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Using indicators to get into and out of trades

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Instead of adding more price-based indicators to a chart, John Person’s indicators available only on TradeShark focus on triggering a trade decision and then assessing risk to determine where the “safe levels” are.

Video Transcript

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Tim:

My guest today is John Person. We're talking about his indicators available exclusively on Trade Shark and his trading ideas in general. John, a lot of traders try to pile on as many indicators as they can on a chart. They've got 60 things running, and they want them all to confirm the same thing, but what's a realistic way to use indicators, especially yours in Trade Shark?

John:

Sure. All of a sudden, people have all these lines in their charts and trend lines and moving averages and now you combine oscillators like RSI and stochastics and so you have all these indicators that A, can give too much information overload obviously; B, they're redundant in nature. I like to look at a trigger, what gets me into the trade. I like to have an indicator that shows, is there power behind the move, and that's what that volume does. Most importantly, as most professional traders will tell you, if you have a great trade idea, if it works, it's going to work. If it doesn't, what's your risk? I think that's the key component that a lot of people fail to ask or wonder

about:

What's my risk? Forget about your profits. What's my risk?

That's where the person's support and reverse comes into play. Very powerful in determining. If this is my entry, where's my initial stock going to go? As the market starts to move in my favor, what safe level, keyword, "safe level," can I start to trail my stopping and get out of harm's way by still allowing the market to move in my favor. That's why I like to utilize several different types of conditional

indicators:

my volume, as well as my support and reverse indicator.

Tim:

Now Trade Shark has got a lot of great, predictive indicators. What happens if their indicators ... or another indicator I'm looking at on TradeShark doesn't agree with what one of your indicators is saying. What do you do?

John:

Sure. The volume and the support and resistance are based on specific algorithms on different conditions. If you have specific TradeShark indicators that are also price-based, mine aren't really price-based per se and so therefore, you can use multiple indicators. If they're not in agreement, then that might ... you may want to heighten your trade management skills and pay attention to that trade a little bit closer on an intraday or an intra-week basis, depending on your time frame.

What I mean by that specifically is if ... maybe you have one indicator that says the market is gonna to go up but there's not a lot of volume behind it, I'd watch that closely on a day-to-day basis to see if maybe the volume picked up, or I'd watch to see if price is pulling away from that support level, which means that the trend is improving and therefore, the outlook’s looking better. If those conditions aren't met, that's why I say traders, if several of your indicators aren't lining up, you really need to focus on the market a little bit more attentively.

Tim:

Is the opposite true if you've got a few of them lining up and they're all saying the same thing? Does that increase my odds of success?

John:

I think if you have several indicators that are non-correlated, indicating stronger prices, then yes, it does give you a higher sense of confidence. I think the key with the markets is, we ... none of us have a crystal ball where a market can go. We have tools, and if taught the right way to use specific tools, we improve our odds of success in the market.

Tim:

All right, so if I'm a beginner and I don't have that gut instinct yet, I don't have the experience that you obviously have over 35 years, are your indicators that are in TradeShark kind of a way to ... a shortcut to that, to basically trade alongside you without having you there?

John:

Oh, God, yes. I mean, if I had ... I mean, I worked with George Lane, the father, the innovator of stochastics, but George wasn't there all my life. We definitely need tools to help us to put down a trade. Again, we do not have as individuals, or any one trader, a crystal ball, the forecast, where will the price be two weeks from now and how will it get there? Market might go up, and we have great instincts the market is going to go up, but it could go down first, stop you out, and then take off without you.

If we utilize more tools and the right tools in connection with each other, and I think that's the key ... Too many indicators all telling the same thing? Probably is not doing you any favors, but using multiple indicators that are based off of different variables, volume, prices and again, market condition; and condition is defined for me as, is the market price higher or lower than x period days ago or weeks ago? Those lined up give me a better chance of success and odds rather than just looking back at experience.

Tim:

I know after trading for 35 years some of this is like pretty complex in terms of what's going on behind the scenes and what the trader is seeing. How easy is it for me to understand the signals or what this indicators are trying to tell me?

John:

That's very important. Because if you have a complex cockpit and all these dials, you don't know which one is for what and it takes years of development and training, this is extremely easy, fast to learn. Real simple. If price is moving and you have an optic and you can completely see that laid over the indicators as we describe in our instructional videos of how to use this, you can see the histogram component, you can see the volume component, the moving average component, you can see everything trending with price and that you know there are strong volume participation and momentum behind the market.

Tim:

We know it's easy to use. If I have questions my understanding too is that with TradeShark they offer world class support for your indicator. They're not just going to give you the indicator, they're going to show you how to use it.

John:

Right. Again when you say why TradeShark, impeccable customer service as well as support for their client. If one of my clients and one of my followers who has started to use TradeShark needs help, hey I didn't understand, where do this ... How do I input that, simple questions instead of getting an answering machine or a voice recording that says we will be back with you two weeks from now, they have customer support.

Tim:

How important is it to have somebody on the other end of that phone that has seen the indicators, been trained themselves on how it works to answer my questions?

John:

Absolutely. I mean, if someone that doesn't have experience and they don't have customer service that knows the business, then it's the blind leading the blind and nobody needs that, especially when there's real money on the line. People have taken the time. They have hard-earned money on the line of their investment dollars. I mean, not everyone has unlimited capital to trade with and go through the learning experiences and losses to develop those skills. We need to speed up those skill sets of trading rapidly, and that's where Trade Shark and the customer service comes in.

Tim:

You bring up real dollars, which I think is extremely important in trading. In the industry, there's a lot of indicators out there that have not been traded with real money before. They sell them. You have. You've made money with these indicators, so this is something you trust.

John:

Absolutely. And that’s why just the pure logic behind the indicators themselves and the fact that I utilize this every single day in my trading, this is the power behind these and why it all works together with TradeShark.

Tim:

John, thanks for your time.

John:

Thanks, Tim.

Tim:

We've been talking with John Person about his indicators available exclusively in Trade Shark and how he uses them in real trades.

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