Trading on Momentum: Advanced Techniques for High Percentage Day Trading [Hardcover]

Ken Wolff (Author), Chris Schumacher (Author), Jeff Tappan (Author)

Book Description

Publication Date: September 30, 2001

The NASDAQ has reached a record 60 new highs in 1999, closing above the 4000 milestone. This record was the icing on the cake to a year of volatile victories for the NASDAQ, which experienced the largest one-year gain ever for a major market index. Momentum has never been more important. For example, the first day of tradingin 2000 saw the NASDAQ dropping close to 100 points before finishing the day with a significant gain, yet on the second day of trading, the NASDAQ experienced its worst point drop in history. This text shows traders how to profit consistently by recognizing when the market has changed, determining what has changed, and adapting their trading methods to this new environment.

Editorial Reviews

From the Back Cover

High-Powered Strategies for Understanding­­and Profiting from­­Predictable Rules of Market Momentum

Recent market swings have hammered many active traders­­and driven home the hazards of relying solely on traditional valuation methods. Trading on Momentum unveils anontraditional, market-proven model for taking advantage of fast-changing market dynamics, and trading stocks based on observable market momentum rather than unreliable fundamental attributes.

Momentum traders know when the market is changing, determine what attributes are changing and why, then instantly adapt their methods to take advantage of those changes. Whatever your style or trading experience, you can use these low-risk, high-percentage techniques and strategies to:

• Determine market dynamics by tracking movement throughout the trading day
• Confidently identify­­and act on­­short-term market tops and bottoms
• Master momentum techniques including gainers, dumpers, and gap plays

Day trading remains one of today's purest, most accessible opportunities for profit­­but only if traders have the knowledge and experience to recognize and act upon new opportunities as they become available. Trading on Momentum represents just such an opportunity, and outlines techniques for working with the markets­­instead of against them­­to see and seize the profit opportunities that are available throughout every trading day.

"Professional momentum traders exploit patterns that tend to repeat themselves over and over again. The ability to recognize the root causes and the indicators signaling that a pattern is about to repeat itself enables a successful momentum trader to enter a trade just as the momentum is starting and exit, sometimes just minutes or seconds later, as the momentum slows and turns. By riding waves of continuous momentum, it creates opportunity for tremendous gains not available to investors or long-term traders."
­­From the Introduction

Every second of every trading day, literally one-half of executed trades have the potential to generate immediate profits. In those brief moments following the trade, it isn't the fundamentals of each stock that change­­it is the trading momentum. Traders who understand how to recognize and use this momentum can greatly increase their percentage of profitable trades­­every second of every trading day.

Trading on Momentum utilizes detailed charts, graphs, and examples to outline and explain the dynamic trading method called momentum trading. Beginning with the basics, then progressing to the advanced methods, psychological factors, and unique tools of the successful momentum trader, this guidebook gives traders the information they need to incorporate momentum techniques into their trading arsenals. A step-by-step guidebook for quickly identifying market turning points­­then getting in and out for a quick profit­­Trading on Momentum discusses:

• Tracking stocks and analyzing their trading patterns­­thereby replacing guesswork with solid research and knowledge
• Preparing properly for the open­­when the day's best trading opportunities consistently occur
• Using the Level II Time of Sales Ticker to determine the strength of the trend in a particular stock
• Understanding which news stories will propel a stock upward or downward­­and trading each end of the oscillation
• Methods to tailor your trading style based on historic, verifiable time-of-day trading behaviors

When stocks move, they tend to oscillate both up and down, in waves. This information is not new or newsworthy. What is new is the ability to accurately track and predict these movements, and profit in both directions. Trading on Momentum will give you the tools you need to regularly profit from the natural movements of the market, relying on unambiguous history and observation­­and leaving guesswork and luck to others.

