All Entries Tagged With: "Swing Trading"
5 Takeaways from the NYC Traders Expo
February 23, 2012 at 11:35 am
Last night I returned from my trip to the NYC Traders Expo. It was a great experience. Visiting the city itself with some great February weather and seeing all the famous landmarks was nice, but I really enjoyed spending time with some Bandit subscribers and some other trading friends I’ve made over the years from different parts of the country.
In addition, I was fortunate to speak to groups of traders twice while there, which was both challenging and insightful as I prepared ahead of time then fielded some well-thought-out questions from attendees. It was really fun!
There’s an energy when traders collect which is always motivating. From the trading floor I first participated on back in 2000, to times in Chicago seeing everyone file into the CME ahead of the day’s session, there’s just something that happens when traders gather to compete or exchange ideas – I love the atmosphere.
A few thoughts on what I witnessed, in no particular order…
Hunt for the magic bullet. There are a TON of traders who show up just wanting the latest lure to fish with. They aren’t willing to put in the work, to learn to think for themselves, or to understand what it takes to become successful as a trader. They want the overnight shortcut, and they exit the scene just as quickly as they arrive, disappointed and surprised that trading isn’t red and green infomercial-easy.
Trading is a process. I’ve known this, but was reminded of it through my preparations for speaking and in conversations with other traders. Trading requires adaptation, a willingness to lose regularly. Imperfection is to be expected, and so it all becomes about good management of trades rather than finding the can’t-miss sure thing. What works now may not work in a few weeks, so you have to be willing, able, and prepared to shift your approach. The market evolves, and so must you if you want to stay in the game and keep seeing opportunities.
Expectations. Expect some losing trades (and learn to manage them wisely). Expect periods of frustration and confusion, they’re going to happen. Expect the market to surprise you – it’s just that way, so you’ll have to be ready to respond accordingly. Times will come when you have no clue what’s next, but that’s OK. When they arrive, you can accept them and sideline yourself until clarity comes.
Hard work is rewarded. I saw Expo attendees show up early and stay late, attending multiple sessions, taking notes on the good things they heard, and leave tired but hopeful that some fresh perspectives will influence them to improvement in the days ahead. I saw prop traders from SMB who started their day extremely early, made the commute to lower Manhattan, gave it their best all day (though some admitted it was a tough day), then stuck around after the close to listen to my thoughts. Even after I was done presenting, they showed the discipline and desire to improve by asking questions, just absorbing knowledge even though they were tired and hungry and eager to call it a day. Those who work hard – even when it isn’t comfortable – are the ones who will make it, keep improving, and eventually see the fruits of their labor.
Trading is a battle. What’s interesting – and which few stop to recognize – is that only part of the battle is in the market. The rest usually happens internally. So be ready, you’ll need to bring your best if you want to compete in this game. You need to prepare a plan, and think through the emotions you might face while implementing it. Regardless of style, strategy, market, or timeframe, every great trader has his head on straight. Those who don’t will have it beaten to a pulp by a ruthless market.
If you were there, or if these have resonated with you, feel free to share some thoughts of your own.
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
Get our free newsletter to keep up!
Follow @TheStockBandit
LIVE from the NY Traders Expo
February 19, 2012 at 10:25 am
On Tuesday morning at the NY Traders Expo, I’ll be teaching live at 8am ET. I hope you can make it to my session if you’re anywhere around NYC. If not, be sure to register for the Webcast so you can attend virtually!
Specifically, I’ll be discussing Unique Traits of High-Performance Traders. I have a lot of good stuff planned, plus I’ll share the setups which have been working well for me recently as well as the best setups I see in the market right now. I’m excited about being there and giving you some insights for better trading.
Make plans to be there by pre-registering or just show up (it’s free)!
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
Get our free newsletter to keep up!
Follow @TheStockBandit
Week 7 Trades Review (Video)
February 18, 2012 at 9:30 am
Stocks headed higher again last week in a lackluster fashion, as a Monday gap was followed by some mid-week hesitation, and ultimately a move to new recovery highs for the NAZ, S&P 500, and DJIA.
