Greeksman's Trading Journey and Value Building Insights

2009-12-04T10:54:00.002+08:00

Forex Profit Alerts: December 3, 2009

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2009-11-17T09:31:00.002+08:00

Join the Forex Revolution with Forex Mastery

Tick Tock. Tick Tock. Time is ticking..

Forex Mastery goes live in less than 24 hours!

At 12 Noon to be exact tomorrow (Tuesday), the the much anticipated Forex Mastery System from OU Forex Trader goes on sale for the first time..

You can now see the countdown timer live at:

Link

(Be sure and go there tomorrow precisely at 12 PM Noon to pre-order your copy of Forex
Mastery -- Course copies WILL be limited)!

By now, you should have already seen the first four preview videos (that are creating quite a
stir online, sending in over 10,000 traders and generating 1500+ comments on our video blog)..

(If you haven't, you can still view these here:

Link

But here's a BRAND NEW video, that will really get your BLOOD PUMPING, showing you in how the powerful M3 Navigator Software works....

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Watch, as Gary Albrecht (the creator of the M3 Navigator) shows a recent real-market example
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Link

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Go there and watch it now..

Then return tomorrow, Tuesday November 17th at Noon Eastern when Forex Mastery GOES LIVE for the FIRST TIME!

Trade Smart. Not Often..

P.S. Don't miss this latest video showing how the M3 Navigator software predicted a 200 pip
move, live in a class full of students last week..

Link

P.P.S. Forex Mastery GOES LIVE tomorrow --> Tuesday, November 17th at 12PM Noon Eastern

Go here to claim your copy on Tuesday:

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2009-11-16T17:46:00.003+08:00

100 More Correlation Copies Are Being Leaked, But They Won't Last...*

Well I sure didn't expect this!

But yesterday Jason Fielder himself contacted me and let me know the demand was SO high for Correlation AFTER it closed, they were "strong armed" into hiring 2 additional staff members to keep up with the high level of support they are committed to providing.

Because of the new staff that were hired, and the FAR higher than expected demand, Jason just told me he is releasing 75 more copies of Correlation.

Link

(They are now able to support more traders which was the limitation to releasing more copies the week before last.)

BUT...

And this is a big but...

The OTHER reason they are releasing more copies is because of the crazy demand that has not subsided since they closed two Friday's ago.

How do they judge this demand?

Simple, they have a "Waiting List" on the original order page, and you won't believe how many traders have already signed up...

Over 742!

Remember only 75 are available for the 700+ traders that are on the wait list...and they won't last long!

Link

And this time, the doors won't re-open.

PS: Do the math-- there are 742 people on the waiting list. And there are only 75 copies being made available.

There is no risk and, and they even brought back those amazing bonuses as well!

2009-11-10T11:41:00.001+08:00

Did you ever think Forex would be this easy?

How would you like to have your share of 3 trillion dollars?

No it’s not bailout money from the Government. It’s the amount of daily volume in the Forex Market!

Unbelievable isn’t it? That much trading is going on sight unseen, EVERY DAY. Just imagine getting your hands on some..

Anyone with even just a bit of trading knowledge knows that where there’s that much money moving around, there has to be multiple opportunities to “tag along”…

…and there is..

Link

Problem is, you can get sucked in so fast you could lose your shirt..

Ever see the movie Titanic?

At the end, the ship tilts straight up and finally plunges toeternity. Survivors had to get as far away as possible because that massive movement would’ve surely sucked them down with it..

That’s how it’s been with Forex..

Huge spikes, massive market swings and plunges. Almost on a daily basis. This nerve racking market gets everybody excited, but scares the pants off the Average Joe trader..

But Multinational Corporations, International Banks, World Governments and Big Players with deep pockets shouldn’t be the only guys cashing in on Forex..

But unfortunately, that’s been the norm until now..

That’s because the Forex Market's been too dangerous and 'unsafe' for the regular traders like you and I....

That is Until now..

--------------------
Project 'X' Revealed
--------------------

You see, the guys over at OU Forex Trader have just lifted the veil on “Project X”. The secret project they've been quietly working for months. It’s so powerful, so complete, so perfect for the 'regular guy' Forex trader... you’ll want to head over there and watch this video about their breakthrough program…

This is definitely worth your time..

Just visit the link below and you’ll be taken to watch a video that details just what this is all about..

Here’s the link, invest a minute or two and judge for yourself.. Being able to safely and profitably enter Forex could be just what you, your portfolio and your bank account needs..

Link

See you over there,

P.S. This video is time-sensitive so I recommend you watch it right away. The information revealed on this video will be a "Game-Changer" for Forex Traders and is not to be missed..

Go there now to have a look:

Link

2009-11-03T17:37:00.002+08:00

Shocking final Webinar reveals correlation's Performance

With less than 100 copies left and time running out on the option to become a Correlation Code Owner, Jason thought he'd hold one final webinar this Thursday to REALLY show you what you will be test driving.

The feedback from the brand new owners has been some of the best he's ever seen for ANY trading system he's ever developed (it's really quite astounding and he will be sharing some of it with you in the webinar.)

Link

So:

If you aren't averaging 455 pips / month in under 15 minutes per day (and that's NOT EVEN his scalping trades!)...

If you are not pulling the trigger on ALL of your trades with "absolute" confidence...

If you are not taking your trades with 'laser like" accuracy...

You need to drop by for your final chance to see the Correlation Code in action, before they SLAM their doors shut for good.

Oh, and one more thing, this webinar will be different than the last, because he will be focusing more on the actual performance of the system.

He'll be showing you his "1-2 Stack" system which explains exactly how he "stacks" different trades on top of each other to "Supercharge" his performance (remember some of his trades are over 90% accurate).

Link

PS: Jason has just recorded a new video where he shows you some recent performance with his "Follow The Leader" trade that just might make you a "tad" jealous...

As soon as you register for the webinar you will be redirected to the video, so make sure to enter your email, even if you can't make it, at least that way you'll get to see his latest correlation trades.

2009-10-31T11:27:00.003+08:00

First Day after Studying Correlation Code

When Correlation Code was launched yesterday, I did not hesitate and quickly got a copy because I am impressed with Jason Fielder's stuff since the day when I joined Triad Formula.

First, I made sure that my login details are correct, followed by downloading the 11 new FXI MT4 indicators on the platform. After that, I went through the training modules and decided for myself which are the primary strategies I have to priortise my time to specialize. There are all together 8 strategies in Correlation Code, and I kind of made up my mind what two or three will form my core cup of tea.

Some people on my Facebook wondered whether it is worth purchasing Correlation Code. My immediate response is it is a question to be decided by ourselves. There will be folks who are skeptical, and would believe that there are always freebies out there for grabs. Hence, during the pre-launch seminar, I saw a few comments to the effect that it is not worth US$1,997 at all. Again, there is perfectly fine to deem US$1,997 as expensive, and it is the person who sees it expensive feels that it is expensive. As far as I am concerned, investing in myself is a core theme I am carrying out my trading business for many years. Hence, investing US$1,997 is not an issue for me - as I find it cheap actually to learn something from someone on whom I trusted as I tested and am satisfied with the previous product.

Anyway, why do I care for other people? I care for myself and as I have already invested this sum, it means that I am now allowing myself to drill into further underlying of how correlation can enable us to milk the market in a different dimension. In this journey, there will be people who bought the package, and "try try", and in the end, finds it not suitable. Well, at least they have given themselves a chance to experience. For folks who do not take the first step to understand whether the product is suitable (and this consists of majority of the people in the world), it means that they will continue their journey of looking for the Holy Grail that is free of charge. It also means that they may stay where they are and ponder and ponder whether they are on the right track.

Well, it is going to be a busy weekend for me as I am going to roll up my sleeves on Day 2 of my Correlation Code journey.

2009-10-29T15:45:00.001+08:00

Over 44,000 Traders Can't Be Wrong! "The Code'' Just went live!

I'm almost embarrassed to say it, but Jason has already sold over HALF of the Correlation Code copies available...

And the doors haven't even opened yet!

An "Absolutely Astounding" number of nearly 10,000 wildly excited traders attended yesterdays two live webinars, and snatched 53% of the limited number of correlation copies faster than you can say...

"Target Hit"!

(Jason opened his doors for just 60 minutes after each webinar, then they SLAMMED them shut till right NOW!)

Correlation Is Now Live!

Link

Correlation Will Sell Out!

The Special Bonuses May Already Be Gone...So Hurry up and grab them while you still can!

If you were you there then you have probably already snatched up your copy of The Correlation Code like so many others because of the raw power of trading the "Cracks in the Correlation".

Now for the bad news...

Jason is only releasing 947 copies of The Correlation Code!

That means Less than 2.3% of the traders who loved Jason's reports will even have the opportunity to become a Correlation owner.

Link

So if you missed the webinar now is your chance to grab your copy...

But you really do need to hurry.

PS- The best part of this system is that this is all without any risk, because of their iron-clad 45 day guarantee.

They are that confident that once you start trading "The Code", you will never go back.

2009-10-28T17:22:00.001+08:00

Correlation Secrets!

Over 42,000 downloads of The Correlation Secret & The Correlation Cheat Sheets...

Tens of thousands of traders POUNDING Jason's blog every day to watch the videos and learn more...

2146 plus comments of INTENSELY excited traders anticipating "The Big Reveal" on today's live webinars!

It all begins in just a few hours at 1:00 PM EST, when Jason Fielder and Anthony Trister will be getting into the nitty gritty of The Correlation Code!

Link

They'll be showing you more trades and more exciting charts...

You'll also discover when it will become available, how many traders the'll be accepting (it is a very limited number) and they will even reveal some absolutely astounding bonuses as
well.

You don't want to miss this.

Go register now, and if you already have, please do NOT forget to show up!

(You'll get a reminder with your login link 60 minutes before they begin, so check your spam folder if you don't see it)

See you on the webinar!

2009-10-27T15:30:00.001+08:00

One Last Correlation Video Before the Live Webinar

If you had the choice, would you rather rely on the sun rising every day, or the weather forecast?

I'm going to guess, it would be the sunrise.

When you're trading with Fundamental Law on your side as correlation traders do, you're only taking the "sunrise trades".

Let me explain...

Whenever correlated pairs "crack" or become temporarily uncorrelated, they will ALWAYS come back together, just as sure as the sun rises every day.

So again today, Jason Fielder saw a crack between 2 pairs, and grabbed a quick and easy 15 pip scalp. (he could have held on for a total of 52 pips, had he decided to stay in).

Link

Go see how he did it yet again, using the correlation code, and...

If you haven't yet registered for the webinar, there is less than 24 hours till it will be too late!!

Go get your seat NOW!

Link

Let's Rule The Markets Together!

2009-10-26T21:12:00.001+08:00

The Correlation Code Webinar is SOLD OUT!

You haven't registered yet?

Well the subject of this email is exactly what you'll be seeing if you don't go ahead and register yourself right away.

Link

You see Jason has a maximum of 6000 spots, and they already have FAR more than that registered (actually over 8000 so far and climbing).

If you understand the difference between taking trades based on back tested, curve fitted results like most systems, and "Fundamental Law", like correlation, you won't want to miss out...

And they're just about full.

(Fundamental Law is based on the concept that the sun rises every day, it simply HAS to happen, and is the same principal correlation is based on)

Register before they're full, so Jason and Anthony can show you how we can...

Rule The Markets Together!

PS: Go ahead and register for the scholarship copy of "The Code" if you haven't yet! (You'll be redirected after you register)

2009-10-25T20:26:00.008+08:00

Correlation Code in Forex Trading

Correlation Code is a forex trading system that exploits the correlation patterns between currencies pairs which have been happening every minute in the forex market. It is a system based on unchangeable universal fundamental laws.

Example of such universal laws : “When temperatures INCREASES, sales of ice cream INCREASE as well”

Jason Fielder has spent 12 months analyzing 82 different forex strategies based on exploiting “The Correlation Secret“.

After a series of trial testing, 8 profitable and consistent correlation strategies were picked to form the Entire “Forex Correlation Code” Trading System

Here are the main benefits of using The Correlation Secret system against other trading system:

1. Correlation Trading is very easy to identify and trade

2. Correlation Trading is backed by proven, timeless, universal market fundamentals which give you a very high winning accuracy

3. Correlation Trading gives you the PREDICTABLE VOLATILITY you need to trade with confidence and accuracy

There is nothing to use by browsing through the following link:

Visit The Correlation Code Homepage

2009-10-25T15:01:00.004+08:00

Update on DX-Spot V after October expiration

It is amazing that the first week after October expiration was similar to what we saw during the second half of May 2009. After convincing move above 10,000 points, DX-Spot V refused to budge on my original "Judgement Day".

Instead, it made a bold move to even close above 10,000 on 19, 20, 22 October 2009. This is an encouraging sign.

DX-Spot V made a 52 week high at 10070 on 21 Oct, and it took approximately 19 days from 2 Oct low to hit this target. The 64m question is where DX-Spot V will be heading. I turned on the daily trend filter in Profitsource, and as you can see, the last 4 bars are black. It means that the market participants are unable to reach any consensus as to where DX-SpotV should go. Alternatively, bulls and bears are beating each other day in day out.

9800 apparently is a near term support level, and right now, I am going to stay neutral until I see bulls or bears have an edge over the other. The next Judgement Day as marked in my Profitsource chart is actually 22 Dec, 2009 which marks a new trading year from Gann's perspective. This will be a significant turning point I am paying close attention.

2009-10-17T16:09:00.005+08:00

My experience in reading fundamentals

Very often, I heard from students who have been taught to read only the technical charts, and apply technical analysis in trading the currency market. At the same time, I have also consistently heard from students who have been taught to only trade the major pairs because of the tight slippage.

So, if one is to specialize only in GBP/USD, he could miss opportunities even though his view on strong GBP might be right. Keep in mind that in trading currency, we are trading the relative strength of the base currency and quote currency. So, the way I trade forex is to apply my fundamentals first to decide the stronger currency and the weaker currency so that it gives me the best bang for the buck.

I do a weekly analysis of the performance of the major 5 - EUR, GBP, AUD, NZD, CAD, against JPY and USD. It is important to chart the correlation between JPY and FSTE/ DAX and INDU, and do the same between US and FSTE/DAX and INDU. Therefore, if the correlation exists, I would roughly know that USD and JPY will be my quote currency. Of course, if JPY is stronger than USD, and if the equity market exhibits a strong uptrend, I will use USD as the quote currency and not JPY because I need to quote currency to be weaker. Does it make sense to you?

In positioning the trading opportunities by looking at the major 5 as base currency, it is useful to plot them in the format of major 6. The above is an example of how I plot my major 6 - GBP/AUD, GBP/CAD, GBP/JPY, GBP/NZD, GBP/USD and GBP/CHF. Notice that the chart is going to the upside for all major 6. This means that GBP is displaying a strength. Here you will need to understand what has happened in England.

So, with a bit more understanding of the fundamental, and the relative strength of each currency, you will realize how easy to choose the pair that gives you the best bang for the buck in a particular day. Like I shared with Ivan C in my Facebook, Oct 15's session should be a day for GBP/JPY because JPY has been weak given a bull run in the equity market. It should not be a case for GBP/CAD because commodity currency remained strong. On Oct 16, however, CAD showed weakness and this changed the game plan completely.

The above is an example of flexibility, and being flexible allows us to be in a better position than many people on the street, who struggled and pondered how to trade the currency market.

2009-10-11T18:04:00.002+08:00

Example of FTM's Momentum Method on 9 Oct 2009

If you have been a professional forex trader, you will realize that despite the super weakness in USD, GBP was in a more jia lak (Hokkien - meaning worse) position over the last two weeks.

Given the weakness in USD on Wed and Thurs session, typically one can expect a relief rally in USD on Friday session. Don't get me wrong. I am not expecting a USD relief rally because I trade on what I see and not what I think.

Well, USD indeed had a rebound on Friday session How did I see this? The first sign is a rebound of USD/JPY, telling me that USD was no longer weak on Friday's Asian session. This is the first sign. The session sign was the range bound action in the high beta currencies against USD. It was telling me that USD was not that weak on Friday compared to Wed's and Thurs' session. Of course, since AUD/USD has made such a strong move over the weak, Friday is typically expected to be a profit taking day, and I can understand that this might be the case (Smile!).

When GBP remains weak, and JPY is weak, there is no way to trade GBP/JPY on Friday. Instead, it makes perfect sense to trade GBP/USD to look for a short position. So, this is my rationale of going to look for short position on GBP/USD.

Using Bill's Foreign Time Machine Momentum Method, there were two trading opportunities on Friday's session.

Trade 1

Setup bar was formed at 12:30pm candle (based on SG Time), and one would immediately go short at 1:00pm. Using FTM's Momentum Method, one should have exited the position around European session for an approximately 50 pips profit. This is no brainer in my view.

Trade 2

Setup bar was formed at 11:00pm candle (based on SG time), and one would immediately go short at 11:30pm at 1.5915. Guess what? If you don't want to hold the trade over the weekend, you could have exited the trade at the close of Friday's US session for approximately 70 pips profits. Again, this is no brainer to me.

Some of you may ask how I picked these trades? First, I am a fundamental trader and trade based on the relative strength and weakness in individual currency. So, I am not a specialist of any currency pair. In fact, I can trade anything under the sun. Like in this particular case, do I force myself to trade EUR and not GBP when GBP is more jia lak than EUR? And do I force myself to trade GBP/JPY and not GBP/USD when USD is stronger than JPY on Friday's session. So, as professional traders, we have to be inflexible to be flexible. Be more alert to what happened in the global economy and we will see tons of opportunities everywhere in the currency market.

In terms of money management, I don't really the FTM's recommended exit method. Instead, I have said before. I adopted Ross Beck's multiple lots exit method, which is a method I am more comfortable with than Bill's FTM method. It's ok. As professional traders, we have to understand our trading personalities and trade on what we feel comfortable. There is no right or wrong way in trading. In fact, like my options trading, I typically mix and match various people's ideas to become greeksman's trading method.

Hope you enjoy this sharing so far on my FTM journey.

2009-10-10T21:42:00.004+08:00

Let's see what happened before the Judgment Day

Autumn Equinox proved to be a powerful anchoring point from Gann's perspective. After Sep 23 when INDU hit 2009 High (9855), it dropped almost 500 points in literally 9 trading days, and made a come back after bouncing off 50 Day Moving Average (the dynamic support).

I raised this question in my blog a week ago, whether the history will repeat. Someone asked me what happened on Oct 11, 2007? It seems to me that we have a short term memory and the Lehman Brothers and AIG collapse becomes forgettable. Well, that was the day when INDU made the all time high before it made a U-turn till March 2009. Oct 11, 2009 is a Sunday and therefore it won't be a trading day.

All indicators I have here are telling me that there is no reason for INDU will fall:

1. 10, 20, 30, 50 Simple Moving Average are still going up (although SMA is a laggard as we all know).
2. INDU is trading above 50SMA and 200 SMA.
3. 13,34 SMA (John Murphy's favourite) has not shown a bearish crossover.
4. We are still in the 20-week bullish cycle (if you have been following Tom Gentile and Jay Kappael)
...
and many more

On the other hand, when almost everyone is bullish on the market, I have to be extremely careful. On Oct 9, 2009, when INDU closed above 9800 for the second time, the volume was lower than the average volume (NYSE 988, vs. closing avg of 1227; Nasdaq 1929, vs. 2269). Based on my sector analysis, it appeared to me that the last run from the Oct 2 low till Oct 9 high was a result of USD weakness and this in turn helped Crude Oil to rebound like nobody business. The market is also cooking an early recovery story when the Reserve Bank of Australia raised the interest rate by 25 basis point, causing AUD, NZD and CAD hitting 2009 High against the weaker USD. The picture seems to be rosy to the public, and yet the issue is that the market participation is skewed to one or two sectors.

This is a SPX performance chart showing what happened over the last 10 trading days, which represented what happened in the market from Oct 2 low. The lack of participation by the Financials and Semiconductors sectors raised an alarm to me.

