PristineTrading

One basic need human beings have is certainty. We're always looking to provide a measure of certainty to our lives. It provides for us a 'warm fuzzy' to know that we can live day to day and make sure that our necessities for survival are met. However, in the markets, there is never 100% certainty with any trade that is taken. This is one reason why trading the markets is so hard for most people. When trading the markets, this general search of certainty takes hold of many investors and novice market participants, giving them the illusion that they must buy when they're 'certain' that the stock has good upside potential (usually after that stock has doubled in price and has been "upgraded"), and sell when they're certain that the end of the world is happening tomorrow (usually a day prior to the establishment of some sort of climactic bottom). This need to be certain is also the driving force behind the eternal search for the "sure thing". That there is a perfect indicator out there that can provide them with a feeling of certainty, amid an environment that is completely uncertain. Indicators galore are created with the sole purpose of injecting a level of predictability (certainty) to decision-making. These indicators, used as "price predictors", are nothing more than a way to create certainty, in a place where certainty flat out does not exist. In the markets, you shouldn't look for certainty, only for opportunity. This opportunity in many cases won't appear in an obvious fashion. But this is fine, since opportunity isn't created for the uneducated, or he who looks for certainty. Part of the reason why the professionals can be wildly successful at trading is because of this Law of Uncertainty coupled with the pursuit of certainty by novice and unsuccessful traders. Opportunity is created for the educated individual who is willing to take calculated risks in order to achieve his rewards. When you're buying a Pristine Buy Setup (PBS), the entry point isn't the most certain place to be, right? That PBS looks a lot more "certain" after that stock has moved up 3 bars in a row, right? Hindsight is always 20/20. Notice that the place where opportunity dwells is just that place that makes most novices tremble with fear. By the time they gain a measure of certainty, it's often too late. So strive to look for reliable events that present good opportunities based on a methodical approach and then trade those events, with the understanding that you're trying to take advantage of the opportunities that the market presents. Realize that you will have losing trades because of uncertainty. You could have 'the perfect setup' based on your training and experience, and even those trades are never 100% certain. So - 2 key points must be absorbed here. One, that losses are simply a byproduct of this business. Don't get overly dismayed and lose control emotionally when you get stopped out of a trade. Two, remain objective rather than subjective (emotional) and forget about certainty, because the only certain thing in the markets is that there are no certainties. Jared Wesley Contributing Editor Interactive Trading Room Moderator Gap, Intra-Day and Swing Trading Specialist Instructor and Traders Coach

Good Morning All; For this series of four letters, I am going giving you some exact steps that will help you tremendously if you have the technical knowledge, but cannot seem to turn the corner on making good profits. There are going to be four things that you can do that I feel will 'dramatically change your trading career'. The results will be immediate, every week. It should be stated again, that if you do not have the technical expertise, you are not at the level that these comments will help. If you don't know how to look at a chart, no amount of refining will help you. Where do you get this expertise? There is no better place than Pristine's Trading the Pristine Method Seminars. Talk to your counselors about the end of the year deal that will be gone, not to be repeated, after the holidays. After a long time of working with many traders, one discovers that there are certain truths that cannot be denied. There are four things that are done so consistently wrong by new, and even fairly experienced traders, that each of these mistakes results in bad trades 90% of the time for most traders. If traders would simply follow these four rules, they would eliminate most of their losing trades. The fourth rule does not really fall into this "90%" category, but is perhaps the most important. Four Things That Will Change Your Trading Career: Part Two of Four Here is the second rule, and the subject of this lesson. Traders should ONLY take trades that exactly fit the parameters outlined in their trading plan. It sounds simple, but again the facts behind this are staggering. Of the four 'secrets', this one is the easiest to describe, and really requires no technical expertise, just discipline. However, it is arguably the one that costs most traders the most money. Having a trading plan is simply the most important step to trading. It is the only concept that has a 100% correlation with success. 100% of successful traders use trading plans. 100% of traders who do not have plans fail. What more needs to be said? Unfortunately, there is still great aversion to having a trading plan. Here is the pattern that usually happens. First, traders simply leave a seminar or training course and sit in front of the market with the intention of 'developing' a plan over the first few days. The trials and tribulations of trading, combined with the huge dislike for the 'work' of writing a plan keeps 80% of the traders from ever beginning to write one. Of those that begin to write one, 80% never finish, or they do finish a plan that is so poor and vague it cannot be used. Of those that do finish a reasonable plan, as bizarre as it sound, 80% of those never use it. Of those that use it, 80% never follow up properly to see if they are truly following them, or if they are effective. Where are you in this process? No. Stop. Really; go back and answer that honestly. WHERE are you in this process? The purpose of this article is picking the one most important concept to follow up on to eliminate losers. When traders are asked to go back and review their records, it is found that when they go back and pick out the trades that were not really in their plan, an amazing 80-90% of trades taken outside the plan fail. 80-90%. Does that get your interest? Don't believe it? Check for yourself. While it would be interesting to see your results (feel free to send them to paul@pristine.com), experience tells me that few will send them, because few will REALLY do it. Stop and take these lessons seriously. These four 'secrets' will change you career, if you are not doing well now, and if you actually do what they say. Here is what you should be doing to check this. The results below are typical of what you might see. The worst category will be the strategy that is 'no strategy', and you will likely be worse than this example. Closing Comments The point of this lesson is simple. The glory of this does not come from a chart; it comes from the discipline to follow a plan, and more importantly, the discipline to check to see if you are following that plan. By following up in this one area, you may be able to stop the majority of your losing trades. So you ask, "But I don't have a trading plan, or I don't have strategies outlined in my plan, what do I do?" The answer is simple, develop a detailed trading plan that has one or two specific strategies, and follow them. In the next issue of this letter we will look at the third 'secret' that will change your trading. Paul Lange Vice President of Services Pristine Capital Holdings, Inc.

raders (PTT) are taught about the proper mindset for technical trading. Also is the analysis and charts of multiple time frames at that time as a PTT would do it. It setup a bias to follow for the coming days and weeks. If you were a reader at that time it guided you well. Pristine Traded Traders (PTT) view the interaction between buyers and sellers through recognizable price patterns that signal who is in control or who is taking control. This starts with an individual candlestick, then another and another. This Bar-by-Bar analysis as I have named it continues until a pattern forms that provides a clear message for the PTT. I developed Bar-by-Bar analysis years ago as a way to say objective once in a trade and to also stay focused when not in one. This analysis once taught keeps the PTT in the moment, not stuck in the past analysis or projecting the future, which of course can never be known. Technical Traders look at past chart patterns to predict the direction of future ones that have not yet developed. Of course, the future patterns cannot be known and a problem starts when traders imagine future patterns in their mind and what they think will form (as they see it), if the trade is profitable. If the imagined pattern does not develop traders can become conflicted. No one knows how the next bar or bars will form. The trade can go in the direction thought, but prices can do that in unimagined ways. Pristine Tip: Projecting the future beyond the current pattern's message limits possibilities. This is where rationalization starts about the present and all sorts of problems begin for traders. The worst of those problems is not adhering to a stop-loss. Why take a stop-loss when this was not part of the future pattern imagined? This trader is in disbelief of what is, cannot except the moment and is looking for any reason for the trade to be working, even though it is not. Another trader imagines being stopped out and quickly closes a trade for a small gain or loss, but the current pattern has not signaled that there is anything wrong with this trade. In both examples, the traders were not focus on the present. Price patterns can develop in endless ways and once you are in a trade there is no point imagining what isn't there. PTTs have tools like Bar-by-Bar analysis to keep them in alignment with what is. Traders must have confidence in a method used and a trading plan to use that method. Where patterns form in relation to prior support, resistance, what is the prevailing trend, the length of retracements, analysis of multiple time frames being aligned or not, whether relative strength or weakness has been shown, volume analysis and current market internals all are considered. The more of these that are aligned together, the greater the odds of a successful trade. Knowing how to interpret it all, in a systematic way is what makes up the Pristine Method® Seminars. Following it the analysis and charts from 2009. SPY has risen over the last five weeks and is coming into the prior area where sellers aggressively took advantage of any attempt to move higher. The PTT knows that sellers were aggressive in this area because of the three bar combination to the left of current prices. The Topping Tail (TT) signaled distribution on the attempt to move higher. Realize that TT was a large green candle before it was a TT and was preceded by a Bottoming Tail (BT) bar. Also, that BT was the third down candle. After that much selling and a BT, the following candle would typically be a green one. But it ended with a TT, a bearish sign. The next candle was a green candle and we can see that candle opened below the prior TT candle's low or gapped lower. This green candle closed near its high and near the high of the TT candle. Buyers were stepping up and took control this week or so they thought. What happened next clearly put a nail in the heart of the bulls. The third candle was a potent reversal down that retraced almost to the low of the prior green candle. The concept of a Green Bar Ignored (GBI) tells the PTT that sellers took the field back in a big way and bulls are weak. It's not any GBI though. This combination of candles was bearish and as we know led to a sharp selloff and the March 6th low. With the current move from the low now near the area of the prior selling, it suggests new selling in this area. However, the retracement from the low was nearly 100% of the prior decline and at this point we don't actually know that the move higher is over. Retracements of this amount are not typical in a bear market and signal strength. The trend in the weekly time frame is still down and while we should see an increase in selling soon, the length of the retracement suggests the beginning of a bottoming process. The PTT will monitor the candles that form in this area and the volume associated with them in the coming week and weeks to determine how aggressive sellers are and reaction to that selling by bulls. Let's move to the daily time frame. The trend is up in the daily time frame, but a Major Resistance (MR) area is lurking just above. On Friday, prices gapped significantly higher from a Bullish Changing of the Guard (+COG) and it was quite impressive that SPY did not retrace back into that gap. Not only did it not retrace into the gap, SPY closed near the high of the day going into a long weekend. This tells us that traders are confident holding positions over the weekend and expect higher prices this week. To recap, the weekly trend is down and current prices are coming into an area where sellers were aggressive before. At this point, the PTT trading from the daily time frame will start tightening stops and should prices rally or gap higher into the above area of MR they will start selling longs. Shorts positions cannot be put on since the daily time frame is up and a bearish pattern has not formed. Last week's low (green line) is Major Support (MS) in this time frame. A move below it will signal a change in trend and the PTT will then look for shorting setups. The last few weeks have been unusually filled with larger morning gaps and choppy intra-day price action. If you look back at a 60-Min chart of SPY from the middle of February to the middle of March (not shown) you will see fewer gaps and fluid price movements with narrower average range bars. This means that there was much more confidence amongst traders then when SPY was declining into the beginning of March and then after the turn higher into mid March. Even though prices have moved up overall, after March 18th a higher level of uncertainty crept into the market. The PTTs trained eye is aware to reduce position size to and/or be a bit more selective with plays when the broader market is displaying this type of nervous price pattern. Gaps, many overlapping bars and unusually wide ranges communicate uncertainty amongst traders. If you have felt a bit uncertain for longer moments than usual intra-day consider it normal at this time. Now this relates to SPY, which of course is a broad market index and SPY affects many stocks. However, there will always be stocks that are "in-play" and will move in a fluid way. The concept of Relative Strength, Weakness and Sector analysis is the key to finding those opportunities. The PTT has many analysis tools. Now, Friday's intra-day price action showed a change to a higher level of certainty. Should it continue this week with a several day advance into or just over the MS shown, odds are high that it would setup a correction. Pristine Tip: Downtrends and up trends end with price patterns displaying certainty or confidence in the existing trend. In other words, the majority believes in the trend at the end and several bar runs (consecutive) precede corrective price action. I've marked support levels to be aware of on the 60-Min. chart, the first being Friday's low. Below it, prices have the void created by the gap up Friday morning that can be fallen into. The second green line would close the gap and should provide short-term support. The last green line is at Wednesday's low and MS on the daily time frame. Below it, the daily trend will no longer be up, the 60-Min. will be down and the weekly is already down and will have formed a -COG. Bears will have control and the PTT will aggressively scan for shorting opportunities. What actually happens will unfold in the coming weeks. It is possible that SPY will not break daily MS and it will continue to trend higher and form a new higher low. We'll see, but what I have explained here is how the PTT will follow what unfolds in a systematic way in multiple time frames. Should the daily trend not break then a short-term bullish bias will be maintained. If prices can overcome the MR area above on the weekly time frame, then that downtrend will be broken. The cycles or ebbs and flows from one time frame to another are ongoing and the PTT's job is to monitor and update them as they unfold to adjust his or her bias accordingly. Intra-day PPTs will follow the same analysis, but with smaller time frames. This does not mean the higher are totally ignored, but what happens over several minutes is more meaningful in those lower time frames to the intra-day trader. Intra-day PTTs can and do make money trading long in a 2-or 5-Min. uptrend when the daily trade is down and vice versa. We now know that the low in 2009 was "the low" and the near 100% retracement I wrote about then did signal the end of the bear market at the time. SPY has doubled since that time. The analysis as it was explained then is done in the same way today. Market environments change, but we don't change our method of analysis. This method is the same regardless of what we trade. PRISTINE - A Trading Style, Often Imitated, But NEVER Matched! All the best, Greg Capra President & CEO Pristine Capital Holdings, Inc.

