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THE OFFICIAL MAGAZINE OF TECHNICAL ANALYSIS

TRADERSWORLD
A Method for Constant
Success in the Market
Oct/Nov/Dec 2018 Issue #71

Once Upon a Time

W.D Gann's Lost Coffee


Courses

Review of SA Market
Forecaster

2018 World Cup Trading


Where Do You Find the Money to Save
Finding Hidden Events
Profit Blueprint from Selling Options
Rick-Based Trading and on Expiration Day
Investing
The Invisible Wall that Separates You
Combining Andrews and from Your Potential
Elliott Wave to Find the
Third Wave After the Trade is Made

Something Bid is Another Shadow Experience


Brewing! History
Predicts the Future Trade What You See, Not What You Feel

WWW.TRADERSWORLD.COM October/November/December 2018 1


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Editor-in-Chief
Larry Jacobs - Winner of the World Cup Trading
Championship for stocks in 2001. BS, MS in Business and
author of 6 trading books.
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Contents TradersWorld Magazine
Oct/Nov/Dec 2018 Issue #71 Premium Subscription
A Method for Constant Success in the Market Get everything we have for only $19.95 per year
by Eric Penicka 10
Save 50% over our regular subscription of $39.95
Once Upon a Time
by Rick Versteeg 19

W.D Gann’s Lost Coffee Courses


by Cody Jones 29

Review of SA Market Forecaster


by Larry Jacobs 35

2018 World Cup Trading


by Kurt Sakaeda 39

Finding Hidden Events


by Dr. Lorrie Bennett 51 QUARTERLY MAGAZINE SUBSCRIPTION
Read articles explaining classical trading
Rick-Based Trading and Investing
techniques, such as W.D. Gann, Elliott Wave,
by Thomas Barmann 59
astro-trading as well as modern technical
Combining Andrews and Elliott Wave to Find analysis explaining indicators in eSignal,
the Third Wave NinjaTraders, MetaStock & Market Analyst.
by Ron Jaenisch 69
COMPLETE BACK ISSUES OF TRADERS
Something Bid is Brewing! History Predicts the
WORLD Magazine (ISSUES 1-64)
Future
by Andrew Pancholi 73 You also get our complete archive of 60 back
issues from 1986 to present. This, contains
Where Do You Find the Money to Save articles, product reviews, hundreds of chart
by Jacob Singer 80 examples, how-to-trade articles and much

Profit Blueprint from Selling Options on


format, which you can read online anytime.
Expiration Day
by Dan Gibby 85 In every issue, you get the information
you need to trade the markets better with
The Invisible Wall that Separates You from Your charting, astro, cycles, oscillator tools.
Potential: Establishing a Disciiplined Impartial Works for stocks, bonds, futures, options.
Trading Psychology
by Rande Howell 92
60-Day Money Back Guarantee
After the Trade is Made
by George Krum 97
CLICK TO SUBSCRIBE
Another Shadow Experience
by Al McWhirr 103

Trade What You See, Not What You Feel


by Damon Pavlatos 110 1-800-288-4266
Using Market Phases To Catch Big Swings In
Any Market Condition www.TradersWorld.com
by Michele ‘Mish’ Schneider 116
www.TradersWorldOnlineExpo.com

