As reviewed on the Traders Library Blog.
A no-nonsense, straight-shooting guide from Oliver Velez of Velez Capital Management and Greg Capra, the founder of Pristine.com, designed for active, self-directed traders. Provides potent trading strategies, technical skills, intuitive insights on discipline, psychology and winning methods for capturing more winning trades, more often.
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Table of Contents:
Part One: Seeds of Wisdom for the Master Trader: Preparing the Trader's Mind for Greatness.
Chapter 1: Initiation of the Master Trader: Understanding the Master Trader's World.
Chapter 2: Developing the Master Trader's Mind: Keys to Correct Trading Behavior.
Chapter 3: Loss: The Prerequisite to Trading Power and Success.
Chapter 4: Education of the Master Trader: How to Save Yourself from Years of Lost Time and Money.
Chapter 5: The Seven Deadly Sins of Trading: How to Combat Them and Defeat Them.
Chapter 6: Trading Laws of Success: Rules the Master Trader Lives By.
Chapter 7: Secrets of the Master Trader: 15 things Every Trader Should Know, But Doesn't.
Chapter 8: 10 Lessons for the Master Trader.
Chapter 9: Final Words of Wisdom from a True Master.
Tools and Tactics for the Master Trader: Developing the Arsenal of a Master Trader.
Chapter 10: Market Timing Tools and Tactics.
Chapter 11: Charting Tools and Tactics.
Chapter 12: Execution Tools and Tactics.
Chapter 13: NASDAQ Level II Tools and Tactics.
Chapter 14: Entry Tools and Tactics: A Step-by-Step Guide to Entering Stocks Like a Pro.
Chapter 15: Trade Management Tools and Tactics: A Step-by-Step Guide to Managing Your Trades Like a Pro.
Chapter 16: Exit Tools and Tactics: a Step-by-Step Guide to Exiting Your Trades Like a Pro.
Part Three: Looking Ahead.
Chapter 17: How to Put It All Together.
Chapter 18: ESP: The Future of Electronic Trading Software.
Christian Trader Magazine
By Greg Howard, ChristianTrader@aol.com
Pristine.com's Velez and Capra Pack 123 Punch!
I awaited the release of "Tools and Tactics for the Master Day Trader" by Oliver Velez and Greg Capra with much anticipation. I was not disappointed. In fact, I was amazed at the clarity of their approach to explaining successful trading.
Of particular merit is the 90-minute VHS offering "Swing Trading With Oliver Velez." The videotape does a masterful job of explaining the most basic of swing trading tactics, using trendlines with candlestick charts which is the core of Velez' and Capra's system, as well as our own.
>From the moment I opened the book and perused the table of contents, I knew I had finally found the book that I could recommend to others without fear. I have read dozens of books on day trading and investing. Honestly, I have put nearly each and every one of them down in disgust or disappointment. Most are long on generalizations and pathetically thin on strategies, tactics, and mind set. You will not find that in "Tools and Tactics for the Master Day Trader."
The table of contents alone is worthy of note. The book is divided into three parts which logically progress from creating the proper attitude and discipline to tools and tactics to putting it all together in today's electronic trading world. Each chapter is subdivided into topics which are conveniently listed with page numbers in the front of the book. No digging through an index for keywords to find a subject you wanted to go back and review. This book truly qualifies as a manual.
"Tools and Tactics for the Master Day Trader" makes for good, easy reading. It is obvious the authors followed their own advice given throughout the book. Keep it simple. In fact, I chuckled a bit when I read that one test of a clear trading system is for it to be readily understandable by any intelligent 12 year old. I could not agree more. This book does just that. It is by no means watered down, but it is clear and easy to understand. Frequent uses of similes and metaphors to relate the inner workings of the market to real life make this a good basic educational work on the mass psychology of trading.
But it does not stop there. A great portion of the book is dedicated to improving the reader's psychological approach to the market, and when I'm asked to point out why most traders fail, this is the primary cause of disaster. In Chapter 5, "The Seven Deadly Sins of Trading: How to Combat Them and Defeat Them," I saw an eerie reflection of my first year of trading. I committed every single one of them. I still have to fight the urge to "sin" in my trading. If each trader could read this chapter and simply apply the wisdom presented, really apply it, the price of the book would be made up within the first day of trading following its application, many times over. Velez and Capra have it right. They say 85 percent of trading is discipline and approach. I say it's 90 percent. I'm not going to argue five points. No matter what the percentage, you cannot and will not win until you conquer your toughest enemy, yourself.
As for the trading tactics presented, you will find yourself comfortably at home with their main approach of using the basics of trendlines, resistance, and support along with the Japanese candlesticks' revelation of the market's psychology behind stock moves. Each strategy is spelled out in clear, concise language with excellent examples which are as durable as these most basic of trading indicators. There's nothing really fancy about it. It is simple and sound trading at its best. One can apply the strategies from 1 minute charts to daily charts. Each step of the trade setup is spelled out clearly. The temptation will be, as I have said so many times, to try to improve on the strategy. It's too simple. It has to be too simple. How can anything so simple make money in such a complex place as today's electronic markets? Keep it simple, my friends.