Good Morning All; For these next four letters, I am going to give you a series of exact steps that will help you tremendously if you have the technical knowledge, but cannot seem to turn the corner on making good profits. There are going to be four things that you can do that I feel will 'dramatically change your trading career'. The results will be immediate, every week. It should be stated again, that if you do not have the technical expertise, you are not at the level that these comments will help. If you don't know how to look at a chart, no amount of refining will help you. Where do you get this expertise? There is no better place that Pristine's Trading the Pristine Method Seminars. After a long time of working with many traders, one discovers that there are certain truths that cannot be denied. There are four things that are done so consistently wrong by new, and even fairly experienced traders, that each of these mistakes results in bad trades 90% of the time for most traders. If traders would simply follow these four rules, they would eliminate most of their losing trades. The fourth rule does not really fall into this "90%" category, but is perhaps the most important. Four Things That Will Change Your Trading Career: Part One of Four Here is the first rule, and the subject of this lesson. New traders are often so bad at managing trades, that their results would be incredibly improved by not managing at all. If you do not manage, it means you let your trade play out until it hits the target(s), or stops out. Nothing else. This is called 'all or nothing' trading. There are various ways to manage trades. Management should be a detailed part of your trading plan. Many do not even consider 'all or nothing', an option. Many management systems can work beautifully. So what is the problem that makes it the case that traders are better off doing 'nothing'? The problem is that traders do not FOLLOW them. Due to the emotions of trading, traders find excuses to override them. Most new trader's goals are to lock in small profits to avoid losses at all costs, and they change their management in the middle of the trade. Do you do this? There is a 90% chance you do. Here is how to find out. Go BACK in your records (do not do this going forward, it will not work) and take your last 20 trades and write down your entry, stop, target, and actual exit. Now go back to the chart, and see what would have happened if you did not manage the trade. Simply see if you hit the stop or the target first. Make a new column on your sheet and write this down. Then figure the profit for the 'new' column called 'all or nothing'. If the trade stopped, you lose your risk amount, whatever it is. If you hit a target, you may have a gain that is multiple times your loss (if you didn't have a target, figure what would have happened just holding to the end of the day). Compare which way you would have made more money, and be sitting down when you do this. Feel free to email your results to paul@pristine.com. By the way, if you feel like you really are 'getting' the concepts of trading, and you find you have good chart reading abilities and you have more winners that losers, but your account is not growing, you are going to be in this category. This works, because many good plays get to very nice targets. However, if the trader is not in the trade, they never make the big money. Many traders get in the habit of taking normal losses (they have learned to follow stops) but they take small gains. It is hard to make money like this. Below is the five minute chart of ZQK, with an inset of the daily chart. On this day, ZQK gapped up on the daily chart, out of a daily Pristine Buy Setup that had pulled back to the daily rising 20 period moving average. The gap almost cleared the 'half-red' prior bar. This is a bullish gap, so buying an early morning pullback would make an excellent entry. On the chart above, a five minute Pristine Buy Setup triggered at '1', and was an excellent entry for this play. Many traders have learned how to do plays like this. What separates the pros from the novices if who really takes home serious money from this play. Since this play was a bullish gap on a bullish daily chart, we know there is potential to move up a significant amount, even on an intraday basis. So we pull out the hourly chart and look for a 'target area'. This hourly chart is inset in the chart below, and the 'star' marks the target. This is the first base we encounter in the general area of a solid day's move. It is at 2.80 - 2.85. So we are in the play, and have a target area selected. The only variable is management. Please notice something. If you used the 20 period moving average as your management trail stop, you would have been in this trade to the target of 2.85. Notice if you used pivots, (if you don't know what these are, the purple arrows have marked off five or two minute pivots of some kind) you would have achieved the target of 2.85. However, 90% of the traders using these methods don't hit their targets. All of those purple areas (which coincidentally were a form of a pivot) are areas that traders use as an excuse to exit the trade. Most traders would have exited at the first arrow, for a loss. If you were to play this all or nothing, you would just set one order as a stop loss around 2.51, and then set another order to sell at 2.85 then walk away for the day, or at least take this off your screen and leave it alone. The bottom line is very simple. Use an all or nothing method of management UNTIL you prove that you can beat all or nothing with your own management ability. Do not underestimate the power of this lesson, for many traders it is the most important of the four. Closing Comments Understand, that I am NOT saying that all or nothing is the best method of managing trades, but I am saying it is better than what 90% of those reading this article do. Also, you will NOT benefit if you are trading so bad that you stop out of all of your trades. Again, this is not a replacement for knowing technical analysis. Do NOT assume you got the point of this exercise just buy reading it. Do the exercise. You will not believe your results. Email me you comments if you actually do this. Next week we will look at the second thing that will change your trading. Paul Lange Vice President of Services Pristine Capital Holdings, Inc.

As we near the end of the year, here is a look at the long-term to put the short-term gyrations in perspective. For the very bullish case, you want to see the markets consolidate at the top of the range. That is likely to be months. Pullbacks ideally hold the area of first support. A move to the area of second support makes the bullish case very questionable and would at least suggest a much longer period of consolidation. For the ultra-bearish, a clear break below last support, and tent-housing communities could be high-end living for many. All the best, PRISTINE - A Trading Style, Often Imitated, But NEVER Matched!!! Greg Capra President & CEO Pristine Capital Holdings, Inc.

f there's one trading dilemma that tends to inspire the most heated discussions among professionals and novices alike, it would have to be the one dealing with the decision to trade "with the trend" or "against the trend". Countless books have been written on the subject, and although there are no definitive answers, I've decided to set the record straight in regards to the realities of these two approaches and the proper way to handle each. First of all, let's define these two approaches for greater clarity. For our purposes, we'll consider "trend following" any strategy looking to take advantage of a directional move in the context of an existing trend within the timeframe in question. This requires that we make sure that there is an existing trend and then looking for tradable patterns to take advantage of a continuation of said trend. Technical traders learn to recognize the parameters that define a trend, and then look to "cherry pick" among the healthiest trends available (Ref. Trading the Pristine Method® (TPM) and Advanced Technical Strategies (ATS) seminars). On the other hand, "counter-trend" strategies revolve around taking advantage of perceived "excesses" in the directional move of a trend, looking to capture the retracements toward some form of "median" or "support/resistance" area. Although I'm obviously biased toward one of these styles (Trend following), allow me to discuss the pros and cons of each and the way to use each style to obtain the best results within a given trading environment. Trend-following styles base their approach on a simple principle: The trend displays the direction of the group in control (Buyers or sellers) and thus, trend-following traders will want to take positions using reliable patterns to try and take advantage of this potential continuation of the current direction, at least until the trend changes. These traders have developed "objective" ways to define a trend, its quality and odds of continuation. The idea is a rather simple one...trend-followers want to swim with the current. Whenever there's an established trend, the group in control (buyers for uptrends and sellers for downtrends) tends to push prices in the direction of the trend, at least until the imbalance of supply/demand created ceases to exist. Such imbalances create "momentum" that helps them achieve larger moves when they're right. How long can any given trend last? That's anyone's guess, although the analysis of supply/demand levels (Ref. title="technical trading"Pristine's ATS seminar) can sometimes help determine that with great precision. There will be a time when trading in the direction of a given trend becomes higher risk, because the trend could be "extended" or nearing support/resistance areas. In the end, these traders will have confidence in the trend at hand as long as the objective conditions that created and fuel the trend remain in place, looking to trade the patterns included in their respective Trading Plans within the trend. When said trend changes, they'll reevaluate the trading direction and use a new set of tactics better suited to the new trend. Counter-trend traders try to capitalize from those "retracements" toward the median price that typically take place within a trend. If you take any given chart displaying a decent trend, you'll notice that these "retracement" moves do happen, but when compared with the usual moves in the direction of a trend, they tend to be smaller in size and shorter in time. Execution also tends to be an issue when dealing with "counter-trend" trades, as the act of swimming "against the current" makes for greater levels of "slippage" when stops are hit (In many cases the "stop" of a counter-trend trader will be the entry signal of a trend-follower" and since the trend is in the opposite direction...). That's not to say they're not tradable, but the clues mentioned above should set the stage for the way in which a Pristine Trained Trader should normally handle these (Usually as short-term "scalp" trades instead of looking for holding periods similar to those that usually are expected when taking a "trend-following" position). The Pristine Method® seminar series teaches traders very specific parameters to trade some of these "counter-trend" events, looking for just those with the greater odds of producing a decent move. In the end, I'm a trend-following trader for most of my trades, looking to focus on the direction created by the stronger group of traders. Then I'll apply the strategies I learned in my Pristine education to profit from these trends, and when the trend changes I'll have the necessary objectivity to change with it. That's the professional way. Also, Pristine has been nominated for the Trader Planet STAR Award in the categories of Best Trading Course and Best Live Trading Room. We need your vote. Please go to http://www.traderplanet.com/l/9Kc and vote. You can vote everyday! Trade Well! Jeff Yates Contributing Editor Interactive Trading Room Moderator Gap and Intra-Day Trading Specialist Instructor and Traders Coach