WWW.TRADERSWORLD.COM October/November/December 2018 6


10 www.tradersworld.com Jan/Feb/Mar 2013
WWW.TRADERSWORLD.COM October/November/December 2018 7
WWW.TRADERSWORLD.COM October/November/December 2018 8
THE TEXTBOOK OF GANN ANALYSIS...
The Path of Least Resistance
THE UNDERLYING WISDOM & PHILOSOPHY OF W. D.
GANN ELEGANTLY ENCODED IN THE MASTER CHARTS
BY DANIEL T. FERRERA
MOST DETAILED COURSE ON GANN’S MATHEMATICAL & GEOMETRICAL TOOLS!
“We use the square of odd and even numbers to Intent of This Gann Course
get not only the proof of market movements,
but the cause." - - - W.D. Gann The intent of Ferrera’s new course is to provide the
most comprehensive elaboration of W.D. Gann's most
 How to square the natural whole numbers (odd and powerful technical trading tools. It presents all of Gann’s
even), along with their midpoints. foundational mathematical and geometrical techniques
 How to define prices scales by "The Basis of Money” expressed in his master calculators, angles, trend channels,
 How to set the proper scale, and use the 1x1 angle to squaring processes, pattern formations, spiral charts and much
square or balance price with time. more, leading to the clear identification of profitable Trade
Setups, important trend indications, and critical price/time
 How the natural squares (even & odd) sub-cycle
culminations.
would not be possible without understanding the
The material further elaborates a number of Gann’s
Spiral chart (Square of 9).... expressing the square
most advanced geometrical tools and applications, such as the
root as an "inner square" time period. natural squares (even & odd) sub-cycle and the square root as
 How to assimilate all of these elements together as a an "inner square" time period, . It provides both practical and
sequential methodology once the "basis of Gann's actionable trading signals and a valuable structural perspective
forecasting method" has been worked out. to any market on any time frame.
 How Gann’s price squaring techniques and master With 300 pages of detailed text, over 150 charts and
charts are NOT completely separate and independent diagrams, and 190 pages of the rarest Gann’s supplementary
methods, but are tied together thru geometric angles. material, we consider this 500 page treatise to be THE
 How the inner square root sub cycle & natural TEXTBOOK on Gann’s geometrical techniques that no serious
squares of numbers reveals unique market turns. Gann analyst can be without!

FOR A DETAILED WRITEUP ON THIS COURSE INCLUDING FULL CONTENTS, AND SAMPLE SECTIONS SEE:
WWW.SACREDSCIENCE.COM/FERRERA/THE_PATH_OF_LEAST_RESISTANCE.HTM

FERRERA’S NEW COURSE—THE ART OF THE TRADE


W. D. GANN’S SYSTEM OF CHART READING & PATTERN TRADING
Dan Ferrera’s new trading course, The Art of the Trade, provides thorough instruction in W.D. Gann’s key
trading methodology, Pattern Trading. It teaches “Chart Reading” the way Gann himself did it, demonstrating how
to trade the fundamental market patterns identified by Gann. This strategic approach to trading provides advantages
that allow the trader to react to the markets in real-time, without indicator lag. Pattern Trading eliminates lagging
mechanical indicators, which are always based on what the market did in the past and not the present. This style of
“Form-Reading,” as Gann called it, allows one to make decisions in real time, as the opportunities develop on the chart.
The course provides a clear set of rules for reading these market patterns to determine entry, exit, risk
management, and trade management as determined by the recognition of a set of fundamental market patterns identified
by Gann. This approach differs from Gann’s mechanical swing indicators and from his long-pull position trading,
providing a different perspective and alternative trading style, that most often used by Gann himself. The technique is
equally effective on any time frame, so is as valuable for day-traders as it is for daily traders. It also generates a larger
number of trades than his other trading methods.

FOR A DETAILED WRITEUP ON THIS COURSE INCLUDING FULL CONTENTS, AND SAMPLE SECTIONS SEE:
HTTP://WWW.SACREDSCIENCE.COM/FERRERA/THE-ART-OF-THE-TRADE.HTM

SACRED SCIENCE INSTITUTE Ө WWW.SACREDSCIENCE.COM


EMAIL: INSTITUTE@SACREDSCIENCE.COM Ө US TOLL FREE: 800-756-6141
INTERNATIONAL 951-659-8181 Ө SEE OUR WEBSITE FOR OUR FULL CATALOG OF COURSES!

WWW.TRADERSWORLD.COM October/November/December 2018 9


A Method for Constant Success
in the Market
By Eric Penicka

In the new book, GANN SCIENCE: The Periodic Table & The Law of Vibration, the Ticker
interview with W.D. Gann is broken down and explained, and a trading solution based upon
Gann’s Law of Vibration is derived using the clues given in that famous interview.

