Wednesday’s Results: Neither trade triggered.
Quick Tip: Steps
Without goals people drift through life never achieving their true potential. This is not opinion but documented fact from numerous psychological studies. No goals? No progress.
Small and “reasonable” goals are typical for most people if they bother to set goals at all. Yet, they require the same attention as big and “audacious” goals. Really. But there is a difference in the path. The execution.
You’re reading a trading blog so let’s assume you want to achieve the goal of being a consistent, profitable trader.
Tuesday’s Results: The suggested buy at 4237.50 stopped out.
Quick Tip: Turn Losers into Winners
There’s statistical and observable evidence that the population of “successful people” and “winning traders” is much smaller than the population of mediocre, losing, and failed traders.
If that’s the case, then the best lesson you could learn and the surest route to success in trading is to emulate the winners. Copy their successful actions.
Setting aside their actual strategy rules, which you may never be privy to, think about how they handle losses. They have them, too. The answer is almost always their attitude toward defeat and loss. They don’t commiserate, sulk, and quit. They carefully inspect those losses to determine how they can minimize or avoid them in the future. They get up after being knocked down. Every time.
Every loss, failure, or setback is a potential goldmine of a learning experience. The formula is simple but not easy...
Friday’s Results: The suggested buy @ 43252.75 stopped out for a 5.75-point loss (per contract).
Quick Tip: Evidence Surprises
As the sayings go “words are cheap,” “actions speak louder than words.” Your strategy rules should be based on evidence and statistics not intuition and hunches.
In David Aronson’s “Evidence-Based Technical Analysis (Wiley Trading),” he finishes with a case study on how to perform data mining to find “edge” in your rules. The analysis was done one rule at a time. He didn’t connect two or more rules into complex sets. This made the study manageable.
What’s most interesting is that sometimes combining two rules that lose money can create a combination that does have edge!
It would be difficult to research many rule combinations without good software, like TradeStation has. Maybe that should be your next learning project. I can personally attest that a non-programmer can learn their...
Thursday’s Results: The suggested short @ 4504.50 ran 38.75 points to the next level where buying 4465.75 stopped.
Quick Tip: Simplify
When you meet someone new socially the conversation usually leads to “What do you do?” Answering “I trade the market” usually brings the response “You think it’s going up or down?”
This is an important decision you always make before you trade. Is the asset you’re trading likely to go up or down and for how long? Before you can answer you need to identify the timeframe you’re trading. You can be Bullish long term but Bearish for today and vice versa. You may want to keep a grid with short, intermediate, and long-term timeframes for your Bullish and Bearish outlooks.
Opinion on direction and duration is worthless without evidence, analysis method, or data. You need a formula to ultimately answer the question. There are many. Here’s one that is simple and historically sound....
Tuesday’s Results: The suggested short @ 4414.50 stopped out for a 5.75-point loss (per contract).
Quick Tip: Admission
Five losers in a row yesterday and passed on a few trades that were winners. If this hasn’t happened to you it will. Afterward I received this text from a member of the team…
“I am sorry you took a beating today. You REALLY do lose gracefully. Well done! The worst thing about trading isn’t losing trades, it’s losing trades AND skipping the winners. Our minds play tricks with us on such days.”
So, what are the lessons here?
First, if you’re upset about losing you’re taking on too much risk. Lower your position size.
Second, review your performance. In doing so I realized that one trade did not fulfill all the rules. I shouldn’t have taken it. It was a momentary lack of discipline and attention. Knowing this and admitting it is a powerful tonic for improvement. But you won’t get better if you...
Wednesday’s Blog Levels: Nothing triggered in the day session
Quick Tip: Uncommon Success.
The chart above shows two trades from the Globex session leading into yesterday’s open. You’d call that the perfect night. Two 29.50-point runners from level to level. Set and forget. Wake up happy!
Unfortunately, it’s not common. But it does happen every month or so. As the great Wayne Gretzky said, “You miss all the shots you don’t take.” If you’re not planning a couple of set/forget trades for the Globex session before bedtime, you’re missing some big winning shots.
Oh yeah, sometimes you’ll wake up to the little losers. Missed shots. Small if you’re disciplined. No big deal.
If your trade plan doesn’t have a unique ruleset for the Globex session you should get one. Right here! We’ve recently introduced a new membership, only $99/month with the current coupon code. Just two S&P points. You’ll get all the...
Tuesday’s Blog Levels: Neither trade triggered.
Quick Tip: Embrace change.
Successful investors and traders alike have a rule-based strategy that provides them a financial advantage or “edge.” A combination of fundamental and technical analysis are typical components. Another analysis you can add to the recipe is investor “mood” commonly called sentiment. In other words, do market participants feel bullish, bearish or neutral about the future?
While every region and country has a unique economy, given the volume of international trade those individual economies are part of a larger “global” economy. The U.S. economy is the largest in the world but more importantly for us it is also the last market traded on the daily clock. This allows U.S. traders a glimpse at how the Asian and European markets are trading before our stock market opens.
Many years ago, I developed a simple indicator for world sentiment, which I call the World Index. The...
Monday’s Blog Levels: The short idea never triggered and the market opened below the long idea.
Quick Tip: Powerful Habit
Do you know anyone who read the Bible, Quran, Torah, or Vedas only once? (Sorry if I missed your faith but you’ll get the point in a moment).
You read anything enlightening once… “Interesting! I didn’t know that. I’m definitely following this advice!”
Result: A few days of spotty application. Your experience is now called “history.” You didn’t change.
You read anything enlightening a few times… “I’m getting this. I see how it’s changing me for the better. I feel calmer, more intelligent, motivated. Wow!”
Result: You have some new habits. You’re seriously applying. Your experience is now called “real.” You’re changing.
You re-read anything enlightening regularly… “I knew that and forgot it! Studying this needs to be on my calendar....
Friday’s Blog Levels: The suggested buy at 4475.75 picked the bottom of the day session and ran for 40.25 points.
Quick Tip: Multi-Strat Trading
Trading multiple strategies with edge offers you big benefits:
Here’s the link to the webinar recording from yesterday explaining this hedge fund business model in more detail. Watch it today, though. There is a time-sensitive offer you don’t want to miss.
Today’s Best S&P Turning Points
Sell 4486.50 stop 4490.75
Buy 4458.75 stop 4453.00
Subject: Whipping fear.
You know that a confident trader is a winning trader, and a fearful trader is a losing trader. Part of your personal development plan should be eliminating your fears. Yes, fears. Plural. You can have more than one. Over the years teaching traders I’ve noticed different types of fear.