While there are many concepts and nuances to be learned to be a complete technical trader and/or investor, there are a few basic criteria that if followed can make making money easy or relatively easier. Of course, this requires having the patience and discipline to wait for these high probability setups to occur. Can you do it? I will show an example of what to look for. Then it's up to you. In the weekly chart of Google (GOOG), prices broke above price resistance with strong momentum. This was followed by the first pullback after that strength to Minor Support (mS). As a general rule, the first pullback to mS after a strong momentum break above resistance will always be buyable. This is based on the basic concept that resistance once broken will become support. This area of mS is where we know buyers will be. Now we wait to see the price action of that actually happening in this time frame and the daily time frame. This concept can be used in a combination of lower time frames as well. It also applies to any tradable instrument; that being Forex, E-minis, Commodities. The basics covered - Prices have made a strong move above price resistance and we wait for the first pullback to mS where buyers are. Then wait for confirming price action in that area. oving down to the daily time frame, GOOG was not looking bullish at all before the turn. However, realize that the lower time frame never looks bullish when the higher time frame is pulling back to mS. For example, if you saw the EUR/USD currency pair in a 60-min. uptrend that was pulling back to mS, the 5-min. time frame would be in a downtrend. The expectation is that the lower time frame is going to turn in the area of mS in the higher time frame. Now wait for confirming the price action in the lower time frame before taking a position. As GOOG moved into the mS area shown on the weekly time frame, the confirming price action began (in this time frame) with a gap higher and then a strong close into resistance. Here is where it gets interesting and it will become obvious if the big money buyers are continuing to step up. We want to see that big green bar's low and ideally its mid-point defended by the buyers. While the buy signal candle came five days later, it could have come after only two days. There is no set number and this is where our Bar by Bar analysis concept comes in to tell us when GOOG will move. Bar by Bar analysis combines each new bar's meaning within the context of our bigger picture analysis. One bar can be meaningless in of itself, but when combined with our bias and the other bars, it's a powerful concept. The basics covered - While our lower time frame is moving down, the higher time frame area of mS is where prices should produce the price action that confirms that area and reversal of some type happens. Reversals can happening in many ways, so do not be set on it having to happen in "your way." Once the action occurs find an entry signal using Bar by Bar analysis. I have shown you the basics of what to look for in those easy money situations using two time frames; I used the weekly and daily. We can also take that bias into the intra-day time frames as I explained above with EUR/USD, but it could be anything. Now, let's look at some detail that occurred on the 60-Min. of GOOG that showed the "early turn" and a couple of Pristine concepts to understand the price action of the turn. As GOOG was trending lower into the area of mS on the weekly time frame a 60-Min. bearish Wide Range Bar (-WRB) formed accompanied with a huge volume spike. That's a bearish event, but remember this was right into the weekly mS! That was followed by a stall and bullish Wide Range Bar (+WRB), that's a very bullish group of events that started the early turn. Pristine Tip: That 3-bar reversal was the Bottoming Tail (BT) on the daily time frame. The Advanced Candlestick reader understands how different arrangements of candles can mean the same thing in the same time frame and/or different time frames. Names of candlesticks are meaningless and are more likely to confuse traders that use them or worse by causing avoidable losses and/or missed opportunities. Once GOOG gapped up and ran higher a Pristine Price Void (PPV) was created. In other words, there was now no price support below for traders to bid at. Support would need to be "created" for traders to bid at. Creating support and resistance is a powerful concept used by Pristine Traded Traders (PTT) to see where the big money is entering prior to existing support or resistance. Pristine Tip: Strong upward price moves often do not pullback to support, they create it. With the bias from the time frames shown above, intra-day traders could move to lower time frames of their choice to find confirming buy setups to enter. At this point, this is still the case. Side note, while I have used a 20-MA on all time frames. It has no relevance to being actual support, resistance or the trend. It is simply a "visual aid" to speed the analysis once understood. PRISTINE - A Trading Style, Often Imitated, But NEVER Matched!!! Greg Capra President & CEO Pristine Capital Holdings, Inc.

Trading is one of the most fascinating, challenging and rewarding businesses on planet earth. But it perplexes me to hear the vast and varied vehement opinions from the bulls and bears in the media and elsewhere. Are they trying to talk themselves (and their followers) into being correct to save their ego - and wallet? Are they trying to become heroes by saying, in retrospect, that they "nailed" the market direction? (Note: you will only hear from that minority after the fact, with most disappearing into the night.) The Pristine Trained Trader (PTT) focuses on the only thing that matters: objective candlestick price and volume data. Period. Pristine President and CEO Greg Capra, confidently and succinctly states it this way: "It is what it is. You must react to what is happening in the moment, or you will be trading in the past, in a 'mirage'." Traders are bombarded daily with market opinion from a plethora of other traders, analysts, and commentators, all offering their opinions on stocks and market direction. And so many of these traders struggle with this deluge of information, trying often - in vain - to make an objective decision by processing massive amounts of subjective data. My approach is direct and simple: give me a compelling chart setup and sufficient liquidity, and I will trade anything that moves - just ask my students! In the bigger scheme of things, the source of the news is irrelevant to me, unless, of course, it gives me insight into other stocks or sector plays. The market offers tremendous opportunity for you to assert your views through money -- through your buy and sell orders. So when I hear these people touting their view and stocks, my immediate reaction is, "Blah, Blah, Blah. Just hit the mouse." Point your mouse to your order execution module in your trading platform and hit either the buy button or the sell button. That's it. If you think a financial instrument is going higher, buy it; if lower, short it. When all is said and done, price movement will dictate who made the correct choice. Unfortunately, the financial markets are designed for only the minority to win consistently -- not the majority. The uneducated public is unfortunately part of the latter group. I want to be buying when my technical analysis shows that demand is overtaking supply with the larger time frames on major support. When the stock becomes well known after a robust rally, good company news, and even becomes the cover story on some business or financial publication, that is the time to sell at the first sign of slowing momentum. Jeff Yates Contributing Editor Interactive Trading Room Moderator Gap and Intra-Day Trading Specialist Instructor and Traders Coach

This week I want to share with you one of the most enlightening moments in my learning process related to the use of trendlines. When I decided to educate myself about technical analysis and the markets there were no online trading seminars. There were no seminars at all, but if there were they wouldn't have been online since there was no internet. However, there were market letters that that came by snail-mail that did some education along with trade recommendations. All used trendlines in the analysis. Let's review what is taught about the use of trend lines and questions I had after using them. Trend line Analysis: A trend line needs at least two connecting points. A trend line with three or more points is stronger The trend line connecting points shouldn't be too close The trend line shouldn't be too steep or shallow An uptrend line will act as support A downtrend line will act as resistance A trend line once broken will have the opposite effect The break of a long existing trend line changes the trend Questioning the validity for trendlines: Should trendlines be drawn from bar extremes or the closes? Are trendlines drawn in a higher time frame stronger? Are intersecting trendlines a stronger reference point? Are trendlines valid in all time frames, even a 1-min.? Is a trend line drawn on an Arithmetic scaled chart more valid than those on a Semi-log scaled chart? Is the break of a trend line really a change in the trend? How many times can a trend line be redrawn? Can extending a line really predict where prices will reverse? My conclusion about the use of trendlines is that while widely used and have the potential to effect price movement on market indices especially, they are subjective as reference points of support and resistance at best and not needed. If you have used trendlines, had one break, seen prices reverse back in the original direction and you then redrew the line like I have. The question that came to my mind was, is it possible to "connect the dots" again and locate support and resistance? It didn't make sense, not common sense. The answer was no. The enlightening moment came when I realize that the analysis of support and resistance is not to be done diagonally, it has to be done horizontally. It was so simple, but all the hocus-pocus analysis taught made it so hard to get to that point. Besides the basic Trend Line there are Gann lines, Gann Box lines, Regression Channel lines. Median Lines, Andrews Pitchfork Lines, Fibonacci Circle lines, Fibonacci Fan Lines and it goes on and on. It should be no surprise why so many are confused about the use of technical analysis. Been there or there right now? Here what to do, simply look to the left and stop drawing lines! Let's review the trend lines and the real coming overhead resistance on some of the broader market indices. In the chart above of the S&P 500 ETF symbol SPY, I drew the downtrend line. Clearly, prices ignored it like it was not there. Actually, it is only there for those that drew it, so it only exists as a reference point for them, in their minds; it's not real. What is real is the area in red, which is there for everyone. Somewhere in that box sellers are going to overcome buyers. Will that be for a day, two days? How far will prices drop? That's the unknown. Right now there is no pattern to suggest that. The only thing known is that the area to the left is resistance and the move up has the greatest odds of stalling in the box. In the chart above the Nasdaq 100 ETF QQQ, I drew the downtrend line and we see that prices did stall at the line before moving higher. Was the line the reason? No it was not, it was the small area of price resistance to the left. Resistance does not mean prices have to go lower. Especially, when prices have fallen for a while as these did into an area of Major Support (MS) (not shown) where buyers will show up. The Qs entered into the area of price resistance Friday and sellers are going to show up in there. The 200-MA is also in the box and while subjective as a reference point of resistance, it is a widely followed point of reference. Notice the number of overlapping candles that are directly to the left of it and the unfilled gap. n the chart above of the Russell 2000 ETF symbol IWM, I drew the downtrend line. Odds are prices are going to stall there and trend line users will point to that. Why will prices stall there? Because price resistance is to the left and the other markets are coming into resistance also. It just happens to work out this way once and a while. Technical analysis does not have to be complicated; however, we have a tendency to follow what is when it comes to the markets. I did years ago, but eventually realized the majority of what is taught is nonsense. I don't know how all this nonsense started, but it's been going on a long time and continues. Most do not side-step this black hole on the way to finding the truth, if they ever do. You don't have to or can get out of it now. Greg Capra President & CEO Pristine Capital Holdings, Inc.