Though that methodology is the primary purpose and method of the book, other science and
math concepts are explored in Gann Science that traders can use to find further tradeable
mathematical points of force in the market. These and other techniques presented in the book
are still pretty powerful tools and can stand on their own legs as viable trading tools, even
though considered secondary to the primary Law of Vibration technique taught in the book.
One of these ideas is the use of mathematical constants in trading. These constants have great
predictive value in their own right. Numerous scientific formulae and mathematical constants will
work in the analysis of stocks and commodities. By using them as multipliers, or factors, traders
can determine additional pressure points in the market.

These pressure points are what were referred to as “mathematical points of force” in the Faraday
quote Gann often refers to. These numbers can be used to multiply measurements in price or
time, including highs, lows, ranges, or vectors.

There is a chapter in Gann Science dedicated to proving out these numbers with examples of
varied market applications. Numerous constants are used in those examples.

In this article, we will test only one mathematical constant, pi, to see how it may help with our
trading. Pi is significant because of its connection to the circle and the octave. In the examples
following, we will be using pi as a multiplier (factor) to price and time measurements.
In essence, the measurement of price or time would be the diameter of a circle, and when
multiplied by pi, the resultant number is the circumference of that circle. This is basically,
circling the square, where the swing vector (diameter), would be the diagonal of the square.
This can also work in reverse, where the measurement may be divided by pi and used to take a
circumference to find a diameter.

A series of tests will be made on the following charts of the stock of Tesla, (TSLA), the electric
car company. This is a good trading stock because of its volatility and presents good options
trading possibilities for short to intermediate term swing traders.

Pi as a Time Factor
The first test will be to measure some swing points, getting a bar count between highs and lows,

WWW.TRADERSWORLD.COM October/November/December 2018 10


and then measuring that count by pi and projecting it forward.

It is August 21, 2018 as this article is being written and there is a trade triggered yesterday by
two pi time count projections coming together which is causing an up move in TSLA stock. There
is both an expansion and a contraction projection.

The low came in after the open on Monday 8-20-18. The projection of 23 days between two
highs projected 72-bars to the low. The contracting (division) projection took a 49-bar count
between two lows to project a 15-bar count to the low. This can be seen at the far right of the
chart.

The measuring counts are marked with the gray bar counter, and the projections are done with a
black bar counter. All measurements are multiplied by pi, other than the one mentioned prior.

WWW.TRADERSWORLD.COM October/November/December 2018 11


A dozen projections are made on this example chart. Ten of them caused reversals in the
market’s price action. Although the projections made were high to high and low to low, there is
no rule that says this is the only way this can be used.

There is a key point to mention having to do with the area where the red square is placed on the
chart. The area marked is where the 82 and 188 counts come together. There was no reversal
at this point which is what is normally expected. When this happens, generally, the continuation
move will double the range of the swing in progress to that point.

In other words, the measurement indicates the approximate midpoint of a swing. This is a good
place to move into a stop and reverse mode, had a short been put into place. Reverse it into a
long, and let it run to the expected target area.

In this example trading bars are used. Calendar days can be used as well and in general are
preferable. Trading bars were used to show they work as well.

Pi as a Price Factor
On the next chart, some price range projections will be added in to see how pi may affect price.
Four price projections will be made. 3 of them from small price ranges, and one from just the
range of the high bar itself. This one is marked in text at the September 2017 high.
Each range is multiplied by pi, and then projected from the beginning and end of the swing
range, or bar range. Notice how these levels act as important support and resistance points and
also many gaps take place at these areas.

The last projection off the June high minor range gave the area of the last two swing lows,
confirming the two timing signals mentioned in the prior chart, triggering the 8-20-18 long
trade.
It should be stated that these points were chosen randomly and are not to be construed as
the only valid points to be used. Any other swing ranges not shown in the examples are also
applicable and will give different points of force.
It should also be noted that there are multiple points on a chart that when found will tie the
various numbers together and act as the best support and resistance areas in price and in time
due to their harmonic connection.

WWW.TRADERSWORLD.COM October/November/December 2018 12


Pi as a Slope to Set Gann Fans
The following chart brings into the analysis the popular “Gann fan” concept. Most traders are
trying to calculate a 45 degree angle but that is not the true method of finding a correct slope.
A 1:1 relationship is also not a necessary way to begin. Squaring of time and price can be done

WWW.TRADERSWORLD.COM October/November/December 2018 13


in a lot of different ways.