Using John Murphy's intermarket analysis, we need to see these two sectors to participate and clearly it was the case. When everyone is still going long on commodity sectors - oil, metal, gold etc, Kathy Lien from GFT Forex made the comment on Oct 9 that in the latest CFTC report, "forex positioning in the futures market is nearing extreme levels.". This raised the issue as to whether the story of dollar weakness will likely come to an end. If this happens, what we saw in the strength in AUD, NZD and CAD over the last few trading sessions should come to an end. How about oil? It will likely behave in the same way.

From my reading of the weekly FX charts, GBP remained weak for 2 weeks already and did not really participate in the bullish move. England perhaps is still in trouble based on the Manufacturing Production Index announced on 5 Oct. EUR has been in the range for a few months already and the weekly chart looks slightly neutral to bearish to me.

So, there are signs that the market strength may come to a pause (I won't call it an end to be fair and remain objective). I am not sure whether the market will turn to the downside during the Oct expiration week. However, that said according to Stock Trader's Almanac 2009, Oct 12 (the Columbus Day) has been more likely than not an "UP" day (23 times out of the last 28 but 2007 had been the one and only one exception in 7 years - and that was the day when the market decisively made the U-turn). Oct expiration week also marked a "down" day for INDU.

This Gann chart I posted above will be updated after Oct expiration. In the meantime, I closed out most of my bullish positions for a profit or loss or whatever it is. When I see the anchoring point on the chart, as I told my students, it's an alert, and alert telling me that I have to be extra careful.

Interesting, Gann chart has not disappointed me so far since I learnt from my Ultimate Gann Course. There is nothing right or wrong here. Like I chit-chat in Facebook with my friends, some don't believe Gann stuff. It's perfectly fine. Yet, I respected Gann's analysis, so much so that I am committed to drill into Gann stuff at a higher level than where I was a year ago. So, if you respect me, respect by agreeing not to disagree or to believe Gann stuff. Just leave me alone, and we will stay in a peaceful community.

Till then, have a good trading weekend ahead.

2009-10-04T18:14:00.003+08:00

Lessons from get-rich courses

This article was published in The Sunday Times on October 4, 2009. Of course, due to the copyright reason, I am not able to re-produce this article. If you are interested, you can always grab an electronic copy if you are a subscriber of the Straits Times. [By the way, I am aware that many bloggers will simply copy and paste the article in their blogs. This is in breach of copyright under Singapore Copyrights Act. That is, there are legal consequences to copy and paste the article in their blogs without seeking either permission or waiver from SPH.]

The learned author shared with her experience in signing up a 4-day course on options trading and having paid > S$5,000 for this course. She concluded that she did not benefit from this course by objectively giving her reasons. This is good. She did not blame the trainer or the organization providing the course.

"Maybe it's because I was not hungry enough or I was just too busy with my work and family. It did not help that I fell ill immediately after the course"

"To be fair, XXX still invites me for refresher talks and is willing to sit me through a one-to-one mentor programme, but I cannot find the time."

So, the learnt author has correctly pointed out some critical success factors as to how one can benefit from these courses:

1. Be realistic
2. Setting aside time to learn and practise
3. Track record of the training firm and trainers.
4. Don't invest more than what we can afford to lose

No doubt the trainer undertakes to teach whatever he/she can teach. The students have to play their part and not to expect miracles. In other words, if the students' mindset is to go for the course once, and expect that they can trade and make tons of money in the market, perhaps they should not have had signed up for the course. Trading is a craft, and it will take time for us to practise the craft. And because each of us has different time commitment and other obligations, our learning curve will be different. Let's face it. If we spend only 30 minutes a day to practise, are we realistic to make money within a month or two after completing the course. Go figure.

Instead, Singaporean mindset is like this - they first of all will blame the trainers. They will conclude that the trainers are suckers and the public are the poor sheep. Is it fair to blame all the trainers that they have only one motive, i.e. to make money out of students because they cannot trade well. It also appears that the public have this perception that people who teach cannot trade, or people cannot teach and trade at the same time. I am not sure how this comes about because I have quite a number of trading buddies who can teach and share their ideas, while they are trading pretty well. So, if we are listening to hearsay, without going to look for counter examples of such limiting belief, who are we to judge at the end? Go figure.

Finally, teaching is not an easy task I must say. As a trainer, whenever I am asked to teach a course, I have students interest first. I will find out what they want to hear from me, and gauge their levels to make sure that they know how to look for the answers.

I hate to spoonfeed people. If a student comes to me and is basically looking for fish, my heart will go away. If a student has done his homework beforehand, I am happy to share my experience and direct the student to what he is looking for. In other words, if you give 200% and are committed to do the best, trainer like myself will likewise give our 200%.

To end on this note, I would like to share with my readers a recent response to a student who is dyeing to recoup his tuition fee in four months' time, and he is literally looking for quick tips to recoup his money, and showing no sign to respect trading as a business. Here you go:

1. My philosophy has always been that trading is a business, and it will take time for beginners to master the craft. There is no magic overnight nor miracle. It also depends on how much time we are committed to invest, regardless of our other family or personal obligations. It's like driving. The more time we spend on learning how to drive a car, the faster we get our license to drive on the road. It does not mean that we become a professional driver on the road. Beginners have to put on a P-plate and will be frowned upon by other road users (me included). Yet, having been driving for two decades on the road, I still cannot beat Lewis Hamilton because he is a professional F1 racer and he is of another level of skillset. Understand that trading is the same. It depends on how much we are committed. I told my students during preview very frankly if they are after recouping the course fee, they should not have signed up for my course. They should not even go for another course and simply forget about trading. Carrying this mindset is dangerous because it will sabotage that person. Let's be frank and honest here. There won't be a magic and whether you perceived it to be a misunderstanding or misrepresentation, in one way or the other, by Optionetics or any other people around you, I will assure you that this is my guarantee - if you are willing to give you 200% to invest time to perfect the craft, the instructor team (me included) will give you our 200% to assist you.

Virtual trading is a good start and from a trading psychology viewpoint, you have to do what you are comfortable in trading. So, what is the deal if you are trading spread using Jan 2010 options? Are you going to force a trade using near month option and yet if you are not sure what it means in terms of risk, you are going to lose even more. Assuming that you are getting refunds from Optionetics, if you continue to trade that way, you will be bound to lose a lot of money in the market, and no one is going to refund you. Have you considered this potential danger? Are you going to get refunds from Optionetics and call it a day? If so, why would you sign up for the course in the first place? So, I see a lot of internal conflicts and I can feel your frustration. My experience of you is that it may be the appropriate time for you to reflect on yourself.

2. Optionetics does not encourage one to daytrade. It's been clearly explained in 2-day seminar. Of course, we cannot stop anyone from doing daytrade if he/she chooses to, and he/she has to take 100% responsibility for his/her own conduct. Yet, in reality, a lot of people will choose to be blamer (one of the 5 recognized categories by Virginia Satir - go and google this lady if you are interested). I would encourage you to do whatever it takes to shift your mindset by taking your time to perfect the craft. It's not about reading another book, or going for another course, or learning from another person. Trading is a very personal thing and is a lonely business. We do a lot of self-talk everyday. There is this saying that we talk to ourselves 60,000 times a day. In trading, I will double or even triple this number. Do you realize that you are actually talking to yourself now? So, my experience of you is that you've got to know who you are, not as a person, but as a trader.

3. So, in the moment of time but not future, ask yourself these questions: have you done up a trading business plan? Have you found out your preferred markets, strategies? Have you figured out your risk appetite, and the rules applicable to money management and risk management? How do you manage your discipline if your internal voice is telling you to be "naughty"? What is your proposed research & development (i.e. continuous educational development) expenditure? I seek your understanding that Jack spent one whole year in the US just to learn all these from his mentors before he sees the exponential growth in his trading performance. Without a business plan, we will always be making unnecessary time wasting roundtrips.

4. While it may sound disappointing to you whether it is true or not, I seek your understanding that if we respect who we are as a trader, we will grow as a trader. The moment we have self-doubt, we will not behave as a trader but just another person on the street who is looking for another advertisement about someone selling a trading course and alleging that his/her students make 7000% in a day. There are too many blacksheep in Singapore who are selling us dreams. Trading success is not about knowing one or two strategies. All my successful trading buddies subscribe to one common theme - managing our risk and getting to understand trading psychology. On trading psychology, it is a self-experimental exercise, which means that you have to practise on your own. No one is able to teach you this. In terms of good reference books, I will recommend you to read "Trading for a Living" by Dr. Alexander Elder and "Trading in the Zone" by Mark Douglas. These two books are on the top of my list in terms of trading psychology.

5. Finally, understand that trading is not a QTBR scheme (i.e. quick to be rich scheme). If a neuro-surgeon has to master the craft for a decade, what makes us think that trading is not the same? In other words, are we able to succeed so easily by reading a few books or going for one course, and then we can trade like a pro? Unfortunately, many other course providers are selling us this dream., and suck our money. If you have a chance to talk to me in the next 2-day class on 19-20 Nov, I am happy to elaborate this further.

6. Now, I want you to reflect what you have done since the last 2-day class. Have you been following the markets day in day out? Have you finished reading the Home Study Course for 10 times? Have you watched all DVDs / listened to the CDs? Have you been reading articles in Optionetics.com everyday? Have you exhausted available resources like going to my discussion board to ask me question? Ask yourself whether you have given your 200% here. I am not saying that you haven't. I seek your understanding that if you can give yourself a true and honest assessment on what you have done, it will answer a lot of questions you might have.

2009-10-03T10:54:00.006+08:00

Example of FTM's Breakout and Momentum Methods on Non-Farm Payroll Night (2 October 2009)

It's always interesting on the day when US Non-Farm Payroll is announced (at 8:30am EST). The bar set for NFP to me was pretty high and in view of the ADP announcement made two nights ago, it is quite ambitious for the actual NFP number to beat the forecast (or even touch the forecast number). So, a negative 263K number with a 9.8% unemployment rate should be bad enough to cause the market to tank. Indeed, futures were sold off here immediately after NFP number was announced. When the cash market was open at 9:30am EST, it did pretty much the same thing.

Here is where a professional trader will do as opposed to an amateur. When everyone feels that it is bad enough, it's time to go for contrarian trading idea. When the number is bad, normally one will expect that people go long USD and JPY because it's logically sound. People are risk averse and hence they will go for risk aversion currencies. As professional trader, on the other hand, we are trading based on what we see and not what we think.

From my major 12 using Jimmy's Band (taught in FXTE's Trading Tactics Coaching Class), I saw that there was a reverse situation when USD and JPY were sold off instead of the other way. Hence, it's time to get ready to do some long trade against USD and JPY. So, I used Jimmy's Band to identify the pairs I am choosing. USD/JPY was going up, and hence it is logical to choose Yen pairs to go long to achieve a better bang for the buck!

Breakout Method

Here is the FTM Breakout Method on EUR/JPY 30 min chart.

The set-up bar was formed at 10:00am EST, and we would enter a long EUR/JPY based on FTM Breakout method at 10:30am EST. By following this simple trading method, we would have easily made 90 pips within 30 mins which is US$900 on a standard lot.

Momentum Method

Now, let us look at another trade using FTM's momentum method. Again, the idea originated from Jimmy's Band as discussed above. The following is a 15 min chart on GBP/JPY and a set up bar was formed at 12:45pm EST and we would go long on GBP/JPY at 1:00 pm EST. The tricky thing is that it was a Friday night and the European Market was closed at that time. Hence, there was some internal conflict to choose a longer than hourly time frame to trade. Therefore, scalping using a 15 min chart made perfect sense in this situation.

If one were to study the FTM Momentum method closely, he could argue that this set-up bar was not really a set-up bar. In my opinion, it is true if we strictly follow the method. However, this is where the flexibility comes into play as a professional trader. Isn't a set up for Forex Nitty Gritty's method? Yes, indeed. Can we combine FNG and FTM's Momentum method here? Yes, we can. So, here is my answer.

So, a nice 25-30 pips within the next 15 mins were made. If one followed closely, there was a proper set-up bard at 2:00pm EST using strictly the FTM momentum method. Well, by that time, I went to bed and sweet dream. Hence, leave it to folks who could stay up. Trading should be less stress exercise and thus, if we can't trade at that time, then do something else.

2009-09-30T10:49:00.009+08:00

An Example of FTM's Breakout Method

Early this morning, there were many opportunities available in my major 12. However, the better one will be using FTM's Breakout Method. The following is a snapshot of EUR/USD hourly chart which demonstrated a probable set-up using FTM's breakout method. A long trade can be initiated at 14609 with a stop loss of 1.4577 (i.e. 31 pips risk)

The trade is still ongoing and currently, using the breakout method, it is a risk-free trade. Let's see how it goes.

2009-09-28T11:26:00.002+08:00

Another Example on FTM's Breakout Method

This is a bearish set-up on EUR/USD hourly chart based on Forex Time Machine's Breakout Method.

Based on the entry set-up rule, a short position was placed at 9:00am SG time and within an hour, TP1 and TP2 were hit. I applied a different methodology here because I like the 3x multiple lots systems which I learnt from Ross Beck and Jimmy Young in the FXTE program. At this point of time, there is a gravy train on the last lot that is being operating. The trade yielded 62 pips after hitting TP1 and TP2, and this means that it is $620 per standard lot.

Fundamentally, I am bullish in US$ and bearish in EUR. So, the fundamental understanding I have helped me to identify this trading opportunity.

2009-09-27T11:55:00.005+08:00

Does it look familiar?

Talking to my trading buddy, Conrad can be quite fun sometimes because this fellow has very strong insight in reading the market. Each time when I talk to him, he will put some money in my pocket. He has directed me to read some mind-blowing books which I told him I would do it in the following days. In the meantime, let me put up a chart showing what I have learnt from the Ultimate Gann Course so far from Safety In the Market

Here is the daily chart of DJ-SpotV. It was about 227 days from 14 July 2006 to 20 Feb 2007 (i.e. Points A and B). Using simple ABC set-up analysis and the Balance Time Tool in SITM Module in Profitsource, the projection of another top would be around 11 Oct 2007, and that was the day when INDU reached the all time high. It's amazing and blowing my mind when I was doing these projections myself.

From the Ultimate Gann Course, I also learnt to draw Fibo using calendar days and using this technique, it helps to identify whether there are possible signs that there would be a change in trend. Again, it's mind blowing stuff.

Now, here is my projection and firstly, I am not providing any advice here. I am doing what the tools are telling me to do, and plot my lines accordingly based on the rules and guidelines. So, if the market chooses to prove me wrong, I am wrong and it is ok to be wrong.

At this moment, INDU continues to show an uptrend, and it will remain intact if the Fibo calendar days support this view (and so far, this guideline has yet to be violated). Using ABC set-up, there is a reasonable time around 9-10 Oct 2009 where INDU will finish up to 10400-10500. Keep in mind that this day is the 2nd anniversary day (approximately of course) of INDU's all time high. So, will history repeat itself?

It's just amazing that the more I learn Gann stuff, the more I discover on the history. Gann believes that history repeats and the tools are helping me to discover the history.

Let's see what happens when the 2 yr anniversary is approaching.

2009-09-27T10:37:00.004+08:00

Forex Time Machine (Review)

http://www.theforextimemachine.com/home_200909.php

Someone in my discussion board asked whether it is worth paying a few thousand dollars for getting the proper investment education. I was happily explaining to this person that when it comes to investing in myself, I need not think hard because I know before and now, and even after that investing in myself will generate a huge return in the long run. So, what happened was that I grabbed a copy of Forex Time Machine and studied the methods in about two days.

As a professional trader, grabbing the methodology of the three methods in FTM is quite easy. Like Bill nicely put in his Q&A upon the launch of FTM, experienced traders will still benefit from the course because it is perfectly fine to add on additional tools and trading methods to their toolboxes, and this means that these experienced traders are armed with more weapons and are flexible to trade the ever-changing market.

FTM discusses three trading methods - Breakout, Momentum and Spring. Spring method is also part of the previous course "Forex Income Engine 2.0". The interesting part to me is therefore the breakout and momentum.
Momentum method

Imagine that this is the set-up of the momentum method as discussed in FTM. There are just a few technical indicators in the chart. For me, I prefer to trade currency using hourly chart although FTM methodology is fractal in nature which means that you can use it for longer and shorter time frames.

Although it is not part of the requirement to understand the fundamental, by combining what I learnt from Jimmy Young of FXTE pertaining to how to read the market from a top-down approach, picking up a bearish trading opportunity in GBP/USD is no brainer, to be frank with you.

So, based on the momentum method, we will enter a short GBP/USD position at around 16192, and within two hours, we should be able to close this position around 1.6000. That's like 192 pips more or less, and just one trade using standard lot, the course fee has been recouped.

Breakout Method

How about the breakout method? Here is just another example of the breakout method set-up.

As you can see from the chart on the left, there are just a few technical indicators to be used. However, while it is not discussed in the course, I believe it is important to understand the fundamental. So, Jimmy's insight in reading the market helps me to determine that when the market is weak, USD is up because of a strong correlation over the last two weeks, and an inverse correlation with the commodities such as gold and oil, shorting AUD/USD is again a no-brainer job.

See we don't need to follow 100% what the course discusses. The key point as a trader is to understand our own trading preference and psychology, and copy & paste what seems to work for us, and that's is. This is why it is so hard for a newbie to make money immediately because he has yet to develop the craft. It does not mean the course does not work. It works, and yet it works because we understand how to trade the methods and apply what suits us.

For this trade, we should be able to make around 30 pips within an hour or US$300 using one standard lot.

Unfortunately, I understand that the launch has come to an end. For those who procrastinated or were skeptical about paying a few thousand dollars, sorry to hear that. It's normal for human beings to be skeptical. You may need to wait for the next launch then.

I mentioned to this person that there is actually nothing to lose because the course provides MBG (Money Back Guarantee). So, if we are not happy with the course, we can return it to Bill and incur at most administrative fees on shipment. At least we give ourselves an experience to find out if the product works for us. Again, human psychology tells us that most of us will not even dare to make this move - hence explaining why for every thing the mankind do, only 5% of the people will eventually be the Elite Club.

2009-09-02T09:19:00.002+08:00

Will I be able to make tons of $ after attending a $6k course?

Is it the follow-thru impact after my InvestFair 09 talk two weeks ago? I got frequent questions from a number of people who are asking for my opinion on options courses that are being run in Singapore.

If you are in a rush to pay $6k to attend a 2-day or 3-day options trading course, and your objective is to make quick bucks in the shortest time frame possible, I would urge you to donate the same sum to charitable organizations in Singapore because you can get 2.5 times of deduction against your income in 2009, and you will help other folks.

The market is cruel. However, what makes us think that trading is as easy as writing "ABC"? What makes us think that by putting $6k with someone, we can make quick bucks in the short period of time. Is this guy selling us a dream?

Options trading is a tough game, and yet it is possible to make money when one is committed to learn in the manner in which professional options traders are trading. For every hour of actual trading experience one can clock, he/she would have to put in at least 10 times of the effort.

In some of these advertisements in the Straits' Times, it was alleged that one can spend only 15 to 20 minutes a day to do trading. While I don't deny the correctness of this statement, it must be read in the right context. It is true if we are referring to people who have been in trading business day in day out. In other words, we are talking about seasoned traders. It cannot be applied in my opinion to newbies.

If you think by putting $6k with a trader who is teaching you how to trade options successfully and allow you to make lots of money from options trading in a short period of time, please do your due diligence by asking this person a couple of things. You are doing yourself a favour by asking these questions so that you know this "teacher" is not selling you a dream which is not real in the real world (perhaps it is true in lala-land).

I have nothing against anyone who is committed to learn and master options trading. However, I continue to stress that one should learn the stuff from someone who is ex-floor trader or at least has been trained by ex-floor trader. if whoever taught you cannot explain the things I wrote in my blog, and is however telling you that you must believe in those myths, please re-consider.