Over the years, I've seen many TV commentators, newsletter writers, self-proclaimed market gurus, chat room moderators and of course, traders call a bottom. Most of them being early on their call and/or entry are caught on the wrong side of the trend. However, they always have follow up calls to get long in hopes of catching the elusive bottom. I'll show you how elusive - it isn't. What is baffling is, bottoms are one the easiest patterns to spot, so why not wait for it to setup? Of course that would take some trading education, which most people resist spending money on until they have lost some money - or a lot it. But how senseless is it to be calling and risking money on a reversal without any evidence of one? Don't expect this to ever change and we don't want it to. The bottoming pattern happens not only because of accumulation, it is also because of the early buyers capitulating. Let's review some examples. In the charts above are various tradable instruments. I chose bottoming patterns in stocks, commodities, currencies and the broader markets indices. It does not matter what you trade, this happens the same way in all tradable instruments. As prices move lower within a downtrend they will begin to accelerate lower near its end. This is seen through multiple bars moving down with little overlap between them and/or wide range bars. At some point, the move lower will be rejected and prices will spring back up. The spring up typically is shallow and does not violate the trend by overcoming Major Resistance (MR). What follows is a consolidation and pullback that will retest the original low. At times, the original low point of the move will be violated; however, all moves higher that initiated from the retest should have multiple bars moving higher into MR or above it and may have bullish Wide Range Bars (+WRB) as well. Pristine Tip: Multiple bars moving in one direction with little overlap between them are a Wide Range Bar in a higher time frame. The bottoming process can go on for a relatively long period of time depending on the time frame being viewed. Longer time frames will form bottoms over a longer period of time and vice versa for shorter. That being said, the Pristine Trained Trader (PTT) knows that the odds of the bottoming pattern having high odds of making a significant move depends on the alignment of multiple time frames and where the bottom sets up. Let's look at an example of a stock that should form a bottoming pattern soon. In the chart above, I have displayed multiple time frames of ROSS Stores (ROST). The monthly time frame is in a strong uptrend and pulling back where buyers will show up. That pullback is coming into first price support (green area), which may be hard to see to the untrained eye in this time frame. What I have marked on the monthly as price support is the overlapping candles in the $50 dollar area. Pristine Tip: Overlapping candles in a higher time frame are a base in a lower time frame. See the base in the weekly time frame at the left. Notice the increase in volume last week as current prices neared the base of price support. That pick up in volume is exactly what we want to see when prices enter into a price support area. The daily time frame of ROST is clearly in a downtrend and has not formed a bottom. However, Thursday's gap lower on increased volume that resulted in the formation of a Bottoming Tail (BT) is a typical exhaustion gap. This gap lower and BT could be the start of the bottoming process; time will tell. Exhaustion gaps come after a period of declining prices and signal that the last of the traders/investors hoping that prices would hold and turn higher have given up hope and are dumping their shares. With the current correction in the broader markets ongoing, I hope this Chart of the Week will help you what to look for. There may be stocks that have shown relative strength and have started the bottoming process already. You will have to scan for them, but now you know what to look for! Many new to trading the markets are lured into thinking that one market is a better market to trade than another. Those trying to sell you their services related to a specific market will guide you to that faulty thinking. For example, FOREX is a better or easier market to trade than individual stocks or equity e-minis. This is completely false. Any market can be difficult at times because of uncertainty related to that market resulting in choppy price action. Or, any market can be relatively easy to trade when multiple technical concepts are in alignment. With the right trading education - you can trade any market or stock you want with the same method. Remember, the examples of bottoming patterns above were from Stocks, Commodities and Currencies. There is no difference. Yes, different instruments have basic foundational information related to them, but that information is not what you will trade. It's the patterns within the trends at the time that you will trade. Happy Thanksgiving to All! Greg Capra President & CEO Pristine Capital Holdings, Inc.

"How long will it take for me to become a profitable trader?" Boy - if I had a dime for each time I was asked this question, I would have one large collection of dimes. But I think I've done my work well. The majority of people who have sat in on my workshops and listened to me speak over the last couple of are no longer asking this question. So if you ever catch yourself wanting to ask this question, then please pay close attention to what I'm about to share with you here. Because once you understand the poisoned thinking from which this question comes from within you, you will be thankful that you now see things from a much more useful perspective. We are always, from an early age, comparing ourselves with others. From our upbringing and various influences on our thought processes as we grow up, we develop certain metrics and rules in order to determine what is 'right', 'wrong', 'fair', 'unfair', and unfortunately when we are 'good' or 'bad'. Stop doing it. Realize, that you are unlike any other individual or soul on this entire planet....or in the universe. So how can you compare yourself with others? It's like comparing apples and oranges. There are no comparisons because you are simply 'you'. You are not like anyone else. Period. So how long it took other traders to make a 'good' income at trading is completely irrelevant to you. And, if one thinks about it, what possible good could come of putting a 'standard' or an 'average amount of time it takes' out there as YOUR measuring stick simply because someone told you it was so. There are so many fallacies at work in a statement like this that it's ridiculous. If someone were to say it took 11 months, for example, for the 'average' trader to 'make it', what does that mean? Define an 'average trader'. Define 'make it'. And then ask, "What data do you have to support that 11 months is the average?" Did every single trader in the world give the person making this statement specific feedback on how much time it took them to 'make it'? NO! It's NOT POSSIBLE! The very criteria that would go into such a poll is subjective and thus makes the results entertaining, at most. Most of the truly amazing traders seem to 'disappear into the sunset'. They enjoy their privacy. And if they are amazing traders, they will be NO PART of such a silly 'poll' to help new traders provide themselves a measuring stick with which to measure their progress. They understand that this type of 'information' will not serve any trader. Think about that. Now, wouldn't you feel silly if you had actually measured yourself against some standard that was communicated to you which has no way of being based in reality? And even if it was, realizing that using it for yourself as a measuring stick is like comparing apples with oranges? Worse - I know people who have QUIT trading because of articles like this. What possible good could come of it? If you are just starting out, the thought of losing for 11 months before you 'make it' is pretty daunting. So it doesn't serve that person. If you have been trading for 8 months or thereabouts, chances are you will psychologically ruin yourself as you get closer to the 11 month mark and I can almost guarantee that you will not 'make it' by then simply because of human nature and the stress/pressing you will put on yourself. And, God forbid, you are past the 11 month marker already and you will make yourself feel like a complete idiot. Kurt Capra Contributing Editor Instructor and Traders Coach

Good Morning All: Last week I continued with part two of a three part series to help beginners, and maybe some 'veteran' beginners also. Last week we looked at different time frames and the types of accounts used to encompass those time frames properly. We talked about how education is so over looked by so many yet so needed, as everyone will pay their dues one way or another. Here is part three. In this issue, are finally ready to begin trading, so let's go over some rules to get you off on the right foot. A Beginner's Handbook Part 3 of 3 Once you have made all the decisions that were discussed in the first two lessons and have received an education to the level you feel you need to begin trading, the decisive moment arrives. At this point, I want to make sure you have a few tools in your tool belt when you begin trading. First, there is a steep learning curve in trading. I suggest (well, insist if I can...) that you start out slowly with very minimal risk amounts. Get used to your trading software. Understand the plays. Begin to pick your favorites and really develop your trading plan. At this point your plan is likely just a 'shell'. Know how to get in and out of trades. The odds are that you will lose in the beginning. You are learning how to apply what you have been taught. You will make mistakes. The question becomes, do you want to have all this learning cost you serious money or small money? By the way, it is good to start out paper trading, but as soon as your plan develops and you know your trading software, begin trading very small risk amounts. The most important aspects of trading are not learned trading on paper. Most of you reading this need to understand something. The vast majority of traders who come in to the market fail. Many people try to do this without any education, and those who do are the first ones to fail and usually do so in a big way. However, even with an education, it is not an easy game. There are reasons why even somewhat educated traders still fail at this. For most, there is a lack of discipline by individual traders regardless of whatever education level they may be at. In addition, a lack of capital that forces traders to trade with 'scared money'. It is simply a fact that most traders try to make a living from the markets with very little capital base to work with. That causes over trading and poor management decisions. If you have been trading for a while, do any of these things sound like they are powerful issues that are currently impeding your progress? Another skill you must develop is the habit of keeping good records. Keeping records and statistical information can give you an excellent insight in your trading. There are many things that traders should track such as Sharpe ratios, batting averages, percentage gains based on any particular strategy, percentage gain based on long or short, etc. During this process you should be perfecting your trading plan. One that out lines the types of plays you will look for. It should restrict you from trading certain times and plays that you do not want to trade. It should outline money management rules for you, for handling both winning and losing days. It should set up your share size rules, and it should dictate what kind of record keeping, analysis, and continuing education you will do. Some of these I touched on in prior week in this letter. Here is one of the most important things you can do for you trading plan, and for your continued improvement. Pay attention to the analysis part and make plans to follow up on all of your trades. Most traders spend 90% of their time trading. 10% on preparation and 0% on follow up. This is a very big mistake. Traders should spend as much time following up on trades as they do trading. That does not mean that from 9:00 - 4:30 must be counted as 'trading time'. Your plan may call for you to trade the first hour and last hour. The time in between could be used to review the morning trades and prepare for the next day, paper trade new ideas, etc. You should spend considerable time printing charts of the trades you make and evaluating them and learning from any mistakes. Good traders understand that the money lost when making a bad trade can be an 'investment' in a process that works to eliminate mistakes and improve trading. Closing Comments Good traders also understand that the market is always right, and the best we can do is play the odds. Be flexible and remember that even the best trades can be stopped out. This is the final article on "A Beginners Handbook". Paul Lange Vice President of Services Pristine Capital Holdings, Inc.

