The Bull Hunters Guide

So today’s little excerpt is about the DJIA Tech Stocks.   Remember when the big thing was to buy tech stocks.  Well lets find out a little more about them here.  If you are new to the Bullhunters Guide blog, I am dissecting the eBook so that we can  understand the workings of the US stock market a little better.  The Bullhunters Guide to the US Stock Market is downloaded hundreds of times every week so get  your free copy now just to your right of this screen so that you have your own copy to read whenever you like.  Let’s continue…

Hewlett Packard, IBM, Intel and Microsoft are the pure tech stocks in the Dow.  AT&T and Verizon are telecommunications companies.  While all of these companies benefit from a strong economy, corporate customers often invest in technology and telecommunications in the period directly before a recession.  This makes tech stocks somewhat counter-cyclical.

Technology stocks are also more individualistic than most stocks.  For example Hewlett Packard (HP) has a strong direct competitor in Dell.  While what’s good for GM is typically good for Ford, HP and Dell go in opposite directions.  The same can be said for Intel and its prime competitor, Advanced Micro Devices (AMD).

As one of the largest companies in the world, Microsoft is often the creator of cycles.  Every time ‘Mr. Softy’ (as it is known on Wall Street thanks to its MSFT ticker symbol) releases a new operating system, millions  of businesses must upgrade.  This alone causes a bullish tech cycle, with many business and individuals  purchasing new computers and other hardware.

So as we can see from this little excerpt, the tech stocks perform best when the economy is in the later stages of the business cycle which are the predictable cycles of economic activity that repeat over time. The five stages of the business cycle are growth, peak, recession, bottom (or trough), and recovery.  They would be great on your watchlist even if you don’t trade them to give you some idea of how the market is performing.

Let me know how this is helping you by leaving me a comment.  Yes you have to register and it only takes less than a minute to do.   As I mentioned in the last post, I was happy to hear form supporters of the Bullhunter blog by emailing me and leaving me messages to say that we are providing some good information here.

Sean Rasmussen has been working on the next instalment of the Bullhunters Guide and you have been waiting patiently for it.  In it he will discuss the renting shares strategy that Jamie McIntyre teaches in the 21st Century Academy homestudy and how to apply it to the US stock market.

To Your Success

Angela Recchia
Graduate Support
Universal Wealth Creation © 2004 - 2007

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Your biggest enemy, when trading, is within yourself. Success will only come when you learn to control your emotions.
Edwin Lefevre’s Reminiscences of a stock operative (1923) offers advice that still applies today.

Hello Fellow Bullhunters

A little about the psychology of trading is our topic for today. What happens when you begin to trade is that it becomes an expression of your own personality. You take it on originally thinking it is all black and white when instead, as you become more involved with the process, you start to form a kind of love affair with the market and find your favorite stocks and treat them as your very own. STOP RIGHT THERE…

In fact, when this happens, your emotions start to come out and rule how you trade. Becoming emotionally intelligent is a very important step to take at the very beginning. You see, good trading is not a question of doing, rather, it is a way of being. To learn more about Emotional Intelligence, go here to explore Jamie McIntyres ebook: What I Didn’t Learn At School But Wish I Had.

When you trade with your emotions you enter into a downward spiral so do not put yourself under too much pressure because you will fail. It’s important to learn to risk because without risk there is no reward. The minute you become risk orientated you are in the right frame of mind for trading the market.

Develop your own style of trading in a way that you stay detached from it. It is a good idea to start with small trades i.e. one contract at a time. See where this takes you and always, always record every step of what you are doing. This will tell the story of your trading personality.

A trading register will have your buy and sell price, the date you entered and exited. Also write down if the dog next door was barking at the time you chose to do that trade. Why you decided to take the trade. The profit/loss you made. Where you set your stop loss at. All these things and more will reveal your trading personality once again so review your register at any time and you will know straight away whether or not you are an emotional trader.

Wait for the right market conditions before trading. There are times when it is wise to stay out of the market and observe from the sidelines. Do not enter every single trade you see. Do not become a screen watcher and get up to the minute prices of your stock. Set yourself up so that there will be no need for this. You have a life to live… don’t you?

Have the courage of your convictions: Take steps to protect your profits when you see that a trend is weakening, but sit tight and don’t let fear of losing part of your profit cloud your judgment. There is a good chance that the trend will resume its upward climb if you are bullish in a trade, or downward spiral if you are bearish in a trade.

I would like to acknowledge Hans Kujat, a fellow 21st Century Academy Graduate who made the suggestion for this weeks topic.

There is plenty to learn about trading and I am here to help you on that journey. For those of you who wanted to leave me a comment last week and couldn”t because of the challenge of a technical hitch with the software, I invite you back now and look forward to hearing from you.

Angela Recchia
Graduate Support
Universal Wealth Creation © 2004 - 2007

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