You are previewing The StockTwits® Edge: 40 Actionable Trade Set-Ups from Real Market Pros.
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The StockTwits® Edge: 40 Actionable Trade Set-Ups from Real Market Pros

Book Description

Profitable trade set-ups from StockTwits leading traders

StockTwits has emerged as the leading stock market social networking site, providing traders and investors with a vehicle to exchange ideas and receive real-time market insights. StockTwits is a "farm club" for talent, the American Idol of Finance.

One of the biggest secrets on Wall Street is that to become consistently profitable, you need to specialize in a distinct setup. A setup is a combination of factors that need to align in time and space in order to produce a buy or sell signal.

In The Stocktwits Edge, both well-known professional traders and lesser-known individual traders, describe their highest probability setups. Throughout the book, you will get acquainted with various market methods in terms of time frame and asset class. There is something for everyone. Some of the best traders on Stocktwits guide you through how they find profitable ideas on a daily basis and how they manage risk. They not only explain which factors are important, but also why they are important.

While there are many factors involved in successful trading and investing, the ability to identify profitable situations is paramount. This book will help you achieve that goal.

Table of Contents

  1. Cover Page
  2. Title Page
  3. Copyright
  4. Dedication
  5. Contents
  6. Introduction
  7. PART I: Trend Following
    1. CHAPTER 1: Find Trends, Ride Them, and Get Off
      1. LESS IS MORE
      2. CATCHING BIG TRENDS
      3. SIMPLE IS GOOD
      4. UNDERSTANDING MOMENTUM
      5. MACRO TRENDS TODAY
      6. EXAMPLES
      7. HERE COMES THE SUN
    2. CHAPTER 2: Trade, Trend, Tail
      1. MAKE MONEY OR GO HOME
      2. PAY ATTENTION TO VOLATILITY
      3. BEARISH AND BULLISH FORMATIONS
      4. GET ME SOME GOLD
    3. CHAPTER 3: Don't Quit
      1. BURNING DESIRE
      2. TOP-DOWN APPROACH
      3. FAVORITE SETUP
      4. WORDS OF WISDOM
    4. CHAPTER 4: Know Thyself
      1. FOLLOWING IN THE STEPS OF MY FATHER
      2. THE TREND IS YOUR FRIEND
      3. BASE FORMATIONS ON QUIET VOLUME
      4. THE MASTERCARD TRADE
      5. WORDS OF WISDOM
    5. CHAPTER 5: Insider Information Is Reflected in the Charts
      1. MARKET BIO
      2. BREAKOUTS FROM LONG CONSOLIDATION
      3. BREAKOUT FROM A LONG BASE
  8. PART II: Value Investing
    1. CHAPTER 6: Margin of Safety
      1. INVESTING BIO
      2. HUNTING FOR VALUE
      3. FAVORITE SETUP
      4. HOW DO YOU MANAGE RISK?
      5. GOING WITH iGo
    2. CHAPTER 7: The BeanScreen
      1. SUCCESSFUL INVESTING REQUIRES DUE DILIGENCE AND TIME
      2. THE TORTOISE AND THE HARE
      3. THE BEANSCREEN
      4. EQUITY SELECTION
      5. RISK MANAGEMENT
      6. HOW THE BEANSCREEN HAS HELPED OUR INVESTING
    3. CHAPTER 8: Fallen Angels
      1. PROFESSIONAL BACKGROUND
      2. VALUE AND THE BIG MAC THEORY
      3. BUYING GREAT COMPANIES AT LOW PRICES
      4. THE IMPORTANCE OF MIND SHARE
      5. WORDS OF WISDOM
    4. CHAPTER 9: Dividends Don't Lie
      1. MY PROFESSORS WERE WRONG
      2. THE KIND OF STOCKS I LIKE: ONLY THE HIGHEST QUALITY
      3. AFLAC, THE DUCK STOCK
      4. ORPHAN STOCKS: THE SHARES OVERLOOKED BY WALL STREET
      5. DEEP TRUTHS ABOUT THE MARKETS AND INVESTING
  9. PART III: Day Trading
    1. CHAPTER 10: Only Price Pays
      1. LEARNING THE HARD WAY
      2. THE TRUE VALUE OF TECHNICAL ANALYSIS
      3. TREND ALIGNMENT
    2. CHAPTER 11: Intraday Earnings Momentum Gap Trade
      1. FINDING THE RIGHT APPROACH
