Interview: Daytrading With The StockBanditís Jeff White by Jayanthi Gopalakrishnan
Jeff White, founder and chief technical analyst of TheStockBandit.com, started trading the
markets in 1998 and has since gained extensive experience in both stocks and options. His
trading style has gradually evolved over the years, including, as he mentions in the interview,
understanding the true usefulness of the exchange of ideas for an individualís trading.
STOCKS & COMMODITIES Editor Jayanthi Gopalakrishnan (JG) and Staff Writer Bruce
Faber (BF) interviewed White via a conference call on January 7, 2008.
JG: Jeff, how did you get interested in
My wife and I put some savings into
mutual funds in the summer of 1998.
That third quarter the market corrected
and we lost money. So I decided that I
would rather learn how to do it myself
and turn to individual stocks rather
than just mutual funds. That is when I
became a trader.
JG: How often did you trade starting
out? How long did you hold onto your
Back then, I would hold onto things
one to two weeks at a time. We got into
a period not long after I started when
the market saw a lot of what turned out
to be excessive momentum, with the
NASDAQ virtually tripling in the next
year and a half. So it was a good time
for momentum trading. I found that I
liked to grab stocks as they were starting
to break out of patterns. Because I
was trading short term, I turned away
from fundamental concepts and went
purely into the technicals based on the
price action. As I saw resistance levels
being broken, with demand increasing
for a stock, I saw that was breaking
through ceilings, and that was how I
was basing my entries. I would take my
entry and ride the move as long as I
could until it fizzled out. Then I would
move on to the next idea.
JG: It sounds like it is extremely simple,
but we all know itís not. First of all, you mentioned that you were looking for
stocks that were breaking out of patterns.
Are there any specific patterns
you like to look at?
I look for classic chart patterns like
bear and bull flags, wedge patterns,
triangles, and consolidation-type patterns
like rectangles or channels. Those
are the ones I key in on. It is not that Iíve
found they work so much better than
some other method. What they do is
keep me disciplined. They make things
black & white for me as far as when to
be in and out of trades. That is what is
most important to me because I try to
approach my trading with a survival
orientation. I want to preserve my capital
first and foremost. Yet I put that
capital at risk in order to turn a profit.