeep Bonde said...

No. Different things work for different people. Many people follow your approach. They focus on leading stock and as long as leading stocks behave properly, they are bullish.