Having trouble adhering to your stops lately? Well, for some traders this is a difficult psychological demon to overcome. One that if not corrected quickly will lead to your demise as a trader. Sounds pretty serious, doesn't it? It is! For those of you who have this nagging problem, you already know the costs. So, let's try to do something about it before the damage is irreversible! As traders, one of the major weaknesses we have is being human. We are not robots, therefore we bring emotions with us wherever we go and with whatever we do. Being emotional creatures is not conducive to success in trading. Though our mind is a beautiful thing, we must always stay grounded and objective with our thoughts, which is no small task! Most traders who don't stick to their stops know they are doing the wrong thing, but, they also won't allow themselves to exit the position, because they are unable to accept a loss. By accepting a loss, they are admitting they are wrong, and in turn, they will lose money. So, instead of facing or accepting this pain, they choose to forego their stop loss, and let the stock move against them, in HOPES that it will turn around and eventually make them a winner. They will literally do anything to avoid the prospect of becoming a "loser." Sound familiar to anyone? Well, if I'm talking about YOU, then you need to continue reading... Most things we listen to or learn in our training seminars make perfect, logical sense. Find a pattern, stalk a quality entry, locate a reasonable area for the stop, pull the trigger, sit back and manage in between. Let the stock do the work for you. It's simple right? Heck, if someone asked you for technical advice about a particular stock, you could probably rattle off some very nice objective, logical advice worthy of a pro, as long as YOU are not in the stock yourself! Everything changes when it's our own money on the line. This causes many people to lose objectivity and become irrational. For some traders this nasty habit can be easily broken by going back through personal statistics and looking at the positive difference in your P/L by taking your stops versus not taking them. Unfortunately for many, merely looking back at past statistics is not enough. You've been ignoring your stops for so long, it's going to take some stronger medicine to cure this disease! The first thing you must decide on is this: Do you like trading? If the answer is yes, then the choice becomes very simple. Take your stops, or quit trading. Period! Take some time and really internalize those thoughts. Imagine your life as a trader, and all the positive things that go with it. The freedom to trade when and wherever you want, the potential to earn as much or as little as you desire, the ability to spend more time with loved ones etc. Now, picture your life without trading. Can you handle the alternative? If you don't like the alternative picture, then you are taking the first step towards correcting this habit. If you've decided that trading is your passion, then you will do whatever it takes to succeed. That includes taking your stops. So, before you enter any trade, you must first accept that the money is potentially GONE. If you are going to risk $100 on a trade, then BEFORE you enter the position, you must emotionally tell yourself, the $100 is gone. I no longer have it. After all, you can't lose something you don't have! If the thought of losing $100 is too frightening, then you need to lower the amount of money you are willing to lose per trade, until it becomes emotionally acceptable. If you cannot find a dollar amount small enough, then try using a simulator account and work your way up to trading with small shares. If that doesn't work, then there is a chance that this business is not for you. Always keep in mind that we are not going for homeruns, we are looking for base hits. We focus on a consistent approach to making money, something we can repeat day after day. We are not investors, we are technical traders. We have very specific parameters for our set-ups, and using stop losses is a large part of that process. When something does not work as we plan, we take the loss and reassess. We don't opine about the "what if's", we simply move on and stay objective. Remember, it's just one trade! So, don't let that "one" trade wipe out your account and destroy your trading aspirations. Is one trade worth that much? If you feel yourself losing control, then step back and slow things down or perhaps stop trading for a bit. Don't worry about missed opportunities because the market is not going anywhere. When you are ready to trade again, the market will still be there. If you need to, put a sign up in front of you that simply states, "I will adhere to my stop, no matter what!" Another approach might be to record yourself when you are feeling anxious about not taking a stop. Then go back and replay it afterwards to see what your emotional process was. A "consequence" system may work as well. For example, if you don't take your stop, then you are not allowed to play golf for 2 weeks. Take away something meaningful, something that will help promote change. As our own PMTR moderator Jeff Yates always says: "You won't change until the pain to change becomes greater than the pain to stay the same!" I truly believe that. So you need to ask yourself how much money do I need to lose before I change? Although not adhering to stops is a very serious problem, one of the nice things about having this type of issue is that it can be corrected in just one day. Similar to smoking, if you so choose, you can literally quit smoking today and never have another cigarette again in your life. I'm not saying this is easy, but it is possible. Same goes for adhering to stop losses. For example, learning chart patterns will take time, it's not something that you can force yourself to learn in one day. Whereas with adhering to stop losses, if you have the mental strength and desire, you can literally change overnight! It doesn't have to take months. Good luck out there, and remember this is a marathon not a sprint, and it all starts with a good, objective trading plan! The choice is simple: Take your stops or stop trading! Make sure to register for other programs that interest you the most at the following link: Pristine FREE Webinars I would be happy to see you join us and to answer any questions you may have. Jared Wesley Contributing Editor Interactive Trading Room Moderator Gap, Intra-Day and Swing Trading Specialist Instructor and Traders Coach

Good Morning All: Last week I started part one of a three part series to help beginners, and maybe some 'veteran' beginners also. Last week we looked at the difference between a 'buy and hold' philosophy and properly managing all trades. We talked about how things have changed, and how most 'fundamental' criteria are not very helpful. We look at charts for the truth, and manage because things can change quickly in today's environment. Here is part two. In this issue, we want to expand on those things and discuss what time frames you may be interested in trading. In addition, we will discuss how to get an education for varying budget and time constraints. A Beginner's Handbook Part 2 of 3 We briefly touched on the concept of time frames last issue. It is an important topic and is the next item that needs consideration before you begin trading. The concepts of 'trading' can be used to help people who are looking to better manage their IRA. They can also be used for people trying to build wealth by swing trading investment money, and for people trying to produce income by trading on an intra-day basis. This last category includes traders that are often called "day traders" or "scalpers". If you are going to be active in the markets, it is recommended that you maintain 2 separate accounts for trading. These two accounts will have different goals and objectives. One account is a 'wealth building' account. It is for core and swing positions. Core positions are positions based on weekly charts and can last from weeks to months. They have stop losses and entry points like any other trade. Targets may be set as an objective or left to an exit based on raised stops as the stock moves up (or lowered stops as stocks move down in the case of a short). Swing positions are based on daily charts and can last from 2-5 days. This wealth building account is important to capture the major moves in the market. These are moves that may elude the trader who goes home flat every night. Gaps and large extended moves will benefit the swing and core trader, but will often only aggravate the intraday trader. The second account should be 'income producing'. It consists of day trades (ranging from minutes to all day), and 'scalp' trades. Scalp trades are a specialized form of trading. They are designed to make money from very small moves in stock by using large share size and very tight stops. These strategies help to keep income flowing, even at times when the market may be moving sideways, and not generating income in the wealth building account. Once you have decided on your time frame, it is time to begin. Not time to begin trading, but rather time to begin to get an education. Trading is one of the most challenging endeavors in which one can participate. Unfortunately, most traders will spend more time getting educated in the television market before buying a television, than they will spend getting educated in trading concepts before buying a stock. Most traders do not feel the need to get educated in trading. Most traders also fail. No one would try to be a doctor or a lawyer without the proper schooling. Yet for some reason, new traders feel that this is an 'easy to conquer' profession. The truth is that some of the smartest and most successful people often have the most difficult time trading. Continuous success before trading, often translates to over confidence and stubbornness while trading; this is a bad combination. You have to be able to admit when you are wrong and move on quickly. Successful people often become perfectionists; this is a quality not suited for trading. Good traders don't insist on getting them all right. The goal is to make money. Doctors often want to 'save the patient' at all costs. In the market, sick stocks are cut short quickly. Do you know, right now, what strategies you want to play in this market? This month? This week? Today? Do you know what strategies you want to play at different times of the day? Do you know how to handle all of the market maker tricks? Do you know how to handle reversal times? You see, the market is designed to extract money quickly from the unknowing. It is a game where very many supply much money to the very few. What side of this equation have you been on? You need to develop a trading plan that outlines your total business plan when it comes to how you want to trade. You need to outline the strategies you want to use, and when you want to use them. You need to outline money management rules. How much will you risk on that scalp? How much on that core trade? How much can you afford to lose in one day? To do this, you need to begin to understand trading and all the concepts it involves. This is the single most important step, and I could go on for hours. Yet, the vast majority of new traders do not have a plan. Everyone has a different level of money and time they can devote to getting educated. That is fine; there are different ways to approach your education. Some want to improve their core trading to help the returns of their IRA while they work full time at their job. Some want to make their living trading the markets full time. Make sure you start out paper trading or trading very small risk amounts. As you get educated, move up the share sizes very slowly and only upon success. Most traders lose too much in the beginning before they get educated, that they cannot come back by the time they are educated. Don't let this happen to you. Closing Comments There are those that continue to pay the market every day, only they often walk away with very little education. Some traders lose more money in a week than it would take to get a good start on an education. Don't be one of the people with the mindset of, 'When I make enough money trading to pay for a seminar, I will take it then....' Think of the logic in that statement. The training must come first, or it will never come. Paul Lange Vice President of Services Pristine Capital Holdings, Inc.

