The first week of January 2017 has begun with real winter coming to Alaska and most of the European countries; people rushing to lose weight and try newly discovered "vegetable-rich" diets – New Year Resolutions! Macy's unexpected announcement on Wednesday about their plan to close 68 stores around the country; Donald Trump's epic Twitter account claiming his credit not only for the 15 years high in the US consumer confidence and for the US equities being 10% up, but also for "America's Got Talent" Jackie Evancho’s record album sales following her invitation to sing the national anthem at his upcoming inauguration. For traders it has been a week of coming back from a holiday and closely following the markets and economists to see where they are heading in the beginning of 2017 and it looks like the easy Trump money has already been made, or lost for some.
Since the main purpose of our blog this year is to educate and help traders and investors to navigate the financial markets by teaching how to identify the right opportunities, topics and trading ideas, we also want to remind everyone who is still hoping to find trading or investing secrets online turning them into a millionaire next month that this does not happen in the real life and you should be very careful when trusting somebody your hardly earned money. There is also a fair amount of learning and checks to be done when you consider trading or investing yourself and this is why in particular in the beginning of a new year we chose to quote a legendary trader Jesse Livermore: "the game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance, or the get-rich-quick adventurer. They will die poor."
To survive in the financial markets and to have a chance of making 2017 better than 2016 you need to be knowledgeable, self-aware, realistic about your goals and focused on getting it right no matter what effort it takes. This is at least what helped our team to last in the game. There is no magic bullet in trading and we all have to work hard to make money.
Lex van Dam says that you should always trade your own opinions. Most people trade based on listening to rumors or market gurus, or they copy other traders. This may well be a lot easier than doing your own homework, but the end result is normally a portfolio full of bad trading positions with you not being quite sure why you own these stocks in the first place. Having a portfolio of names that you have not picked yourself means not only will you not know when to take the loss and cut your position you will also have no idea when to take profits and that is why one of the basic ideas behind Lex van Dam’s Million Dollar Traders course and 5-Step-Trading® methodology Lex developed is that unless you are able to generate your own original trading ideas it is not very likely that you will make money. “I want to have a portfolio of stocks that I am able to hold when the market goes down, because I have done my research and have good reasons to own my positions. Be careful though; trading your own opinions does not mean doing trades based purely on your own instincts or simply on a hunch – you will still need to develop your own process to analyze possible trading opportunities. In any case, one thing is certain when I trade my own opinions I ensure that I invest in myself instead of betting on other people. If I were you, I would do exactly that.”
So what’s next if you are determined to succeed in trading this year?
With every major financial media and research provider sharing their top tips and ideas for traders and investors in 2017 as well as economic outlook, we hope you found time this week to watch our Trading Club recording as we rushed to release it for our members as soon as the New Year began. If you have not done it yet, this is where you have to start as fundamentals in trading are as important as technical analysis and we are covering it all in our monthly Trading Club meetings.
Charts of the Week: January 2-6, 2017
The S&P 500 found support above 2235 (former resistance) and has yet to complete its rally towards 2292 according to Fibonacci analysis:
Meanwhile, the US Dollar Index had yet to hold 103.22 which was providing resistance following its projected move based on Fibonacci analysis:
WTI Crude Oil appears to have completed its projected rally toward $55 and is undergoing a correction:
Investor interest may be quietly returning to gold as prices have rallied into the New Year:
Lex van Dam’s Trading Club provides access to our best trade ideas within FX, stocks and commodities each month and stay ahead of the action with our weekly market report. We hope you found this article interesting and insightful. For further discussion or to receive access to our monthly Trading Club meeting, join us at the Trading Club.
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.