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Systems Trading - Learn To Build

Feb 15, 2021

One of my core concepts about trading is stacking edges. If you don't know what an edge is in trading then we REALLY need to talk! 

An edge is a quantifiable/statistical advantage with a certain asset class, a trading strategy or you yourself, as in you can focus incredibly well for example. 

When you can stack multiple and complimentary edges together, you can come up with some really powerful trading systems. 

One of the most important tools in my tool kit, is categorizing the market regime. If you've read any of my emails lately then you are well aware of what I'm referring to. 

Categorizing the market regime gives you valuable information about how the market is trading and you can then apply the appropriate trading strategy to the market instead of trying to use what worked 2 times last week (out of 10) or for the past few years. 

This market is completely different than that market, and it warrants a completely different strategy. 

The Vol...

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Trading Bear Volatile Regime

Feb 15, 2021

What a day huh? Today's market action is characteristic of the transition between Bear Volatile and Bear Quiet regimes. It gets tricky in here as optimism starts to kick in as we rally from the depths of hell back to where we are now.   

Bears are nervous and are covering their shorts or waiting to cover their shorts, bulls who got punched in the throat last month and sold at the first bounce are starting to wonder if they did the right thing and start buying. This is what fuels bear market rallies, the most violent of all rallies.   

As you know we aren't here to call bottoms or tops, we let the market regimes guid us. What works in a Bull Quiet regime doesn't work in a lot of other regimes and what worked in Bear Volatile doesn't work as well in a Bear Quiet and vice versa.   

As part of the mentorship program I am running currently, AKA the Trading Thunderdome, we are doing extensive work on finding characteristics of the different market regimes and...

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How different setups work in different regimes

Feb 15, 2021

The FVBO has been doing quite well against some US Dollar FX pairs this past week, I pointed them out on Twitter. Let's have a look at USDJPY 
Earlier in the week I was talking about the VBO setup, being the first breakout of the channel. I have totally cut out this strategy from my main trading and have improved to the new VBO 2.0 (vbo +, or whatever we decide to name it!). 

The new VBO would not take that first breakout and instead wait for the FVBO, which we saw play out nicely on Monday and Tuesday, hitting our profit target with little pause. Where VBO 2.0 comes in would be a pause and a reversal higher...we did not get that. 

Additionally the Bear Quiet/Neutral regime that USDJPY currently is in, doesn't work very well with VBO2 but it is incredibly powerful trading the FVBO. 

If you are utterly confused by now, sorry. I am putting together the full VBO2 and FVBO strategy videos and some backtests. Stay tuned there. 

Next we had the USDCHF which is...

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Compressed vol is everywhere

Feb 15, 2021

When I decided to do the Trading Thunderdome in July I knew we had a huge demand for traders that were looking forward to joiningwas surprised to find out that there were so many traders who were ready to pay the steep fee to join, but weren't ready to go yet. That is, they still had a lot of work to do to benefit and contribute before being able to join the Thunderdome.  

Rather than take their money and run them through it anyway. I started thinking of how I could help more people get to a place in their trading that they would be in a position to benefit from the Thunderdome.  

To all who signed up and paid for the Thunderdome, my apologies, we will be postponing the Thunderdome. I will be giving you a refund.  

Now we need to focus on making traders better, before the Thunderdome. I have some ways that I am looking at making that happen, in a way that is affordable and effective.  

Stay tuned...  

Ok on to markets....

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Fbo and VBO 2.0 for students

Feb 15, 2021

I've been talking about the new VBO2.0 Strategy a bit lately, and I wanted to get it out to those of you who have purchased the Consistently Profitable Trader Course or the Systems Mastery Course!

I've only given this out to you all and the members of the Trading Lab

I hope you enjoy it

For Consistently Profitable Trader Students, click here for the link to yours

For Systems Mastery Students, click here for the link to yours

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Are we trending or breaking out in markets

Feb 15, 2021

Leveling up in trading is hard to do. Mostly because the right things to be focusing on aren't that obvious. You would think that just finding a good trend and riding it to the very end, from the very beginning is all you have to do. Sound simple enough, right?

Except markets launch breakouts which FAIL 80% of the time, only 20% of the time do markets actually breakout and trend. So if you are always chasing breakouts, 80% of the time you will be getting stopped out.

This is what creates trading ranges, breakout traders jump in on the first breakout attempt only to have the trade turn around on you and drop back down into the trading range. 

What looks like a trading range is actually numerous attempts to breakout from the trading range.

Notice how many spikes above the range show a big reversal candle, with a big spike shadow/wick on the candlestick.

Here's a closer look

Since late August of this year the EURUSD has been breaking out above the trading range beautifully, only...

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