Whoever told you that you need not study delta, gamma, theta and vega, and you don't need to pay attention to the volatility, and whoever told you not to buy out-of-the money option without explaining in maths why this is the case, you know what to do.

Whoever told you that you must be options sellers because 80% of the options expire worthless, and whoever is teaching you to do high risk high probability trade without explaining profitability versus probability, you know what to do.

Finally, if whoever is telling you to do short-term trading (like intraday trading), and if he fails to explain to you the PDT rule, you know what to do.

Trading is not as easy as what the public might think, I reiterate. Trading consists of hard work, and is an art. If we are willing to spend time and treat this as a business (I have discussed this in my Optionetics February 09 monthly online forum), then it is possible to survive in long run. If we are not prepared to spend that kind of hours, I would recommend that you forget about trading, and you pass me the money instead and I will spend it for you.

Good luck for those who have read the ST and are about to pay $6k for an options course thinking that they can attack the market immediately. We love you!

2009-08-17T16:04:00.002+08:00

Myths on Options Trading (Part II)

1. One loses money on a long straddles for one and only one reason - i.e. because the underlying does not move.

Does the trader ever bother to understand how vega will hurt or help a long straddles?
Does the trader know how gamma works to allow him/her to profit from a long straddles?

2. Options are very risky .... they are like gambling

Do we know that options can be used as a protective tool, thereby allowing us to protect our valuable assets?

3. Options are not easy to trade

Well, are we blaming others or ourselves if we are not committed to trade options properly. Are we complaining about educational providers who are selling expensive courses? Are we constantly looking for the Holy Grail, i.e. the free and most effective resources? Does information come free every time?

4. Some traders believe that the Put/Call Ratio is a measure of market sentiment. It is also believed to be a contrary indicator.

Well, do we ignore synthetics completely? Selling a put is equal to long stock and a short call. Buying a call is synthetically the same as buying the stock and a put. So, if you already own the stock, and you buy a put to protect it, the PC Ratio will go up, ceteris paribus. Does it mean that you are bearish?

More to come!!

2009-08-16T17:47:00.001+08:00

TRUE OR FALSE

If you can answer all questions correctly, you know your stuff well

1. Being assigned on a short option causes you to lose money.

2. Being assigned increases your risk.

3. The use of market orders is discouraged because market makers will move the market when they see your order.

4. Market makers match buyers with sellers.

5. Implied volatility is based directly off of the historical volatility.

6. Open interest is important.

7. Daily option volume is important.

8. Credit spreads and debit spreads are the same thing.

9. Market makers purposely over/undervalue options from time to time.

10. Risk free trades can be created and opened in one trade.

Source: http://www.optionetics.com/forums/topic.asp?fid=136&id=51766&page=6

2009-08-16T16:54:00.003+08:00

More Myths on Options Trading

Options trading business can be a viable business, and yet it's been tainted by many blacksheep in the Singapore market whereby public associated with options trading as risky, and options traders (especially those who teach as well as trade) are selling dreams to the poor public.

I walked past a bookshop last Sunday and happened to see a book written by a learned author who is selling his options seminar in Singapore, Malaysia and Indonesia, and I admired this fellow who claimed that he has been in trading options for more than 10 years, and he is advocating "non-directional trading". So, I read with interest on this book (and it cost me some S$20) and here is what I found:

a. options selling is better than options buying because 80% of the options expire worthless.

The learnt author said "This is a proven statistical fact. Statistics shows that 80% of options expire worthless. If you buy an option, your chances of winning are only 20%. If you are a seller of an option, your odds of winning are 80%."

First of all, I am not sure where the source of this so-called statistics. Even though this is only my sixth year in options trading business, I already knew this myth some three years ago whereby the so-called "80%" thingy is really a myth.

In an article written by Albert Brinkman published in Summer 2007, he quoted the OCC's 2006 statistics which showed that 31% of the options were unexercised at expiration, 17% were exercised and 52% were closed out prior to expiration. So, where does this 80% thingy come about?

Ok, if you are still in doubt, think about this, just pull out any option chain of your favourite stocks. Regardless of what the stock does, for every put that goes in-the-money, a call will go out-of-the money. So, if someone like this learnt author tells you that 80% of the option expire worthles, you must do one thing - question his math and/ or logic. Ask for official proof rather than hearing him say according to someone ...

b. Always be options seller and never be options buyers

The learnt author also advocates that options sellers will always win and thus we should never become options buyer. True enough, if we sell every option and the stock does not move, the only way we will fail to make money is if all options traded solely for real value. However, stocks do move, and options have to account for that movement through addition of extrinsic value. This value is necessary since if it did not exist, it will be true that options buyers can devise strategies to always make, or at least never lose money.

Options sellers may make money more often than options buyer. However, everything happens for a reason. When sellers lose, they lose far more than what they tend to make on each options sale. On the contrary, buyers may lose more often but each win may return more than several losses. This therefore leads to the point where people tend to confuse something that works most of the time without something that is safe. Obviously the two are not equal. Russian roulette works 5 out of 6 times. With such a high probability, do you want to play now? It is quite safe to cross the road when you see green man. Does it mean it is guaranteed safe? What if you encounter a reckless driver who fails to see the red light or ignores the red light, just shoot it?

So, these two points to me are myths - and if they are not clarified in the books, it is as good as another monkey selling dreams to the public.

Then, what happened today is that I was clearing my old stuff since I am going to move house next month. And I found something that excited me a few years back about options trading, and now to the point where I am, I could not help but laugh harder.

The following represent extracts of a guru's teaching materials, and let's see what is wrong with these statements:

'So, what volatility should options have that allow us to capture the desired movement of the option. We would like to see volatility no greater than 65%'

Guru is teaching us that we should look for THE SWEET SPOT on volatility. So, now many gurus are telling us that there are THE SWEET SPOT on delta, and this guru added THE SWEET SPOT on volatility. If we compare the IV on the options on Pharma stocks and that on the large cap stocks, are we suggesting that we should forget Pharma stocks since the IV can be > 65%. Should IV be a relative number rather than an absolute number? Folks who have our Optionetics Platinum should be able to debunk this myth easily.

'Refrain from buying options that are OTM'"

I did not take this statement out of context but this is exactly what the guru said in the manual. Keep in mind that there is always a trade-off between time and profitability. OTM options exist for its own reason. Just like there is something for options seller to grab and options buyer to grab. Again, the guru is advocating the purchase of only ITM/ ATM options? Folks who have done our two day intermediate class know that OTM options happen for a reason.

'look to purchase ITM or ATM options that have a minimum of 6 to 8 months to expiration. Once we have been filled, we will then look to sell the front month ATM or OTM options.'

The guru advocates this strategy on DIA and QQQQ as strategy for longer-term trades. However, traders should be mindful with how sensitive these longer-term options can be to volatility. So, what if there is a drop of IV on the longer-term option, the traders can be hurt. Folks who have done time spread strategy in a professional way will only that it is far more effective, and mathematically proven that time spread should be constructed using back-to-back basic by selling the front month option and at the same time, buying the immediate next month option, since time spread if done on ATM basis is after theta decay.

So, knowing the open interest of an option being considered for trade, is critical!

It's been again and again debunked by our instructor team that open interest has nothing to do with liquidity. Obviously, we want to get into an option easily in and out but this is governed by liquidity of the option, and it has nothing to do with OI, which is a totally different matter. Liquidity of the option is governed by the bid-ask spread. Are we suggesting that we should not be the first buyer of JNPR Oct option when it is launched next week because OI will be zero? So, go figure.

So, guys, the moral of the story is that when you are listening to a person who claim to trade options successfully, he/she may be doing it in a consistent way and fortunately within a certain period of time when the market condition remains unchanged. Having said that, if we wanna learn options properly, ask the person where he learns options and whether the person teaching him/her knows the options mechanics in a professional way.

So, when choosing an options trading course, if the person does not cover the greeks, and when asked why 2+2 must be 4, he fails to explain, you know how "GOOD" that person is.

2009-08-05T21:01:00.004+08:00

I will be speaking on 23 Aug 2009 at InvestFair 2009 for Optionetics. The chosen topic is about building our edges in finding limited risk options trades. In order to allow us to do this, we have to have the proper knowledge in options trading. What I propose to do is to take the advantage of this session to demystify certain myths that exist in the public domain.

Myth 1 - Are puts and calls the same? Why would someone suggest to track Put/Call Ratio?

Myth 2 - We should be credit spread specialists because we can get paid to initiate such trades

Myth 3 - There is always THE BEST sweet spot (i.e. the BEST delta) for every option trade. Delta 25 is the best. No, Delta 75 is the sweet spot. Who is right and who is wrong?

Myth 4 - When you sell an option whose premium is above $0.25, you won't be assigned. Are you sure?

Myth 5 - Debit spread is easier to understand than credit spread because credit spread has margin to deal with. So, are debit spread and credit spread not the same?

There are many more myths I can find. Let's do my part to demystify at least the above, as there are so many monkeys teaching options in Singapore who know nuts about options. They only know how to sell dreams to the public.

So, interested to listen to me? See you on 23 Aug 2009 at Suntec City Convention Center.

2009-07-13T14:31:00.004+08:00

Optionetics Expert Seminar - Live in Singapore (12-14 August 2009)

Once again, the annual Expert Seminar featuring Tom Gentile will be live in Singapore from 12-14 August 2009 at Furama City Center, Singapore. Nick Gazzolo, one of our senior instructors will be the co-instructor with Tom.

For the first time in history, Expert Seminar 2009 offers to both Optionetics and non-Optionetics students. In this seminar, participants will be exposed to Tom Gentile's world of system trading. Also, detailed discussion on certain advanced strategies such as Collars, Broken Wing Butterflys and Tarzan Loves Jane will be included.

Seats are filling fast, and there are limited seats offered to non-Optionetics students at a discounted price. For details, please visit the following link:

http://fxtrading.na3.acrobat.com/p51612760/

and do contact Optionetics Singapore office at http://www.optionetics.com.sg for details.

2009-05-22T10:04:00.002+08:00

Recent Update

Hi folks, I have been absent for a while as there are a number of projects I have recently embarked on and thus have yet to update anything in my blog.

Quick Update:

Monthly Forum

I am helping Optionetics Singapore to run the monthly online forum which should be every third Thursday of the month. Watch out for an e-mail blast from Optionetics Singapore two weeks before the forum. If you are not on the list, please send an e-mail to classes@optionetics.com.sg or classes@optionetics.com.hk. Of course, I will post the information regularly on my Facebook. Keep a look out of that.

What has been discussed since Feb are:

1. Creating a business plan and trading psychology
2. Identifying Trading Opportunities using seasonal patterns
3. Identifying Trading Opportunities using sector rotation concepts
4. Identifying Trading Opportunities using Profitsource as a tool

The last forum was in particular interesting because it unlocks many folks' limiting belief that they are not able to trade Wave 3 because many instructors have told them this is not possible. Well, I have already demonstrated in my forum how to look for Wave 3's price target and created a few a-ha to the folks. Well, I promise to the folks that in the future runs, I am going to do more on Fibo time analysis and right now, I am running practical test intensively to train myself to identify Gartley Pattern. Why is this important? We are in the trending market and therefore, these stuffs become important in my trading toolbox.

Advanced Coaching Online Classes

For advanced Optionetics students who recently did ICT, ITT and Master ICT Classes in Singapore and Hong Kong, you will have the opportunities to meet with me online three times starting from next Thurs to refresh what we have learnt in these classes. They are only open to a privileged group of students who have committed to advance their education. It's also a gesture from my viewpoint to express my gratitude to these students who allow me to share my experience with them. The class will be 1.5 hours and will be in the usual "trading out loud" format. So, there won't be any slides or presentations. We go straight to analyse and discuss real trades for education purposes. Honestly I am looking forward to it.

Forex Education

While I told myself my R&D budget for 2009 will be frozen, I decided to invest in two forex courses to continue to enhance my knowledge.

1) OU Forex

I have signed up for OU Forex with a view to getting another perspective of forex trading. I must say that there are lots of materials to read everyday. In fact, it's a standard for me to spend at least an hour every morning to go through the new stuff and market analysis. Over the weekend, or on my off days, I will have to catch up with the daily webinar by Forex Joe and Sunil. Oh well, I have learnt a lot because Sunil has discussed how to use FIbonacci as a trading rule and of course, he shared with us his specialty - Harmonic Pattern. This impresses me a lot. The exclusive forum also contains very rich information from traders from different part of the world.

2) Forex Nitty Gritty

Again, I signed up for this because the fee is pretty cheap, and it happens to provide me with a very simple trading method which compliments with FXTE's momentum trading system. I am not able to share with the simple method is from FNG. However, I will say this it is a fairly simple method, and if one is correct in the fundamental outlook - e.g. Bearish on USD or JPY, he can start using the simple method to profit from the market. Incidentally, I started with FNG's simple method this Monday (well, because I am not a FX newbie), and the trades I put just on Monday has already covered me 10 months' of FNG"s subscription. It's awesome.

What else am I doing?

Nothing much really. There won't be any workshops or coaching to do at AKLTG until July. Also, I am not going to OASIS at Santa Clara this year for personal reasons. So, it is a good time for me to rest my body because July will be a crazy month in view that Wealth Academy 18 and Patterns of Excellence Whoosh 28 (Mod 1) are coming.

Till then, take care.

2009-04-07T15:30:00.001+08:00

Official Launch of FXTE Program in Singapore

Today marks the beginning of Quarter 2 of 2009. The fact is we are all excited about the official launch of FXTE Program in Singapore. FXTE is a US educational institution providing forex trading education worldwide via physical seminars and online courses.

On 25 and 26 April 2009, FXTE's Forex Trading Essential Course will be offered for the first time in Singapore at Furama City Center. Two of our FXTE instructors, Jimmy Young and Steve Nurre, will be flying 10,000 miles to the Lion City to teach this course.

What you will learn in these 2-days are

1. How the SIMPLICITY of the FX market removes the clutter often found in the stock and options markets and allows you to focus on the most important thing - MAKING MONEY!

2. That the FOREX can be traded 24 hours a day, 5.5 days per week so you can always find a time to trade - even with your busy schedule. (see - we are very honest - we know what we are talking about. Who said FX is 24 by "7"?)

3. The simple approach to trading Forex - created by a 20 year bank trader for people just like you, that can INCREASE your PROFIT potential by changing how you view the news.

4. How Forex can provide all the upside of trading the equity markets but with LESS RISK.

For further details, click this link - FXTE 2-day class

The course is being offered for only SGD188.00. There is no typo. It's really SGD188.00. You will get 2 full days of forex education. For those who want to gain exposure to the forex market for the first time, or want to learn more how to trade forex, this is a golden opportunity that you should not miss.

2009-04-07T15:26:00.003+08:00

How to Read a Chart & Act Effectively
by Jimmy Young, CTA

Introduction

This is a guide that tells you, in simple understandable language, how to choose the right charts, read them correctly, and act effectively in the market from what you see on them. Probably most of you have taken a course or studied the use of charts in the past. This should add to that knowledge.

Recommendation

There are several good charting packages available free. Netdania is what I use.

Using charts effectively

The default number of periods on these charts is 300. This is a good starting point;

Hourly chart that's about 12 days of data.
15 minute chart its 3 days of data.
5-minute chart it's slightly more than 24 hours of data.

You can create multiple "tabs" or "layouts" so that it’s easy to quickly switch between charts or sets of charts.

What to look at first

1. Glance at hourly chart to see the big picture. Note significant support and resistance levels within 2% of today’s opening rate.

2. Study the 15 minute chart in great detail noting the following:

* Prevailing trend
* Current price in relation to the 60 period simple moving average.
* High and low since GMT 00:00
* Tops and bottoms during full 3 day time period.

How to use the information gathered so far

1. Determine the big picture (for intraday trading).

Glancing at the hourly chart will give you the big picture – up or down. If it’s not clear immediately then you’re in a trading range. Lets assume the trend is down.

2. Determine if the 15 minute chart confirms the downtrend indicated by big picture:

Current price on 15-minute chart should be below 60 period moving average and the moving average line should be sloping down. If this is so then you have established the direction of the prevailing trend to be
down.

There are always two trends – a prevailing (major) trend and a minor trend. The minor trend is a reversal of the main trend, which lasts for a short period of time. Minor trends are clearly spotted on 5-minute charts.

3. Determine the current trend (major or minor) from the 5 minute chart:

Current price on 5-minute chart is below 60 period moving average and the moving average line is sloping downward – major trend.

Current price on 5-minute chart is above 60 period moving average and the moving average line is sloping upward – minor trend.

How to trade the information gathered so far

At this point you know the following:

* Direction of the prevailing trend.
* Whether we are currently trading in the direction of the prevailing (major) trend or experiencing a minor trend (reaction to major trend).

Possible trade scenarios:

1) Lets assume prevailing (major) trend is down and we are in a minor up-trend. Strategy would be to sell when the current price on 5-minute chart falls below the 60 period moving average and the 60 period moving average line is sloping downward. Why? Because the prevailing trend is reasserting itself and the next move is likely to be down. Is there more we can do? Yes. Look for further confirmation. For example, if the minor trend had stalled for a while and the lows of the past half hour or hour are very close to the 5 minute moving average then selling just below the lows of the past half hour is a better place to enter the market then just below the moving average line.

2) Lets assume prevailing (major) trend is down and 5-minute chart confirms downtrend. Strategy would be to wait for a minor (up trend) trend to appear and reverse before entering the market. The reason for this is that the move is too “mature” at this point and a correction is likely. Since you trade with tight stops you will be stopped out on a reaction. Exception: If market trades through today’s low and/ or low of past three days (these levels will be apparent on the 15 minute chart) further quick downward price action is likely and a short position would be correct.

3) A better strategy assuming prevailing trend down, 5-minute chart down, and just above days lows is to BUY with a tight stop below the day’s low. Your risk is limited and defined and the technical condition (overdone?) is in your favor. Confirmation would be if today’s low was a bit higher than yesterday’s low and the price action indicated a very short-term trading range (1 minute chart) just above today’s low. The thinking here is that buyers are not waiting for a break of today’s or yesterday’s low to buy cheaper; they are concerned they may not see the level.

4) Generally speaking, the safest place to buy is after a sustained significant decline when the bottoms are getting higher. Preferably these bottoms will be hours apart. By the third or forth higher bottom it is clear a bottom is in place and an up-move is coming. As in the example above your risk is limited and defined – a low lower than the last low.

5) The reverse is true in major up-trends.

Other chart ideas

There are always two trends to consider – a major trend and a minor trend. The minor trend is a reversal of the major trend, which generally lasts for a short period of time. Buying above old tops and selling below old bottoms can be excellent entry levels; assuming the move is not overly mature and a nearby reaction unlikely. When a strong up move is occurring the market should make both higher tops and higher bottoms. The reverse is true for down moves- lower bottoms and lower tops. Reactions (minor reversals) are smaller when a strong move is occurring. As the reactions begin to increase that is a clear warning signal that the move is losing momentum. When the last reaction exceedsthe prior reaction you can assume the trend has changed, at least temporarily. Higher bottoms always indicate strength, and an up move usually starts from the third or fourth higher bottom. Reverse this rule in a rising market; lower tops… You will always make the most money by following the major trend although to say you will never trade against the trend means that you will miss a lot of opportunities to make big profits. The rule is: When you are trading against the trend wait until you have a definite indication of a selling or buying point near the top or bottom, where you can place a close stop loss order (risk small amount of capital). The profit target can be a short-term gain to nearby resistance or more.

Consider the normal or average daily range, average price change from open to high and average price change from open to low, in determining your intra-day price targets. Do not overlook the fact that it requires time for a market to get ready at the bottom before it advances and for selling pressure to work it’s way through at top before a decline. Smaller loses and sidewaystrading are a sign the trend may be waning in a downtrend. Smaller gains and sideways trading in an up trend. Fourth time at bottom or top is crucial; next phase of move will soon become clear… be ready.Oftentimes, when an important support or resistance level is broken a quick move occurs followed by a reaction back to or slightly above support or below resistance. This is a great opportunity to play thebreak on the “rebound”. Your stop can be super tight. For example, EURUSD important resistance 1.0840 is broken and a quick move to 1.0860, followed by a decline to 1.0835. Buy with a 1.0820 stop. Themove back down is natural and takes nothing away from the importance of the breakout. However, EURUSD should not decline significantly below the breakout (breakout 1.0840; EURUSD should not go below 1.0825.

