European and U.S Markets Close at Their Highs

Submitted by Dr. Keppler on Sunday, February 5th, 2012 - 10:00 AM

Friday's reported employment data in the U.S. were exceptionally strong. Payrolls rose by over 243k, as opposed to a forecast of 140k and, in addition, private sector employment rose by over 257k. November and December employment data was also revised higher by over 57k and 3k respectively. In addition, annual benchmark revisions disclosed that an increase of over 266k jobs were created in 2011, than previously estimated. The employment to population ratio rose to 58.5% while the civilian force participation rate remained at 63.7%. The number of people unemployed declined to 12.8 million in January of 2012.

There were also some significant gains in manufacturing, health care and in the service sector. The ISM non manufacturing index rose by over 3.8 points to 56.8, the strongest reading in almost a year. The very important employment component soared to 57.4, the highest level in 6 years. New export orders rose by over 5.5 points to 56.5 and overall, new orders increased by over 4.8 points to 59.4. The inventory component declined by about 1.5 points, suggesting that businesses were reducing inventories. This will negatively impact 1st Quarter GDP, but is likely to be positive in the future, as businesses eventually begin to restock. read more.....

A Trojan Horse

Submitted by Dr. Keppler on Sunday, January 29th, 2012 - 11:00 AM

Greece and its private creditors are expected to complete a debt-swap agreement this week. Luxembourg Prime Minister Jean Claude Juncker from the Institute of International Finance announced in an e-mailed statement from Athens that both sides were "close" to completing a voluntary exchange. Unidentified sources claimed that Creditors were prepared to accept an average coupon of as low as 3.6 percent on new 30-year bonds.

Junker, himself had previously mentioned that the new bonds issued in the swap would have a coupon rate below 3.5 percent for the period up to 2020 and below 4 percent over the 30-year term. The bottom line is that these rates equate to a loss of about 69 percent on the net present value of Greek debt.read more.....

Where is the Market going in 2012?

Submitted by Dr. Keppler on Tuesday, January 3rd, 2012 - 1:00 PM

We are now starting a new year; new beginnings are usually accompanied by optimism and hope. Yet, at the beginning of this year, I have received many e-mails and calls of distress from clients, students and friends. It seems that almost everyone is expressing serious concern and anxiety about 2012. The dier forecasts for this New Year include an actual prediction by the Mayan Calendar that civilization and the world will end in 2012.

Many financial analysts and pundits are also making some seriously alarming predictions about the financial markets. I have heard many theories about potential catastrophic financial events and some are postulating possible outcomes that would have been unthinkable only a year ago. read more.....

The Right Prescription for an Ailing Economy

Submitted by Dr. Keppler on Sunday, September 18th, 2011 - 8:00 AM

Sometimes, we focus so much on the trees that we truly lose sight of the forest.
As both sides debate various economic theories and schools of thought regarding the jobs bill, they completely miss one fundamental and powerful economic principle that has stood the test of time. It is the fact that no healthy economy can exist without a healthy and vigorous construction industry. For anyone who does not believe this assertion, I simply invite them to look and count the number of construction cranes on the Beijing skyline or any other major Chinese city for that matter.

The fact that construction is the backbone of any healthy economy has been well known throughout history. Our ancestors understood this fact; every great civilization on the planet has left us in awe of its construction marvels. The pyramids in Giza, the Great Wall of China, the Greek Pantheon and the Coliseum in Rome all remain as a powerful testament to the power of economic development that accompanies ambitious construction projects. It’s time for us to be thinking of what marvels we will build for our future generations to utilize and admire. read more.....

Stop Losses For A Volatile Market

Submitted by Dr. Keppler on Wednesday, September 7th, 2011 - 8:00 AM

Over the past few weeks I have received many questions and inquiries from students and traders about the placement of stops. All of the inquiries had one common thread; many of the traders were finding that their stops were being consistently hit. When stops are frequently hit, the losses quickly add up and that should be a warning sign that something different needs to be done.

It is important to highlight that during the past several weeks the markets have experienced an extremely high level of volatility. Volatile markets demand adjustments to strategies and trading styles. Volatile markets will cause many stops to trigger that otherwise may not.   read more.....

Advantages of Trading with Market Profile Charts

Submitted by Dr. Keppler on Thursday, January 27th, 2011 - 2:00 PM

Even though Market Profile charts were developed about three decades ago, there is still a great deal of misconception and confusion about them.  Many traders still do not understand what Market Profile Charts can and cannot do. Unfortunately, this prevents many traders from being able to truly learn and harness the power of the profile.

The profile offers many advantages that are not available on any other type of chart. The original intent of the Market Profile was to provide traders with real time access to trading volume data. Now, remote traders can share the same type of valuable information that floor traders had access to by being in the pit.  The profile development was welcomed by professional traders and continued to be the tool of choice for many of them.   read more.....

