I have created 5 training modules that I would be most happy to sell to you. The problem is whether this is the right course for you, and am I the right guide as we set out into the stock market jungle.
Also, as I looked around I found that you have many choices to be your guide. I felt the need to differentiate myself. This particular blog has one purpose only: as of February 3rd, 2020, I will trade a theoretical portfolio using one basic method that I teach in the training modules. THIS IS NOT TO BE CONSTRUED AS TRADING ADVICE, IT IS TEACHING METHODS ONLY.
I will start with a theoretical $100,000 and trade only four things: S&P 500, Gold, Oil, and Bitcoin. This gives us a bit of variety and demonstrates that you, yes YOU can use the methods and basic tools I teach to trade anything.
At anytime you can drop me a line at: Charles@bluestonetrading.school if you have a question. I would also be most appreciative for any criticisms and/or complaints.
Scroll to this point; the most recent entries start here:
February 15th, 2020
It is time for the weekly wrap-up. First one, actually. I will put up each of the charts I am following and repeat – briefly – the method I am using to trade a theoretical portfolio.
First a recap. The method is a moving crossover system. I use three EMAs: 8, (red) 21,(blue) 55 (brown). We start by establishing the trend. Is the blue above or below the brown? In the chart above, we can see an uptrend. We are now waiting for a trade signal: I want the red to come below the blue and cross back above to trigger a trade. I will go through each trade in a little more detail as they occur. Also, a bit of explanation re: the currency pair and how they work.
You can find this and more by clicking on my preamble. You can get my book and a couple of videos before buying anything.
The chart above of the S&P 500 shows our current trade. You can see the blue EMA is above the brown indicating an uptrend. We bought in just above the candle as the close caused the red EMA to cross above the blue EMA. I looked for recent support and placed my protective stop. To keep things simple and basic I used a trailing stop. The trade is doing quite well. It is the only one triggered since I started this project in early February. I want to also demonstrate that patience is a virtue when it comes to trading. When I am stopped out, I will provide a complete breakdown of the ins and outs of the trade. If we get a chance to pyramid, I will also explain what that is as we are always on the lookout to ride the “big move”.
The chart above is of Bitcoin. We can see that it is in an uptrend. We are waiting for the crossover that will cause us to act. From my description above, you should be able to see the opportunity that occurred had we been trading this earlier.
The chart of Gold above also shows an uptrend. Once again we are happy with the set up – just need a trigger.
The chart above of Oil shows a downtrend. Can you see it. Try to spot why before I tell you.
The blue EMA is below the brown EMA. We are waiting for some kind of trigger for this chart as well to match the trend. As I have mentioned there are other ways to determine trend. They are covered in my course.
The moving averages are wonderful tools. They come in a number of forms. The simple is the one used the most often. The only drawback is that it lags the market. In the charts above I have used the exponential moving average. It is calculated along the same lines as its simple brother (we all have a simple brother). The difference is it gives more weight to recent prices in the math.
February 6th, 2020
Based on our simple trade method, a trade in the S&P 500 was triggered.
I had placed a stop just under resistance and made it a trailing stop. The assorted stops are covered in my books and my course. I will have a link to the first book so that you can receive Book I free of charge.
Why did I use a trailing stop instead of a static stop?
It is because the market place feels quite volatile an jittery. I don’t particularly like language like “feels like” when discussing trades, but in this case it is within my process.
As detailed in my Book and course I am interested in the big move. To that end I make probing trades. The net result, typically, is you get a few winners and a few losers. Then several times a year you are on the back of a juicy winner. The way we convert from a small trade to a much larger trade without taking on any more risk is detailed in the Book and the course.
February 3rd, 2020
Starting today I am trading four items: S&P 500, Gold, Oil and Bitcoin.
This chart (above) is of Bitcoin
The chart (above) is of Gold
The chart (above) is of the S&P 500
The chart (above) is of Oil
This is what we are looking for. The set up of the charts above are quite simple. It is the set up I use all the time.
We have three moving averages. As you know, moving averages smooth out the price, making it a little easier to work with.
The Moving Averages in the charts above are as follows:
8 day EMA (exponential moving average) Red
21 day EMA Blue
55 day EMA Brown
Our first consideration is that of the trend. We want to go along with the trend as much as possible. Always at the start of a trade.
There are a number of ways to identify the trend which is going to be up – down – sideways. I teach others in my training.
We are going to use a very simple method for the purposes of this demonstration. When the 21 EMA is above the 55 EMA, we will consider the trend to be UP. When it is below the 55 EMA, we will consider the trend to be DOWN.
Our trades will be instigated by the 8 day moving average crossing the 21 day moving average. So if the red line crosses above the blue line we have what is called a long trade – we will profit if the price of the entity we are trading goes up. But since we only want to go with the trend, the blue line needs to be above the brown when the red crosses the blue for us to act.
Your homework is to identify the trend – up or down – of each chart for tomorrow.