After a prolonged up move when a top has been made there is usually a trading range, followed by a sharp decline. After that, a secondary reaction back near the old highs often occurs. This is because the market gets ahead of itself and a short squeeze occurs. Selling near the old top with a stop above the old top is the safest place to sell. The third lower top is also a great place to sell. The same is true in reverse for down moves. Be careful not to buy near top or sell near bottom within trading ranges. Wait for breakaway (huge profit potential) or play the range. Whether the market is very active or in a trading range, all indications are more accurate and trustworthier when the market is actively trading.

Limitations of charts

Scheduled economic announcements that are complete surprises render nearby short-term support and resistance levels meaningless because the basis (all available information) has changed significantly, requiring a price adjustment to reflect the new information. Other support and resistance levels within the normal daily trading range remain valid. For example, on Friday the unemployment number missed the mark by roughly 120,000 jobs. That’s a huge disparity and rendered all nearby resistance levels in the EURUSD meaningless. However, resistance level 200 points or more from the day’s opening were still meaningful because they represented resistance to a big up move on a given day.

Unscheduled or unexpected statements by government officials may render all charts points on a short-term chart meaningless, depending upon the severity of what was said or implied. For example, when Treasury Secretary John Snow hinted that the U.S. had abandoned its strong U.S. dollar policy.

2009-04-04T23:31:00.003+08:00

100 Points
by Boris Schlossberg and Kathy Lien of GFT Forex

"You guys suck," is refrain I hear often."100 points a month?! I could do that in my sleep. You should be doing 100 points a week at minimum!" Well, I try to point out we the game is a lot more difficult than you think, but the critics do not want to hear it. They proceed to tell me all about their marvelous trading exploits showing me how they just picked a turn to within a pip of the bottom and then went on to bank a thousand points in the trade as they "let the profits run."

My favorite of these demo billionaires was guy who used to write to me with the sole purpose of telling me how stupid our latest trade idea was and how trading was so easy that he was making thousands of pips week. I finally relented and asked him top show me his "portfolio of trades." The guy proudly wrote back that he was was long a wide variety of pairs such as EUR/JPY, AUD/JPY, GBP/JPY and NZD/JPY. I did not have the heart to tell him that this was the same trade levered four times the maximum risk he should have been taking. A few months after that conversation the carry trade collapsed and I never heard from him again. Another trading master of the universe relegated to the dustbin of market history.

They say that you should never watch how sausage or politics are made. To that old adage I would also add investment returns. Since most people only look at year end numbers they are convinced that trading returns accrue with the consistency of a weekly paycheck rising in a straight 45 degree angle towards ultimate wealth. Nothing of course is further from the truth. Take a close look at the audited records of any hedge fund and in fact you will see many months of losses punctuated by a few months of gains, that hopefully eke out to a net positive number at the end of the year.

Investment returns are notoriously lumpy not only on a month over month basis but even on year over year basis. Witness the two of the very best hedge funds in business -Citadel and SAC - posting double digit losses this year. Someone the other day reminded me that despite George Soros vaunted $1 Billion win in the GBP/USD in the early 1990's, a few years later he managed to lose $600M in the yen trade not once but twice in the same year. Everyone remembers the wins but forgets the losses.

One of the nice side benefits for those of you who trade with us at BK is that you get to see how investment returns are actually made on trade by trade basis in real time. As many of you can attest it is hardly a glamorous affair. The reason why trading can be so trying is that you are always operating in an environment of complete uncertainty. You can fail by making a bad trade selection (something that we all fall victim to far more than any of us care to admit) but you can also fail even when all of your analytics are absolutely correct.

K has a marvelously understated term for it. She call it market activity. Market activity can encompass anything from some large player dumping a yard worth currency during the illiquid early Asian session irrespective of price as he hurries to leave the office for tryst with his mistress, to some political official making an offhand remark (see Timmy Geithner) that gets spattered on the Bloomberg terminal a second later. All of this "market activity" can wreck havoc with your best laid plans stopping you out before your trading thesis has a chance to play out.

That's why 100 points a month is not bad at all. 100 points a month is 12% per year. Drop $20,000 into your retirement account each year and compound it at 12% and after 20 years you have 1.8M. After 30 years you have 6M. That's hardly a plan to becoming a baller overnight, but that's how real money gets made.

2009-04-01T10:05:00.002+08:00

2009-03-28T15:01:00.002+08:00

Fast and Furious Trading

In this week BKT Weeks Video, Boris Schlossberg continued his discussion on the 10 pips strategy. This link (Fast and Furious Trading) will direct you to his YouTube video.

His rules are as follows:

1. Look at 5 min charts - on EUR/USD and USD/JPY
2. Sell 2nd candle close above 2nd SD Band (for Sell Trades) or close below 2nd SD Band (for Buy Trades). Exception is 00 and 05 level.
3. Trade on all sessions using EUR and JPY
4. 10 pips stop; 7 pip limit

There are some interesting observations:

1. Boris stressed that this is not a strategy that can be automated. So, he believes that if someone designs an EA on this strategy, it will fail as there is discretion as to whether the rules should be implemented.

2. This is not a Holy Grail. There will be losing trades. I have personally observed the strategy and interestingly, it is more likely than not making money.

3. In this version, Boris did not cover the use of GBP/USD although in his video last week, he said GBP/USD may be incorporated into this system to improve the equty curve of the entire system.

2009-03-21T18:26:00.007+08:00

Winning by Losing
by Kathy Lien and Boris Schlossberg of GFT Forex

"The key to succeeding in trading is to lose well. It doesn't matter if you are a die hard fundamentalist who thinks that chart reading is akin to astrology or an unrepentant technician who thinks that all news flow has less value than celebrity gossip. Every great trader I ever met knew how to control risk which is simply a polite way of saying that they knew how to take losses.

Of course losing is not what every newbie trader focuses on. Everybody wants to win big. Everybody approaches trading as though it was a lottery not a business. I am always amused by new traders who email me for the next 10 point trade and the next one and the next one after that thinking that the FX market is like a massive ATM machine. Those traders usually have a shorter shelf life than a half eaten apple.

On the other hand, traders that approach the market with a much more cautious attitude tend to do better. They soon learn that in trading losing is the only variable that you can control. Winning is frequently a function of luck, but losing is always a matter of skill.

Everybody hates stops. What's even worse is to be stopped two, three, four times in a row. In a debate between tight stops and wide stops I used to always hear "You don't want to die a death of a thousand cuts!" Well actually I do. After years of trading I came to the conclusion that tight stops will keep me in the game. I may be bloodied, I may be hobbled but I will remain alive to trade another day. In a choice between taking many small measured stops versus a few very large ones I will always choose the former because large stops can frequently turn into catastrophic losses, and much as it is unpleasant to lose money, it is always easier to recoup a series of small losses rather several huge ones.

Recouping is what trading is actually all about. Everybody who begins trading envisions an ever climbing equity curve that builds with the consistency of a weekly paycheck. Nothing can be further from the truth. In reality trading is always the act of giving money back to the market and then trying to claw it back.

Trading is tough precisely because it is so brutal. Unlike a job that pays us even if we are sick or distracted or simply not in the mood to do our best, trading promises you nothing. You lose, you don't eat. That's why I have such enormous respect for those traders who make their living solely from the market. They are the gladiators of modern finance and the ones that survive always know how to take a stop. The rest of us must learn those skills.

The need to build wealth through trading is greater now than at any time in the past 50 years. Does anyone who is 40 or younger believe that Social Security will pay them anything? How about your decimated 401K plans that are likely to range trade for the next 10 years as stocks cycle much like they did in the 1970's? Bonds? Good luck trying to fund your retirement with 2% yields.

Bottom line is that in the next decade trading may be the only avenue left to build wealth with your savings. That's why it is more important than ever to master key principle of the game - in order to win in trading you must learn how to lose properly."

What a timely reminder to many aspiring traders who think that traders have easy life and trading is as simple as ABC. Also, this article serves to reiterate that professional traders approach trading in a completely different way compared with amateurs. Professional traders always deal with the risks and profit target is the second. In this case of Kathy and Boris, they always talk about hitting T1 and move the stop to breakeven, and let the remaining lots do what they are supposed to do. They make they make. They don't make, it's fine. At least risk has been removed after hitting T1.

That's why I subscribed to their mode of trading completely, and it makes perfect sense to me. So, if one feels that forex is an ATM machine, and he can learn the tricks by attending courses but no practices after that, he may wish to spend to money to buy me kopi instead.

2009-03-18T13:44:00.002+08:00

Trading 'expert' ordered to refund fees

I am sure many folks in Singapore are bombarded with the recent case of Dr. C who was successfully sued by a group of students. See this Link.

The basis of the claim lodged by the complainants is that Dr. C misrepresented to them on his qualification. Is it a joke? Yes, at least to me. When a self-proclaimed options guru markets his course, the participants relied only on his academic qualifications. Well, there is a big difference between academic qualifications and practical / experience qualifications.

Lecturers (or nka Assistant Professors) are all assumed to have at least Doctorate Degree, and it is a requirement. Do they necessarily possess practical experience? Not really. They need to be exposed to the development outside the campus in order to understand what the heck it is going on in the world. Having a paper qualification is good but it does not mean that this person is an expert.

If we all respect trading as a business, and is a skill we need to practise in order to get better and better, we just have to do and learn from someone who does it professionally and day in day out. Learning trading from a PhD will give us very good textbook knowledge. In this case, of course, I have the privilege to speak to Dr's classmates many years ago and understand his background and his trading journey. From what I was told, I did notice immediately that this guy is going to be in trouble one fine day. It's just a matter of time. Why? It's because when he is teaching someone options, he does not even bother (or should I say he knows?) talking about volatility and Greeks. He simply asked his students to have "faith" on him (btw, what faith is he talking about?). He also taught my good friends a 911 strategy which clearly does not make any sense as he did not reveal the entire risk of making that particular adjustment.

On the brighter side, without him in this market for the last few years, options won't be a popular subject at all. Most of my friends would probably not wake up and still live in the dream of knowing the so-called most powerful strategy in the Planet, which after I had a chance to look at it, is merely a pure gambling on direction without regard to volatility at all.

So, Dr. , you have done a few good deeds. Kudo to you! Salute!!

2009-03-16T17:34:00.006+08:00

Common Flaws found in Free Breakout Forex System

I have been a big fans of forex breakout system because it is a no-brainer and is fairly easy to implement. It is also uncommon that one can find breakout trading systems free in the internet.

This is an example:

*******************************************

-Determine the 08.00 – 12.00 GMT (0:00am to 4am EST) High Low on EUR/USD and GBP/USD
-Determine the 12.00 – 16.00 GMT High Low on EUR/USD and GBP/USD

-Set Buy Stop at High + 5 pips and SellStop at Low - 5 pips for both time frames and both currencies.

-Set Target Price at entry + 80 pips for EUR/USD and entry + 120 pips for GBP/USD

-Set Stop Loss at entry - 50 pips for EUR/USD and entry - 70 pips for GBP/USD.If the other side of the breakout is within 50 pips for EUR/USD or within 70 pips for BP/USD then the Stop Loss will be that level.(Longtrade:

SL = Low range - 5 pips = Sell Stop; Short trade: SL = High range + 5 pips = Buy Stop)

-Move the SL to breakeven after a gain of 30 pips for EUR/USD and a gain of 40 pips for GBP/USD.

-If a certain position is taken and price turns against you and it breaks the other side of the breakout channel then turn. If the breakout channel is broader then the stop loss first the stoploss will be hit. If the breakout channel is narrower then the stoploss then hitting the other side means that you have to turn your position.There is only one turn per time frame possible .

-At 24.00 CET all orders expiring and close all trades at market On Friday we do the same at 23.00 CET.

Note :

6 – 10 CET or 8 – 12 GMT

10 - 14 CET or 12 - 16 GMT

********************************

Sound easy to implement, huh? However, contrary to free information, no one seems to discuss a big flaw in this type of trading system.

Let me give you an example:

Suppose you have a set-up to buy EUR/USD

EP - 1.2959
PT - 1.3059
SL - 1.2859

Risking 100 pips for 100 pips profit (or RRR 1:1)

Some people will place the system diligently without asking any further questions. Some "smarter" ones will tell you that you should check the range - if it is 80pips or more, the set-up fails. So, you will ask "why 80 pips or more?" You get a response that it has been backtested.

While I found all these craps in the internet, we at the same time realize that market conditions do changes. So, we must be nimble and adaptive to the changing market conditions.

Have you ever wondered that EUR/USD can make 200 pips daily move consistently since last month? This was definitely not the case in 2008. So, relying on 80 pips as a gauge is a complete disregard of the current market conditions. Anyone talking about 80 pips does not know what he is doing.

To be in a better position, ask yourself what's the opening price for EUR/USD say at 5:00pm EST. Suppose the opening price is 1.2800. You roughly know that given a 200 pips average daily move on this pair, hitting a PT of 1.3059 is challenging as the estimated high will only be 1.3000.

You will also realize that different pairs/ crosses have different average daily move, which is something you need to know. As we are getting more experience as a forex trader, this is definitely a relevant question to ask. You will realize that not all set-ups can give us the best bang for the buck. This means that we have to think whether we should still take that trade.

See, this is something you may not find in free websites. However, you realize that you now know this relevant issue by reading my blog. It is easy, isn't it?

2009-01-21T19:36:00.001+08:00

Why Does the Average Forex Trading Strategy Lose Money?

The following article (Part I) is a good wake-up call for folks who are looking for the Holy Grail.

http://www.dailyfx.com/story/topheadline/Why_Does_the_Average_Forex_1232461301568.html?print=1

Enjoy!

2009-01-18T23:01:00.002+08:00

Which Forex course is worth to attend?

Quite recently, a few readers in my Discussion Board asked me the same question - which forex course is worth to attend?

"I ... would like to get your advice which forex course provide best system and which one worth to attend?"

This is an alarming question to me because you will realize that the subject matter in this question is to ask for the "best" system. As far as I am concerned, I do not believe there is the BEST system in the market. In fact, I will honestly tell my readers that there isn't any such system in the market. Imagine the system is telling you that it is the best. However, the system itself can never be the Holy Grail. The fact that there exists no Holy Grail in the market means that there is no one "best" system out there.

It may be a piece of disappointing news to many because they have been constantly looking for the best system. Well, you know as much as I do that success in trading business is not only to master one trading system, or learn from one instructor. I have been relaying the following example to many folks and I am happy to repeat:

Suppose A and B both pay $3,000 to learn from X to trade forex. X provides the entry guidelines and the so-called things to watch out. It is not surprising for either or in fact both to ask "can this work in other currency pair?" and "can this work if I do this or that?" People are all like that. They think they are looking for the best system. At the same time, they are also looking for ways to "outsmart" the system. Is this a self-fulfilling prophecy here - i.e. human beings are better than systems? Is there any conflicting issue you realize?

If you happen to shop for a course or a particular instructor, and if he tells you trading psychology is not important, you should run and not walk away. If he tells you that if you simply follow the rules, you will definitely make money. I think you should run and not walk away.

In my example, both A and B may have different trading personalities. Therefore, they may apply different money management rules to suit their own circumstances I believe. It's not about being right or wrong in trading business. It is all about how to manage risks. So, if both are able to adopt certain rules to manage their risks, they are doing a great job as risk managers.

So, here is my reply to my readers: there is no one best trading system or trading course that guarantees making money. We are the ones who control our destiny.

By the way, there is so much free information in the public domain. If we focus on looking for free information, we will notice that it is everywhere. Perhaps one of the most common places to go is babypips.com, followed by forexfactory.com. So, have you checked these websites already?

2009-01-18T11:22:00.006+08:00

Never too late to Get Education

I was able to make some time to meet up with my fellow Optionetics colleagues over the weekend at Suntec City as we had our first 3-day Interactive Computer Training (ICT) Class in Singapore in 2009. I met up with some old friends who started with me around the same time in this trading business, and at the same time new friends who recently joined our Optionetics program.

This friend of mine started with Optionetics in 2005. We had a drink somewhere around Suntec City and shared with each other what we had been doing over the past few years. He shared with me that over the last couple of years, he did not do much with his portfolio and he used "complacency" as his reason. The market was bullish until the financial turmoil back in late 2007. His portfolio went up and he did not see the need to do anything. Put simply, he thought that he would just let the portfolio continue doing what it has been doing.

Of course you know as much as I do what happened over the last year. This friend of mine felt the pain too. Fortunately, he told me that he was not hurt as badly as his peers. During our talk, he shared with me that he went for education with Optionetics, and he should have had realized that there are ways to protect his portfolio. This serves as a wake-up call for him to change his strategies by being more alert to what's happening in the market, and get further education in order to improve his literacy in dealing with trading business.

A lot of things happened for a reason. When we feel the pain, it's probably the time for us to change our behavior. Does it happen on you too? What I am saying is that regardless of the entry into this trading business, there is always something to learn every single day. This is because the market condition keeps changing and what we saw is not what we see now.

Several people in this ICT Class were new to Optionetics. However, they all went for the class for a common reason - to take charge of their lives and make a difference regardless of the extent to which it will be. Some of them shared with us that they wanna have more time to pursue their passions - including hobbies, families and children etc. All I can say is that these folks have made their first step (i.e. by taking action).

You will realize recently that the poor folks who bought Hi-Note and Lehman Mini-bonds somehow were promised to be compensated in whole or in part. There are ethical and legal issues involved in this saga, and is beyond my role to comment. Suffice to say this serves as an alarm bell, in particular to the young ones, that they must do something to improve their financial literacy. If I were to describe that Mini-bonds is like (and I have simplified the picture for discussion sake here) buying 1 call and selling 2 puts. Optionetics students will be able to quickly tell me that:

1. Long 1 call and short 1 Put is synthetically long stock - an unacceptable position from Optionetics' perspective

2. 1 Short Put (or naked put) - which is also unacceptable position from Optionetics' perspective.

At the end, I have yet to hear any of my students from Optionetics who went to buy these kinds of instruments. Perhaps what they paid for getting the Optionetics education save them a lot. We knew some celebrities in HK who lost some HK$20m on mini-bonds. For our Optionetics students, they paid only a tiny fraction and they are able to stay away from this saga.

So, while I understand that S$5,000 for a 2-day life-time Optionetics program may be expensive. At the same time, if one thinks of these poor chaps, spending S$5,000 instead of losing the entire portfolio is worthy.

There were also stories about brokers and remisers in Singapore who lost a lot of money on stocks. One poor chap lost $1m because he failed to acknowledge his reading in the market and apply dollar cost averaging techniques.

What I can share with these people is that

"Will they buy insurance when they buy their houses?"
"Will they buy insurance when they buy their cars?"

So,

"Will they buy insurance for their stocks?"

It's amazing that many people did not know stock insurance, which is essentially put options. Had these guys been educated to apply this very simple techniques, they might be able to save millions of dollars.

It's amazing that there are many people who are prepared to enter into the financial markets without getting education, thinking that they are able to deal with all sorts of issues. When they lose money, they start to blame themselves, blame the markets, blame the Government. Is it what you do in your life - knowing how to blame and nothing else?

Here is your opportunities -

For newbies - we have Optionetics 2-hour Introductory Seminars in Singapore from 21 to 23 March (for details: check out http://www.optionetics.com.sg).

For repeating students - sign up for the upcoming 2-day Intermediate Seminar in Singapore on 5 and 6 April 2009.

For students who decide to step up and get further education - we have the following advanced courses in Singapore

- ITT Class - 14 to 16 April 2009
- Master ICT Class - 8 to 10 April 2009.

