The Times Ain't Forgotten
No good live version on YouTube so I'm forced to embed this ... Jason Isbell's album The Nashville Sound has several tracks that I like, which is remarkable. I'll feature the others in time. This song was written shortly after the booboisie elected T___p.
Notes for Chat with Traders, Episode 157
Repeat guest, formerly featured in Episode 119
Episode 157 ... Alex @TAGRtrades (62:23)
- Wife takes care of their new baby (four months old)
- Hasn't had a full night of sleep in four months
- Child care $30K a year so doesn't make sense for wife not to stay at home [only in 'murika]
- December 2017 his best month to date
- Bitcoin / Blockchain mania at end of year 2017, he was able to catch that
- MARA, DPW, RIOT his main plays ... sympathy plays
- He would buy the one that was still red when the other two turned green
- Lots of liquidity, easy to trade size since exits so easy
- June 2018 will be five years of trading full time
- Have to know what are the leaders and laggards in a sector
- He knew when to back off, take the foot off the pedal, this time around
- When friends and family contact you for advice, it shows the end is near
- One or two days a month was where he made the bulk of his gains
- Equity curve looks pretty when stretched out, but if you zoom in it looks choppier
- Compounding is the key
- Only one day this year with zero trades, but quite a few with only one or two trades
- Stocks that he trades are low float, under $10 ... lots of liquidity issues
- Makes errors, then doesn't correct them, tries to wriggle out, problems snowball
- Trying to be better about 1) market preparation; 2) holding longer; 3) getting bigger
- In order to get bigger, you have to get better [great saying]
- Liquidity issues are huge when your account size gets bigger
- Lives in central time zone, market opens at 8:30 AM
- Starts looking at market about 90 minutes before the open
- Develops watch list night before -- stocks to watch
- Puts 12 charts on the screens at once
- Looks at daily charts for support / resistance levels
- Following the right people on Twitter is important for getting news
- Pays for two news services, squawk boxes (TradeXchange, Benzinga Pro); worth the money
- He's in favor of journaling, but doesn't do it as much as he used to
- He's not a big spender, seeing himself down $2-3K in a trade still painful
- When he has a big day, he doesn't celebrate
- Still risks same percentage per trade (max 2-3% loss) as in the past
- Has no confidence in his swing trading ability yet
- People say he's just a long-biased trader in a giant bull market (to put him down I guess?)
- Now he's 85% on the long side, 15% short side
- Short trades are 1/20th the size of his long trades
- Never adds to his short trades, takes one shot
- Watches top ten most volume names closely
- Uses finviz.com to scan ... under $10 stocks, trading 2.5x average daily volume (whatever the default is)
- Great charts don't matter if the volume isn't there
- Looks closely at all the charts (20-30) from scan above
- Low float, hot sector, high short interest, good chart setups
- Knows top five and bottom five from his list
- Always starts with the daily chart, only looks back 20 days for high / low resistance
- Then looks at the hourly chart for support / resistance
- Uses 3 minute chart to enter trades
- Looks for flag and pennant patterns after a breakout
- Uses VWAP on every single chart, but doesn't overanalyze it
- VWAP gives you a quick basis of where the average person stands
- Adds 200- and 50-day moving average to charts as target levels (since other people look at those levels)
- No longer scales into trades, he just goes all in now, max risk from single entry, one shot
- Quickly takes profits on a piece, then slowly scales out the rest (1/5th his size left at final target, e.g. 200-day MA)
- Self-discipline all important, be flexible, make adjustments
- New traders see one mold, try it, it doesn't fit them, they give up or lose a lot
- Be flexible instead, find what fits you
- Twitter: @TAGRtrades
Already Told Jesus Everything I Know
No good live version so I'm forced to embed this ... great song.
Won't You Help Me Share My Load
No good live version so I'm forced to embed this. Another case where the cover is better than the original ... Raul has a nicer voice than Van's:
Great Videos from Linda Raschke
Linda Raschke did this series of videos for Futures Magazine back in 2013 and every one of them is pure gold. (Great story in the final segment about Linda's cat making some amazing hotkey trades.)