In summary, even grizzled veterans of $50,000 losing streaks who have come back to amass small personal fortunes will find this book of great benefit. For those of you who have not endured the high cost of tuition the market can exact in exchange for making you a more savvy trader, this book may serve to reduce that tuition considerably.
"Tools and Tactics for the Master Day Trader" cannot make you a better trader; you will have to do that for yourself. But in applying the wisdom found on nearly every page, you could find yourself at least a year ahead of the pack. Would you spend 40 bucks to gain at least a year's worth of knowledge?
I wish this book had been available to me when first started trading. Like Velez, I saw my first trade go down in a $4500 ball of flames and carnage. I sat back in shock and nearly lost it emotionally. How could this have happened?
If this book had been out then, I would have at least known why.
Web Site Review
Traders, this is the quintessential service provider for education, trading strategies, picks, and get this, live, real time alerts. Yes, live, real time trading alerts. And what's more, even novice traders who haven't figured out yet that you get what you pay for will surely have to agree that the fees charged by Pristine.com for their services are very reasonable and quite competitive. Yes, while the site offers some incredible free services of which you should avail yourself each day, this is a for profit site. A workman is worthy of his hire. I do not hesitate to pay an honest, hardworking workman for his efforts.
NOTE: You can have one week free run of the site, including premiere services by simply registering. I took the one week test drive, and I stayed, picking the services that matched my trading style the best.
>From the moment you enter the site, you will find yourself immersed in a world of information that is neatly and logically organized. The understated elegance of the page layouts makes for quick and clean navigation.
You will find a variety of free services as well as fee-based services. I have tried all of them, and I can highly recommend them. Let me take just a moment and give you the highlights of what I currently use and how it may benefit you.
* Pristine Lite Daily - A single stock chart delivered to your e-mail in PDF format each day with clear and easy to understand trading strategy, from set up, to entry, to stop loss, to trade target. Those of you who used to trade from my Morning Call picks will find the strategies, setups, and plays to be very familiar and comfortable. How do they stack up? I've been trading them for the past month. No one is losing weight around here. An excellent value for $19.95 montly.
* Pristine Day Trader - Four stock picks with charts delivered to your e-mail in PDF format each day with a brief overview of the market or a lesson or thought for the day. Each pick is setup clearly, the strategy named (not clearly explained since these are mostly basic long and short plays from trendlines and moving averages with candlestick confirmation; the strategies are explained elsewhere in the Day Trader's subscriber area), and the entries, stops, and targets are spelled out. Again, these will be very comfortable and familiar to Morning Call traders. The price for this service is a fair amount, $125 monthly, but well worth it in my opinion.
* Pristine ESP - Oh my goodness, what a great piece of software. This live real time alerts software is worth its weight in gold. I use the Swing Trader and Day Trader modules activated. From the moment the market opens, you receive real time alerts of stocks making new highs, new lows, 40 day moving average breakouts, etc. As you add modules, more alerts are sent. You can test drive the free version with limited alerts or you can subscribe to the more in depth alerting available for Swing Traders or for Day Traders. Honestly, unless you have a very strong trading background and the ability to instantaneously execute trades through an ECN or on the SOES, I would stay away from trying to play the Day Trader picks. If you have to ask what ECN or SOES stand for, you need to wait and use just the Basic and Swing Trader modules.
* Stock Chart of the Week - A great technical analysis training tool, showing you an impending set up and how to trade it properly.
* Stock Play of the Week - One trade, similar to the daily Pristine Lite picks, which discusses a trade from setup, to entry, to stop loss, to target in one, clean presentation. Even if the trade doesn't pan out, and they don't always pan out, you will learn how to properly set up, execute, and manage a swing trade.
* Weekly Columns - the wealth of information available here is wonderful, for veteran and novice alike. Want to speed up your learning curve? There's only one way. Hang around the pros who are doing what you want to do. Yes, hang around with me, but I've also harped until I'm blue in the face that you need to get your information from a variety of sources. An excellent selection is just a few mouse clicks away.
* Educational Reports - Free strategies to help your trading in key situations. Definitely worth the time to read and learn. Just a note. For those of you who are new to trading, you will want to take the time to go through the more in depth educational services available to you from Pristine.com. I paid a high tuition to be still alive and prospering in
the markets. I paid it in losses. One way or the other, the market will exact its tuition from you. Books are great, videos are often better, but live hands on training is a must. Think of the time and tuition required to become a CPA, attorney, doctor, or any other highly paid professional. Doesn't it make sense that maybe you might have to invest in some education to play the trading game well? I did. Much more than I should have.
The rewards of trading are incredible. Nowhere can you find such complete freedom in earning your living or in advancing toward your retirement should you choose to remain in your regular job. Treat this wealth creation technique with respect. Learn it. Live it. It will treat you kindly in return and give you a life you may have only dreamed of having.
The wise learn from the mistakes of others...how wise are you?
In short, I now can relax about the traders I had to abandon when my health took away my ability to write to you daily. I gladly recommend Pristine.com as my replacement.
- Greg Howard, Christian Trader Newsletter
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