Archive for June, 2011

Jun
25

The Weekend Trader – That One Thing … Again

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Some tidbits as we hit the dog (bear?) days of summer.

Weekly PivotPoint Briefing – The weekly Briefing that I do as Chief Investment Officer and Trader for PivotPoint Advisors has been posted in the Briefing Room Tab on the PivotPoint site. This week’s Briefing focuses on a long trade which we entered for clients when our buy indicators triggered on Monday and exited on Tuesday as the S&P approached the upper end of its daily down channel.

Jellie Team #8 Concludes – The formal four-week training for S&P Trader Jellie Team #8 concluded on Friday with one of the participants in my view reaching the upper echelon of all past Jellie traders. So major kudos to Brad for his performance, and as importantly, for putting up with my constant pain-in-the-a$$ (but purposeful) drill sergeant approach.

As I’ve said before, I purposely take such an approach at times given the seriousness of this business, and figure if people can’t stand up to me, then they’ll never be able to stand up to the markets. Said another way, better to have me scream at you than the market “yelling” in the form of losses.

As the program feedback from participants and brokers remains at very high levels, I’ve tentatively scheduled the next effort for September, so please email me as soon as possible at don@donmillereducation.com if you’d like to participate as a member of Team #9. And a reminder to all past Jellie Webinar participants that Webinar tuition can always be applied to the live efforts.

Trading After Dark Episode #5 – Yes, I plan on finally working on Episode #5 over the next few weeks. I’m thinking of a High Stakes entry this time around as time and opportunity permit. In the meantime, a reminder that four other episodes remain available for viewing!

Summer Posting – As I’ve often mentioned, there is a ton of trade journal and inspirational material amidst these virtual pages of the last three years – including both this blog and the initial trade journal blog – which remains fully archived and available.

Along those lines, and as we get ready to hit the summer full stride, I’ll be reposting some of the more significant journal entries as ranked by onlooker traffic, feedback. and those which I believe should be of particular interest to traders.

And to kick us off, here’s one of my favorites that helps reinforce one of my more important cornerstone trading concepts … humility.

Enjoy!

That One ThingOriginally Posted December 6, 2008

There’s a great scene from from the classic 1991 movie City Slickers:

Curly: Do you know what the secret of life is? [holds up one finger] This.
Mitch: Your finger?
Curly: One thing. Just one thing. You stick to that and the rest don’t mean s***.
Mitch: But, what is the “one thing?”
Curly: That’s what you have to find out.

Well, as this year’s journey nears a historic end, my “one thing” seems to be coming into clearer focus … at least the trading “thing” … although like many trading elements, it seems to be spilling over into personal life as well.

And while it starts with the comeback concept which I first surfaced in July, and which formed the cornerstone for subsequent performance momentum that is now apparently catching national attention (I was asked for two more interviews over the last week which I’ve declined … this is now getting a bit crazy), I now realize there’s much iceberg below that initial tip.

Throughout the blog, I’ve long said that the power behind the “comeback mentality” was that it required that I ramp up my focus by visualizing the mental state in which I’ve typically excelled. And that certainly remains true. Yet I’ve now realized that there’s a second element to that concept that reaches even deeper, and that’s the humbling effect a drawdown — real or perceived — has on one’s mindset.

Why is it that many who “make it to the top” also come crashing down? Archie Karas, Internet Millionaires-Gone-Bust, O.J. Simpson, Plaxico Burress, name-your-fraud chatroom guru, AIG/Ford/Chrysler/GM execs (choose one or all), __________ (name your celebrity or athlete), and on and on. I would argue two major reasons are pride and arrogance.

And as this record race nears a close, it’s become clear that the greatest power behind the fictitious draw chart is that it instills an ongoing inner circuit breaker that minimizes the chance of pride and arrogance seeping in. Essentially, it mandates humility, and humility trumps arrogance every day. And for my trading, humility has clearly become my “one thing”.

And so I enter next week mentally reversing the sign before last week’s chip gain. I’ve taken a humbling -$72K hit, there’s certainly no reason to get a big head, and I need to go back to work to get it back. The more I believe that — and by Monday I’ll think it really happened that way — the more powerful the results are … in trading and in life.

Or to say another way:

I think Curly would be pleased.

Categories : The Weekend Trader
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Jun
18

The Weekend Trader – Trading Lessons From the Cup

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Sunday 6/19 Update – For all traders over 40, or for those younger who have been told they’re not cut out for this biz, you HAVE to watch this morning’s Parting Shot by Bob Ryan on ESPN’s Sports Reporters discussing Tim Thomas.

Oh, and the weekly PivotPoint Briefing has been posted in the PP Briefing Room tab … and Happy 19th to my daughter Chelsea … and Happy Father’s Day to all Dads!!
Yes, I’m a sports fan.