There is always something for someone. The question for you is "are you committed?"

2008-12-26T11:04:00.002+08:00

Merry Christmas and Happy New Year!!

Time really flies in that we are approaching the final week of 2008. As most hedge fund managers have already gone for holidays, I do expect there isn't much to do with the forex market until next year. As a result, I have officially closed shop in my forex business for 2008.

Looking back what I have done during the first year of running this new (forex) business, I have learnt a couple of things:

1. Believe in yourself and you will find ways to achieve certain goals - my limiting belief of not being able to stomach the volatility in the forex market over the last decade, has been thrown away. Now that I am able to trade forex simply means that limiting belief is just limiting belief. If I give myself a complete stretch, I have progressed to the next step.

2. Successful trading is all but psychology - I could have the so-called "best and powerful" trading strategies and also the "best" forex guru in town to teach me, and yet the progress could not be achieved until I have got the trader's attutide right in this business. That's how the psychology comes about. Have an attitude that is deemed correct in my own circumstances. Follow the rules, and keep myself discplined. Further, remember the importance of continious improvement - Kaizan. I followed faithfully what I called "7 Essential Credentials of a Successful Trader" to work on this new business. I am glad to see significant progress in the first year and trust that I will be able to deal with the challenges in 2009.

3. Always have a back-up plan - this forex business was the result of my contingency plan in 2008. By anticipating the challenges in the equity and index markets, I started equipping myself with additional knowledge in another area of practice and I was glad that this anticipation resulted in a successful launch of my forex business. The fact that I could start the real operation within a couple of months means that I could make a difference from my old days as an options trader. So, what's my back-up plan for 2009? I am going to look at the next level of challenges - i.e. futures market. This means that I will be essentially one day able to trade anything under the sun. Having said that, I do anticipate a come-back to the index options market in 2009 as I expect that the trend will likely be a side-way for 2009 and perhaps 2010. I did quite well in 2005 in the sideways market by deploying sideways strategies - something which I am very good at. So, I am ready to play sideways strategies again in 2009 at least.

Finally, this will be my last post for 2008. I wish all of my readers a Merry Christmas and look forward to the upcoming challenges in 2009.

Believe in yourself and you will make a difference! This is our Patterns of Excellence!!

2008-12-16T16:39:00.002+08:00

Am I a marketer?

First and foremost, I am grateful that there are many readers in my Discussion Board , and I realize that not everyone has been actively participating in my board, which is fine with me. I am not in the board selling you any information or courses. However, as and when I think there are some interesting products, I do post a link or two to keep my readers aware. Of course, if my readers are interested, they have the choice of buying the products directly by clicking the link in my board.

Having said that, I am recently quite perturbed with a few participants who registered in my board and made a lot of unresourceful remarks. You know as much as I do that every aspiring trader wants to succeed in trading and yet, no one is going to spoon feed us. Thus, we all have to devote our time to learn and better equip ourselves in this business. Put simply, there is no short cut or miracle. If I don't give me 100%, I won't see the result I have today. Is it a fair statement?

Now, here is the deal. I am happy to share with my readers knowledge I have provided that it does not infringe any proprietary rights. A particular reader recently has demanded me to release certain details of a proprietary system and insisted that it is no harm to share just as little information as possible. When I replied politely that this trading system is proprietary, I got remark that I am the best marketer in promoting my course and stuff like that.

What a joke, isn't it? Sharing information is fine to the extent that the source originates from public domain. If the information is proprietary, it cannot be given out free. That's the real life in business. Obviously, we all wanted to get this kind of information free of charge. Doing so is however not respecting intellectual property law, and is also unfair to people out there who are willing to pay for such information.

So, blaming me as a marketer for courses because I don't give out such proprietary information does not help that person at all. Well, there are also many sites that provide free forex trading system information. Why doesn't this person go to read for himself? Well, I don't have a clue!

2008-12-11T15:24:00.002+08:00

Practice Defensive Forex Trading

“In trading, Risk is Pre-Determined but Reward is Un-Predictable. Your Stop determined your risk. The Market decides your reward. Success in trading is supported by your discipline, diligence and decided by your Money Management and Psychology.,” - Henry Aw Young, Singapore

Henry is a good friend of mine with whom I met in Adam Khoo's Wealth Academy Program in 2008. He is also a professional trader and a trading coach.

As you can see, people who have been proper trading education will say something like the above. Always determine the risk before looking for the reward. Establish the pain threshold with informed decision right before placing the trade and know how much we will lose in a particular if we are wrong first before asking how much money we can make if we are right.

Amateur traders could find it hard to accept. They tend to ask "if trading is for money, why should they not take about how much they can make in a trade?" Well, the answer is fairly simple. If we are in a trade without knowing the maximum pain threshold, and if we are wrong in that trade, emotion will drive us crazy, and we will start giving excuses so that we can delay our pain until such time as we cannot. By that time it will be too late to get out of the losing position, and the traders might as well not exit the trade. The probable outcome s that the traders have their accounts wipe out and curse and swear that they shall not trade anymore because the market is unfair to them.

Does this sound familiar to you? You should have heard in the recent bear market where many people lost tons of money because they approached this business in a completely incorrect manner.

So, who in the market right now are still making money? I guess people who have been educated properly and practice defensive trading. And what do I mean by defensive trading? Let's draw some indications below:

1. Always find a reason not to trade, and if you find one, then, you are out of the market. This helps us to focus on quality set-up / pattern and at the same time, kick away emotional trading.

2. Always address stop loss first before looking at the profit. Yes, it is completely reversed. The advantage of this is by ascertaining the stop loss, you will be able to determine the proper position sizing, and risk allocation. If you find that the stop loss is something you are not comfortable, you have found another reason to stay out of the market.

3. Trade based on your trading personality. I know this is a challenge. Some of us tend to trade in a shorter time frame. I am one of them. When I talk about shorter time frame, I mean it is short in my own definition. For example, I trade forex by using at least a 5-min chart and at the same time. 1 min-chart is too short in my definition.

4. Do take into account of bid/ask spread. Very often, we tend to look at the upside of an individual trade and when taking into account the spread, the result can look very different. So, remember to incorporate bid/ask spread in your trading result so that it becomes more realistic.

5. Do your research and development. I would like to answer Chris' (JMOT's) questions here. I am a system trader because it is something I learnt from Tom Gentile, the co-found of Optionetics. I took Tom's traits in my trading business and very often, I blend a few systems which may give me better results. For example, if I take FAST2 to trade on USD/JPY, the accruacy may be somewhere between 65% and 75%. Knowing that the win/loss ratio and the risk/reward ratio, most FX1 students may find it hard to make money on FAST2. Some of the students may start blaming FX1 and whoever on the planet saying that this course sucks.

In my case, I focus on how to better the system with a view to increasing the win/loss ratio. In my own R&D, I asked myself the following questions:

- Can I use some signals to filter out the less probable side of the trade? Put simply, if USD/JPY is on a short-term downtrend, and there is a long signal, should I take this trade blindly? This is why I incorporate Kathy Line's BB Band in my modified FAST2. So, if the pair is in the sell zone, I will concentrate on the short trades.

- Can I take into account support and resistance? Put simply, if USD/JPY gives me a sell signal, and at the same time, the profit target will face a strong support somehow in between, should I take this signal? Peter Bain and John Person are the gurus in pivot point analysis. There are also free MT4 code for daily pivot points. How about putting pivot points in the pair and filter out less probable trades? For example, this afternoon there was potentially a short USD/JPY trade and I decided not to trade. My PT was 92.20 and S1 is 92.24. So, I did not place the trade which eventually was proven to be a right decision becuase it really bounced back nicely at S1and moved all way to my SL and I would have registered a max loss on this signal.

So, these are some of my ideas to fine-tune the trading systems based on what I know. You may ask how the hell I know all of these. I can share with you that it is based on my hunger and desire to become the best forex trader in Singapore. That means I constantly look into my existing trading systems (and till now, I have at least 20 systems) and decide which of these are suitable in the given market condition. Unlike many amateur traders, instead of focusing the word "why?", I look at "how". With this little weeak of the question marker, I see a hell lot of oppotunities in forex market.

Another reader asked why I posted my daily forex record in my discussion board. I am not showing off of course. The sole purpose of doing this is to keep track which systems I use on a particular day, and how they performed. Of course, some of these systems are proprietary and thus I am not allowed to post the detail entry and exit rules. I need to respect the intellectual property of the inventor of the systems. At the same time, I have recently spent hell lot of time to forexfactory.com and singaporeforexforum.com as there are tons of free traidng systems and some of them provide MT4 codes. So, if you are committed to be the best of the best, you must decide for yourself what you should do.

Have fun in your forex venture!

2008-11-22T16:45:00.002+08:00

Getting addicted to Forex Trading

My wife and I went to a parent workshop this morning about internet security at home for concerned parents. The presenter mentioned that online gaming is very popular among the kids and it is very easy for them to be addicted. I was thinking whether it is just the problem for the kids because I have a similar challenge too.

Over the last four weeks, I only placed 3 options trades, all of which were simple quickie on directional bets. For the rest of the time, I focused 100% on forex trades. Yeah, I had two business trips in the month of November and honestly did not really trade. However, the fact that I am now back to the normal schedule allows me to focus again on forex trading.

As I explained to some of my readers, forex trading is tough if one hasn't got the proper education. In addition, under the influence of Boris and Kathy from GFT Forex, I honestly do not trade forex by looking at the technicals alone. I read into a lot of fundamentals and use fundamentals to confirm my directional bias, and use technicals (if I have to) to confirm my bias. So, in this sense, I have fulfilled with Boris mentioned on the first M and the second M.

Imagine in a down day where you see a bullish signal on the carry trade pairs, are you seriously going to long? Well, a pure technical trader may go for this trade and probably it will be either a small winner or luckily best, no loss. However, by understanding the fundamentals, one will more likely than not filter out this long signal and hence, places no trade.

My forex trading hours are primarily in the afternoon, Singapore time. To me, this is the best time to trade because there is no US news that could swing the market easily. In addition, Europe markets have the tendency to follow the US market of the previous days. It's therefore easier to gauge the direction.

Having said that, I know and am aware that there are students who still prefer to trade during US cash market hours. It's fine because it boils down to one's trading preference - in this case, the operating hours. Now that I have traded forex for a while, I must say that I have an upper hand on the news around Asia and Europe, and even Canada, Kiwi and Aussie. There are many opportunities a day so a forex trader should not worry about having nothing to trade. Of course, we filter the better ones in order to ensure a higher win/loss ratio.

I have many trading systems in forex - which I acquired from many mentors and gurus. However, I screened out the best of five which have been working consistently:

Asia High Low System - AHLS
This is a system that requires one to place a trade at 3pm Singapore time on EUR/USD. The idea is to look for breakout of the range, and aim at a quick bite of the breakout and pocket the profits. This system has a track record of about 60% correct over the last few years. A few of us are working on a semi-automatic system and probably will launch in the near future.

London Momentum
This is a system that requires one to place a trade at 3pm Singapore time on GBP/JPY, at which time the London market is open. There is a set of formula to use to calculate the EP, SL and PT and is largely based on Jimmy Young's original version with mutiple lots to go in and scale out. The system however suffers an inconsistency at the beginning of this year and thus, I have researched and introduced a filter that provides a better result. Yesterday, I have further refined the system in such a way that I chalked up 185 pips per 3 lots in a mere two hours. So, London Momentum (Beta 2) will be what I am concentrating on for the next month to see if it can give me a better result. There isn't a trade everyday but for the time I traded so far in November, I recalled there was only a losing trade.

5 min 60 SMA
For Jimmy Young's trading tactics coaching class students, and also the TradeCast Publication subscriber, you know this is the main daily trading system Jimmy and his students use. The challenging part of this system is the execution, and I am still working on how to get a better execution. In addition, I have introduced a new set of stop loss rule which largely follows Kathy's multiple lot scaling out method. So, as Boris said, forex traders are risk managers. I would therefore be more than happy to lock in the profits and make the trade risk free first before looking for the final lot to make a home run.

1 min 60 SMA
This is the newly inented trading system introduced by Jimmy not long ago. It's purely based on the news each day, and can be referred to in the NewsTrader Publication. I have tested this system since last week, and it's 50/50 so far. Let me test it further before I give you my insights.

FAST2
When USD/JPY is trading in a tight range, FX104 did not really work. So, as an alternative, let's go back to the first forex trading system introduced by FX1 Academy. Using Kathy's BB filters and my own parameters, I have managed to screen out many bad qualty set-up. I am glad to say that I have not made a single loss this week on FAST2 based on my parameters. So, who said FX1 Academy's $4,500 course not working? I bet to differ.

For further information about Jimmy Young's trading course, please go to http://www.fxte.com for further details. I know the full-package costs US$7,999 (consisting of the basic course, intermediate online course, trading tactics coaching class, and the advanced online seminar) and it is quite expensive in view of the current economic climate. And at the same time, it is expensive because it gives you the entire trading package which enables you to start, rather than putting one in a half-past-six position. Jimmy shares with his students the game plan each day and this is the cream of the crop. He also does post-mortem everyday to explain what works and what does not work. I have certainly benefited so much from Jimmy's insight.

2008-11-22T16:32:00.002+08:00

3 Simple Rules of Winning Forex Traders (from Kathy Lien and Boris Schlossberg of GFT Forex)

About two weeks I went on CNBC and predicted that range will rule the currency markets for the foreseeable future. The price of EUR/USD at the time of broadcast? 1.2630. The price of EUR/USD at close of trade today? 1.2590. So range reigns in the currency market as every rally fails and every decline proves false breaking the hearts of both bulls and bears and that dynamic will probably last for the rest of this year. Thus with little new to say and holiday shortened week ahead of us I thought we'd change the format this week and skips the price action review concentrating instead understanding the basic building blocks of successful trading.

This past week in Kuwait I gave a presentation titled "3 M's that Drive the Currency Market". It showcased a simple analytical framework created by Kathy and I to explain most of the price movement in currencies. The 3 M's stand for Macro - broad economic and political themes, Micro - day to day economic releases and Monetary - for monetary policy of the G-10 nations. The 3M's model, though relatively straightforward, does a very good job of encapsulating virtually all of the catalysts in the FX market.

As I was flying back to US, my thoughts drifted to the 3M idea and I realized that trading itself can also be summarized in a 3 variable model - a model I call the Three Simple Rules Of Winning Traders.

Rule 1 - Develop an opinion

Whenever I hear traders tell me, "I don't have any opinion, I just trade price action." I always smile ruefully and think to myself that the trader is both an idiot and a liar. The fact of the matter is that every time you enter the market you are implicitly rendering an opinion on the future movement of price. The difference between those traders who do so implicitly versus those who put forth an explicit reason for their trade is that the former have no clue of what they are doing while the later at least try to figure out the story behind the trade.

It goes without saying that I have little respect for traders who mechanically follow price action like mindless robots. In trading you get paid not for what is happening now, but for what will happen in the future and if you cannot figure out what is likely to drive price towards your target you are just a lemming in the market. Right or wrong, developing an opinion is the cornerstone of a winning strategy.

Rule 2 - Let Price Confirm Your Thesis

To politely paraphrase a very crude Wall Street saying, opinions are like faces - everyone has one. Developing an opinion even one that is ultimately correct is utterly worthless if the market happens to disagree with your assessment. The history if trading is littered with brilliant analysts who were absolutely correct on their calls and yet were bankrupted by the vagaries of price action before they were ever proven right. Your opinion may be dead on, but as traders it is price movement, not opinion that we are trading. Until and unless price corroborates your opinion you have no entry signal for your trade.

Rule 3 - Manage Your Trade

More than anything else great traders are good money managers. I've always believed that you can put two great traders on the opposite side of a position and often both of them will wind up making money. On the other hand put two novices in the same spot and they will more than likely both lose. Trading above all the art of managing the unknown. Let's say you own a sandwich shop in some strip mall in Nebraska. Most likely you would know to within 10 or 20 sandwiches how many customers you will have every single day of the year. Now imagine that sandwich shop was the FX market. The day to day variance would drive most sandwich shop owners insane. Some days you may sell 500 sandwiches, other days you may have to dump all your food supplies into the garbage as no business came through your door. That's why trading at its core is always about managing risk. Every time you trade the operating principle is - Hope for the Best Prepare for the Worst.

The only way we've been able to control risk and at the same time participate in the market is by always cutting our position in half once a short profit target is met. No matter what anyone tell you, there is simply no way to know a priori if any given trade will be successful. At BKT we really believe that half a loaf is better than none. Success in trading is contingent not only on your analysis but on your ability to properly manage your position. That is why the game is hard. To be a winning trader you must be both - a good analyst and an an excellent risk manager.

2008-11-06T11:39:00.003+08:00

AN ARTICLE TO SHARE

Dear Readers,

I would like to dedicate this article to all of you.

Lesson Learnt From My Grandmother

It brought me a lot of fond memories when I first wrote it, and the more I read, the happier I will be. The fact that life is full of challenges means that we can become stronger and stronger. You know as much as I do that we should love our family, relatives and close friends, and treasure them before it is too late to do so.

So, if you haven't talked to your parents for a while, go ahead and make that phone call and say "I love you". Treasure yourself too because who is the most important person in this world. After going through Module 2 of Patterns of Excellence, I know the answer pretty well. So, take charge of your life and become 120% responsibility for what you are doing.

2008-10-28T12:38:00.002+08:00

Ok you guys win. I can't beat you guys!!

In a local forum, someone said,

"I buy, the price go down. I sell, the price go up."
"I give up. Lost $20k in one month. "
"No more."

We need many of these people in the market to fund our profits. Retail investors and traders who are so penny wise and pound foolish will never appreciate the importance of getting education. They approach investment and trading in the wrong ways.

Everyone knows that in order to profit, he has to buy low and sell high. But many times, he does not seem to be able to figure out that in order to profit, he can actually sell high and buy low (well, I am not talking about naked short position, and don't get me wrong on this). And interestingly, he may be buying high and selling low. Why does this happen? This has something to do with fear and greed.

Fear - afraid to take losses and as a result, losses keep piling up until that person cannot tolerate anymore.

Greed - take profit as fast as possible because it may be gone. So, the person will take profit and later will discover that he could have made more and started screaming and shouting.

Having said that, by getting proper education, this person could have saved $20k. Of course, when every smarter Alec is telling you that "cash is king and thus you should wait", he is also not getting proper education. Please don't listen to these people because they never tell you that you can profit from a bear market first before it reverts. So, instead of waiting for the bull market to come back, why waste time to stay sideline? We have traders who continue to make money in the bear market, me included. It's the result of us getting proper education, and trading with a plan. Don't under-estimate the power of education and don't be afraid of getting involved in the bear market.

Well, who knows when we are seeing this situation in future. But if we are educated, I am sure we know how to deal with this next time.

2008-10-17T13:48:00.002+08:00

My Dearest Grandmother

I will always remember you, my grandmum, the one who brought my up and took good care of me when I was young. I know you suffered a lot over the last few months, especially whenever I heard from Flora that you were admitted to hospital again.

I admired you for being tough and determined. I admired your perseverance even though at times you suffered tremendous pain. Having said that, you remained positive and had faith on the doctors' diagnosis. You faced the tough test the God put on you this month - for doing an operation which a normal person would not even dare to receive. You were doing well to be honest. We, all members of Wong's family, are proud of you.

Will the God take care of you, and you will enjoy a new page of life.

Your dearest Grandson!
Jack

2008-10-09T16:48:00.005+08:00

Whoosh 26 Module 1

Oct 2008 marks a milestone for me in terms of stretching my goals. I was part of the coaching team for Whoosh 26 - Patterns of Excellence (POE) Module 1.

Thank you for the guidance from the various senior coaches, and of course Pete Tan, our POE Head coach.

