How to Generate Weekly Trading Ideas Like a Professional
Posted on November 9, 2018
Welcome to this week’s blog, providing a snapshot of just some of the trades we have been covering in our Trading Club this week. In my previous post I explained how our Checklist Trading process absolutely nailed the short in crude oil - which is now down over 20% since our scorecard turned negative at the end of September. This time I want to highlight what is becoming another great call in equities, with the S&P 500 index up around +4% since our Equity Market Checklist flipped positive on 31st October.
Here’s where it all began. Unlike day traders and technical analysts who base their decisions almost exclusively on price action, as professional fund managers Lex and I like to focus on fundamentals first. Thats not to say that we don’t look at charts (far from it), but as we teach in our Million Dollar Traders course, it is vital to not view anything in isolation and instead form a view on a market based on a range of tried and tested measures - both fundamental and technical. This is precisely why our Checklist process is so effective, and is a crucial part of our investment process. Here you can see the +2 we had for equities this month, which suggested that positioning long this month should see the greater opportunities for profit. (Disclaimer: Our service is intended for educational and informational purposes only and should not be considered investment advice. Do not make any decisions based on the articles and material presented on our website and never trade with money you cannot afford to lose. We cannot be held responsible for your trading results. For more information, please check Risk Disclosure - T&C.)
Now, I don’t want it to sound as though we are overly academic when it comes to our analysis. There is such a thing as ‘analysis paralysis’, and any true trader will tell you that the only thing that ultimately matters, is price. We get that too. But in finding balance by incorporating our data driven Checklists in our trading process, we are much more profitable in the long run. Here’s how its playing out on the chart:
This is the time where each week I urge you to come and join us as a member of our online Trading Club for more good stuff. But to be honest, if you’re reading this far then you’re most likely sufficiently enthused by markets and wanting to improve your trading to have already checked it out! So this week I’ll close with one more Checklist providing food for thought, on the proviso that you will join me for the new video next week…
Our Business Cycle Checklist, which is strongly positive at +4.5, shows no signs of a looming recession and suggests that the coast is clear for stocks. With stocks rallying and the Equity Checklist positive, why are there so many bearish calls?
Remember, the market climbs a wall of worry.
Have a great weekend,
James Helliwell | Chief Investment Strategist
Disclaimer: Our service is intended for educational and informational purposes only and should not be considered investment advice. Do not make any decisions based on the articles and material presented on www.lexvandam.com and never trade with money you cannot afford to lose. We cannot be held responsible for your trading results. For more information, please check Risk Disclosure - T&C.