The Key to Successful Trading, the Key to Successful Living

by Darrin Donnelly on September 15, 2011

Life will throw many problems our way, but it also has a tendency to shower us with unexpected gifts.  The market does the exact same.

The key is how we manage these ups and downs, ebbs and flows, peaks and valleys, bubbles and crashes.

How does one manage to surf life’s waves?  How does a good trader mange to successfully surf the market’s waves? [click to continue…]

Market Enters “Tipping Point” Week

by Darrin Donnelly on September 12, 2011

Sometimes, the best trade to make is no trade at all.

Coming off the Labor Day holiday, the Darvas System told us to go completely to cash.  As we enter this week, cash is still the place to be.

The market confirmed that cash was king at the end of last week as the NASDAQ recorded two straight Distribution Days on Thursday and Friday.

These two fresh Distribution Days brings our count up to four in the last 20 sessions.  This action puts us on alert for a potential snap back into a Downtrend. [click to continue…]

I’m currently reading The Little Book of Trading by Michael Covel.  It’s an excellent book for traders of all experience levels.  It combines the vast and practical research Covel has become known for with extensive advice from some of the world’s most successful traders.

One passage that stood out to me makes a point that all traders – especially those new to the game – need to come to terms with. [click to continue…]

We’ve Entered a New Uptrend, Here’s What to Watch For

by Darrin Donnelly on August 30, 2011

Last week, the market shifted gears and fought its way out of a sharp Downtrend.  As we enter a new Uptrend, there are a few specific rules to follow and conditions to watch for.

First, remember that the initial days – and sometimes weeks – of a new Uptrend are often choppy.

That means, be prepared for some pullbacks.  Most of these are a normal part of the process, but some are not.  Learn to recognize the difference by watching the volume behind these moves.  The heavier the volume, the more significant the move. [click to continue…]

The Best Way to Profit from a Downtrend

by Darrin Donnelly on August 23, 2011

The month of August has been a brutal one for the stock market.  The NASDAQ has already dropped more than 15% since August 1st.

But, if you’ve been following my newsletter, you know that we’ve actually been making big profits off of this Downtrend.  NOT by shorting individual stocks, but by investing in inverse ETFs.

On August 1st, the Darvas System triggered a Downtrend signal.  At that time, I bought into SQQQ, an ETF that tracks the INVERSE of the NASDAQ at 300%.  That is, if the NASDAQ goes down 10%, SQQQ goes up 30%. [click to continue…]

What to Do When the Market Goes Choppy

by Darrin Donnelly on July 31, 2011

Over the last couple weeks, the market has behaved erratically.

You can’t really blame Mr. Market for his lack of consistency.  Washington has been engaged in what can only be described as the epitome of dysfunction and the earnings season has provided us with many surprises – both good and bad.

In a time like this, you’ve got to be following a proven system.

The great thing about the Darvas Trading System is that Nicolas Darvas designed it in such a way that it virtually guarantees you’ll exit your positions and hit the sidelines prior to a major Downtrend. [click to continue…]