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Stress-Free Trader (The Lawrence Chan Blog)

Full time index & forex trader, occasional consultant to hedge funds / institutions, my work leads to my not so normal view of the financial markets. My blog mostly talks about trading, market behaviours and other musings.

Originally this blog is supposed to be organized in a separate website like what most authors do but I don’t think I will maintain it properly that way. So here it is as part of this website.

Schedule – Regular blog post every Friday with occasional additional posts when I feel like ranting.

In case you are curious of what I do outside of blogging here:

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2012 Year End Deja vu

2012 Dec 31 Mon 14:29:12 | by Lawrence

2012 started the year with a 20+ points gap to the upside from 2011 close.

And that gap was never filled. It is the first time in S&P history that a gap from the year before not filled in the year right after.

And now a year later, right before the 1st week of January, we have this flushed low into the close (and afterhours) last week. Only to start this week with a huge gap up again. It is not filled yet.

Coincidence or conspiracy?

Something interesting to think about.


Recovering and thoughts for 2013

2012 Dec 27 Thu 19:39:35 | by Lawrence

Better today after my bout with the merciless cold.

Have not been sick for so long,

almost forgotten what it’s like.

A good way to humble someone like me going into new year.

Reminding me that trading is just a small part of our lives.

Can be good at one thing and completely helpless in another.

Just like what my father told me yesterday,

"You are always the weak one in the family."

What can I say?


Many asked me if I will provide the indicators and related stuff in the site.

I guess if that’s what everyone is asking for I am getting my guy to work on it.

It is not going to be just NeoTicker. Don’t worry.

As far as I can see, we can host all kinds of indicators, plug-ins, etc. for all common platforms.

I use several platforms myself so are my institutional clients. So it should not be a surprise that I have indicators, tools, etc. build around almost every common (and uncommon) retail and institutional platforms.

The thing I worry most is that people will stuff virus in their uploads. It happened in forums with TS, the other NT, my NT, eSignal, etc. so it will happen. Will try to figure out a way to minimize the risk for our members.

If you have ideas, comments on this topic, just put that in the comment section.

Happy Holidays!

No comment yet

Pattern Of Sickness

2012 Dec 22 Sat 17:25:00 | by Lawrence

Here we go again.

First day of my year end break and I am sick.

Last time I got sick was way back when -

definitely another holiday break.

Sounds like a pattern, isn’t it?

Was told that I do not have enough sleep or exercise of late.

Or maybe that sudden change of weather.

Could be that I visited hospitals as frequently as others hitting nightclubs.

None work as good as a predictor than a long holiday break for me.

Must be the holiday spirits cursing me.


p.s. have to take things slow for a few days until getting better.


Others Predictions

There are some interesting predictions I have seen that are worth mentioning.

First, the one for its entertainment value goes to Saxo Bank’s annual "Saxo Bank 10 Outrageous Predictions for 2013"

Second, is John Mauldin’s "We’ve Had A Good Few Years, But It’s Now Time To Prepare For A Huge Drop In Earnings" for its sensible approach.

My Predictions

Many asks for my longer term view going into 2013.

I do not usually do that because I use January as my yardstick to project price levels and directions for the year. So it is quite difficult for me to dish out useful projections this point in time. Since it is good publicity for the site, I will do it for the sake of entertainment only.

Here we go, my predictions for the year 2013:

US Stock Market Will Top Out In First Half Of 2013 If The Top Is Not Already In Place

My cycle work suggests a multiple year market top is due from now to first half of 2013. The US stock market will enter a cyclical decline phase for several years. Somehow it agrees with the article mentioned above (the one by John Mauldin) which uses a completely different approach from mine.

World Stock Markets Going Into Decline for Several Years

As US stock market going south, the rest of the stock markets will go down with it.

Collapse Of Japan Economy And Its Financial System

The redemption of their government bond has already happened. Japanese government bonds have always been supported mainly by their people, especially their older generation. There is no wealth nor cash flow from the younger generations. So net outflow of money for the government when the older generation is cashing out their bonds to survive.

The only route Japanese government can do now is to have Bank of Japan buying all their new issues, just like what the Fed is doing for the US government.

Japan should be one of the first countries forced to reset their financial system.

European Union No More

The people do not want the union any more. It is already over.

Think of it as an ugly divorce in progress.

Acceleration of Faster And Wilder Swings Across All Markets Making It Extremely Difficult To Trade

When structural collapses happening here and there, essentially everywhere, we get many market shocks. So expect very fast and wild price swings in all markets. Market timing and straight money management becoming the most important tools for years to come.

In summary, my long term idea for year 2013 is to short stock markets worldwide, and eyes on short term crazy swing opportunities in forex.

Feel free to submitting your predictions in the comment section!


Market Internals 2012-12-19

2012 Dec 20 Thu 9:36:25 | by Lawrence

My monthly update on market internals. The current snapshot of S&P 500 3-Day Advance Issues, Tick16 Short Term + Long Term as of 2012 Dec 19 close. Reading 1. Long Term Tick16 (yellow line) cleared neutral zone and zoomed to straight up to overbought area 2. Short Term Tick16 (red line) divergence against price for about a month now 3. 3 Days Advance Issues (green line) popped back up to overbought zone Inference a. #1 in trend buy mode. That means coming several selloffs can be bought on swing basis. A potential long term top in the making with time window of about 3 to 6 months. b. #2 points to a top in the making but it will be used up when the red line drops back below neutral zone c. #3 in the context of #1 points to a pullback in the making Last update predicted the powerful upside push correctly

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2012 Dec 18
Since I Have Spare Time

First, I posted a new article on using advance / decline issues the the market breadth primer series. http://www.daytradingbias.com/?p=74518 Second, I also activated the Ignore List feature on comment display as requested by many site members. Ins …

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2012 Dec 17
Market Breadth Primer: Introduction

This is a long due series I promised to cover. I was waiting for a good time to gather my thoughts and summarizing them into drafts. Well there was never a good time and probably never will if I keep stalling. So here it is, first piece on the subjec …

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2012 Dec 14
Bernanke Having Serious Health Issues?

From his speech to the Economic Club of Indiana, Mr. Bernanke made some interesting statements. These statements, coming from someone with such prestigious background in education and credentials, look contradictory to what Mr. Bernanke is capable …

One comment

2012 Dec 14
Japan Election 2012 December 16th

Not sure what to expect from the election but the outcome from that can be major game changing event in how dollar yen will move in coming months. In turn, it will affect all other financial markets. From the chart of dollar yen, it is clear that it …

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2012 Dec 12
Changes to the online eBook Art of Chart Reading has completed

I think all the old links are fixed to point to the new ebook page. If anyone find any of the pages in the ebook (and anywhere within the site) still mention Crash Course please let me know. Also posted another part of the ebook, Swing Highs and Sw …

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