Understanding and predicting the volatility of the market is a large portion of the job of a trader. Prediction of the way in which money will move, however, is a little like predicting just how much sugar will actually appear in every wad of cotton candy spun by hand at the local fairgrounds. You can guess, and guess well, but, at the end of the day, it is still a guess, albeit an educated one. Consequently, various indicators have been developed over the years in order to make sense of the seemingly random movement of values. Everyone wants to know how to make money in the stock market, so understanding the ebb and flow of market values is vital.
The Donchian Channel, created by Richard Donchian, is an indicator specifically designed to analyze volatility. The indicator examines the most extreme highs and lows of a particular stock within a specified period. The difference between the highs and lows is the channel. The more volatile a stock is, the greater the length of the channel. The narrower it is – the more stable the stock. Examining the trend of a stock over time, based on the information provided by the Donchian Channel, can make choosing the stock in which to put your faith, a great deal easier.
In this lesson, I examine the psychology of doomsday prepper traders that you are going to come across on Wall Street.
Doomsday preppers are usually stackers, but stackers are not always preppers.
I guesstimate that roughly 1/3rd of the American public is paranoid. Wikipedia defines paranoia a.... More »
The Donchian channel is by far one of the most widely used indicators used in technical trading systems today, and having said this, is one of the most effective you will come to find in your arsenal of tools – especially if you find yourself working on larger, well-trending markets.
Donchian .... More »
I get asked the question, "How can I make money trading stocks?"- all the time.
I've found the most incredible stock trading service I've ever come across by a trader that ranked #3 out of over 10,480 traders! One of his clients is a an actual Hedge Fund!
Cool thing is, I've been using this st.... More »
The popular trader Jason Bond hit the biggest pay out of his life-time today with a shocking $26,000 win in RSOL. This is Jason's biggest single win, in terms of dollars, of his stock trading career.
For most of us, $26,000 is what we make in an entire year working for someone else.
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I just made about 5% on the market bounce in TNA today and if you followed me on this trade that I first talked about in last Thursday's episode, congratulations on the excellent timing of this swing trade.
In this lesson, I review what I liked about TNA, and more importantly, I reveal the second.... More »