All posts by Sami Abusaad
Buyers Beware
There is nothing about the market that isn’t bullish right now. Sami says that the market looks like it will continue higher for the time being, but that potential buyers should still be careful. In this video, Sami explains: – The prediction that he got right about IWM – Where to find a 1-2-3 entry in DVAX – Which problem GEO and FGEN both have – Why GDX is a long term play – The breakout that can be found in KHC and MDCA
Continue Reading -->What Sami Predicted About Big Tech
Last week, Sami predicted money rotation going into the big tech stocks, highlighting GOOG, FB and MSFT in particular. How does that affect the market this week? In this video, Sami explains: – How BSIG is like Litecoin – Which gold stock he’s chosen to play this week – Why you can still take IRM long – The rule he’s breaking for HGEN – How IZEA and PFMT are similar
Continue Reading -->Trading a Bullish Market This Week
The market has turned all-out bullish, although QQQ looked like it would fail on the buy setup. How does that affect Sami’s trading plan for this week? In this video, Sami explains: – The issues that he has with CLF – When CLVS will confirm a buy setup – Which media company he thinks looks best – Where he expects FREQ to go – How ODT is similar to FREQ
Continue Reading -->How Did Friday Change the Gameplan?
Last week the market looked pretty bearish, but it was completely undone at the very end of the day. Now, it’s looking like it will have a “W” pattern and will go back up. How should you plan to trade this week? In this video, Sami explains: – Why he doesn’t like the setup in GLD – How GDX compares to other gold stocks – What he’s hoping for in AIV – Where to take CLVS as a long-term trade – The major issue in EVFM
Continue Reading -->How to Determine Market Direction
QQQ has a bearish sell setup on the daily chart, but a bullish buy setup on the weekly chart. How does Sami know which way the stock is heading? In this video, Sami explains: – How high he expects GLSI to go – What he doesn’t like about GNUS – His favorite kind of monthly chart – Why JE could go back up after collapsing – The problem with MGNI
Continue Reading -->Where is Money Going This Week?
Last week money flowed out of tech stocks and into more cyclical names, like REITs and retail stocks. The market isn’t as bearish as it looks, but this week will be an important time for QQQ to determine if it will trigger a weekly buy setup. In this video, Sami explains: – Why GLSI is a unique stock – What’s so beautiful about CTXR – The sign in GEO that the stock will go higher – Which stock was one of his biggest mistakes – Where to add and place a stop in REI
Continue Reading -->4 Tips for Getting Out of a Trading Mess
Do your palms begin to sweat just before the opening bell? Are you elated when a trade goes your way? Do sexy, high-risk trades distract you from your plan? If so, your trading is in a mess. That mess is a result of your belief systems. If you’re a rational person with common sense, you’re smart enough to be a professional trader. Most struggling traders don’t lack intellect– they lack a belief system that is in sync with the market. These 4 trading tips will help you begin to change your belief system and get yourself out of that mess. Trading Tip #1: Understand the problems caused by hope and fear. One of my favorite trading books is Reminiscences of a Stock Operator by Edwin Lefevre. In it, he writes: “The speculator’s chief enemies are always boring from within. It is inseparable from human nature to hope and to fear. In speculation, when the market goes against you, you hope that every day will be the last day – and you lose more than you should had you not listened to hope – the same ally that is so potent a success-bringer to empire builders and pioneers, big and little. And when the market goes your way, you become fearful that the next day will take away your profit, and you get out too soon. Fear keeps you from making as much money as you ought to. The successful trader has to fight these two deep-seated instincts. He has to reverse what you might call his natural impulses. Instead of hoping, he must fear; instead of fearing, he must hope. He must fear that his loss may develop into a much bigger loss, and hope that his profit may become a big profit. It is absolutely wrong to gamble in stocks the way the average man does.”