Bonus ... I found another good one (of course good traders are made not born, but I believe it does help to be born with a certain temperament):
Double bonus ... so much gold in the following three short videos, every word is precious ... if you don't get it, listen over and over and over until you do:
Misery Loves Company
No live version on YouTube so I'm forced to embed this ... maybe the perfect anthem for San Francisco?
Notes for Chat with Traders, Episode 156
Episode 156 ... Michael Katz (59:45)
- Has three kids, two boys and a girl
- Started in markets, late 1990s, then in his late teens, during internet boom (born 1980?)
- Opened first account with a couple thousand dollars
- Blew up a couple of accounts early on
- Discovered equitytradingonline ... Gary Roth
- Seven Points Capital (Mike Mangieri, Gary Roth, Mike Katz) started as execution firm
- Started trading "parity" on NYSE
- Parity: buy on the bid through the floor broker, could easily scratch the trade, "risk free"
- Getting good locates is a key edge a prop firm can provide [don't I know it!]
- Scalping with size in high volume stocks within $5 to $20 range
- Trades 50 million shares a month
- Uses hot keys
- Scales in and scales out
- Has 15 different set-ups, each with its own rules
- Descending triangles in low-cap trash names that have flown ("Flying Pigs") ... look for a lower high
- Enters within the triangle, enters the break of the triangle, enters the retrace to base of triangle
- ECN rebates don't make much difference to his P&L
- Trades eight to ten names on any given day
- Will swing trade ... if it's green and it's working, he'll keep it; then exit rules come into play
- The best trades start working right away
- Whatever is gapping, he'll notice it
- Uses scanner to find intraday setups: volume, volatility criteria
- Watching volume important to him
- Recommends Anna Coulling's book, A Complete Guide to Volume Price Analysis
- He looks closely at Volume Profile
- Consistency is what differentiates great traders from lucky ones
- Need a clear and definable edge
- Avoid large losses, scale back when you're not performing well
- On the other hand, scale up dramatically when you're feeling in the zone
- Always knows where he's getting out before he gets in
- Amateur traders just hope for the best, never even consider their exit when wrong
- Risks a fixed dollar amount on every trade
- Sizes his positions based on stop price and fixed dollar loss, determined in advance
- If he breaks his rules, he sizes down, slows down, takes a day off
- Rule breaking very important to pay attention to [recognize when you're going on tilt]
- Taking losses quickly, which most people can't do, itself is an edge
- Reading order flow, observing patterns, also both edges
- Big fan of journaling
- Sports, trading, poker are all the same: you have a game plan, you execute during the game, then review the tapes afterward
- Over time you develop a trading method
- He still loves watching trading videos on YouTube, seeing what other people do
- He's willing to learn from everywhere he can, then makes it his own
- Can't imitate someone else's method, only yours will work for you
- Establish rules for each set-up
- Surround yourself with good, smart people who can mentor you
- Be careful because there are false gurus and DVD sellers out there looking to take advantage of you
- There are great traders on Twitter (mentions SmashTheBid) who are under the radar; seek them out
- Katz says some kind things to Aaron in parting
- www.sevenpointscapital.com
- Twitter: Michael_Katz11
The Gifts That God Gave
The great Rodney Crowell....
The State of Film Criticism Today
Thanks to my buddy Ben for hipping me to "Rex Reed Bangs a Gong on the Mediocrity of Modern Life." The URL for that piece is mysteriously: who-is-rex-reed.html.
I love Rex (meaning I almost always agree with him). He's the last honest movie critic. He has balls, the way only a gay man born in the American South in the 1930's can have balls. And he writes well.
A few excerpts to whet your appetite:
"Mr. Reed bought his apartment in the Dakota for $30,000 in 1970." [nice timing]
"... one of the reasons that movies are so profoundly screwed up today is because the last person who gets any credit for anything is the writer."
"All [neighbor John Lennon] did was lie around stoned watching television."