      2. TECHNICAL ANALYSIS RULES
      3. TRADING EARNINGS MOMENTUM
      4. FSYS IS GAPPING UP ON A STRONG EARNINGS REPORT
    3. CHAPTER 12: Trading the News
      1. THE PROPRIETARY TRADER
      2. STOCKS IN PLAY
      3. MY “A” SETUP
      4. SHORTING TOYOTA MOTOR CORPORATION
    4. CHAPTER 13: Intraday Momentum
      1. PROFITABLE BY MONTH FOUR
      2. EMBRACE MOMENTUM
      3. TRADING THE NEWS
      4. CONFIRMING BULLISHNESS OF FUNDAMENTAL HEADLINES
      5. RISK MANAGEMENT
    5. CHAPTER 14: The Underlying Psychology of Large Players
      1. BURN THE SHIPS
      2. FEAR AND GREED
      3. THE BALANCE BETWEEN BUYERS AND SELLERS
      4. JUNIPER NETWORKS
  10. PART IV: Swing Trading
    1. CHAPTER 15: Flags and Wedges
      1. SERVING CHIVAS TO THE WALL STREET SHARKS
      2. I TRY TO BE WHERE THE MONEY IS
      3. EXPERIENCE CAN'T BE BOUGHT
      4. USE STOPS OR DON'T BOTHER TRADING
      5. THE FALLING WEDGE
      6. CAN YOU STILL WIN THE GAME, OR IS IT RIGGED?
    2. CHAPTER 16: Breakout from a Tight Base
      1. IT IS LIKE A CHESS STRATEGY
      2. LOOKING FOR AN EDGE
      3. BREAKOUT FROM A TIGHT BASE
      4. FOLLOWING MY PLAN
      5. WORDS OF WISDOM
    3. CHAPTER 17: The Base Is Everything
      1. SURVIVING THE CRASH
      2. COMBINING TIME FRAMES: THE INTRADAY AND THE DAILY
      3. OUR UNIQUE MARKET APPROACH
      4. DAILY BREAKOUT SETUP
    4. CHAPTER 18: Trading People, Not Stocks
      1. FROM ENGINEER TO FULL-TIME TRADER
      2. TRADE THE TRADERS
      3. SWING TRADING REQUIRES SPECIFIC WAY OF THINKING
      4. NU SKIN ENTERPRISES, INC.
    5. CHAPTER 19: The Top-Down Technician
      1. ALL ROADS LEAD TO TECHNICAL ANALYSIS
      2. FROM BROAD TRENDS TO SPECIFIC PICKS
      3. STRONG TREND LINES AND THE ROOM TO RUN
      4. APPLICATION OF THE SETUP
    6. CHAPTER 20: Identifying Trend Shifts
      1. LEARNING FROM THE MASTERS
      2. EMOTIONS DRIVE PRICES
      3. THE NEWS ABSORPTION TRADE
      4. PRICE BATTLE FOR WHIRLPOOL
      5. IMPORTANCE OF SENTIMENT AND FUNDAMENTAL SHIFTS
    7. CHAPTER 21: A Chart Will Never Lie to You
      1. JOURNALING TO STAY ACCOUNTABLE
      2. HAVING A PLAN
      3. THE STOCK MARKET REFLECTS HUMAN EMOTIONS
      4. TRADE STOCKS THAT ARE LEADERS IN THE SECTOR
      5. THE DESCENDING TRIANGLE
      6. THE THOUGHT PROCESS BEHIND MY TRADES
      7. WORDS OF WISDOM
    8. CHAPTER 22: The Short Squeeze Trade
      1. THE COLD CALLER
      2. PHIL, THE MENTOR
      3. THE IMPORTANCE OF RISK MANAGEMENT
      4. THE ART OF CONTRARY THINKING
      5. TYPICAL SHORT SQUEEZE TRADE
    9. CHAPTER 23: The Price Tells the Story
      1. MY TRADING JOURNEY
      2. PRICE TELLS THE STORY
      3. THE WEDGE PLAY
      4. RECENT TRADE IN CAB
    10. CHAPTER 24: Force Confirmations, Not Trades
      1. BACKGROUND
      2. THE SWAN BROTHERS
      3. FORCE CONFIRMATIONS, NOT TRADES
      4. FLAG AND PENNANT FORMATIONS
      5. EXAMPLE
      6. WORDS OF WISDOM
    11. CHAPTER 25: The Birth of a New Trend
      1. THERE IS NO SUBSTITUTE FOR EXPERIENCE
      2. WHEN ELEPHANTS DANCE, THEY LEAVE TRACES
      3. HIGH VOLUME RANGE EXPANSION
      4. LIQUIDITY FOLLOWS PRICE
      5. THERE ARE NO PERFECT SETUPS
    12. CHAPTER 26: The Trend Intensity Breakout Setup
      1. LEARNING WHAT WORKS AND WHAT DOESN'T WORK
      2. LOOKING FOR ENDURING STRUCTURAL EDGES
      3. CAPTURING A SWING
  11. PART V: Options Trading
    1. CHAPTER 27: Unusual Options Activity
      1. HACKING MY PARENTS' TRADING ACCOUNT
      2. SEVEN SIMPLE STEPS
      3. ALIGNMENT OF TECHNICALS, FUNDAMENTALS, AND OPTIONS FLOW
      4. KELLOGG IS IN TROUBLE
    2. CHAPTER 28: Put Ratio Spread
      1. IMPORTANCE OF A NONFINANCIAL BACKGROUND
