Art & Science of Active Trend Trading–Free Report 9-7-2014

Good Day Traders,
I hope all had a great weekend! Saturday was the monthly meeting of the Bay Area Money Makers and we had a great meeting talking about Breakouts, Shake Outs and Fake Outs.
Regarding meetings, we are considering doing a weekend training session in the future for those who would like to get better versed in using the Active Trend Trading System. If there is interest in an offering like this drop me a note and let me know if you would want to attend in person or via webinar. We are entering an exciting time for the market between October and March when most of the significant advances are made, so strengthening your foundation might be a wise move.

The How to Make Money Trading Stocks-Market Stock Talk Show is back every Friday at 10 a.m. PDT! If you want to jump to the head of the line register early at this link:

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General Market Observation:  Into a new week and where will the market go? I think a case can be made for going either direction with perhaps more muted expectations to the upside. Remember that even though the market is currently overbought on several indicators price action continuing to climb is a possibility. On the flip side, both the S&P and Nasdaq 100 is showing some signs of potential weakness on the weekly charts. Momentum remains low and the Accumulation and Distribution also remains in at a weak D rating! In fact during this whole tradable rally in the indexes the A/C rating has remained in the lower rating below C.

SPX: While last week was a short week for all indexes, the S&P churned just above support at 1991. While the Big Picture in IBD put a good face on Friday’s action, the weekly action might be revealing some cracks that could take the market into at least a healthy pull back during the month of September. Weak action in September is cyclic and tends to show up sometime in September. The tail-tell signs primarily show up on the weekly chart with the S&P finishing with a bearish Hanging Man reversal pattern, mediocre momentum and negatively divergent TSI and Stochastics. While this does not mean go out and get short the index it does mean that with little momentum pushes to the upside will further exhaust any momentum reserves remaining and a downside move may be in the near offing.

SPX 9-7Click to Enlarge

Nasdaq 100:  The NDX is showing almost the same chart pattern as the S&P. The Index finished the week with a Hanging Man on the weekly chart with negative divergence on the indicators. Again this does not mean there will be an immediate plunge but with falling momentum energy has to be found somewhere before meaningful advancements can be made. When advances are made with low momentum the following pull backs tend to be more severe and dramatic. Watch for any significant close below the 8 day EMA as a clue of pending weakness.

RUT:   The Russell finished the week with an outside week as visible on the weekly charts. This too is not a sign of a healthy index. While one could say that Friday’s action was positive after coming back from what looked to the start of a sell off, the volume on the bounce was weak. Remember that each of the indexes can recharge their momentum by simply moving sideways until the necessary rest has been achieved. Right now we’re in the wait and see stage after a great tradable rally in all three indexes.


Cumulative Profit/Loss June through Sept 5, 2014

Income Generating Trades Closed = + $ 6983.15
Capital Growth Trades Closed = + $ 2560.00

Total Profit/Loss Month to Date = + $ 9543.15

Total Booked Profits since June 1 when the timing service began: $9.54K


Margin Account Up 26.4% YTD
IRA Account Up 43.2% YTD
For a complete view of specific trades closed visit the website at:


Outs & Ins:   Again this weekend the IBD 50 simply recycled stocks that have been on the list at during the year.  A peek at the thumbnail charts from Monday’s IBD show that JAZZ, LAD, UBNT (interesting base within a base), KS and ALXN are in definable patterns with either a defined Buy Point or within range for buys. 

The word EXTENDED was used a lot throughout the list.

O-I 9-7



Comments and opinions written below this line of text may be provocative and only obliquely related to trading.  Some may find these “Off the Wall” comments challenging to their outlook on life.  I will not post any comments made on subject matter below this line, so if you disagree blast away.



Off the Wall:  The latest season of “Falling Skies” just concluded so my enjoyment of SciFi will be put on hold until next season.  It’s an interesting story about how aliens invade the earth and almost destroy it except the fighting human spirit continues to propel a small band to fight against overwhelming odds!  One of the creatures that is fighting for the aliens is called a Skitter!  This creature has multiple legs and the ability to skitter around in all directions constantly searching for the human rebels!  They are kind of like a coach roach that can go in all directions in a nanosecond.  Skitters tend to be nervous rapidly skittering here and there quickly constantly searching and constantly moving.  They have a really hard time of just relaxing and letting the human targets come to them!

The rest of the story on the fictional skitters is that they were a captive to the more supreme aliens who had previously conquered their planet.  Their remaining plight in life is to just skitter around for their masters! 

I think that we traders can sometimes become Stock Skitters!  We are on the move constantly looking for winning stocks.  Like the fictional skitters who tend to get themselves killed because of the over aggressive and impulsive nature, we traders can come to the same ending with our trades because of our impulsive and aggressive constant searching for the perfect trade or perfect stock!   We traders can also be captives!   Not captives of some alien master, but captives to untrue beliefs we develop about trading.  If you find yourself skittering around and getting frantic about trading-stop it.  To stop being a Stock Skitter we must work on ourselves to remove words like impulsive, frantic, fearful and nervous from our definition of us as traders.  This often takes time and patience, but it is achievable! 

Share Your Success:  Many of you have sent me notes regarding the success you are having with the Active Trend Trading System.  Please send your stories to me at or leave a post on the website.   Thanks!