I’ve supported pretty much every local pro and college team near where I’ve lived which includes the New England, Seattle, Dallas, and Madison, WI (Go Badgers!) areas, but I admit hockey is my first love and I bleed the black and gold of the Boston Bruins.

You see, I have since I was eight years old. 

And I’m far from alone on this … Exhibit A being this absolutely wonderful piece by ESPN’s Bill Simmons.

For you “youngsters”, watching hockey in the late 1960s often consisted of snuggling up to a black and white 14″ TV and trying to find the puck through the snowflakes of UHF (young folks can Google that!) transmission.

It consisted of trips with my Dad to the old Boston Garden (or as I used to say, “Gahden” before I lost my Boston accent in my many years of travel) in obstruction view seats behind a pole or in the nose-bleed seeds of the rafters among the Garden rats.

It consisted of playing street hockey in my driveway where I was goalie and my best friend of Chara-like size would fire shots at me, often breaking every window of the garage and adjacent porch … after which time my parents would simply replace the each window with plexiglass.

It consisted of having Bobby Orr as my hero given his combination of skill, grace, and personal humility.  And yes, he’d drop the gloves and stand his ground when absolutely necessary.

It consisted of sneaking an AM radio under my pillow at midnight when the Bs were playing on the west coast.

And despite two championships in the early 1970s, it often consisted of heartbreak due to some odd team malfunction at the most inopportune times.

So you have to understand where I’m coming from when I say I had a very enjoyable week.

And yes, there are many trading lessons to be learned from the incredible Bruins’ run for what is arguably the most difficult trophy to win given the grueling two-month campaign after a full season … and I’ll use parallels to my own trading to illustrate.

In the finals, the Bs were not the more skillful team … that would go to Vancouver who had the so-called “pedigree” of high scorers, and more than a fistful of “bests” in terms of regular season statistics.  In fact, the comparison wasn’t even close. 

And then Vancouver got out to a two-game lead in the finals, at which time all of the historical probabilities were heavily tilted in the Cannucks’ favor.  After all, the Bruins would have to win four of the next five against the best team in the world who had home-ice advantage on their side.

And then they blinked.

Vancouver thought they could simply “show up” to finish the job, while the Bruins dug deep and found their “heart”.

The Bs won Games 3 & 4 in a lopsided manner on home ice to tie the best of seven series at 2-2, lost a 1-0 nail biter in Game 5 back in Vancouver, and then once again won 4-0 in Game 6 back in Boston to set up a winner-take-all Game 7 back in Vancouver.

Yet the mistake Vancouver made was to simply believe that all they had to do in Game 7 was to show up.  In interview after interview, their mantra of “don’t worry, we’re going back home and will be fine” was repeated over and over again.  You really got the feeling that all they had to do was lace up their pedigree skates, and they’d be hoisting the most famous trophy in all of sports.

But as the Bruins grinded and grinded them into submission in Game 7 minute by minute, it was clear that hard work and “heart” (remember that Annie Duke interview?? … a must read for traders) trumped historical pedigree, overwhelming probabilities, and skill. A 1-0 Boston score after an extremely hard working goal later became 2-0, then 3-0, and finally 4-0.

There are of course stories like this everywhere where the hard-working and resourceful underdog overcomes all odds to win … from David vs. Goliath to the 1980 USA vs. Russia Miracle on Ice to - now, the 2011 Stanley Cup Champion Boston Bruins.

OK, what are my trading lessons from all of this.

First, hard work trumps historical pedigree.  You see, by my definition, I’m not the most “gifted” trader. For I have to earn every penny via sweat and toil, while staying on guard to both protect and grow it. And despite my many market successes, I frankly and completely suck when I think I can “just show up” and sleepwalk through a trading day or week.

Second, despite the statistical odds against trading success due to the constant transfer of wealth from the vast majority of traders who “don’t get it” to the small minority who consistently win, never underestimate your potential to cross that thin line (Remember our Bamboo roots!) or listen to the naysayers.  You simply have to work harder than everyone else … and all the time.

Third, make your trading a self-proclaimed personal competition.  The initial trading journal portion of this blog is full of posts during my 2008-09 $2 Million run where I simply viewed that time as a personal “race” and pretended that I was constantly coming from behind. Remember that fictitious drawdown concept that has since become well-publicized and chronicled in trading journals?

And finally, celebrate and share your successes.

Tooday, there will be a parade in this city of champions (yea, we’re admittedly getting spoiled as the only city to now have a championship in every major sport in the span of seven years) where over a million people who similarly bleed Black and Gold will line the streets.

You see, deep down and like similar cities, Boston is a blue-collar, nose-to-the-grindstone working man’s town.  It’s a city where sweat, toil, and sacrifice once launched a historical revolution for freedom, and where those championships – like the 2011 Stanley Cup – rooted in hard work and humility are rewarded with particularly deserved celebration.