Why Prop Traders Excel Where Most Individuals Traders Fail!

Submitted by Dr. Keppler on Wednesday, December 1, 2010 - 1:00 PM

Learning to trade is a most challenging endeavor and there are certainly many different roads that individual traders travel to become successful.   In my experience I have found that the journey is always quite different from one individual to the other.  A few trader, who are extremely patient and persistent decide to become self taught.   They watch every webinar or video that they can find and read every book that they can get their hands on.  These self dedicated traders often persevere through many losses and over a number of years to develop the required knowledge base and skill for profitable trading. read more.....

How much money can you expect to make trading?

Submitted by Dr. Keppler on Sunday, October 24th, 2010 - 7:30 PM

Everyone wants to know how much money they can earn if they learn to trade. Last week I was contacted by a student who was very interested in learning to become a trader. She was bright, excited and highly motivated.  She shared with me that she was a hard worker and had been running a profitable small business for the past ten years.  Unfortunately, she had to close the doors of her business as a result of the current economic conditions and was now looking to become a trader. read more.....

Understanding the Trading Psychology of Support and Resistance

Submitted by Dr. Keppler on Saturday, October 9th, 2010 - 1:30 PM

In studying a chart for any liquid instrument, traders will observe that prices usually move in a series of peaks and valleys. The direction of these peaks and valleys provide us with a lot of valuable information about price action and direction. They also help us in determining the direction of a trend and levels of support and resistance. These valleys and peaks create opportunities for traders to enter or get out of trades. Professional traders always like to buy at support and sell at resistance, since these trades will usually have a much higher probability of success.. read more.....

3 Things You Must Identify Before Entering a Trade

Submitted by Dr. Keppler on Sunday, August 29th, 2010 - 6:30 PM

Successful trading is not a game of chance or luck, it is a strategic approach based on a technical understanding of price movement in the market. Naturally, there are many important things that a trader must know and identify before they would ever consider taking a trade. However, there are three things that I will discuss in this article that are paramount to the success and profitability of any trade. read more.....

The Secret of a Winning Trading Strategy

Submitted by Dr. Keppler on Monday, August 8th, 2010 - 10:30 AM

The word “strategy” has become so overused in our vernacular; it has now become completely void of any value or meaning.  We live in a world abundant with strategies; there are video game strategies, sports strategies, marketing strategies, weight loss strategies, makeup strategies, dating strategies, business strategies, financial strategies, pet grooming strategies, wedding strategies and even potty training strategies.

It’s a shame that “strategy” has lost its mojo.  There was a time when the concept of strategy was only reserved for powerful and great leaders.  Strategic thinking was a product of the brightest and most brilliant minds.  After all, history reminds us that strategy allowed Alexander the Great to conquer the entire known world before reaching the age of thirty. read more.....

High Frequency Trading Impact on Day Traders

Submitted by Dr. Keppler on Friday, July30th, 2010 - 12:30 PM

The financial markets and trading have undergone some incredible changes over the past decade.  The growth and expansion of electronic trading has had a dramatic impact on the markets and has changed them forever.  In the good old days stock trading was conducted in the open and was simple and straightforward: buyers and sellers got together on the exchange floor and made their deals. In 1998, the Securities and Exchange Commission authorized electronic exchanges to compete with marketplaces like the New York Stock Exchange. The stated intent was to open the markets up, so that anyone with a computer and a modest capital investment could have access to the markets.

However, as these new electronic marketplaces have grown and evolved, they have given large investors and traders a distinct advantage in the marketplace.  The little guy even with the most advanced personal computer is light years behind the major players.  It’s like someone on a scooter trying to compete with a supersonic jet. The scooter is always at an incredible disadvantage. read more.....

7 Common Mistakes New Traders Make

Submitted by Dr. Keppler on Thursday, April 22, 2010 - 4:00 PM

Naturally, there are many mistakes that new traders make when they start. New traders should not be hard on themselves. Every trader has made mistakes in their trading career. Successful traders learn from their mistakes and make a deliberate effort not to keep repeating them. It's important to remember that quitters never win and winners never quit. In my experience in working with new traders I have observed seven common mistakes that tend to surface frequently.

1. Trading without a plan

I can't over emphasize the importance of having a trading plan. As a business professor the first thing that I taught entrepreneurs who were interested in starting a new business was how to develop and write a strategic plan. Trading is a highly competitive and risky business, no one can survive the trading business without a well thought strategic plan. I have never encountered a successful trader that did not follow a strategic trading plan. I understand that it can be difficult for someone new to trading to develop a decent trading plan, a successful strategic trading plan requires an understanding of the financial markets and how to trade them. read more.....