INTERVIEW
Click And Trade? Not So Fast!
Jean Folger is a technical analyst and system researcher with PowerZone Trading, a company she cofounded. She is author of Make Money Trading: How To Build A Winning Trading Business, and a private trader specializing in the emini markets. She is an affiliate of the Market Technicians Association, and is a regular contributor to financial magazines and news outlets.
PowerZone Trading (www.powerzonetrading.com) develops commercial trading indicators and systems for the NinjaTrader, TradeStation and MultiCharts trading platforms. The company provides programming and consulting services for active traders. Folger can be contacted at jean@powerzonetrading.com.
Stocks & Commodities Editor Jayanthi Gopalakrishnan interviewed Folger on May 9, 2013.
Tell us a little bit about yourself and how you got interested in the markets — specifically, technical analysis.
The markets have always fascinated me. As a young teenager I remember watching my dad study The Wall Street Journal, Investor’s Business Daily, and Technical Analysis of Stocks & Commodities magazine. He’d always have a pencil, graph paper, and calculator out on the table and he helped me make my first investment. When it did well, I became really interested in taking a more active approach in the market because, up to that point, I’d really only been exposed to buy & hold investing. I had to spend considerable time reading everything I could about trading and eventually technical analysis. Technical analysis really clicked for me from the beginning, and that might take a little background history to explain why.
I’m curious.
I am active in a lot of adventure sports like mountain biking, kite surfing, and whitewater kayaking. When I started kayaking hard rivers, I never felt comfortable just blindly following a more experienced kayaker through a difficult rapid. I always wanted to stop above the rapid and scout it, take a look at it, watch how the water is moving, and come up with a plan based on what I saw. Ultimately, this meant looking at a rapid, figuring out where I wanted to be at the bottom of the rapid, and working my way up to the top to figure out the best line through the rapid. Once I saw my line, I was confident I could navigate the rapid, whereas if someone else was telling me where to go, it didn’t work well for me. I had to see it myself. Trading is the same way.
Technical analysis gave me the tools I needed to make my own trading decisions.I felt like it was really easy to follow other people, like analysts, when making investment decisions, but I wanted to see the trade for myself. Technical analysis gave me the tools I needed to make my own decisions. Eventually, I used technical indicators to build a daytrading strategy, but I found I was looking at the same indicators that everyone else was looking at, such as moving averages and the CCI (commodity channel index). I wanted a unique view of the market, so I worked on developing several custom indicators to help me find specific market conditions instead of being limited to the indicators that were already included in my trading platform. These custom indicators became the basis for the first daytrading strategy that I developed, tested, and ultimately traded for several years. That’s how I became interested in technical analysis.
What do you currently do?
I had realized through that process that there were other traders out there who could benefit from using unique indicators or being able to have their own ideas programmed into indicators, so in 2003 I collaborated with Lee Leibfarth to form PowerZone Trading. Right now we are just finishing the development and testing of some new tools that will allow traders to visualize the forces inside a price bar using concepts like volume profile, market depth, support & resistance, and historical analysis. It’s called the Bar Analyzer app. It will help traders to look inside the bars, not just for the price history, but to identify the real-time market activity that can lead to trading opportunities.