When starting to learn about technical analysis you begin by sifting through a maze of tools. Some have what seems to be a magical ability to locate support and resistance. Most of these tools locate these areas by "connecting the right dots" on the chart. However, there are differing opinions as to which are the right dots. Support and resistance areas are also located by using moving averages. These too can have pinpoint accuracy, but which ones? If you continue on this path you'll eventually settle on some combination of these tools, but I guarantee that you will also be second guessing them forever. Let's look at an example of what is real and what is not. In the daily chart of Apple (AAPL), we see that prices stopped their decline right at the 200-period moving average. The 200-MA is the most widely followed moving average by traders and institutions, so it is the one that often does become a self-fulfilling prophecy. For this reason, I also put the 200-period moving average on my daily charts. However, I also look to the left to see if there is confirming real price support. As we can see, Apple did not has pushed through the 200-MA and is on its way to real support. Years ago, I realized the only real support that could be relied on with consistency was based on price. However, I didn't come to this realization until I removed all the moving averages, trend lines, Fibonacci lines and even the horizontal lines from my charts. Consistently I saw that while prices stalled at a widely followed moving average, the majority of the time that stall was temporary and prices continued to real support- as Apple did. Do prices ever stop and reverse from a 200-MA without price support to the left? They do at times because of the self-fulfilling prophecy. The way I suggest you handle this is to at least let the 60-minute timeframe reverse trend before trading against the daily trend that has stalled at the 200-MA. Let's look at that. The 60-min. chart of AAPL is a clear series of lower highs and lower lows. When the bounce from the daily 200-MA happened, prices stopped right at price resistance, which was an unfilled gap and reversed. With prices having been rejected right where they should have been, the odds of a test of the pivot low that formed at the daily 200-MA was high. On this chart is an excellent example of how to play a breakdown strategy in the area of prior support or any breakdown for that matter. As we know, there is going to be buyers in an area of support. However, when the trend is down and there's no "price support" to the left (a Pristine Price Void, PPV) in the higher time frame, the lower timeframe support is likely to fail. What we see happened when AAPL bounced from support on the 60-Min. is that sellers took advantage (green diamond) and pushed prices right back down. This little bounce and failure sets up a shock for the buyers and signals that prices are ready to resume the move lower. That candle marked with the green diamond was a large green candle engulfing the prior before it turned into a Topping Tail (TT). With that signal in mind, we have a short bias to take into a lower timeframe of choice (I'll use the 5-min.) to look for entry points. That being said, those trading from the 60 min. timeframe can take the signal under the candle marked with the green diamond. Moving down to the 5-min. timeframe, we are expanding the data to see more detail of the price action that will provide signals not seen on the higher time frame. The green diamond at the left of the chart marks the same point on the 60-min. chart. While 60-min. traders will be entering after the greater than 100% retracement seen here on the 5-min., 5-min. Those that have taken Pristine Seminars will recognize the secondary signs of continuation that I have marked with light green diamonds. The first is what we call a 180 reversal or a Green Bar Ignored (GBI). The second is a Money Bar setup that Pristine Trained Traders use after a breakdown has already happened. These setups have shock value and are entered after the candle forms marked by the light green diamond. With a PVV below, you can count on prices moving lower. I hope you've gained a few insights into to seeing what is real and what is not in technical analysis. Most spend their time studying what is not real when starting out and many never stop. PRISTINE - A trading style, often imitated, but Never matched All the best, Greg Capra President & CEO Pristine Capital Holdings, Inc.

Discipline: "To know and not to do, is not to know" As I sit here contemplating the subject of discipline, I think back at the early stages of my trading career. I heard the word so often but never really understood how it fit in with trading the markets. First off, let's get to know what the word really means: The dictionary describes it like this: "Training to act in accordance with rules" When someone is winning or succeeding at something, discipline is easy to follow. When someone has experienced defeat, discipline is a wild animal that is looking for a victim to attack. Better said, when your losing, the rules go out the window. Now think about that in your trading career. Its 9:50 am EST and you have increased your account for the day by some $500. That's $1500 an hour! You sit on the sidelines not wanting to risk this precious gain only taking the most perfect textbook patterns. How easy is that? Your momentarily happy and go out of your way to kiss your spouse, pet the dog or cat, nothing can get you down. It's a great day! We'll, let's take a peek at a different scenario. It's 9:50 am EST and you just lost two trades in a row; you are down $500 in your trading account and you absolutely despise hearing someone that is having a great trading morning. Your spouse says good morning and you don't answer or say something to appease her/him so they won't talk to you for a while. The family pet comes over and all you can say is "beat it Rover" and your immediate thoughts are, I have got to get this money back. It's 10:00 am, you see a questionable trading pattern and if you tilt your head to the left and then turn your monitor at a 45 degree angle you can see signs of glory that has $500 written all over it. Your trading plan just went out the window and if you listen closely, you can hear the snarls of the un-caged animal lurking over head. Oh, by the way, his name is "Discipline". You take the trade and you earn your $500 back. What a great day just to be even. The cycle continues until the stock market zaps every last dollar from your trading account and you become another statistic. This just doesn't work you say, as you fade into the distance never to attempt trading again. You lay dormant as another victim that has been serious wounded by the faceless market. Does any of this sound familiar? I bet you can begin to relate to the reasoning behind this message. My friend, discipline is an animal that intends to throw you off course, ditch your plan and humble you. If you have a trading plan, (and you should) you need to honor that plan at all cost of temptation. I know you want to rid the grief of losing for that day so you do what most people do, they move to HOPE MODE and that just wont cut it. You need to find a way to make certain your plan will stay intact when days like this come, and they will! Design you trading plan with this in mind. Set parameters on how you will handle the rest of the trading day. For example: will you scalp only; reduce your risk; only be allowed to trade once more that day if you lose; there are a number of things you can insert into your plan to avoid this discipline killer. Once you experience how powerful it is to just follow your plan and not give way to "Hope Mode" the faster you will learn the skill of discipline. I would be happy to see you join us and to answer any questions you may have. Good trading! Jeff Yates Contributing Editor Interactive Trading Room Moderator Gap, Intra-Day and Swing Trading Specialist Instructor and Traders Coach

Good Morning All: For the next three weeks, I will be looking at things that beginning traders should know as they start this business. Don't be surprised however, if some of you moderately experienced to very experienced traders don't find a few interesting tidbits; Even if they serve as nothing more that review. A Beginner's Handbook Part 1 of 3 Welcome to trading. Are you new to this field? Or is it called online stock buying? Or is it day trading? Or is it investing? Well let's get a few terms straight. This will be the first of a three part series, "A Beginners Handbook". First, at Pristine, we consider 'buy and hold' something that is no longer a term that should be applied to the stock market. Do this if you like in real estate, bonds, gold, but not stocks. It implies a long-term buy and hold with your eyes closed approach that should no longer be used in the stock market. The term 'investing' is fine as long as it does not mean 'buy and hold'. There is nothing wrong with long term holds. We believe in swing trades and core trades that could last for months or years in some cases. However, they are 'managed'. As traders, we do not close our eyes hoping all will be all right. Traders are educated in technical strategies and discipline. They become self-sufficient Most of today's large cap companies are in the technology area. These companies are subject to having their main product replaced by a new technology very easily. Long ago, it required many years for any company to start up a new car company and over take General Motors. Today, anyone can create software in their garage that can revolutionize how something is done and put a competitor out of business. Look at the company Iomega, for example. They are the makers of the infamous zip drives that appeared on computers years back. The current technology at the time was storing information on 1.44 meg disks. They came out with a system to store 100 megs on a disk, and got contracts to put their drive on every major computer. Sounds like a company you can buy and hold forever, doesn't it? It is, until someone discovers that the same information can go on a CD and have it cost much less. At that very moment in time, literally overnight, Iomega is out of business; unless it has other products to sell. The rule is 'change or become extinct'. This example is found over and over again in everything from video sales to computer chips. When practicing 'buy and hold' (as opposed to long term trading), you are relying on news and announcements and fundamental data. Many of you have probably already discovered how worthless this process is. To the extent it has a valid use; it is never to take the news or information at face value. Take a look at Amazon's recent earnings. You can look wherever you want, the comments were the same. "Results from Amazon (AMZN) ... also disappointed the Street". If you are relying on news to make decisions, it must be time to get short AMZN, right?. However, take a look at what happened after the dismal report was out. There was no other news. Those of you that already know this see this happens all the time. So if 'buy and hold' is out, what do we do? You hear stories all the time about all of the 'day traders'. You look around you and you don't see many. You may not even know any besides yourself and those you met at a seminar. Unfortunately, the term 'day trading' is often misused by the media. There is a large group of people that we call 'online investors'. These are the folks that use their computer in place of their telephone to call places like E-Trade, Schwab, etc. and place their orders. They are typically managing their savings or IRA money, and are typically untrained. They were plentiful during the bull run of the 90's, and often were wrongly called 'day traders'. They did not need to be trained because they made money buying stocks in the late 90s no matter what they did. Most of them are all gone now. We consider our selves 'traders', but this does not include the much larger group of 'online traders' mentioned above. Traders use technical analysis to find, enter, and manage trades. That applies to long or short term trades. Those that are focused on trading and exiting by the end of the day with that account are called day traders. We consider traders people who spend a good part of the day with the market. Those who are trained to manage positions that may last from several minutes to several months. While we believe that 'buy and hold' is a dead term, we do use many time frames to hold stocks, the longest of which is a 'core' position. While a core positions may last for months (or years), it differs from investing because there is an exact exit strategy planned for a core position. We also use a 'swing' time frame. This is one that may last from 2-5 days. We also use tactics that would have us holding a stock overnight one time, or exiting the same day. Sometimes exiting part of a position only minutes after entry. So if you are going to trade, how do you buy stocks? If you are trading only a few trades a week, and limiting yourself to swing and core trades, using on of the 'online brokers' is fine. The time it takes to have your order filled is not very fast, but for occasional long-term trades it is acceptable. If you are going to be trading more often, or trading in and out the same day, you will want to use a 'direct access' broker. This is a broker that lets you see all of the market participants, where they are buying and where they are selling. You then place your own order on your computer screen and many of these orders will have instant executions. By instant I mean instant, usually within a fraction of a second. If you need a broker, or not happy with your current broker, consider Mastertrader.com. It has the best rates and service, a variety of platforms, and you earn points to use at Pristine for services and seminars. So, you know what you want to do, and you have selected a broker. Now you need a computer and an Internet connection. Again, for occasional swing and core trading, any machine that can access the Internet will do. If you are going to be active intraday, you will need to have something better. You will need a computer that is competitive with the current top of the line computer, or is at least current with the technology within the last 12-24 months. You will want a fast Internet connection. You need to be looking at Cable, FIOS, Satellite, or T1-3. Depending on where you trade, you will have to evaluate which of these is available and most effective for your money. You will need to have a working knowledge of computers, as your time with the computer will be extensive whether you want it to be or not. So now you are ready to trade, right? Well, no not really. The biggest distinction I made earlier was that 'day traders' are educated in trading strategies and disciplines. This will be the focus of the next Lesson, how to start out trading when you have no education or experience in trading. I will discuss how to build that education as you go, without using up all of your capital. Closing Comments There is perhaps no greater occupation to have than that of a professional trader. Yet, few achieve that title. Few achieve, even thought thresh hold is not that high. In terms of cost and education, most anyone is capable. You have to set yourself apart, and be different. That is part of what we will talk about next week. Until next week, good trading. Paul Lange Vice President of Services Pristine Capital Holdings, Inc.