Inside the Bandit Hideout, we took a number of trades on day & swing trading timeframes, as well as in both directions, so I wanted to offer a video recap of each of them. It wasn’t a great week by any measure, but once again the numbers game of trading proved essential as several stopped trades were offset by some winners. Diversifying trading directions, timeframes and strategies has some big advantages.
I wanted to give you a show-and-tell look at the trades I took this week. It should give you a feel for not only how I managed my trades, but also the kinds of setups which have been working well of late. And for those curious about our trading style in the member area, this should give you a good indication of what a typical week looks like. Check out the trial if you’re interested in adding our ideas to your own.
(Direct video link is here for those interested in embedding it elsewhere to share).
Be sure to view in HD (720P) and full-screen mode for best quality in the video.
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
Get our free newsletter to keep up!
Follow @TheStockBandit
Week 6 Trades Review (Video)
February 13, 2012 at 9:23 am
The market continued its recent run last week as the NAZ made multi-year highs yet again before a Friday pullback erased the week’s gains. All in all, it was a healthy week of rest for the indexes.
Despite the lack of overall market movement last week, we were able to capture some nice very gains in our trades inside the Bandit Hideout and I wanted to offer a video recap of each of them. It was a blend of success from day trades and swing trades, as well as longs and shorts which made the difference. Diversifying trading directions, timeframes and strategies has some big advantages.
I wanted to give you a show-and-tell look at the trades I took this week. It should give you a feel for not only how I managed my trades, but also the kinds of setups which have been working well of late. And for those curious about our trading style in the member area, this should give you a good indication of what a typical week looks like. Check out the trial if you’re interested in adding our ideas to your own.
(Direct video link is here for those interested in embedding it elsewhere to share).
Be sure to view in HD (720P) and full-screen mode for best quality in the video.
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
Get our free newsletter to keep up!
Follow @TheStockBandit
Why Anticipatory Trading is so Tricky
February 3, 2012 at 9:25 am
Charts give us the opportunity to wait for confirmation or enter ahead of time – to anticipate. And while the latter may give us more of a feeling of being right, it’s not an easy way to trade.
Here’s an example from this week…
AGP is sitting in a bullish consolidation pattern here within an existing uptrend. This is a quality pattern – but it has yet to confirm. A breakout would happen beyond the upper channel trend line, currently at $70. Check out the setup, then down below let’s discuss trading it.
This is a setup which would have delivered some frustration for those anticipating a breakout – at least for those who entered early. Wednesday saw a move back up toward the upper channel line, suggesting a breakout was perhaps coming soon, only to have a decisive turn lower on Thursday bring it right back into the center of the channel. The stock is again lower this morning.
There’s a huge difference between how pro’s and amateurs make anticipatory trades, let’s see what they are and what those choices lead to.
How Amateur Traders Anticipate
Many amateur traders make anticipatory trades. They receive a tip, or they have a hunch, or they just want to see their predictions proven, and they get in before any bit of a move has started. They load up, then wait to get paid. A failure of the stock to deliver the move results in the max loss possible under this circumstance, all because of how the amateur entered the trade.
How Professional Traders Anticipate
Many professional traders make anticipatory trades as well. Their experience provides them with market feel, and when watching the tape and eyeing the charts, they’ll run across trades they like too – maybe even the exact same setups as the amateur finds. However, their execution methods are worlds apart.
Rather than piling into the trade and sitting back and hoping the market proves them correct, the professional enters a feeler position – a starter. A trade small enough to watch but not big enough to hurt them or really help them. It’s a marker. As the trade begins to prove itself and the pattern starts to confirm, they add to the trade. They build a position as it works, allowing them to get paid nicely when their hunch proves correct. A failure of the stock to deliver the expected move results initially simply leaves them stopping out of their starter position for the bare minimum loss.
See the difference between the two?
