Is your trading different?
Is your investing different?
These comments arrive from time to time about how someone is a different type of trader and how these order flow or global macro or stop hunting strategies do not apply to them.
Or how they are an investor and that these strategies do not apply to them either. That they are investors, so they cannot possibly learn or implement anything from the traders point of view to enhance their trading, or investing or managing some kind of portfolio.
To these people I would say: Reconsider.
Strongly reconsider and redouble your efforts and commitment. To attain a higher level of awareness because not just your future grander prosperity is at stake, but that also learning about the global macro elements and strategies can save yourself and your family, when another year like 2008 comes along.
In 2008, all of my double digit profits from the year came from global macro trading in the currency markets. That’s right. ALL. Without this kind of knowledge, I would have just been a sheep getting slaughtered like the rest of the people who were just long the stock market when the S&P fell -50% and suffered big paper or actual losses. But with the knowledge of knowledge of the global macro trends and momentum, you could have placed some really monster currency trades for big profits. You could have not just protected your fortune in 2008, but expanded it, setting yourself up to scoop up the bargains in the stock market, with added cash in your coffer.
Soros saved himself and his hedge fund in 2008 through macro trading. He caught the down move in the British Pound, and the selloff in the USD late in the year. He even said he really had to push it in his macro trading to make up for losses he was taking in the equity market. The reason being his hedge fund bought a huge stake of a Brazilian oil producer, right before crude prices were peaking. He was bleeding from that and was in the red for most of the year. He was still able to manage around a +10% return for the year, and positioned himself for the recovery in the risk appetite markets that occurred in 2009. That is the power of understanding and implementing global macro trading.
Economic times seem pretty good in America and elsewhere. Unemployment rate is low and it seems that the economic expansion will continue for the foreseeable future. But still, make sure you prepare. Don’t be a sheep and allow yourself and your family to potentially get slaughtered the next time a market dislocation happens.
A market dislocation and crisis will happen again. It is just a matter of when. Perhaps it might not always happen to the same extent as 2008, but to various other degrees it will. The reason being that markets and governments are made up of humans, and they do not make perfect decisions. There are dumb government policies and dumb decisions made by various traders that cause big mispricings in the financial markets that you can benefit from.
And following those gold peddlers to simply buy gold and store it in a vault and hope for the best, etc, is nowhere near ideal.
One of the best ways to make that happen is with learning Global Macro Trading. If you get really good at it, and establish a flexible framework, then you will know how to make money when the markets go up, and when the markets go down. As you start to realize more and more that the financial markets, whether you are trading or investing revolves around as George Soros put it:
“There is always a divergence between prevailing expectations and the actual course of events. Financial success depends on the ability to anticipate prevailing expectations.”
Global macro trading is the closest to the holy grail that you will ever get to.
The lesson here is: It is very foolish to box yourself in. People will tell you that you can only do this or that in life. Ignore them. Sure, some things require focus for many years, but you can most certainly keep growing and reinventing yourself, decade after decade. I was reading the biography of a man who was a musician, scientist, architect, painter, ice skater, horse breeder, etc. Every decade of his life he kept on choosing to do something different. Those were just his desires in life.
Back to trading.
Now, in order to get to this stage you must turn yourself into a winner…
The winners in life persevere and are tenacious. They find the universal principles of speculation, extract the good trading strategies and figure out how to apply them to their trading and their unique situation. They don’t keep saying “No, this does not apply to me.”
Sure, you do have to say NO a lot. There are a lot of garbage trading strategies out there that are rehashes of technical indicators that do not give you any insight into what is going on “outside of the chart.” This knowledge of what is going on “outside of the chart,” is crucial, as people found out yet again when the SNB removed their 1.20 floor in the EUR/CHF and the price gapped lower by -25%. The wisdom of that episode is shown in the this blog post.
Back to the whole saying “No” a lot. Warren Buffett can say no to 99 deals out of 100. A trader can look at many situations and not find their ideal setup. But, eventually, as you keep searching for your truth and developing your philosophy, you have to say “Yes” to something. To say “Yes” to something that you can learn and prosper and that offers virtually unlimited potential for growth.