Good Stocks - Bad Market In a correcting market environment you better know how to determine which stocks are "acting well" and which aren't if you're going to trade the long side. Acting well is a term often used to communicate that one tradable instrument is outperforming something else. This could be the broader market, a sector, another stock or a market internal gauge. For the stocks we are going to look at it, will be relative to the broader markets. It can also mean how that tradable instrument reacts to gaps, support, resistance or the lack thereof. In addition to knowing which stocks are acting well, you'll need to be able to determine with relative accuracy when the market is likely to bounce a bit. In a correcting market even the stocks acting well have a greater tendency not to rise when the market is falling. However, when the market makes a short-term low these stocks are likely to act even better. Meaning, go higher. The first thing that we want to consider is the market timing. For this example I will use the Nasdaq 100 ETF symbol QQQ, which has actually been weaker than the S&P 500 and the Russell 2000. QQQ has reached its first area of price support since breaking down (closed the VOID) and has stabilized between 65 and 66. Friday, prices broke below the prior three days lows, which were very close to each other (a minor breakdown) and rallied back up toward the high of the day. Pristine Tip: A Bottoming Tail (BT) bar that forms in this way - at prior price support - is a strong indication of a short-term low. Now we need to see if QQQ can trade above Friday's high for confirmation of this price action. The chart of YAHOO (YHOO) is most interesting in that it bottomed at close to the same time that QQQ topped. YHOO began to show its strength when it was able to move sideways, rather than retrace lower after the strong rally that created a Pristine Price Void (PVV) below. As QQQ began its decline, YHOO moved sideways at the prior resistance to the left and absorbed that supply (red area). This is what I call acting well. Once it formed a new support pivot, buyers came in when prices dropped back to retest that area. Lastly, YHOO gapped above the sideways consolidation it had formed creating another PVV and has held above that area. Wow, YHOO really acts well! CREE is another stock that acts well. While it did have a failed breakout and then move lower with QQQ, it recovered relatively quickly. Like YHOO, CREE has moved sideways at its prior resistance and is absorbing the supply there (red area). Plus this is happening after a large gap up that created a PVV. Also, on 10-19 when QQQ formed a Bearish Wide Range Bar (-WRB), CREE formed a BT! CREE then formed a new support pivot, has not even come close to test it, and after Friday's bullish day it isn't likely to. Cree is looking real good. I pointed out that Harley Davidson (HOG) had formed a bottom on 10-19 on my first post on Twitter. While HOG was showing relative weakness to the broader market prior to October, it was bottoming. As I showed at Twitter and Facebook, the reason this bottoming action really interested me is because the monthly time frame of HOG was a Pristine Buy Setup (PBS). You can check out the charts at Twitter and Facebook. Like YHOO and CREE, HOG is moving sideways after a strong move at resistance and is absorbing the supply there (red area). Notice that HOG broke below the prior two day's lows on Friday. While it did not recover back the high of the day; these breaks can result in a move higher if prices move above high. HOG is acting well too. All the best Greg Capra President & CEO Pristine Capital Holdings, Inc.

Good Morning All: If you are an experienced trader, you can skip reading this article. If you are new, or if you have been at this less than a year and not making money yet, you may want to read this. If you have been at it more than a year and are not making money, you probably will not read this. To a Handful of Traders Out There I have to accept the fact that there are very few people willing to recognize in the early stages of trading that they need an education. It should seem obvious, as it is the only acceptable route in any other high-paying profession. While I have to accept that fact, I do not really understand it. Having excepted it, I know that the next best thing we can do at Pristine is to make sure people stay under our wing until they are ready to advance their careers through a proper education. We want to make sure that you stay with us even if you have not yet made a commitment to be a full or part-time trader, or to manage your own long-term money. To do that we want to continuously improve you and your knowledge by offering a variety of ways to obtain great information for free. Every 6 to 8 weeks we do a seminar called "Online Trading Essentials". There is a nominal charge for it but if you are currently a Pristine student you can get it for free. If you are in the process of discussing a seminar with a counselor, you may also be able to get it free. Talk to your counselor. It is a great class that delivers four and a half hours of nonstop critical information about many of the topics that traders need to know about trading. Everything from advanced concepts about risk management and share sizing, down to what a level II screen is for, and how to use news and/or fundamental analysis in your trading. This is all information that is critical to know, yet on the other hand is too basic to actually be taught in our paid for seminars as they focus purely on technical or more advanced topics. In addition, we are introducing a new series of "Power Trading Workshops" that are designed to deliver more information and they come to you Monday through Thursday (some weeks may only be three days) at 4.15, just after the market closes. Some of these will have new topics that have not been discussed, and some will blend some old favorites and new twists. Naturally, we still have new people who want to know about Pristine and about some of what we teach, and that will be included in some of the topics as well. You can view the schedule for these on our homepage or in the e-mails that you receive. They are under the topic of either "Power Trading Workshops", or "Free Webinars". Paul Lange Vice President of Services Pristine Capital Holdings, Inc.

n a prior Chart of the Week (COTW) titled Bringing Common Sense to Trading Part I, I explained how to determine turning points and continuation points with price action alone. This week I am going to show why prices trended as they did Friday. In that prior COTW, I also told you that price oscillators, various other indicators and drawing lines to determine turning points or support and resistance have nothing to do with prices reversing when they do. Friday's drop should reinforce that fact for you. To an extent, these analysis tools do have a self-fulfilling prophecy at times since so many people have been taught to believe the fallacy and use them. The internet based online trading education industry perpetuates these hocus-pocus indicator based methods. Not much has changed over the years. When I started to learn about trading the markets there was no online education, since there was no internet. However, there were mailed letters that gave recommendations and some education. Like most online educators now, those letters also used the indicator mythology. It's not easy getting started with so much information to sift through about how to use these types of technical analysis to trade and invest. I did not side-step the learning and use of indicators, but I did eventually see the truth. Through these COTW letters and our other services I hope you will see through these deceptions that create confusion about price movement. Okay, let me explain what happened on Friday. Before we get to Friday, above is a chart that I posted at the Pristine Facebook Fan Page and the Group Page last Wednesday. In it I showed why sellers would show up the next day, and they did. I also said that ES (ES is the e-mini contract for the S&P 500) retraced further than I thought it would, but those Topping Tails (TT) suggest that short-sellers are waiting to pound it again. This alone did not suggest or predict how much prices would fall on Friday. However, what made that possible was the way prices moved up to the area of the prior TTs. The key here is the fact that there is virtually no overlapping of the candles on the way up. Each candle started at or very near the prior candle close and did not retrace back into the prior candle. In other words, this is a continuous fluid movement. There is no uncertainty among the majority traders. Prices are going up; buy or get out of the way! This arrangement of candles displays strength, power and momentum. But if that is the case, how could prices fall as far and as hard as they did? While this arrangement of candles does display strength, it is the weakest link also. As I have explained in the past, one of the most powerful concepts to understand is that of supply and demand. Where sellers and buyers are and when there is a Void of them. The way prices moved up into the supply area and the TTs (little to no overlap between candles) it created what I refer to as a Pristine Price Void (PPV). When prices move upward so fast there is no support under prices. There are no pullbacks or sideways consolidations. So there is nowhere to buy a pullback based on a price support as a reference point (demand area). There is a Void of support or demand because prices moved higher so fast. In addition, as current prices move sideways over time they move away from any small support area that might be there. This makes any small support area irrelevant. This is a common question students have. What about that small area of price support? What is more powerful or meaningful, that small area of consolidation or the bearish daily time frame and intra-day bearish shock? It's the weight of the evidence to consider as a whole, not one piece of information. Pristine Tip: A truly strong momentum move does not need support. It creates it. I discussed this in the COTW Bringing Common Sense to Trading Part I. Look for momentum moves that begin from a consolidation and have a PVV overhead. Not moves that end at the top of a range. In the chart above, I've shown the daily time frame at the upper left and the 60-min. time frame. In the 60-min. you can see how little congestion (stall in prices moving higher) there is, especially on the Tuesday the 16th. As prices moved sideways and away from what little intra-day overlapping there was, it made those areas less relevant as a reference point of support. The essence of a Head and Shoulders top is that the upward move has ended when the new high fails (the head) and that the time moving sideways (the Shoulders) signals distribution. That price pattern creates a Void below. Also in this example, there is a shock that occurred on the 18th and confirmed the bearishness of the bigger daily picture. Let's assume that you had no idea of the bearish big picture and potential for the larger decline. It's conceivable that you could have thought that prices have fallen a lot and would bounce on Friday and looked for long trades. Well that's fine, but unless the price action becomes climactic near a prior support area or there is an actual trend change on the time frame being traded (in this case the 5-min.), there would be no objective reason to buy. This is a rule all Pristine students and prop traders are taught from the start. Include it into your trading plan and it will eliminate a lot of unnecessary loses. I hope this COTW has helped you understand why prices moved as they did on Friday and see that the commonplace indicator based mythology is unnecessary and misleading. I will be presenting a Free Workshop on Tuesday October 30th. At it I will be discussing what we covered today and other Pristine trading strategies. It will be similar to the coaching sessions I do with students and hope to talk to you there. All the best, Greg Capra President & CEO Pristine Capital Holdings, Inc.