There’s a big argument to be made for just waiting for confirmation in a pattern to take place before entering a trade, but anticipatory trading can still produce profits, so long as you’re doing it carefully.
For those of you anticipatory traders, the example above is a great example of how to finesse your entry. Scale in, make the setup confirm before adding, and know you’re covered either way – whether a tiny loss you can easily survive or a winning trade you can build on.
(For more on anticipatory trading, read When to Make Anticipatory Trades.)
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
Follow TheStockBandit on Twitter or get our free newsletter to keep up!
Week 4 Trades Review (Video)
January 28, 2012 at 10:05 pm
The market saw mixed results last week as it primarily based, which really isolated the stocks on the move while many spent time putting in rest. For the week, I took a number of entries as both day trades and swing trades, and it was a really nice week, thanks primarily to the swing trades.
I wanted to give you a show-and-tell look at the trades I took this week. It should give you a feel for not only how I managed my trades, but also the kinds of setups which have been working well of late. And for those curious about our trading style in the member area, this should give you a good indication of what a typical week looks like.
Be sure to watch for the weekend index review video as well.
(Direct video link is here for those interested in embedding it elsewhere to share).
Be sure to view in HD (720P) and full-screen mode for best quality in the video.
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
Get our free newsletter to keep up!
Follow @TheStockBandit
The Zurich Axioms
January 25, 2012 at 12:08 pm
I first learned about The Zurich Axioms by Max Gunther in the daily Worden Report when Don mentioned it among his favorite trading books a few years ago. Soon after, I picked up a copy and found it was indeed packed with some great insights – enough to be a must-have trading book.
There are 12 major axioms highlighted in the book, with a chapter devoted to each, as well as 16 minor axioms. It’s a relatively short book at only about 123 pages, but the “Rules of Risk and Reward Used by Generations of Swiss Bankers” offers no shortage of wisdom and insights for any trader or speculator.
Without disclosing all of the Axioms, I’ll summarize two of my favorites.
Always Play for Meaningful Stakes.
This minor axiom highlights the importance of trading with enough size for it to matter. This goes beyond the learning stages in which a developing trader needs to hone his skills and not fixate on the money. Rather, playing for meaningful stakes is about getting over the fear of getting hurt in such a way that when a play works, it’s well worth the risk taken.
A story is told in the book about the oil tycoon J. Paul Getty, who grew up rich, but once he became an adult he was sent out on his own. Wanting to enter the oil business, he shunned various opportunities to invest $50 in the early 1900′s in favor of betting nearly his entire savings of $500 on an oil lease he felt was more promising. After paydirt was hit, he sold his holdings for $12,000 just a short time later.
Getty mentioned that if he had not struck oil, the $500 would have hurt, but that he could have found a way to save that amount back up again. He was quoted as saying “it seemed to me I had a lot more to win than to lose.” That’s playing for meaningful stakes.
As a trader, it’s not about walking a tightrope where bankruptcy is the result if you slip. It means you don’t nickel-and-dime your way throughout the entire year if you want to get somewhere interesting.
Optimism means expecting the best, but confidence means knowing how you will handle the worst. Never make a move if you are merely optimistic.
What an excellent reminder for traders! Gunther makes the point that without some level of optimism, one cannot trade to begin with. However, there is general optimism and there is specific optimism. According to Gunther, it’s the venture-specific optimism which can become dangerous if you allow it.
The latter mention of what true confidence is just cannot be ignored here. Do you know how you will handle the worst? If you do, then you’ve got arguably the most difficult element of a trading plan already in place – the adverse exit. The ability to fail gracefully in trading – over and over – is what will ultimately define how long you can stay in the game. Your success may eventually be tremendous, but if you’re unable to handle losing the right way, you’ll be taken out long before the big wins can ever come along.
My advice? Pick up a copy of The Zurich Axioms and get a pen ready to mark up the margins and underline key points. It’s a quick read and one you’ll return to often.
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
Follow TheStockBandit on Twitter or get our free newsletter to keep up!