Personally, I did say “NO” a lot in trading. To various technical indicator strategies, forex robots, etc. Eventually I found something to say “Yes” to. An enthusiastic yes.
What I have done with my writing and books and courses is to get you to say “Yes” to global macro trading. Not to say “Yes” to penny stocks. To say “Yes” to Global Macro Trading, which is the highest form of trading. To awaken you to its power. And also the other order flow strategies like stop hunting and news trading. Redouble your commitment to learning about the universal principles of speculation.
But I Use These Technical Indicators and Chart Patterns, Will This Order Flow Work For Me?
Yes, these order flow strategies can work for you, either to combine with your existing strategies, or as a replacement of them.
Take a look at some of these charts:
In this T-Mobile Trade, I have created a whole Video Training for your, describing in complete detail how I caught it and how you can use the same strategies to beat the S&P. All in the Telecom Profits training course.
There may be others that say: But these strategies only work for intraday time frames, or swing trading and not for longer term “investing”. To these I would respond with the above charts, and also that they have not made a sufficient effort to think creatively and flexibly.
Let’s take an example of how you could have used this stop hunting knowledge back in 2009 to become a phenomenal “investor.”
Therefore, don’t say that these strategies don’t apply to your situation. They most certainly CAN be used!
Even if you can only update and check the markets once a week, there are opportunities. Obviously, a lot less than if you were an active trader every day, but opportunities still exist.
Trading and investing has to be market truth driven, not eternally optimistic that the market will keep going on forever driven.
Trading has to be order flow, liquidity, and volatility driven, not personal joy driven.
You most certainly should be enthusiastic and optimistic about your trading ability to interpret the market action and profit from it. And also to attain joy from the profits you drive. But this magnificent trading attitude is completely different from someone who believes that asset values will stay elevated permanently.
There is a big difference in philosophies regarding let’s say a Warren Buffett and a George Soros and Paul Tudor Jones.
Buffett can be involved in holding his “investments” through large drawdowns. And that results in such moments like these when a company goes bad on him and he loses a few hundred million.
Such a philosophy is very different from someone like a George Soros who believes that the market could turn against him at any time, or to a Paul Tudor Jones who believed that every day, every position he had on was wrong.
So you must think about these things carefully and find something that will fit your personality.
Lack of knowledge can be cured. What is more difficult to cure is ignorance, especially willful ignorance.
Now, onto one of the most important revelations you may have in your entire life:
You do not need to trade through and experience a dozen bull and bear markets to know how to trade them. With a flexible, scenario based global macro trading philosophy and strategies, you can get up to speed much, much faster. That’s the reason why someone could be involved in the markets for 60 years, and be a 100 year old stockbroker, and not make much money, while someone else like a Paul Tudor Jones makes $100 million by the age of 33. It’s not the amount of years that you spend on trading. It is what kind of insights, strategies, thoughts and actions do you pack into your years. Search for and implement the higher quality trading ideas and strategies via the Order Flow Mastery Course. If you can understand what I have just written, and be enlightened by it, then it is one of the most important paragraphs I have ever written. (can I get some thank you letters?)
The Secret is You!
Certainly, I can keep doing a better job of explaining these concepts to you. But most of it comes from YOU. You are the secret. You are the special someone to implement these strategies for profit.
I am very big into love and loving understanding, compassion, etc, of both others and to yourself. Love yourself, have patience with yourself as you are still growing every day. As Oscar Wilde said: “To love oneself is the beginning of a lifelong romance.”
But sometimes you have to get tough with people and with yourself. To be thick skinned and hard-nosed. Ask yourself why you are not getting the results you seek. Like 99% love, 1% tough.