I agree to the concept "paper trading isn't the same as seat time" I firmly believe paper trading to long never brings the reality of real money to the table. Its the emotional side of trading that we have to work through. I believe paper trading should be done but at some point you need to get on the track and experience the real world as well. I would just start with small shares and slowly bring the emotion up to speed. In time, you will be running your own race. -Jeff

Good Morning All: Over the years, I have written many articles; hundreds, maybe even thousands if you include partial repeats and every short lesson. Sometimes the lesson is a partial re-write, or a new take, or a new way to explain or organize the information. While there are many summaries out there on various topics, and while the topics on this lesson may be found somewhere else, I began a three part series two weeks ago answering a very direct question: What causes failure in trading? This has been a no-nonsense, nuts and bolts look at the question, not a philosophical dissertation. Two weeks ago I discussed 'discipline' as the first true reason for failure. Last week I discussed reason number two; the inability to focus. Today I will discuss the third reason, which will end this series. There may be other reasons, but these are the top three. To clarify again, most people actually fail because they do not get an education. However, that is a decision that people consciously make. I want to discuss why the people who really try, can still fail. What Causes Failure? Part Three of Three Reason number three is the inability for traders to plan and follow up. This is a fairly broad topic, I agree. However, it has to be in there as one of the top three. Again, these three are not in any particular order. Yes, all of these topics are somewhat interrelated. Many may argue that this one is the most important. But what good is a plan, if you do not have the discipline to follow it in the first place? What good is a plan, if it is so expansive no one can review it accurately to see if it was followed? When I talk about planning, I am not talking about planning with a small letter 'p'. I am not talking about preparing a watchlist for the day, or checking the earnings schedule. I am talking about planning the a big letter 'P'. I am talking about the Trading Plan. When I talk about a Trading Plan, I mean a very detailed plan or what you are allowed to trade every day, when and how you trade it, how you enter, how you mange, when you can change it, what strategies, and all the money management rules. If you day trade without a trading plan you follow religiously every day, you WILL fail. You 'may' survive as a swing trader, depending on your background. The other half of this third reason for failure is the inability to follow up. No Trading Plan is worth anything if it is not followed. Closing Comments: This is the end of this three part series. To be sure, the number one reason traders fail is they do not receive a quality education. That is what we do at Pristine, provide the best education in the business. What I wanted to address here is, even after the education, why do some still fail. Lack of discipline, lack of focus, and the failure to create a trading plan and to follow up to make sure those first three are in place. That sums it up. Do you have these three eliminated? Eliminate these three reasons to fail, and you will have an outstanding chance for success. Paul Lange Vice President of Services Pristine Capital Holdings, Inc. http://www.pristine.com/images/educator_plange.jpg

In the Chart of the Week (COTW) dated Monday 9/17/12, I showed you why a short-term correction was near. This was regardless of the bearish October Phenomenon. As I said then, the time of year alone is not a reliable guide without other factors being in alignment. Those factors are - the right price action and speculative bets being placed on higher prices. In that COTW I showed that this was happening and it virtually insured a short-term correction was close. As we know now, Friday 9/14/12 was the high day of the current move. If you would like a copy of that COTW you can e-mail me at greg@pristine.com or e-mail counselor@pristine.com for it and it will be sent to you. In the chart above, the S&P 500 is displayed by the ETF symbol SPY. The bulls attempted to hold the prior low in the 143 area of SPY last week, but could not. With an area of Major Support (MS) in the 140 area, it's an obvious place to except a bounce from. Ideally, prices would drop straight down into it similar as they did from early last week. This would create a small Pristine Price Void (PPV) for prices to bounce up into. Assuming we see this setup, I would not play this as a swing trading long. Meaning, I will not hold for a few days, since what is needed for a bottom is not yet in place. Rather I'll use the area as a reference point where the intra-day time frame will bottom and start a short-term uptrend. Historically, correction bottoms do not occur without the majority convinced that the market is going lower and they make speculative bets on that. We are not seeing that yet based those option traders that are typically on wrong side near turning points. These are the under-capitalized, overly-emotional traders that bet big at the worst time. I've used their actions at a guide for many years and they rarely fail to signal when the turn is near. When these traders start loading the boat with put options (bearish bets) the odds are that a tradable low will not be far off. Lastly, let's look at the NASDAQ 100 index ETF symbol QQQ In the above chart is a Head & Shoulders pattern that formed in the NASDAQ 100 ETF symbol QQQ. The pattern is simply a new high that has failed (longs are caught) and break of prior support. I typically don't show or talk about the esoteric types of analysis that I studied in the past. However, I thought I would show this and how it aligns with the simple technique taught at Pristine. The Head & Shoulders top theory is that the vertical length of the area between the head of the pattern and the neckline (the base) will give you the point where prices will decline to by projecting the same length below the base. In the chart, you can see that I've drawn a line from the head to the base and then placed a line of equal length from the base going lower. That is where prices should decline to. Well, based on the simple analysis of what was resistance becomes support, we see that the Minor Support (mS) area is the same as the measured low projection. I studied this many times years ago and it was virtually always the same. The projection lined up with an area of price support; it could be a minor or major area. The other lines below are simply other price support reference points to be aware of should the decline continue lower. Complex analysis tends to impress us when starting to learn about trading based on technical analysis. We are conditioned to think that the markets are complex and it's needed. Most online trading courses are based on this type of analysis. If you have to buy software or indicators to trade be wary of such education. If your charts of filled with things like indicators, wave counts, Fibonacci projections, etc. The only thing you can be sure of is that the confusion will continue. All the best, Greg Capra President & CEO Pristine Capital Holdings, Inc.

Many of you know that I have a back ground in Stock Car racing. The more I think about it, the more I see similarities that racing and trading the markets have in common. Particularly that they both require intense focus. I was thinking back on my racing days and I remembered a statement that my crew chief made to me. That statement not only gave me the edge in racing but virtually in every other venture that I was a part of. Are you ready for that magic set of words? Well, I think it would be prudent for me to explain a few things first. You see, in racing, you are rewarded for being fast, having cautious aggressiveness and being the most consistent; in addition, everything is measured in fractions of seconds.... In some cases the decisions you make, or don't make for that matter, could injure you or even worse, could be fatal. When you hear these words that I am going to share with you, it may not make sense at first but experienced individuals know how important this is. OKAY, are you ready? My crew chief said to me, "Jeff, if you want to go fast you have to slow way down." Now you can just imagine the confusion on my face when I was told this. I think my exact response was, "Huh?" He went on to explain to me that to be fast, you need to slow down in the corners so that you can set up the car for the exit. Most people drive off in a corner and man handle the car and as a result, they have a poor exit. By simply rolling into the corner rather than driving 100% into the corner, you will have more momentum in the majority of the track, which is in the straight away. I finally began to understand this concept and since then, I have applied it to many things in my life. So, here is the big question... How does this apply to trading the markets? Many people that are embarking on a new career want the experience of success," YESTERDAY"! They "rev up" their trading account and go full-speed into the corner not giving any consideration to consistency. They don't even know what their car has under the hood. They start buying and selling stocks as if they were selling tickets to a Broadway show. No strategy, no plan, just pure adrenalin and emotion. Most new traders feel that if you are in the trading business, you should be trading; not sitting and waiting. Unfortunately, a very high percentage of new traders never make a proper exit off the corner. Man handling their trading eventually causes them to end up in the wall, and I don't mean Wall Street. If they would just learn how to roll into the corner (paper trade) and set their car up for the exit (proper education FIRST) they would learn how to pass the majority of people down the straight away. I had a conversation once with racing legend Bill Elliot who has gone down in history as one of the most winning drivers on the NASCAR circuit. This is basically what he told me: "Jeff, if you were to paint a line around the track where your front tires are tracking, the goal would be to only focus on hitting your marks." He went on to say "Sloppiness or inconsistency of your line around the track is one of the most damaging things a racer can do." That made so much sense to me the more I thought about it. So many people spend so much time looking for the better way around or a better system that they lose the peril and momentum of consistency. By the time they find their "line" (the Holy Grail that does not exist) they have already used up their equipment. You do not need to trade 20 or even 100 trades per day to be a trader. The professionals ARE NOT TRADING the majority of the time, they are just following their line (only taking their setups and not looking for the newest and "better way" to make a lot of money in the markets.) The sooner you learn and understand that taking less trades with more consistent setups is really the only way to achieve financial rewards in day-trading, the sooner you will be on your way to consistent profits. Jeff Yates Contributing Editor Interactive Trading Room Moderator Gap, Intra-Day and Swing Trading Specialist Instructor and Traders Coach

Good Morning All: Over the years, I have written many articles. Hundreds, maybe even thousands if you include partial repeats and every short lesson. Sometimes the lesson is a partial re-write, or a new take, or a new way to explain or organize the information. While there are many summaries out there on various topics, and while the topics on this lesson may be found somewhere else, I began last week answering a very direct question. What causes failure in trading? This will be a no-nonsense, nuts and bolts look at the question, not a philosophical dissertation. I will discuss the top three over three letters. Last week I discussed 'discipline'. Today I will discuss the second of the three reasons for failure. To clarify again, most people actually fail because they do not get an education. However, that is decision people make. I want to discuss why the people who really try, can still fail. Last week I opened here telling you of an inescapable truth I discovered long ago. Everyone who enters trading is exactly the same, and stay the same for a long time. Reason number two for failure continues that tradition. Reason number two, is the lack of, or the inability to, focus. Yes, all of these topics are somewhat interrelated. Nevertheless, they each also have their own merit. Discipline and lack of focus are not the same thing. You may not have focus due to a lack of discipline, but you may not have focus by design. Many traders come to the market with the view that they have to become the master of all around them. They feel they need to learn about economic data, currency rates, foreign politics, and the list goes on. When traders learn technical analysis, the feel the need to put everything to use. I have seen trading plans that have 14 strategies spelled out for a new trader. Yet, all of that information is not going to change what a stock does that gaps over a red bar and pulls back to minor support. It will not change what happens to a stock that is in a perfect 15-minute uptrend. Closing Comments: Perhaps you have read the book "Market Wizards" by Jack Schwager. You should take note of the point of the book. In this book, the author sets out to interview 25 successful traders to determine what they have in common. He wants to find out what strategy it is that they all do, or how the strategies are similar. He finds two things that all traders have in common. One of them, the one we care about, was that no two did anything remotely similar in strategy, however, they all focused on one unique thing, waited for it to happened, and did only that. Focus. Paul Lange Vice President of Services Pristine Capital Holdings, Inc.