Product Details

• Hardcover: 288 pages
• Publisher: McGraw-Hill Companies; 1st edition (September 30, 2001)
• Language: English
• ISBN-10: 0071370684
• ISBN-13: 978-0071370684
• Product Dimensions: 9.3 x 7.4 x 1.2 inches
• Shipping Weight: 1.8 pounds
• Average Customer Review: 2.8 out of 5 stars  See all reviews (12 customer reviews)
• Amazon Best Sellers Rank: #1,467,072 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

31 of 37 people found the following review helpful:

2.0 out of 5 stars A seriously substandard title, December 1, 2001

By 

marvin cobby (New York) - See all my reviews

This review is from: Trading on Momentum: Advanced Techniques for High Percentage Day Trading (Hardcover)

This book lacks substance, lacks detail and is merely an exercise in self-promotion. If you want to learn to daytrade professionally, get "The Undergroundtrader.com Guide to Electronic Trading"...
Wolff's book is nearly as crass as his online chatroom, which suggests buying against the trend, in violation of the primary rule of trading: "Trade with the Trend"... there are many better daytrading titles on Amazon.com.

40 of 52 people found the following review helpful:

5.0 out of 5 stars The bottom line of successful Day-Trading in a box, December 19, 2001

By 

ROBERT SCOTT LEETE - See all my reviews

This review is from: Trading on Momentum: Advanced Techniques for High Percentage Day Trading (Hardcover)

A little history goes with my review, inthat Mr. Wolff also runs a trading room, (MTrader), which I traded in about a year after I began trading. After a short stay at MTrader, I left, simply because I believed that adhering to the patterned strategies of Wolff were a bit too involved and things had to be simpler and faster. That was a mistake and after about a year of alternating trading styles, different strategies, indicators, software, etc., I happened on Wolff's book and out of curiosity, ordered and read it.

Plainly stated, what moves stocks is news about what a stock has just done, is about to do or is expected to do and the relative expectations of the investors and traders focusing on that stock. Wolff has studied news related momentum for years and is what I would securely describe as a master of expectation and price movement potential. There are a number of successful traders out there who cut their teeth on his schooling...a few went on to try there own trade site.

The methods are plainly and simply explained and in themselves, not difficult. Perhaps because of this truth, others may dismiss it, however, if you read this book and think about it, you come to one glaring fact...and that is Mr. Wolff explains momentum trading methods that are based on logic of predictable reaction to news related momentum....there are no lagging indicators...complicated formulas...just logic.

The difficulty is the patience and discipline one needs to apply in adhering to and application of the information.

One more thing...I'm trading at MTrader again because with everything else I've tried and I believe I've tried about everything...I found no consistency...I was either burning-hot....or stumbling. Here, I have found consistency that anticipates what a stock will do based on it's news and the market/sector sentiment at that moment.

Highly recommend this read. I hesitate to state this, but would also suggest after reading the book, you try a week trial at the site to see what you read happening...it would be helpful. Or I suppose if you want to save some money, drop by the site for the trial, (it's free) and decide before you buy if it allmakes some sense to you...

Good Trading!

15 of 19 people found the following review helpful:

3.0 out of 5 stars Some good strategies but needs to get updated, April 6, 2005

By 

Richard Rallies "Rally Man" (Chicago) - See all my reviews

This review is from: Trading on Momentum: Advanced Techniques for High Percentage Day Trading (Hardcover)

Momentum stock trading can be one of the fastest and most lucrative ways to make money in the market. This book has good strategies that can help you in your trading efforts but I think it needs to get updated for the benefit of the readers.

We as traders need to constantly keep reading and testing setups and strategies because that's the only way to stay sane and profitable in this business. Fortunatly the internet has some pretty good places where you can gather great information and keep updated with profitable techniques. Some of those websites that I have found to be worthy when it comes to trading momentum stocks is MomentumStockTrading dotcom

When it comes to momentum trading the one thing that we need to keep in mind is that the market will present us with trading and investing opportunities all the time. Not all of them are good enough to consider or even look at. That's why it's vital to know what kind of setups and factors to look for before you enter the next trade.

Once you understand, test and master those setups and factors you can aspire to take advantage of hot stocks consistently either in premarket, market hours and after hours every week.