- Reminiscences of a Stock Operator, page 114 Hope is essential. It keeps us going through tough times. Without hope, we would probably perish as a species. But in trading, if a trade starts going against you, hope might keep you in the trade and cause you to lose more than you should have. On the other hand, fear can cause us to pull out of winning trades too early. When things are going great, fear kicks in and keeps us from making as much money as we could have. The way our brains are hardwired for survival can get in the way of our trading. While you can’t stop being human, you can pay attention to the ways hope and fear affect you. Then you can begin to minimize their impact on your trading. Trading Tip #2: Understand what you really want “Win or lose, everybody gets what they want out of the market” – Ed Seykota Most traders don’t want to get out of their mess. They don’t want to be consistently profitable. They want to win. They want emotional satisfaction from trading. They want a thrill. This is the same reason people go to casinos, despite consistently losing money for years. They do it for the excitement. Trading randomly is gambling, and it gives you the same thrill. When I first started trading, I thought my number one goal was to be consistent. But that wasn’t true at all. When I dug a little deeper, I realized that I didn’t actually care about consistency — I cared about winning money. When I worked for a Big Four accounting firm, we used to say “garbage in, garbage out.” To develop consistency, you have to audit your inputs. You must develop a consistent trading routine and system so that you can pinpoint what isn’t working. Once you find the problem, you’ll be able to stop doing what doesn’t work. For now, forget about figuring out what works and just worry about what doesn’t. What works for me may not work for you. So I can never tell you what works. But what I can tell you is that when you start focusing on eliminating what you know does NOT work, your trading will take a giant step forward. Trading Tip #3: Your attachment to money is the main cause of your failure When you’re attached to a certain outcome, the first thing to go out the window is objectivity. You don’t see things as they are anymore. Most traders are constantly checking their P&L because they’re attached to the money. This is why it’s easy to trade on a simulator. You aren’t attached to the outcome. The biggest difference between simulator trading and actual trading is the psychological element, the emotional part. When you’re trading your own account, your money’s on the line. If you are too attached to the money, you can neither lose it nor make more with it. Trading Tip #4: Reading charts won’t solve your problems. “A blindfolded monkey throwing darts at a newspaper’s financial pages could select a portfolio that would do just as well as one carefully selected by experts.” – Burton Malkiel Most traders can quickly become proficient in reading charts. It’s not that difficult. There are two colors (red and green) and three trends (up, down, and sideways). What’s more difficult is developing the psychological intelligence required in trading. Psychological intelligence relies on developing and maintaining an objective state of mind. When I first started trading, I recorded my entire screen so I could go back and review the trades I made. Once the market closed, I would be baffled, wondering why I got in on some trades and got out of others. At first, it seemed like there were no reasons why. But there was a reason — it’s because I was psychologically messed up as a trader. No matter how well you understand charts, it won’t overrule the psychology behind your trades.
Continue Reading -->Calling a Market Top
The market appears to have topped out, at least for now. Find out why it’s so hard to call a top, and what would make it more clear. In this video, Sami explains: – How to go long on stocks when the market has topped – Why FOLD looks similar to EHTH – How to use the gap fade strategy – What is causing him to watch MTDR – Where he expects OMI to go
Continue Reading -->What to Watch for Market Movement
The market is extremely bullish and easy to figure out this week. Find out what Sami’s looking at to determine if he will turn bullish or if the market will go lower. In this video, Sami explains: – How to find a 1 2 3 setup in BCOV – What he likes about CLRB – Which names he likes as long-term plays – Where a base breakout is setting up in GSM – Why he recommends holding NVDA through earnings
Continue Reading -->Why The Market is So Boring
The market is continuing to be bullish, but at some point buyers will rush in and the market will accelerate upwards. Find out what Sami expects to happen once it does. In this video, Sami explains: – Which month he expects the market to mirror – Why this week’s watch list isn’t as good as last week’s – How AMZN and NVDA look alike – Where to place a stop in CYDY – Which gold stocks he’s watching
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