Reaching the pinnacle of your field is no easy task.  In 2008, I was blessed with a similar accomplishment in reaching the top of my field for trading performance among my asset class.  And yes, for one short day and post, I celebrated it … in part to recognize 366 days of extremely hard work and personal sacrifice, yet more so to try to inspire others to do similarly.  (btw, that Fireworks picture from that 12-31-08 Night to Dance post — one of the viewed posts of the blog – was actually a photo of fireworks in, of all places, Vancouver!)

Life is short, but the lessons are long.

Work, compete, and celebrate … but most importantly, Praise God, share the glory, and pay it forward.

For the latter will provide the greatest reward of all.

Congratulations to the 2011 Stanley Cup Champions … the Boston Bruins … and to all who overcome the “meaningless” odds to reach their fullest potential.

And yes, the $250 Jellie Trader Training Webinar discount remains in effect. Just email me at don@donmillereducation.com and I’ll email a special invoice.

And look for the weekly PivotPoint briefing in the Briefing Room tab over the weekend.

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Jun
16

Special Post – Champions of the World

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40 years ago, I slept through the last Bruins’ Cup win after coming out of surgery. 

This time I stayed awake.

Categories : Fun
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Jun
12

The Weekend Trader – Stanley Cup Edition

Posted by: Don Miller | Comments Comments Off

Some weekend thoughts as the cross-county race for hockey’s holy grail (and arguably the most difficult North American trophy to capture given the grueling task) still continues even as summer rapidly approaches.

PivotPoint Weekly Briefing – Our weekly PivotPoint Advisors Briefing has been posted in the Briefing Room tab on the PivotPoint site (and yes, I write 100% of it and place the trades) and discusses the recent market meltdown, and in particular, how we reacted to the significant, rare, and unique technical failure signal occurring on June 1 when the market failed to follow through on a break of its daily down channel for the first time in over a year.

We first discussed this critical failure in the previous week’s Briefing (refer to the 6-3-11 Briefing on that same page for a detailed chart of the historical validity of the upward break attempt), including our decision to exit all client S&P long positions immediately upon the first bounce after the failure occurred. 

Since we exited, the S&Ps have melted down another 3.2% (making it down 5.6% from the point of 6/1 failure, and down a whopping 7.3% from its 2011 high about a month ago), validating once again that it matters not whether you’re right or wrong … rather it’s how much you win when right and how little you lose when wrong – whether it be managing client long accounts on daily, weekly, and monthly cycles, or two-way intraday futures trading using 5 and 15 minute cycles.

As noted in PivotPoint CEO John Norquay’s email and performance chart sent to clients yesterday, PP fund performance since the early-year market high and as of Friday’s close has reached a value peak for the year vs. the S&P.

Cumulative goal count may not mean a darn thing in the quest for the Stanley Cup, but in trading, cumulative count means everything.

2009 Bamboo Trader Cookout Anniversary – In just a few weeks, it will have been two full years since that infamous cookout on the Cape that started with an emergency trip via ambulance to the hospital to close a 2 1/2 inch gash on my head with about ten staples, and ended with a heart-to-heart evening chat with traders in my “air traffic control” trading center.  (And like trading, I still have the scar … and yes, I now make sure to duck every time I enter the shed).  Oh, how time flies.

Reaching #1 - Many thanks to those of you who voted and helped Cherie Norquay (wonderful Christian friend and wife of John Norquay) reach #1 on the Charts with her incredibly inspiring One Nation Under God Memorial Day salute.  As of today, she’s still holding strong at #3, and you can find more of her incredible music here.

She, John, and the entire GrowUganda.org team will be planning their next trip to Uganda shortly, and I’m so very pleased do be able to continue to donate a portion of our Jellie Trader and Trading After Dark proceeds (including all net proceeds from the sale of TAD shirts and caps) to their mission efforts.

Jellie Team #8 – We’re half way through the current effort, and I like what I see with respect to some substantial progress traders are making in moving away from late (a.k.a. “retail” and “losing”) entries.  Thanks as always to the participants who put up with my drill sergeant barking at times … yet as I’ve told them, better have me yell at them than the markets.  Trading will never be a business for the thin skinned.

OpenTrader Response – Wow, wow, wow.  The YouTube link & preview I posted last week has now reached over 16,000 (that’s sixteen thousand) hits.  That’s not only “Out of the Shadows” folks, but “Into the Spotlight”!)

This incredible level of interest, coupled with other forums including this site, Trading After Dark, and other similar venues, tells me that the concepts of education, reality, and transparency continue to gain full momentum and fill a huge market vacuum that would otherwise be filled by snake oil marketing, rah-rah chatrooms that build neither confidence nor focus, and lies.