There is a story from my junior high school days where the dean got tough with me. My family had just convinced the dean to bump me up to the top class in the grade. So there was added responsibility on my part to be able to do the work and operate at that higher level. But that was oblivious to me. My grades were slacking and this was going to make it seem like the dean made a horrible decision putting me in the top class. This was oblivious to me as I was 11 years old. Well, this dean pulls me out of the class in the middle of lesson and into the hallway. She starts screaming at me and shouting at me. I almost pissed my pants. Not just because I was getting into trouble with my grades, but to my 11 year old mind, I felt like she shouted so loud about my troubles that all the classes and students on the whole floor heard what was going on with me. Then I raised my grades and everything went well.
As a trading example, it was rumored that in one hedge fund’s early days in the 1990’s, every trader could see everyone else’s profit and loss. That’s being tough.
As another trading example, there is a hedge fund, that after a tumultuous year with some traders being in the news about insider trading, tallied up the years returns. They were pretty good. But the founder said something along the lines of: “This is sh**, we can do better.” That’s being tough and finding ways to push it and grow.
“Jones’ casualness in seeing visitors, talking to his staff and participating in this interview at the same time he was trading a heavy S&P position.”
“Now I spend my day trying to make myself as happy and relaxed as I can be. – Paul Tudor Jones”
And there is also the flipside where casualness can lead to casualties. In this case, casualties meaning that you take losses in your trading account.
As a general belief, the development of your abilities comes from environments and atmoshperes of harmony, freedom from tension, etc. The proaction and love of gong after a worthy objective, etc. This is the 99% loving yourself part. But there can be cases when you get tough on yourself and ask why you are not where you desire to be in life. This is the 1% being tough on yourself and others part.
If someone I know calls on me with a problem and I visit them, I usually spend around 90-95% of the time really listening to them showing genuine compassion and love and praise. Then around 1-9% of the time asking some questions to help them talk themselves through it and share some stories with me. Then around 1% of the time judging and being tough.
You can’t just be tough right away. You have build up a person’s “Love Bank,” and show that you really do care about them, love them just the way they are, listen to them, have good ideas, etc. Then you can have some more influence with them.
It actually happened twice recently. Two people I knew exploded with anger at other members of their family. They said and did a lot of things that they regretted during these periods of violent anger. Lots of thoughts and actions and words that they wish they hadn’t thought, hand’t done, hadn’t said. In one of the cases I was able to save a marriage worth saving.
There is a certain rule to apply in these situations. It is called the 72 hour rule. Wait 72 hours to cool off and gain perspective before making any important decisions, such as a major trade, major business deal, leaving your spouse, etc. Therefore, next time you feel angry, lonely, tired, sick, etc, give it a few more days. Get on my Book List for more of these personal development and life strategies.
This is also a trading secret as Michael Marcus revealed in the book Market Wizards:
“When in doubt, get out and get a good night’s sleep. I’ve done that lots of times and the next day everything was clear.”
Back to the secret in trading being YOU.
There is a delicate balance in trading of caring enough about the results, but also not caring too much that you do unnecessary work and frustrate yourself and squander your time and energy. Therefore the trick is to care enough about making money in trading. Care enough about a +50% or +100% year or month. Care enough and you will eventually find the right things to do.
As the trader Brian Gelber said Market Wizards book says:
“The realization that when you don’t care, you do well, and when you try too hard, you don’t do well.”
The Same, But Also Different
In some ways I am like everyone else. I require constant reinforcement and reminders to make the positive changes and improvements in my life and trading. That constant exposure over a period of time. In other ways, I am different in that I really do try to make those improvements far faster than others. What it takes others 20 years, I try to do in 2 years. What it takes others 2 years, I try to do in 2 months. What it takes others 2 months, I try to learn and apply in 2 weeks. I don’t always get it right, but it is this sense of urgency that spurs me and powers me forward. I hope to instill this in you as well, since we aren’t getting any younger.
Looking back to my early years, I thought that “my” trading was different than all the rest. In some ways , it is a very different way to view the markets than most people who are hopping around from trading forum to trading forum and guru to guru. However, we all fall under certain universal principles of speculation as I call them. Every trader is on their own path to discover them and interpret them and form them into a trading method, process and system that fits their personality.
NOTE: If you want to dive DEEP into this global macro subject, invest in the Order Flow Mastery Course.