Rule #3: Money’s Directional Flow “Determines” the Market’s Direction …

Tweet“The stock market is about money. Money flows in and stocks go up, Money flows out and stocks go down.”  Jesse Livermore (July 26, 1877 – November 28, 1940) When you look at the chart (see below), you will see the direction and trending of Net Inflowing Liquidity levels (often referred to as “direction money flows”  … and […]

Rule #2: When the Big Guys Decide to Sell, the Market drops …

Tweet Who are the Big Guys? If you’ve studied the market, you know by now that the “Big Guys” are the Institutional Investors.   Since they own over half the market’s equities, they essentially control the market. If they are Selling, the market has tremendous downside pressure as they take their profits.   If they are Selling […]

Rule #1: To Always Be Right in the Market, do what Institutional Investors Are Doing …

Tweet  (The Corollary to Rule #1 is to Never go Against Institutional Investors.) Professional traders know the importance for NEVER doing the opposite of what Institutional Investors are doing. That’s because the market moves in the same direction that Institutional Investors are moving in.  Here is what you need to know:  When Institutional Investors are in […]

Rule #5: How you can use the (VIX) Volatility Index to Make you a Better Investor/Trader …

Tweet The VIX explained:  Few really know what the Volatility Index is, or how it is calculated.  Here’s are two brief explanations … the first is a technical explanation, and the second is a description that investors can easily understand. First, a brief technical explanation … The Volatility Index (or VIX) is a weighted measure […]

Rule #4: Use Option Liquidity Information to Know What the “Big Investors” will do next …

TweetWhy Using Option’s Liquidity Works … Imagine that a large Institutional Investor or Wall Street firm was going to start buying a lot of stocks tomorrow … enough to push the market in a given direction.   If you were then …. given you knew “what” you were going to do,  wouldn’t you take advantage of what you were about […]

Rule #6: How to use a Stochastic Momentum Indicator …

TweetRecommendations on using a Stochastic Momentum Indicator … I like using the Stochastic-Momentum indicator in certain instances because it can often give you a much clearer picture than just using a Stochastic indicator. Some refer to this indicator as the SMI and they use the same trading rules as they use with the Stochastic Oscillator. […]