      2. THE MARKET IS IMPERFECT
      3. MANAGING PUT RATIO SPREADS
      4. SETUP APPLICATION
      5. WORDS OF WISDOM
    3. CHAPTER 29: Know What You Don't Know
      1. OPTIONS TRADING WAS A BIT OF A FAMILY BUSINESS
      2. ON AND OFF THE FLOOR
      3. SELLING PREMIUM IN MOMENTUM NAMES
    4. CHAPTER 30: There Is Always an Option
      1. LEARNING THE RULES OF THE GAME
      2. FOLLOW THE INTERMARKET FLOW
      3. HOW OPTIONS WORK
      4. PLAY THE BIG MOVE
      5. THE SETUP
      6. WORDS OF WISDOM
    5. CHAPTER 31: Selling Premium
      1. SECTION 1256 CONTRACTS
      2. HISTORICAL FOUNDATION
      3. TECHNICAL FOUNDATION
      4. CHOOSING STRIKES
      5. PROACTIVE TRADING
    6. CHAPTER 32: The New High Dip
      1. THE MORNING PAPER
      2. VAK TRADING
      3. THE NEW HIGH DIP STRATEGY
      4. MY OPTIONS APPROACH
  12. PART VI: Forex Trading
    1. CHAPTER 33: They Call Me Mrs. Cable
      1. FINDING MY TRADING STYLE
      2. THE ROAD TO SUCCESS IS IN SPECIALIZING
      3. THE TRANSITION FROM DEMO TO LIVE TRADING
      4. KEEPING IT SIMPLE
      5. RISK MANAGEMENT
      6. APPROACHING THE MARKET
      7. PUTTING IT INTO PRACTICE
      8. WORDS OF WISDOM
    2. CHAPTER 34: The Mind of a Chartist
      1. THERE MUST BE A WAY
      2. CHARTS ARE MY LANGUAGE
      3. DOW THEORY
      4. FINDING THE RIGHT APPROACH
      5. CAPITALIZING ON CORRECTIONS WITHIN THE CONTEXT OF A TREND
  13. PART VII: The Art of Trading
    1. CHAPTER 35: Trading Is an Art
      1. BORN TO WIN
      2. KNOWING WHEN TO PRESS A BET
      3. SCALING IN
      4. RIDING THE VXX
    2. CHAPTER 36: Embrace the Tape
      1. NEVER AGAIN!
      2. THE GAME
      3. FADING THE OBVIOUS
      4. A SYMPATHY PLAY
      5. WORDS OF WISDOM
    3. CHAPTER 37: Macro Setups at the Crest of Structural Change
      1. BEGINNING OF PEAK OIL
      2. MACRO SETUPS
      3. THE RIGHT VEHICLES TO PLAY PEAK OIL
      4. GOOD MACRO INVESTORS ARE CONTRARIANS
    4. CHAPTER 38: Broken Butterfly Formation
      1. MAJOR CORNERSTONES
      2. PREPARATION IS ESSENTIAL
      3. TRADING FIBONACCI RETRACEMENTS
      4. APPLICATION OF MY SETUP
      5. RISK MANAGEMENT PHILOSOPHY
    5. CHAPTER 39: Always Happy, Never Satisfied
      1. MAKE ALL YOUR MISTAKES EARLY IN YOUR CAREER
      2. THINK MACRO, TRADE MICRO
      3. THINKING A FEW MOVES AHEAD
      4. THE GOLD/SILVER RATIO
      5. WORDS OF WISDOM
    6. CHAPTER 40: One Step Ahead of the Herd
      1. A FINANCIAL ADVISER FOR OVER 12 YEARS
      2. JOINING NAAIM
      3. WHY TECHNICAL ANALYSIS WORKS
      4. BEATING THE HERD
      5. MY DBC TRADE
      6. BUYING ON A LARGER THAN NORMAL PULLBACK
      7. ATHEROS COMMUNICATIONS
      8. HAVE A PLAN AND TRADE YOUR PLAN
    7. CHAPTER 41: Change Is the Only Constant
      1. IT'S A METHOD, NOT A SYSTEM
      2. ABILITY TO ADAPT TO CHANGE
      3. LOOKING FOR RELATIVE STRENGTH
    8. CHAPTER 42: The Kirk Report
      1. MY JOURNEY
      2. MARKET PHILOSOPHY AND APPROACH
      3. LESSONS LEARNED FROM MENTORING
    9. CHAPTER 43: Stick with Names You Know
      1. BUYING MY FIRST STOCK
      2. PREPARATION, PREPARATION, PREPARATION
      3. ANALYZING DIFFERENT TIME FRAMES
    10. CHAPTER 44: Massive Trends and the Trajectory of Noise
      1. DISCOVERING BEHAVIORAL ECONOMICS
      2. IDENTIFYING MASSIVE TRENDS EARLY
      3. CERADYNE AND THE WAR ON TERROR
    11. CHAPTER 45: We Have Met the Enemy, and It Is Us
      1. HAVING THE PROBABILITIES IN YOUR FAVOR
      2. IT'S ALL ABOUT HAVING AN EDGE
      3. THE PULLBACK TRADE
    12. CHAPTER 46: A Contrarian at Heart
      1. CUTTING LOSSES QUICKLY
      2. AGAINST THE CROWD
      3. SHORTING EXTREMELY OVERBOUGHT STOCKS
      4. SHORT, SHORT, SHORT
  14. Index