If you think coaching in Wealth Academy is the same as coaching in POE, please re-think. POE Coaching is 100,000 times more challenging than WA coaching. First of all, Pete expects all coaches to attend the pre-course coaching workshops (all together there are four sessions). I missed two of them and was a bit embarassed when I showed up on the third session. These sessions started from 7pm to 4am next morning. No kidding. Also, I am new to Pete and was not comfortable in front of him on the first night. But ... I am now used to Pete. He is a very tough guy and at the same time, is willing to share his knowledge with the group.

In terms of the actual POE, we had some 40 participants and for the first time as a coach, I understand the rationale of two key activities - WHY MUST YOU CHANGE? and WHY AM I IMPORTANT? Regrettably, I missed the STEEL ROD on the third night otherwise this coaching experience will be more fulfiling I must say.

Overall, it is a definitely a stretch to me, and I look forward to Mod 2 at the end of this month. I am grateful to all the senior coaches from POE for accepting me as part of the Whoosh coaching family. I learnt a lot, and I trusts that we will share our joy and happiness in future Whoosh batches.

2008-10-09T09:30:00.004+08:00

What to do with your money now?

I commend the effort by my best pal, Conrad who wrote this short article in his blog ( http://www.conradalvinlim.com/?p=270). I am doing my readers a big favor by presenting Conrad's thoughts to you.

Ironically, I received a few calls recently from my readers and buddies who asked me what they should do in this economic crisis (or should it be named 'opportunity instead?). If you flip newspaper and watch Channel News Asia, CNN and CNBC, you may have heard this phrase very often - CASH IS KING!

When I reviewed the arguments presented by the speakers and journalists, I could not help but to think that some of these arguments are too naive. Why? This is the best time and it is never too late to improve your financial literacy, thereby offering yourself a valuable opportunity to learn how to manage your money. Instead of asking around what to invest and how to invest, it is now your time (yes, your time) to look for these answers.

As nicely put by Conrad, you know your bank deposit isn't that safe because the safe zone is only S$20,000 per account. Cash in milo tins may be safer in that regard. But instead of keeping the money and doing nothing, why do you not offer yourself an opportunity to get education?

When so many people are screaming and shouting about the downfall of the equity market, when so many people are losing money in this market, only a few have equipped the skill to make money. I happened to be one of the few people who had the ability to do so.

Today is 9 Oct, 2008 and over the last 6 trading days, my forex portfolio was up by 17%, and there are still three weeks to go before the end of Oct. When my buddies who hold off to trade options because they are scared of the high implied volatility and wide slippage, forex is my logical choice because it is the largest market and no matter what happens in the equity market, the liqudity and the tight spread the forex market continues to offer make me wonder whether I have made to right decision to move to play and defend in the forex market.

Well, my story is that I started forex education formally only in this March. However, with the proper trading psychology and well-founded business plan, I was able to start my forex business in a few months and am now reaping the fruits of my earlier effort. So, while many people who took up courses and still lost money in forex, and while many people continue to say that forex trading is risky, here is an example - see for yourself how to delay gratification and get yourself some education will help you to survive in this market.

While my friends told me that they have bought nice cars and houses, I always think how to invest in myself first - delayed gratification is painful because one can be easily influenced by the peers. However, instant gratification can be painful when something suddenly happens and you have no time to respond.

If you are seriously in getting some forex education, you can consider the following:

http://www.babypips.com
http://www.theforexbooks.com
http://www.singaporeforexforum.com/forum.php
http://www.gftforex.com/
http://www.dailyfx.com
http://www.netvibes.com/BKTraderFX#FXDashBoard

and many more ...

If you are ready to start your forex education, let me know. I have tons to share with you too.

2008-09-28T19:27:00.006+08:00

Big Mouth Iron Condor (BMIC) System^TM

A lot of traders around the world were comparing my BMIC System^TM with Dan Sheridan's High Probability Condors. First, let me clarify that BMIC System is a system created by me and it is not based on Dan's system alone. In fact, BMIC System is generated by mixing and playing with at least three iron condor systems that are available currently in the internet and of course, the system works because I have done sufficient backtesting before I put this system on live trading.

Now, some of you may find that my Beta 1 Guidelines are too much to handle. Remember that this system is a rule-based system and therefore I have a lot of rules to capture different scenarios. For example, the hard close rule is to deal with the overnight RLS settlement. Buy back cheap rule is to make sure that a trader can remove his obligation as early as possible. So, they are all there for reasons. You cannot get these rules in a complete sense by reading other iron condor systems because most of them tell you vaguely how to get in but none of them is really able to address the "How to get out", or at best, you may consider this or that ... blah blah blah.

Why do I not talk about volatility? In the first place, iron condor consists of two vertical spreads. Therefore, the volatility is hedged in that you buy high IV option and sell high IV option at the same time. Or you buy low IV option and sell low IV option. Indeed, RVX can help to determine how big the mouth is. It helps in certain sense but that's all you can use. So, not mentioning volatility is not fatal because it does not matter at all, unlike time spread or diagonals.

If RVX is at all time low, chances of getting burnt WOULD NOT GO UP because you are going to use some rules to get out of the position. For example in Beta 1, I talked about what if you lose 1.5 times of your original credit received, you should consider getting out. So, those who said they may be burnt did not consider faithfully all the potential exit rules, and I am daring to say that - they did not.

All in all, no matter which iron condor system you are trading, make sure that you have done sufficient backtesting and forward testing before putting money at risk. Taking someone's system without testing it can be fatal and when you get burnt, don't blame the system developer but yourself - why? It's because you haven't done enough practice to drive F1. How can you drive like Lewis Hamilton when you just get your license?

Go figure.

2008-09-28T19:06:00.003+08:00

Com'on - Listen to the so-called guru's advice

Read the following in a local forum with interest of how silly and naive aspiring traders can be:

"I am a newbie and just started trading few weeks ago. I thought I got some good information from this forum and won some money initially. One particular forummer caught my eyes as he was very articulate and claimed he was right of the market movement for the past few months..2 weeks ago on a friday, when the market turned, I listen to his advice and go long, becos he sound to firm and sure abt the position..never did I expect he flip his position so fast on the coming monday..Now i suffered for a lost of $10450..very sad now I never lost such a huge amount in my life..and the above was my entire saving..I am keeping this away from my wife over the weekend and now feel very depress and lost"

Hey, in the first place, a few lessons we can learn from this poor chap's mistake:

1. Treat someone's opinion as a fact is fatal because a trader can turn his opinion in a split second. Since he is not giving you any advice, he owes no fiduciary duty to you. If you are wrong, it is your own mistake and you have no legal recourse against this guy. So, don't even think of suing that trader? No way, you are wasting your money and your lawyer will happily pocket the legal fee.

2. Never trade with the amount you cannot afford to lose. So, if you hear like this guy say "I suffered a loss {sic} of $10,450 ... I never lost such huge amount in my life", probably he is trading too big and thinking that this trade would be a home run. Once you are in the mindset of gambling, chances are you are asking how much this trade can make, and not how much you will lose if you are wrong in the first place. That's why gamblers can sometimes make money but in the long run, gamblers can't last. Probability is not on their sides anyway.

3. This is really a joke but is so common. So many people are not willing to pay a few K to get proper education because they say the instructors suck, the course sucks, the materials suck, the strategy does not work. Ironically, they are happy to pay so much money to let Mr. Market teach them a good lesson. You can call this moral hazard, or the law of adversity. Isn't it better to pay $10k for proper education and learn how to trade well and last longer, instead of paying $10k to Mr. Market and now the money is gone. This poor guy literally has less than $10k to start his trading business. He felt sad and probably he wouldn't trade anymore because humans are scared due to "once bitten, twice shy" syndromes.

Another victim ....

2008-09-25T13:30:00.004+08:00

Thanks, Conrad

My best trading pal, Conrad Alvin Lim mentioned me in his blog, and guess what? I received two friends request in my Facebook. Not a bad way to attract traffic and increase my profile (do I really need a high profile? I don't actually).

Without sharing too much the stories of my two new friends, I would just like to highlight the difference between Wealth Academy Trader ("WAT") and Optionetics two-day intermediate seminar. I consistently receive questions, specifically asking me to compare and contrast these two courses. It's like "Greeksman, I am considering either WAT or Optionetics. What's your take?"

I see the comparison as that of an apple with an orange. I am not in the best position to comment on WAT since I am never Conrad's student myself. However, from the conversation I have with Conrad and his students, and since I have the honour of being a special guest in his WAT forum, I understand that WAT provides basic training on trading matters.

In my opinion, whether a person decides to trade stocks, indices, options, futures or forex, because he chooses to be a trader, he has to acquire the basic skill. I believe therefore WAT is a good course to help aspiring traders to build their foundation. I don't any get commission from Conrad though to say this. I do find that had Conrad taught WAT earlier, I would have had become one of his students so that I can brush up my technical analysis and candlesticks.

In the world of Optionetics, however, apart from having a basic technical training, one will add on the foundation of options. So, one can start trading options assuming that he has already had trading skill. I sincerely believe that this should be the case. If one starts immediately to trade options, it's like "Hmm ... you are driving a F1 race car without having a driving license". I am not saying that it is not possible but you know the risk involved.

In the end, whatever one decides to do, he must understand why he is doing what he wants to do, and do whatever it takes to achieve the goal he set for himself. So, if you are interested in knowing more on Optionetics, do drop me a note or come to one of our previews by registering at http://www.optionetics.como.sg. The previews for the upcoming seminars will be 7-9 October in Singapore, and 11-13 October in Hong Kong.

If you are physically in Hong Kong, please come to Langham Place, Mongkok on 11 Oct at 1:00pm. Why? It is because for the first time in Optionetics' history, I will be doing the preview in 100% Cantonese. The slides will all be in Chinese too. So, if you are interested in hearing Optionetics talk options in Cantonese, I shall see you in Hong Kong. I am sincerely looking forward to it.

2008-09-23T11:57:00.005+08:00

Those who attended the course should sue these people for misrepresentation - the course promises easy profits, which is clearly untrue

Very often in the local forum, you will see someone stand up to be a referee or an umpire to tell the world that it is unfair for someone to make money and for the rest to lose money. I can never understand the mindset of these people. Most likely, they could be victims of these seminars, and perhaps lost a lot of money by learning how to trade or invest.

Instead of blaming themselves for being ignorant and perhaps not giving 100% to learn how to trade/ invest well, they choose to blame the seminar organisers, the instructors, the founders of the courses, the people involved in the seminars, their academic qualification (which has no relevance in trading/ investing whatsover).

The sad thing is that if you subscribe to this logic, chances are you will never be able to be successful in investing and trading. It goes by this simple logic - trading and investment is a skill and it is not possible to be acquired overnight. Most of the participants I came across carried what I called a "quick-to-get-rich" mindset. Worst still, if they also have the mindset of equating setbacks as failure, they will never achieve anything from trading and investing. The seminar fee will simply go down to the sink. It is as simple as that.

Now, if you are serious in learning how to trade / invest well, then ask yourself this question. Are you able to commit to yourself (not to the others) that you will do whatever it takes to achieve it? Are you able to design a plan to enable you to learn the process and the requisite mechanics? Don't say that you have a day job and you don't have time to do this. Maybe you have to sacrifice your sleeping time. Maybe you have to sacrifice your Friday night's drinks. Maybe you have to let go a hobby like golf over the weekend. To respect trading and investing as a business, you must put in time and effort to realise the dream. How do you expect someone to teach you how to ride a bicycle without you practising how to do it?

To think what these folks do is naive and obviously, don't say that I haven't told you so - they will fail and I guarantee that! The saving grace of course is that we need these people to participate in the market, so that we can grab money from them.

2008-09-22T12:05:00.006+08:00

WEALTH ACADEMY - CONGRATULATIONS ON BATCH 13

Congratulations to the folks on the right of the photo who completed Batch 13 of Wealth Academy on 18 - 21 Sep 2008.

As I told my fellow coaches, there is always a reason for everything. I am not going to AKLTG to coach for money. In fact, I came out with my own money to be a coach. But why did I spend my weekend there at the expense of many things which I could otherwise do? I sincerely believe that as I meet people from different walks of life, it will inspire me and sometimes I do learn something from the others by understanding their questions, and talking to them. So, there are values I found in engaging conversation with different people.

Thanks Adam for his thoughtful remark at the closing ceremony by framing me as the "Best Options Trader in Singapore". This is despite the fact that my readers jolly well know that AKLTG offers an options trading program and there is a perceived competition between AKLTG's options trading program and the options trading program along which I tag. He does not mind doing the introduction. To me, Adam has inspired my life since I joined Wealth Academy in May this year. I learned so much from him in terms of how to be empowered by doing just simple things every single day.

Conrad? Well, there is nothing more than I can say. This guy rocks and he is what I call one of the best day-traders in the world. Who can compare with him on his knowledge in candlestick patterns? I can't because I am a beginner in candlestick analysis. Actually, I don't need to use candlesticks so much in my options trading as I am primarily a premium collector. However, I found the knowledge in candlesticks a must in my forex trading because there is no premium collection strategy but purely directional play. So, it becomes a MUST for me to learn it.

Thanks Terry for doing a fantastic job as the Program Director. He is an amazing chap with a lot of energy, and he led the team to provide the participants, Adam and Conrad with tremendous support. Of course, to my fellow coaches, you guys are great because I learned something from you too - Kavin, Michelle, Serene, Joshua, Vincent, Bernard, Vivian, Allan, Ruben, Cheryl, Melvyn, Lawrence, Justin, Alicia, Mark (I hope I did not miss out anyone ...)

That's why I keep going back to AKLTG, a place to allow me to be energized and empowered.

Finally, I would like to thank Arthur, one of the participants for providing the picture so that my blog can now be updated with a graduation photo!

So, if you wanna come back to be a coach in WA 14, it's going to be fun.

2008-08-23T15:57:00.003+08:00

Getting Half the Juice - from Boris Schlossberg and Kathy Lien of GFT Forex

The longer you trade the markets the more you realize that the only absolute in the game exists on the downside. What I mean, is that the only factor that we can control with any degree of consistency is our losses. Most people of course believe they can control profits and that is perhaps the most naive belief of all. I'll never forget one time sharing a cab downtown with well known colleague who opined in no uncertain terms that he never takes trades with less than 3 to 1 risk reward ratio. I remember feeling uncomfortable at the time with his utter conviction that this was the only way to trade and only much later realized that this man must have never put his own money on the line because his premise was laughably unrealistic.

In real trading there is no such thing as 2 to 1 trades or 3 to 1 trades because you never know ahead of time how much money the market will give you. It is an utter act of hubris to think that just because you want to make 100 points of reward for every 30 points of risk you will actually achieve it. The 2 to 1 or 3 to 1 risk/reward trades are what they teach you trading books, and of course as so often the case what looks great in theory is actually remarkably dumb in practice. As the greatest philosopher since Plato once noted "In theory there is no difference between theory and practice. In practice there is."

Last week I spoke about the need to set minimum targets and stick to them. However when it comes to maximum gains - the game is always open ended. Sometimes you hit a home run, sometimes a double and sometimes you just have to satisfied with a dribbling bunt. (For all our non North American readers I apologize for the profusion of baseball metaphors) but I think everyone gets the general idea - YOU CANNOT CONTROL YOUR PROFITS, YOU CAN ONLY CONTROL YOUR POSITIONS.

Sometimes when you squeeze a lemon you only get half the juice, and trading can be very much the same way. In practice, most traders scale out of their trades, taking some profit as it comes. In fact when you read our Millionaire Traders book the one unifying theme amongst most of our interview subjects be they trend followers or trend faders, long term or short term traders was that they always scaled out of their winners. Certainty and arrogance is for amateurs. Professionals play the probabilities and always remain flexible and open to the markets.

2008-08-23T10:10:00.004+08:00

Finally, I got wiped out today after several days struggle

I read this note from one forex forum with sorrows. This student just picked up a forex trading class. He said in the forum that he could not control himself. He could not remove any emotion. He could not follow all the strategies and rules. He knew the danger but yet he continued to do it. He told himself he needed to stop not following the rules but he could not do it.

He shared in the forum about what happened a few nights ago. All the indicators were showing the strong uptrend. Yet, he was going for short position. When his trade was stopped, he went to short position again when there was signs of retracement. Worst still, he placed an order without profit target and stop loss. He admitted that he is gambling. So, in the end, his account was wiped out within merely 2 days.

He is in depression mode. He is remorseful and embarassed. An now he is asking others for help, in particular how to control his emotion.

As far as I am conerned, this is a classic example of why an aspiring trader can easily fail after paying for a seminar. A retail trader has a high tendency to approach trading in the wrong way. He trades without a plan. He trades with emotion, greed and fear. A seminar in itself is not in the position to put a newbie in the position of a professional trader. Instead, the newbie has to take control and makes a decision to follow the rules, and trade with a plan. If he fails, he cannot blame the seminar, the course provider, and the instructor. From this newbie's note, he did not blame anyone. So, it is indeed a good sign. He knows his weakness. He just does not know how to do it. In my mind, there is still hope on this newbie. He had a painful lesson and he will learn from his mistakes.

So, how can we help him? Actually, no one except him can help himself. Why? It is because like I said above, he has to take charge of the outcome. Maybe he should stop trading for a while. Maybe he should start again by paper trading in a demo account. Prove to himself that he can make consistent money before funding a new account. It's very obvious that instructors keep telling newbies not to put real money to trade but practise in demo account first. Not many people I know will follow the rules. In my case, I never trade a system unless I have backtested it and paper trade for a while. Only when I see consistent returns I will put my first $ at risk.. Some people call me nuts and some people disagree with me. Honestly, I don't give a damn. Why? At the end of the day, I am accountable to myself, not to the others. So, why am I concerned with what other people said?

I wish this newbie a successful trading career. Don't give up and take massive action to deal with the psychology part. Like what Conrad and I said to our respective students, it is trading psychology that brings success to a professional trader.

2008-08-22T09:51:00.005+08:00

Increase our edge in directional trading - sector analysis

Kudos to Mike Wade and the technical support team of Hubb Corporation in Sydney, 2-day seminar students in Singapore and Hong Kong have the knowledge of sector analysis, and for those folks who purchased Profitsource (http://www.profitsource.com), they can even enjoy the new Sector Scan which is currently available to students elsewhere at ICT and ITT levels.

Have you ever heard a complaint like Wave Theory does not work or Profitsource sucks?

"i have hat lot of failed trades with my profit source for the last 2months, i would like to know what i did wrong. eg i bought lots of wave4 trade that went the exact opposite and i have lot quite some money in the process, what should i do as am starting to doubt the process"

In the past, as this student politely said, I will reply this way:

"Profitsource W4 setups are just that: SETUPS. There is no guarantee they will turn into great profits. It is of most importance that you have a trade plan before you open position. Having exit points when things go wrong saves you money. Adjustment points when things go your way will save you a lot of frustration. If you are up $7K and end up loosing $4k is highly irritable, you need to take care of your winners so you can win more but limit your losses.

Once you are in a trade, it doesn’t matter what EW formation you see on PS. By then you have predefined exit/adjustment points.

There is always a chance that if you can be right about what the underlying is going to do and loose money on options. Learning more about how options work should eliminate that danger."

Here is what I would have said in the past:

"I strongly suggest taking advanced seminars. I was struggling for two years, then after ICT, ITT and POMM I was able to become a full time trader in 14 months. Yes I had to do homework as well as sacrifice vacation time to attend seminars and OASIS; however, telling my employer that my last day on a job will be 9/12/08…priceless."

However, as an instructor now, I know I should not reply with emotion and insist others to follow what I am doing. At the same time, I know very well that if something is not working, I may not be convinced to get additional education as a means to change my strategy. There are more costs involved and not everyone is ready to do so. Grateful to Mike because he studied sector analysis and found that it works well to increase his hit in directional trading.

In this respect, the 2-day Singapore and Hong Kong seminars in July 2008 incorporated sector analysis as part of the agenda. This agenda is exclusive to only Singapore and Hong Kong students as far as I know. The sector analysis discussion is only available to other students who are at ICT and ITT levels (which means they have to pay to get such knowledge).