Mum remains the word on more details … for now :-) .

Jellie Webinar Discount – For now – at least through the Stanley Cup Finals before my Bruins bow out – the $250 tuition discount for the 16-Hour course charting the waters that the beta Jellie team swam remains in effect.  Simply email me at don@donmillereducation.com and I’ll email a special discounted invoice for immediate course download.

Have a blessed and peaceful weekend.

Categories : The Weekend Trader
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Jun
05

The Weekend Trader Part 2 – Out of the Shadows

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Many know that in this industry full of “shadows”, I’ve long advocated for industry transparency including personally publishing actual daily diaries, statistics blogging, a decade’s worth of live public trading, blatantly candid postings of that day in October 2008 and the May 2010 flash crash amidst the record successes, eight 4-week Jellie trade-alongs, and most recently, Trading After Dark trade captures.

So consider the following another industry leap forward for industry transparency …

Mum’s the word for now, but look for more details to come in the near future.

Here’s The Weekend Trader Part 1 if you missed it.

Categories : Breaking News
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Jun
04

The Weekend Trader Part 1 – That Razor Thin Line

Posted by: Don Miller | Comments Comments Off

Lots going on at this end as we approach summer, so let’s go with the shorthand version today.

PivotPoint Weekly Briefing - The weekly PivotPoint Advsisors briefing has been posted on the PivotPoint site (Briefing Room Tab) and describes (1) this week’s trade sequence, (2) our protective stop exit, and (3) unique current market scenario.

As has long been our theme on this intraday trading blog, the PivotPoint briefing similarly reflects full transparency in terms of both the successes and challenges of our ongoing market journey.  The only difference is that the PP material reflects longer-term daily and weekly cycles – and often involves non-margin equity accounts – versus the intraday futures cycles often referenced here that we traders work with on a daily basis.

Team Jellie #8 – Team #8 is in full swing and will begin its second of four weeks on Monday.  This effort is purposely one of our smaller teams (as many know, I added this unexpected summer edition just recently) as we focus on adding a more personal theme in terms of individual trading troubleshooting.

One obvious early theme is that of correcting an extremely troublesome “retail” entry tendency that one of our participants somehow got embedded in his trading pattern, including chasing breakouts at new highs or lows (“turtle soup” style) or during times of oscillation (i.e. MATD) markets.

As I’ve often said, the line separating excellence from mediocrity (or worse) – even in my own trading – is razor thin.  And it’s always a great personal pleasure to see someone step across that line.

Personal Scorecards & Trading After Dark Update – As I continue to fulfill my ongoing PivotPoint CIO role, I’m considering returning to some of our original blog roots in terms of discussing current key intraday trading tendencies and scorecards, in addition to publishing another Trading After Dark installment which I expect to do shortly.

So look for more info on this in the near future.

Jellie Webinar Discounts - I’ve admittedly been a bit surprised at the extent of interest in the discounted Jellie Webinar series, especially when the normal tuition fee is placed so far below market and its underlying value (as defined by industry leaders) to begin with.

And while it seems a bit penny-wise and pound-foolish for traders to wait for a further discount, I’m of course very pleased to be able to increase the circulation of the material even further, while of course further helping our charitable causes.  And so I’ll keep the option to purchase the eight 2-Hour Webinars chronicling the beta Jellie Team’s journey at a $250 discount a bit longer.  Simply email me at don@donmillereducation.com and I’ll forward a discounted PayPal invoice.

One question often asked is whether I reduce my “advantage” by further sharing the concepts and strategies – which is an industry ”excuse” offered by many so-called traders. 

My response?  While I could write pages on why such an excuse so ridiculously absurd that it’s off the charts, two immediate responses are that (1) the S&P’s are the most liquid futures trading vehicle on the planet, and (2) trading success will always be dictated by one’s ability to execute the strategies in this performance-based skill business … which will vary even for the most seasoned and successful traders.

For example, as I told Team #8 this week, there are only three things that will ever keep me from profiting in the markets: (1) Personal Motivation - Remember those Catching the Rabbit posts??, (2) Focus, and (3) Simply being present – i.e. you have to be present to win.  And yes, I often struggle with each one of these demons at various times … especially the longer I trade into my 50s.

And such remains my personal battle to stay on the correct side of that razor-thin line, let I get cut by straddling it.

Twitter Trader Followers – For those who like nice round numbers, we’re now over 1,000 and still climbing.  Not that Charlie Sheen has anything to worry about.

Climbing the Charts – And speaking of counts, it’s nice to see Cherie Norquay’s (wife of PivotPoint CEO John Norquay) inspirational memorial day “One Nation Under God” song climbing to #3 on the Indieheaven site.  Check it out!

Have a peaceful weekend.

Categories : The Weekend Trader
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