Notes on The Playbook Chapter 1

Posted on July 8, 2020 by James Carl
  • big picture
    • what are technical levels in our market
    • our market’s distance from technical levels
    • is market trending up or down
    • market’s present concerns
    • what is moving the market
  • intraday fundamentals
    • seek fresh news
    • provides potential real order flow
    • real order flow increases likelihood of clean trend growth
    • things to look for:
      • improved margins
        • margin improvement can send stocks higher during earnings season
      • government investigations
        • sell, sell, sell.
      • raised guidance going forward
        • opportunities for good risk reward ratios
      • better than expected revenue
        • gauge on how the core of the business is doing
      • gains in market share
        • business has an edge in it’s sector driving price higher
      • new product, new drug, new X…
        • market reaction can determine fundamental shift in how stock is viewed
      • earnings
        • consider trading outside a normal PE range for growth stocks as a trading vehicle
      • +/- 3.00% with increased premarket volume
        • usually precursor to large intraday movement
  • technical analysis
    • easily missused
    • keep it simple
    • use standard/familiar timeframes
    • technical indicators have more impact on high beta stocks
  • reading the tape
    • this can help you determine entry/exit prices quickly
  • intuition
    • something you earn
understand what to consider when making a decision