So, what should a student do? He should start looking at the sector analysis to understand how smart money flows from one sector to another sector. He should understand how different sectors react at a prevailing time or at a particular market condition. This is the starting point.

As part of the identification of trading opportunities, 2-day seminar students may considerfocusing on

1. Strong stocks in the strongest sectors that display a Wave 4 Buy set-up, or a bullish break-out set-up
2. Weak stocks in the weakest sectors that disaply a Wave 4 Sell set-up or a bearish break-out set-up

The amount of trades obviously will be reduced but the hit rate increases, and this is something I discovered over my backtesting. My hit rate in July on sector directional trading is 80% correct, and suddenly a non-directional trader like myself finds the niche and confidence to come back to directional trading. Do I need to take additional courses to do that? Not really. At the end of the day, additional education is useful in helping us to improve our skill. But nothing comes with building confidence based on the basic stuff that still works well. A 2-day student does not need to any advanced courses to gain this experience. Just come to any of our 2-day seminars either in Singapore and Hong Kong, which is free re-attendance to them. So, why paid $4,000 to get something that may potential be free.

Our next 2-day class is scheduled to be in Singapore on 23/24 Oct and in Hong Kong on 28/29 Oct. If you are an existing Optionetics 2-day student living in Asia, you may consider taking action to see us.

2008-08-21T11:35:00.006+08:00

I am not defending for Optionetics. I am only talking about business and commercial sense

I was engaged in a dialogue in my discussion board with an Optionetics student from the US. She wrote to me a long post:

*************************************

I am happy for you to be part of the Optionetics, being its official teacher. I’m not so happy for the newbie’s out there. When you were just a regular “student” you were more open, more helpful. When I was studying your BMIC, seeing you post your live trades or even trades that just closed, it was very helpful. Now your response to most questions is that you cannot do it anymore, because you are Optionetics teacher. How that suppose to help the new student? Just another student (you 2 years ago) could do it, and now you, the official teacher cannot help as much as you were able to do short time ago? For the sake of new students, please, quit being a teacher, and become just another student again. It will benefit them more, like it did me.

My original education on the Iron Condor started with Don Fishback. That’s where I learned the formula to compute the Expected Move, that I believe is the most accurate, since it comes straight from the Black-Scholes options pricing model. Any time some student asks about the EM formula, he is being told “it’s a big secret, unless you pay another 3-4 grand and come to a POMM class”.

How about just pointing the curious student to some books? You just said in your previous post that you cannot say anything about non Optionetics books. My question then is “Is Optionetics also in the books sale business, not only in seminar business?” What about books by Charles Cottle, his older one CWS or the newer one OTTHR? Would pointing them to students prevent them from going and paying for POMM class? Or maybe these books would motivate them even more to go to that class?

After studying Don Fishback’s Iron Condors, I also was studying from Keith Fitz-Gerald, before running into Dan Sheridan and you. At the same time, because lucky me I live around Chicago, I was able to study for FREE from TOS.

That’s another beef that I have with yours and all the other teachers answers when somebody asks “Which is the best broker to use?” I was invited to attend Expert class in Chicago, last month, which was done by George and Tom. During that class both of them were openly saying that TOS and OX are the brokers they are using and recommending them. So if the 2 big guys can say it openly during their seminar, what’s wrong with all the rest of the Optionetics teachers? Why they cannot point their students to the best brokers? While I can understand, Optionetics being secretive about TOS, since this broker offers FREE very high level option education classes to their clients, it’s in the interest of the student to know about this option to them, and in my mind company who says often, that the best interest of the student is on their mind, to point them that way.

While I can understand that at least you guys, the official Optionetics teachers should not discuss the other teaching companies, like Pristine.com or Randomwalktrading.com how about just saying that RWT has good books (and I have written proof that some of the Optionetics teachers were/are contributing writers to their monthly articles). While I’m not impressed with Pristine’s options side education, their technical analysis is very good, as pointed already about a year ago on discussion boards by another Optionetics student (who luckily for us did not become a teacher ;>)

Most of the students are honest, hard working at their option education and not looking only for freebies (like our friend Bok, the CPA ;>) Sometimes just the seminar is not enough; I for example had read at least 100 books on TA, options, psychology of trading etc… I attended some other options seminars, besides the ones by TOS. I’m on the mailing/seminar list of Nison, Bigalow, OptionsUniversity, etc… Point them to those materials, so they can study in the confines of their homes, have different point of view, some questions explained different way. I believe that no wrong will come Optionetics way doing this. They will appreciate more the company who REALLY has the students best on its mind, not only its account receivable.

I will end it there for tonight. I hope you and all others will look at my series of posts as not me complaining, but trying to see the real Optionetics – Empowering Investors company, that I believed it to be over 5 years ago during my 2 hours free introductory seminar.

******************************

I thanked this student who provided me with the honest feedback. There are lots of restrictions or business ethics as to why Optionetics is not in the position to fulfil the wishes of newbies. Whatever it does, it will never please everyone on the planet. So, may I have the permission to explain:

1. As a company that provides educational services (and not a charitable organization), the employees and contractors have to be paid. No one does charity work in this business anyway. Accordingly, Optionetics has to be run as a business, i.e. a profitable venture. Having said that, it has strong business ethics. It has its students/customers to be concerned. Students' success brings into Optionetics the intangibles, and its reputation. Therefore, from a business perspective, I don't understand why there are still people who lack the business mindset and insist that a company such as Optionetics is morally wrong in selling educational services. It is the corporate objective to be in this business and it is a business proposition.

2. While Thinkorswim is a licensed broker based in the US, it does not have a license to operate in Singapore. On record, only Optionsxpress and E-trade have license to operate in Singapore as brokers. In this respect, it is not possible to recommend Thinkorswim as a broker in an event held in Singapore. To do so will put the company in trouble as the Monetary Authority of Singapore will be after the company. Moreover, as far as I know, Thinkorswim or any other unlicensed brokers are unable to provide any form of solicitation and demonstration of their platform in an event held in Singapore. If so, the Monetary Authority of Singapore will also be after them.

3. From a business perspective, other service providers are actually the company's competitors. So, like Warren Buffett looking for a valued stock, the third criterion is that a company must display a strong economic moat. So, how can a company running a business mention other competitors' products or services in its own event. It simply does not make any business sense.

While I appreciated that student's effort in bringing up many points, what is missing is a sound business proposition, and commercial sense. As I am running my own business, these things are very obvious to me.

2008-08-19T18:11:00.002+08:00

It takes all sorts of traders to make this world

I am still in the process of recovering from the two full days of invovlement in Invest Fair 2008. I was at my Optionetics' booth, with the aim of meeting prospective students (or appropriately put, options traders wannabies). I shared with my teammates in Skilled Builders Group meeting last night on two interesting stories I had in this event.

Story 1: Meeting a student who had previously signed up for the 2-day seminar but eventually gave up

I met with this student who previously signed up for the 2-day intermediate seminar (i.e. the package that includes our Home Study Course and free life-time reattendance). He was one of the members of the 95% Club. In other words, he failed to continue with the program. When I asked him why he failed, the response was as follows:

"I am not as smart as you"
"I am not a lawyer"
"I am not a university gradutate"
"Options is too difficult for me. I don't understand the concept"

Do you think the response is fair? You may be able to understand why there are so many people in the end who decide to give up. The response was far too negative. It is precisely why these people will fail because they constantly put their mind into unresourceful state. One major challenge for professional traders is to avoid negativity (or stay in the resourceful and positive state). That is the mindset of professional traders. So, good luck with this fellow student and hope he will do something he likes.

Story 2: Seniority in trading - does it matter?

This may be a good one laugh after all. One participant in the Fair came to our booth and asked whether our program (Profitsource) has any proprietary indicator. I explained that Profitsource does not have any propreitary information because it is just a software to allow the users to do technical analysis. I then explained to him that I trade forex without even using any technical indicators at all. He was a bit shocked and asked me how many years of experience I had in trading. When I mentioned that I had a few years of experience, he said that the fact that I enjoyed my success for a short period of time does not mean anything. I was a bit surprised to hear that because if this gentleman has been in this business for 25 years, why is he still looking for propreitary indicator? Does it matter if one has been in this business for many years? Does seniority mean success? Go figure out. I was laughing behind his back because I could not believe that a trader with 25 years of trading experience is still searching for the Holy Grail.

More to come!

2008-08-15T11:00:00.008+08:00

Full-time Trader? Does a full-time trader need to trade full time?

Come across the following questions from Conrad's Board which was raised by an aspiring forex trader. This guy asked

"I have some doubts whether to be a full-time Forex trader after 1 year.

i) My friends told me that it takes as much as S$100k to trade in Forex market.
ii) There is no guarantee to make money in Forex. Otherwise, people will have quitted and traded full-time at home.
iii) Is it a must to work a trading firm to gain experience?

Kindly advise a lost soul like me.

Thank you."

How will you respond if you were asked to answer these questions?

Ans: Yes, your friends are correct in that you need to take as much as $100k to trade in forex market. But where is the leverage? Do you understand the concept of leverage which can be a double-edged sword. It can work for you and against you. So, go figure out what leverage means in forex market and how you should apply leverage correctly.

There is no crystal ball out there. I don't even know what to eat tonight. Let alone what I am doing tomorrow. However, does a full-time trader really need to trade full-time? It has always been a FAQ and a $64K question. I won't sacrifice a 9-5 job because I will trade from 10-4 at night. It is simply switching the work clock. It does not make sense. While a lot of folks have painted a 24x5 feature in forex market, do understand that there are certain hours where the market moves fast for you to make money. I place my forex trades only at 8AM when Tokyo is open, 2PM when Frankfurt is open and 3PM when London is open. So, I don't need to trade forex full time as I have better things to fill my non-forex trading hours. Attend Wealth Academy to understand the concept of primary source income and multiple stream of income. It will blow your mind.

The last question is whether it is a must to work in a trading firm to gain experience. Straight answer is "no". One can gain experience by doing the following:

1. Learn the skill by making mistakes in the martket.
2. Get education to learn the skill, paper trade to gain experience and increase confidence level.

At the end of the day, there are too many folks out there who want to take advantage of the quick-to-be-rich scheme. Here is another classic example!

2008-08-14T09:16:00.009+08:00

The $4K Forex Course in Singapore

"The worst fx training ever given by a local company. You trade in order to earn 2 - 3pips per trade! Don't ever join them! You will be cheated 3.5k. I happened"

"I attended XXX and my take on them is they teach retracement. A course in retracement is not worth $400 not to mention $4000!"

"Recently i attended a seminar by XXX too... sounds interesting... but when it comes to the course fees for 2 days... its almost $5k! (round up) Is that too expensive? Or, is there value for it (for anyone who has attended before)."

Many folks in Singapore must be confronted with rising cost of living. Hence, some daring folks are looking around for quick to be rich scheme. There is a variety of schemes available in Singapore - stocks, options, futures, forex etc. You name it, Singapore has it.

Out of curiosity, one of my trading buddies asked me for websites on forex education. It prompted me to one and I saw some folks discuss the forex courses that are conducted in Singapore. In fact, my trading buddies overseas asked me how I got my forex trading education. What I told them was that Singapore ranks Number 2 in the world int terms of the number of forex traders. So, we are spoilt by choice.

I am a firm believer of education before putting money at risk. So, I was one of those who paid a few thousand dollars for these courses. I did not do only one but a few courses over the period of three months. I also plan to do a popular forex course next month, after I postponed it for three times because of my overseas assignments in options teaching. I also have plan to do an advanced forex course in the first half of 2009.

So, does it work for me after paying a few thousand dollars on forex education? The real answer is that these courses work. Why are they not working for some people? To be frank, I believe it is people that make these courses not work. Why? Let me ask your these questions. Why do you trade? If your answer is "money", then please run. Don't walk away. As my mentor, Tom Gentile, said, money is the result of successful traders and should never be a goal.

Money itself does not motivate us to do something. It's the emotion we attach to the money that drives us. Something I learnt in Patterns of Excellence @ AKLTG. So, if you haven't figured out the answer to "why trade?, perhaps you should not spend that kind of money to get education. You are not even ready to start a trading business.

As far as I am concerned, that course which a lot of folks have negative feedback works for me extremely well. To be frank, Dr. Lim has given me a lot of inspiration simply because he is a believer of looking at the price chart without using any technical indicators. When I was asked by others how I trade forex, my response is I don't use any technical indicators at all. One guy questioned me and sought confirmation. I re-confirmed that I don't even use an indicator such as moving average. How amazing it is to trade forex this way.

The FAST2 is a beginner strategy. It laid down the important concept of having a Profit Target and a Stop Loss in forex. Having a PT and a SL in forex is a must because of the volatility of the forex market, especially during the European and US trading hours. However, newbies tend to focus on the outcome of a trade and not the process of practising to make the skill perfect. Worst still, some newbies can't wait to recoup their course fees and start trading with real money. Guess what will happen? Losing money? Most likely. It is not the strategy that does not work. Newbies simply do not have the requisite skill set yet to trade live. That's the whole point.

Have you ever wondered trading FAST2 in certain hours only? Have you ever wondered not to trade FAST 2 in certain time? Have you done a basic fundamental analysis of what is going on in the global economy? Have you studied the inter-relationship between the stock market, bond market, commodity market and the currency market? So, if you have no clue what I am asking above, you are not ready yet. The above questions are important as far as FAST2's performance is concerned.

A lot of folks do not discuss FX104, which is a daily trading system given by Dr. Lim in the supplementary course which costs us only $20. Yes, I did FX104 under the old regime. FX102, 103 and 104 are blended in a one-day course already but it is still $20. It's amazing how FX104 performed since I started trading it on 28 May 2008. In my case, I started paper trading this system for two months before I go live. I proved to myself that the system can generate consistent paper money for two months (which was 1,400 pips out of 14 trades) before I put the system on live. So far, in my real account for FX104, I have done 4 trades already , and profited around 200 pips. As I am writing this post, a FX104 short trade is in the process and it is already broken even.

So, you may ask why FAST2 and FX104 work for me but there are so many folks who complain about them. Like I said, before you go trade anything, you must do your due diligence. Having a trader's attitude and approach trading as a business.

In my recent Seven Essential Credentials of Successful Traders series written for Optionetics, I said that all successful traders have the following things in common:

1. A Strong Self-Belief that trading is a viable business
2. Have good traders habits
3. Have S.M.A.R.T Goals
4. Have a Master Plan for this trading business
5. Have Winning Strategies
6. Willing to "Kaizen" - continous improvement
7. Know how to protect this business

So, aspriing traders - have you got what it takes to be a trader by having all the above credentials? If not, you are not in the 5% Club yet I must say. You still need to work hard in order to leave the 95% Club.

Take care!

2008-07-21T22:18:00.005+08:00

WEALTH ACADEMY - CONGRATULATIONS ON BATCH 12

After completing WA Batch 11 in May 2008, I returned to WA 12 as a coach on a part-time basis. What I learnt as a coach is the team spirit. The coaches aren't paid for spending time in AKLTG. However, it is the passion that drove every coach to do more than 100% to make sure that the participants benefit from the program.

For those who are WA graduates, I encourage you to seriously consider to come back as a coach. You may not realise the fun in the coach room. There were lots of happenings and with Adam and Conrad in the room, there was fun and laugh I can say.

I always believe a project cannot be accomplished if the team members don't have chemistry. However, this was not the case for this team. Some of us were already friends from POE and some of us were from Conrad's Wealth Academy Trader - like Justin, Sean and Kavin.

The only regret I have is that I missed the happening on Friday and Saturday whereby from word of mouth, our Mr. Terry Seah did a pretty good job in the game we play in WA. As by popularity, Mr. Terry Seah (our Ah XXXX) will be the next Program Director for WA 13, who will be assisted by Kavin Chia - the Assistant PD.

Enjoy!

2008-07-14T20:14:00.014+08:00

Patterns of Excellence (Module 1) - 10 to 13 July 2008

Another milestone was achieved over the weekend when I completed my Module 1 of Patterns of Excellence (POE) at AKLTG.

Module 1 is about how we can use POE to transform the quality of OUR own lives. We learn:

Ultimate Success Formula
Mental-Recording: Master Your Mind
Create Empowering Beliefs
Re-programming patterns of behaviour
Design Your Destiny
Reframing - transform problems into opportunities
Anchoring: activate powerful states
Values: discover your driving force
Peak states for peak performance
Build instant rapport with the others

After completing the course over 3.5 days, I graduated from this class and became a member of Whoosh Batch 25.

So, I moved towards my goals a little bit further. One of my goals was to complete POE in 2008 and I am glad to say that I have made it.

This course is not a trading or investment course. It's about how one gets to know himself better. Isn't it true that as a professional trader, it is important to know your trading personality. So, this course gave me an opportunity to reveal my emotional self.

Although the course started at 9AM, it ended at 2AM the next day. Interestingly, despite the jam-packed schedules and the fact that I only slept 12 hours over the last 4 days, I was not fatigue at all. In fact, when I am preparing this post, I am full of energy because I can say "hmm ... ENERGIZED!, YES!!". I am also playing Rocky Music in my brain to wake me up. This course has completely removed my limiting belief on many things.

IF WE BELIEVE IT CAN, IT CAN!

I take this opportunity to thank Adam because he continuously inspired me (and sometimes makes me feel agitated). Realizing that Adam and I have many areas common, can I model his excellence and excel myself? Why not? In fact, I have incorporated a lot of his speaking styles in my training too. I am also good at "copying" or "replicating" someone if you don't realize.

Apart from Adam and the co-trainer (Stuart), I must also thank Nicolas and Jun De who were our coaches for Group 9, and Peter, Chiew Ling, Kia Huey, Hidah and Lawrenece for being supportive when we performed certain group activities in class.

I also would like to commend the courage and confidence Kia Huey and Hidah gained during the course. At the beginning, they shared with the group that they did not have any confidence in speaking in front of the entire group of audience. Guess what they did eventually (see below):

See Kia Huey who was speaking confidently and with emotion next to Adam and her thank-you note to all the participants (see right)

See Left - Kia Huey spoke with emotion when she was on the main stage. This is the power of empowered belief - if you believe you can speak in front of the public, just one trigger is good enough to make you do what you believe you can do.

After Kia Huey gave her speech, guess what happened on Hidah?

She put herself on the line because she committed to the group that one of the stretch goals is to come up to the front and speak to the group. And with Kia Huey's speech, it fired up Hidah's emotion and she made it!!

Before the end of the course, each of us was required to write our name, our fear and limiting beliefs on wooden boards. Ladies needed to break 1 and Men needed to break at least 2 boards.

Our Mr. Atakalawoo (Lawrence) told us that it would be easy to break 2 boards. So, he opted to break 3 and guess what? He made it. Since Mr. Atakalawoo broke 3 pieces, I asked myself this question - can I be better than him? So, I asked for 4 pieces. Although it took me about 10 attempts (not the three-letter word huh!), I also made it. The goup's record was evidenced by the picture above.

I believe I came for one of the best courses I ever did in my life and I have committed to take up POE Module 2 during Oct 29 to 2 Nov at AKLTG to learn the advanced NLP techniques. In the meantime, SBG25 Group has started operating, and we must work hard to achieve our goals!

2008-06-13T10:04:00.002+08:00

GREEKSMAN LANDED 600 PARTICIPANTS IN 3 BREAKOUT SESSIONS ON AMERICAN SOIL

It's the end of my trip away from Singapore and I am heading back to the Lion City today.

With many fond memories and thank-you messages from my students/ readers all over the world, I considered my debut appearance as a speaker in OASIS a tremendous success. While some instructors had difficulties to get their rooms filled, it was not in my case. The second run and better still the third and final run were full house again. It's worth mentioning that for my last run, the session scheduled just before the closing bell, students were sitting down on the corridor, and stayed behind to ask me questions or chat with me, ignoring George and Tom on the main stage. So, by the time I left Ballroom A, George & Tom had finished almost 50% of their content of the closing bell.

Who said Chinese cannot speak on American soil? Believe it and dared to dream, and I was there representing Singapore and Hong Kong. When I was on the main stage to join my fellow instructors, to be thanked by our CEO, Richard Cawood, and some 2,500 participants, I was proud of myself to having such achievement. Being the first instructor from Singapore standing on the main stage, it is a critical milestone in my career as a speaker.

During my session, I played with the participants certain games I learnt from Adam Khoo during my Wealth Academy training last week. Participants were receptive and my fellow instructors next door wondered what happened in my session, because participants were shouting and yelling loud for milk and cows, whoosh ... whoosh ... whoosh. I confess that I learnt so much from Adam, in particular, the way he speaks and the body language he used. I am very good at replicating many people and so, replicating Adam is as easy as ABC to me.

I have committed to my students that Big-Mouth-Iron-Condor Beta 3 will be one of the topics I shall speak in OASIS 2009. One student asked me actually what Beta 3 is. I have no idea but I have committed to deliver this topic. So, with a die-die-must-do situation, this topic will be out next year. For those students who like to see me on American soil again, it will be OASIS 2009 - Jun 18-20 at Santa Clara Convention Center.

Till then, I will be busy with my other projects for Optionetics and of course, answering my students' questions on options in my discussion board. To attract 5,000 page view within 2 months in my discussion board with Optionetics is not an easy task but with my constant profile-building, I am sure it will hit 20,000 view counts by end of 2008.

2008-06-06T13:24:00.008+08:00

My OASIS DEBUT ON 5 JUN 2008

5 June 2008 was an important milestone I achieved in my life. Being the first instructor from Singapore ever to present a breakout topic at OASIS (Opionetics Annual Super-Investors Summit) at Santa Clara Convention Center, I attracted approximately 360 students in total during my first and second breakout sessions, presenting my famous "Big Mouth Iron Condor System".

I interacted with my students and readers for the first 10 mins of my sessions by discussing distortion filters and limited belief, which led me to explain why it matters so much from a trading psychology perspective in my trading business. Yes, cows drink milk and stop when the green light is on are classical examples of distortion filters and some students thanked me for brining up such an important element in trading.

Of course the highlight was my inaugural revelation of Beta 2 of the BMIC System, which I promised to my students that it would not appear anywhere in my discussion boards. I hope my students take home the creativity I have in developing Beta 2 version of the BMIC system, and promise to back-test the system and paper trade it until they are ready. I am so glad to hear that an Australian student flying all the way to Santa Clara just to see me in person. Obviously, when I was walking around the event hall, my students came to introduce themselves to me, and thanked me for inspiring them in today's breakout session.

I owed my success to all instructors in the Optionetics community because they are the best in the world of options, and of course Adam and Conrad from AKLTG because it is them and their combined effort to boost up my trading psychology to its momentum peak and right now, it is still hanging well at the peak. I have a day of rest tomorrow and will finish my third and final breakout session at 2:45pm on 7 June 2008, Ballroom A.

I was so glad to meet Michael Chin from Perth, my long-time trading buddy whom I first met in Perth back in Apr 2005. Michael is another successful example of Optionetics' education, and a great trader in my standard. A few years' back, he would not even dream of setting up his trading business. Guess what, he told me that with his passion in trading, he has set up his own business and started coaching students. He continued to improve his trading knowledge and stay ahead of the crowd. I wish Michael all the best in his business.

On the same day, I met Mary (Optionetics student from Sydney) and finally Harry (Optionetics student from Melbourne). I met Mary in Sydney back in May 2006 in the then Eliott Wave Class, and noted her progress in becoming a better and better trader. For Harry, he has been my on-line friend for many months (sorry, I lost count). Finally we met in person at Santa Clara. To me, Harry was another successful example because he started off this business with little knowledge and low confidence. I have been providing mental support via online and set up a trade discussion group to help Harry to boost both his knowledge and confidence. He is now able to generate profits from his trading, and I guess it is what I told my students today the commitment, and the "why" factor - why do you trade? Harry, all the best in your trading career and hope you enjoy the rest of the OASIS event.

I will continue updating my blog about OASIS encounters. So, stay tuned!

2008-06-02T19:48:00.003+08:00

FOREX MASTERY CLASS WITH KATHY LIEN ON 2 JUN 2008

It is not easy to see this young lady live in person but today I was committed to be away from my usual tax work and routine forex trading opportunities to listen what Kathy shared with us.

Throughout the day, although Kathy hurt her left leg and could not walk normally, she was energetic to share with the audience her insights in fundamental and technical trading techniques.

In terms of the fundamental trading techniques, she has shared with us (something I have never heard before) the trick of trading economic news - Tier 1 and Tier 2 concepts and also what to look out for in proactive trading techniques based on the news. I admitted that some trainers in Singapore may not even know this and will ask their students to shy away from trading the stuff. Oh well, Kathy has given us a road map of things to look out, and her key considerations plus a complete trading plan. She also placed two live trades today as illustration.

On the technical front, a lot was based on her e-book. So, free riders will simply download the books and read it for themselves. This is perfectly fine for people who have plenty of time. But you know it is not for me. I would rather spend such time to do backtesting and create templates.

Anyway, it was a fruitful event I must say, and I have gained some very solid insight from this young lady, who is you know 12 years younger than me.

Thanks FX:1 Academy for organising this event for us.

Truly Appreciated!!

2008-05-31T09:32:00.000+08:00

Market Outlook Commencing 2 June 2008

This was a short trading week and the bulls were happy to take control for the entire week. Overall, 1.3% rise for INDU, 3.2% rise for COMPQ - thanks for DELL (see below). SPX was up by 1.8% and RUT was up by 3.3%.

I would like to deal with Eng Huat's trade and my comments relating thereto. RUT - the small cap index showed some buying interest recently. According to sector rotation theory, we are now in an environment where the interest rate appeared to have bottomed. Together with the speculation that Uncle Ben will raise interest rate in the next FOMC meeting, Conrad's students know where the hot money will flow - one of them is small cap (RUT). So, if this sector rotation theory holds, no matter how bearish the technical outlook for RUT may be, I will not be bearish on that. If I am bearish on the market overall, I will choose the bigger cap to play. I hope I can clarify this and thanks Eng Huat's sharing with us in this board.

The bulls took advantage of lower oil prices, some good economic data and of course good earnings on a few big names to push this market.

Oil is heavily speculated. The speculators obviously had taken advantage this week to take profit. There is not really any buying interest in oil. Hm .... so even though the chart still looks bullish, I won't go in to chase for any upward move at this point.

According to briefing.com, it was stated that the Americans have been altering their driving patterns in time of facing rising gas prices. This is a pleasant news because Americans can be flexible and adaptive. Americans should be proud of themselves.

Personal income rose 0.2% in April while spending was flat versus March on an inflation-adjusted basis. But the annual spending rate in April is still above Q1 average. Take a look of the GDP number for Q1 - who said the economy is in a recession? 0.9% to be is a relief number to prove to the bears that the US economy is still growing albeit very slow. It's ok. There is no recession.

The Fed is concerned with the inflation. Core-PCE was reported to have risen 0.1% in April, leaving the YOY rate unchanged at 2.1%. This number is important because it is still below Fed's forecasted range of 2.2% to 2.4% for 2008.

Perhaps with these good economic numbers people are not fearful in participating in the market. The movement in the Big 4 can substantiate this point. Also, MA, COST, DELL and TIF and BIG made buyers happy with their positive earnings news.

Coming to this point of the economy, I will start going for slightly longer term buy on value stock in line with the sector rotation theory. Also, I declare that I am looking for buys in Financial and Housing sectors wherever opportunity arises. I was debating with my friends last night on the property sector. My friends' view was that the property sector is dropping. I told them however the sector is going to rise but the stock market must go up first. I am not so pessimistic like them. So, wait for me to say a few names in the housing sectors.

I was glad to meet with Dr. Lim Ming Soon of FX1 Academy this week too. This guy is amazing because his trading knowledge and his passion has proven to me that a medical doctor can also be a good trader. He taught us this week FX 103 and FX 104 systems. A few people out there complained about paying $4,000 to learn the basic trading system FX1 offers. I can tell you that the meat of this $4,000 is not the system you learnt in 2-day course. Look at my debut record on my FX 104 trade - are you impressed with chalking up 180 pips in a day with only 5 mins' work. People are interesting creature. They like to hear say and have limited beliefs. Forex lost money and thus, it is risky to trade forex. This course is expensive and that one too. You can learn forex by reading the book. As I was sharing with some students last night at AKLTG, it's not the course sucks. It is not the trainer's sucks. It is ourselves. We need to acquire traders' mindset and have the right psychology. That way, no matter what you do, you are giving yourself a chance to succeed.

I will be heading to OASIS on 4 June and due to my return flight from SFO to HK, I will be in the air over the next weekend. So, there is no market update next week and I hope you understand that. I will only switch on my PC upon touching down in HK on 9 Jun evening.

Till then, take care and to those who are going to OASIS, let's have fun and drink with happiness!!

2008-05-25T20:45:00.001+08:00

The Power of the Dream

Deep within each heart
There lies a magic spark
That lights the fire of our imagination
And since the dawn of man
The strenght of just "I can"
Has brought together people of all nations

There’s nothing ordinary
In the living of each day
There’s a special part
Every one of us will play

Feel the flame forever burn
Teaching lessons we must learn
To bring us closer to the power of the dream
As the world gives us its best
To stand apart from all the rest
It is the power of the dream that brings us here

Your mind will take you far
The rest is just pure heart
You’ll find your fate is all your own creation
Every boy and girl
As they come into this world
They bring the gift of hope and inspiration

Feel the flame forever burn
Teaching lessons we must learn
To bring us closer to the power of the dream
The world unites in hope and peace
We pray that it will always be
It is the power of the dream that brings us here

There’s so much strength in all of us
Every woman child and man
It’s the moment that you think you can’t
You’ll discover that you can

Feel the flame forever burn
Teaching lessons we must learn
To bring us closer to the power of the dream
The world unites in hope and peace
We pray that it will always be
It is the power of the dream that brings us here

Feel the flame forever burn
Teaching lessons we must learn
To bring us closer to the power of the dream
The world unites in hope and peace
We pray that it will always be
It is the power of the dream that brings us here

The power of the dream
The faith in things unseen
The courage to embrace your fear
No matter where you are
To reach for your own star
To realize the power of the dream

2008-05-24T09:00:00.002+08:00

Market Outlook Commencing 27 May 2008

Wow, whatever bulls have made eventually have to be returned to the market. The bears took complete control this week. INDU dropped by 3.9%. COMPQ was down by 3.3%. SPX dropped by 3.5% and RUT dropped by 2.3%. From a sector rotation perspective, something I like from Conrad last week in Wealth Academy, the drop this week was not surprising to me at all. RUT is still the strongest amongst the Big Four and thus was not the worst performer amongst them. Go figure.

The Big Fou remained below 200 SMA respectively. VIX found the support and rebound, sending the indices down in this manner. The volume this week was up on the extremely down day. NYSE registered two consecutive distribution days and NASQ had a distribution day too. The distribution day on Thurs for both NYSE and NASQ was quite ugly.

Of course the big news this week is again oil. Oil registered a record high of $135.09 and closed at $131.82 this week. When I was at WAT on Friday, Conrad and his students discussed where the oil could possibly go. The number looks big but it is no big deal to me. Why? Because I don't care. What you can do is to get this number by drawing some Fibo extension. If you don't know how to do it, then it is something you must learn. The number at XXOP level is an interesting number.

Now, the financial sector is back to limelight after FOMC minutes were released on Wed section. Stocks did not like the minutes because it signals the end of the rate cut.

"...risks to growth were now thought to be more closely balanced by the risks to inflation... [and that] several members noted it was unlikely to be appropriate to ease policy in response to information suggesting that the economy was slowing further or even contracting slightly in the near term, unless economic and financial developments indicated a significant weakening of the economic outlook."

Inflation pressure has revived and the market obviously did not like the news. If the market is still expecting a rate cut but the Fed minutes was a disapointment, bad news in short-term right? This signals that the interest rate could have found a bottom and Fed won't be cutting interest rate at least for the time being because this will just mean pushing inflation rate up where Fed has been trying hard to control the inflation rate.

Rising oil prices hurt consumer? It depends on how you see it. AMR announced that it would be cutting 11 to 12% capacity and instituting a $15 fee for the first checked bad on its flights to combat rising oil prices. F announced a cut in production of full-size SUVs and trucks in the US because the customers demand would likely be shifted to more fuel efficient vehicles. So, corporations are changing their strategies as a result of rising oil prices. It does not mean consumers must suffer. Again, it depends on how you see it.

HD and LOW issued cautious outlook but to me, it is not new. Why? The market has already expected a not-so-good outlook. The reaction on these stocks is short-term in my opinion.

Existing home sales in April fell 1% from March to annualised rate of 4.89m units. In fact, it is better than expected, and is important. Why? the market can only recover by taking the first step of registering a slowing rate of decline. Yes, there is still a decline but at a reducing rate. Is the worst over?

Market Outlook Commencing 27 May 2008

Overall, the short-term speculators took opportunity to push the market down because the economic data were not disappointing. Remember the market in the short-term is irrational and if you use logic to read the market, it won't work at all.

From a sector perspective, the energy sector still outperformed the rest. The financial sector plummeted 6.1% this week. Is the worst over yet or not for financial sector. The technical outlook is at this point a mess. The transports sector was another suffering party, dragged down by AMR and surge in oil price. So, the Dow Jones Transportation Average declined 4.2% and from its Monday high, 7.1%.

So, from a sector rotation perspective, I will patiently wait for entry signal for housing market and financial market. I have no established position at this point. Wait for the technical outlook. I won't be chasing for oil stocks aggressively because it has gone up so much and so fast. Patience and trade defensively is something I learnt so much from Conrad. And yes, it is perfectly fine not to trade when there is simply just one reason to trade.

OASIS is less than 2 weeks to go. I am looking forward to it.

2008-05-19T16:11:00.009+08:00

WEALTH ACADEMY 15-18 May 2008

My mind was completely blown away after completing Wealth Academy at AKLTG over the weekend. It's a solid 3.5 days workshop and each full day started from 9am to midnight.

Thanks Adam and Conrad, and of course all the coaches for these 3.5 days hardwork, sharing with us various insights about the secrets of success of the millionaires. In one way, I was inspired by all the folks in AKLTG because they are so energetic and look at Adam himself. His almost lost his voice on the second day but yet he continued to speak with inspiration and conviction. After seeing Adam's a few times, now I fully understand why he has been so successful in building his empire of businesses and networth.

I was also grateful to Conrad not only because he is a good friend of mine, he has taught me a lot in terms of his super technical analysis. This guy probably is the best trader in Singapore, and perhaps in this region. His candlestick analysis is the sharpest I have ever seen in my life. Of course, in this workshop, I also learnt from Conrad how he worked himself out of bankruptcy and realised his dream(ok, I better stop him or else Con-man will xxxx me).

Although I met Conrad a few times, this picture was our very first picture taking together. I am sure his students in WAT will be successful because they have a very good "si-fu" and this si-fu is no non-sense guy. While some may say traders are all like that, Conrad being Conrad convinced his students that in order to trade profitably and consistently, always look at defense as the starting point. And you know what, in manging my own trading business, I have switched my mindset from Brazil to Italy. I have in fact written article for Optionetics on this topic because that article was dedicated to Conrad's defensive trading technique and this is why I am now able to achieve my trading results profitably and consistently.

Finally, in this 3.5 days' training, we all had to fork out $200 real cash to play a millionaire challenge. The game is about real life simulation in handling our financial by increasing our income and reducing our expenses, and building our networth by using leveraging and investing techniques. The top 8 students would be able to have a bite of the total pool of cash contributions. I did not gamble in casino (there was one in this game), and I also did not borrow money from loan sharks. I used my prudent financial management primarily based on what I learnt from another good friend of mine, Dennis Ng. So, I managed to snatch the 8th place amongst some 90 to 100 students and won a prize of S$1,180. The tactics I have used, as I mentioned to my team-mates, are what I am using in real life. So, they are not new to me. But after this game, I realized that I still need to improve further in scrutinizing my income and expenses. So, I said to myself from June onwards I will become the senior Minister of Finance in my home to watch closely my income and expenses.

If you haven't been to Wealth Academy, I would encourage you to think about going for it. It will be a mind-blowing experience and the amount you paid will be quite value for money. Trust me, you shall not regret!

2008-05-19T15:59:00.001+08:00

MARKET OUTLOOK FOR MAY 19, 2008

Don't say I haven't told you so. 80% of the chance the market will be bullish on the expiration week. Again, this is proven right for May expiration. Overall, INDU rose 1.9% this week. COMPQ rose 3.4% this week and is the best performer. SPX rose 2.7% while RUT was up 2.9% this week.

Although we are in 20 week bearish phase right now, it also appears that the Presidential Election Cycle is pushing the market higher. Again, it is historical pattern. Don't ask me why this is so.

I enjoyed my stay in Hong Kong as I was able to see my parents and my grandmum. Of course, I also met with a couple of my old time trading buddies. But I would like to mention specifically my encounter with Mr. Peter Lui. Peter was a market maker for almost 20 years and was a legend in the history of HK's warrants markets. His market making insight has inspired me that if you want to do something good, you can even beat the market (of course I mean the HK market). The stock exchange has to do something in order to prevent from these folks to whack the market so that the "house" will lose money. It can happen in markets such as Hong Kong because it is small compared to the US. Having said that, it also means that it makes perfect sense to trade the US market as a retailed trader because we won't get hurt so badly as it is liquid enough and also not so much to be subject to manipulation.

I was half way with my Wealth Academy Workshop. So, before I am going for my third day (each day is from 9am to midnight - and it requires determination and commitment on our parts - we got only a few hours sleep each day and then have to start the hardwork again the next day), let me finish this market commentary so as not to disappoint my readers.

The major new this week of course is the oil price - almost almost $128 per barrel. Other than this, there was so other not so good news. Industrial production declined 0.7% last month. Uncle Ben expressed concern that the financial market conditions are still far from normal. WMT issued a very conservative guidance for the current quarter. With that - the market went up. Why? Perhaps the bulls are glad to hear that the market is not so bad now after BSC's collapse in March. The worries about US recession appear to be unfounded. Participants are dared to enter into the stock market again. Wait. Hang on for a second. The volume in NYSE and NASD was extremely low throughout the week. So, I am not quite sure whether it is a retail investors/ traders participation at this point. The numbers are telling me so. Sorry, I am not so excited until I see some strong volume going back to the market. Otherwise, I am only cautiously optimistic that the bad news have been forgotten.

Some good news were announced this week too. Retail sales, weekly initial claims, CPI and Apr housing better than expected - all are good news to the market. Retail sales report was up 0.5% in April. Excluding autos and gasoline, it was 0.6%. It suggested that there is a trend in consumer spending. Housing starts also rose 8.2% in April and surprised the market. The annualised rate of 1.032m units is almost the average level of 1.031m for the past 4 months. Although it does not mean the housing recession is over, it provides stability (notice the key word - stability in the housing market) and this is exactly what the bulls are looking for.

The NY Empire State Index and Phila Fed Index were negative which signaled a contraction in manufacturing activity. However, like I said in the above, the worse is over and the bulls have no reasons not to push the market.

Not much news on the earnings front this week. WMT beat quarterly expectation and this gives INDU and SPX a booster of course. No, due to the conservative guidance, WMT was pretty much flat for the week.

So, which sector should you go? To be frank, it would appear that the commodity sector is making a coming back. Look at oil and gold. Ha, not so. Actually May is a month which to me is boring as there is no particularly strong sector for which I can ride on a trend. Yeah, you can chase for oil and it is entirely up to you.

For this month, essentially I don't have any particular strong play. Premium collection remains my key focus. Yup, I did position in solar stocks. Maybe you should look at this sector - Sunpower, FSLR, JASO etc.

As a professional trader, it is perfectly fine to say "there is no reason to trade". If there isn't, then just don't trade. There is nothing wrong not to trade, isn't it?

Have a good weekend!