One method is to use pi as the slope. On the following chart, two fans are plotted using a
slope of .314. Floating the decimal is necessary to fit the fan to the price level of the chart in
question.

No prices or high or low are used. Only the slope is input of .314. These can be anchored at any
pivot and will give results.

The fans are shown on a separate chart for clarity. The confluent points between the price and
time counts along with the fans gives many good trade opportunities. Notice the 8-20-18 low is
confirmed by the fan line. Fan lines not involved in the price action were removed.

This is one good use, but maybe not the best construct for these fans. A full chapter dedicated
to the proper set up and use of Gann fans is included in the Gann Science book, in the Chapter
on Pitch: The Fourth Dimension.

WWW.TRADERSWORLD.COM October/November/December 2018 14


This particular analysis of Tesla has been done using nothing but pi as a multiplier or factor.
This simple mechanism using pi could be developed into a trading system by itself. The nice
thing about it is that it only uses simple arithmetic and can be done with a calculator in a few
minutes.

Using Pi as a Setting on Technical Indicators


Traders who use indicators can use derivatives of pi to set up their indicators with.
On the following chart, two AMA, adaptive moving averages set at 31 and 314 have been
plotted. Two oscillators, a CCI, and a cyclic RSI have been set at 31 length.
Lastly, another fan set from the first top of the double top not used as a fan anchor on the prior
chart does a nice job of displaying the vibrational tendencies of the price action. Looking at both
of the down fans from the two charts, different angles from the two fans caught some of the
same pivot points.

The slope is again .314.

The trend lines on the cyclic RSI are indicating divergence points.
For readers interested in furthering these concepts, try using the prices of highs and lows and
multiplying and dividing by pi and its increments to find important support and resistance levels.
The Pi number can be used as a measuring stick by itself. Checking back off the 8-20 low,
315 trading and calendar days hit swing lows. The inclined reader may wish to test planetary
longitude. Using Mercury, and measuring back 315* geocentric degrees ties back to a high 11-
17-17. These points are shown on the indicator chart. These are good confirmations of the pi
projection measurements from the first chart.

These techniques can be used in any time frame. The best trades on a daily bar are set up
by numbers coming together on a weekly chart. The entry on the daily bar can be fine tuned
by some calculations made on an intraday chart. The best use of this material is to know the
position of the market in these various time frames which will lead to very precise trading
setups.

WWW.TRADERSWORLD.COM October/November/December 2018 15


For more information about GANN SCIENCE – The Periodic Table & The Law of Vibration,
please see the following link, which provides more details and contents of this new course:

www.sacredscience.com/Penicka/Gann-Science.htm
You can also email institute@sacredscience.com or call 800-756-6641 or 951-659-8181 for more
information.

WWW.TRADERSWORLD.COM October/November/December 2018 16


GANN SCIENCE
The Periodic Table & The Law of Vibration
THE SOLUTION TO GANN’S LAW OF VIBRATION
AS PRESENTED IN THE TICKER INTERVIEW
By Eric Penicka
ATOMIC ELEMENTS DEFINE MATHEMATICAL STRUCTURE OF MARKETS
WHAT IS TAUGHT IN THIS COURSE
This course provides the solution to the Law of Vibration, as Gann originally presented it
in his interview with Richard Wyckoff in The Ticker and Investment Digest, in 1909. The
author takes Gann’s exact words and correlates them with the cutting edge science of Gann’s
day to demonstrate what Gann meant when he said, “stocks are like atoms”. He develops a
system which identifies the key “mathematical points of force” that govern the structure
behind the market.
The author builds a solid foundation in the Natural Sciences of Gann’s day, showing how
the emerging science of the Periodic Table of Atomic Elements provides a system of order
based upon the vibrational values of the elements themselves. When the elemental
structure is determined for an individual market, a Master Number Set will be defined for
that market which determines its movement in price and time forever into the future.
A POWERFUL & HIGHLY PRACTICAL SET OF TRADING TOOLS! 480 Pages w/Forum.

FOR A MUCH MORE DETAILED WRITE-UP, CONTENTS, SAMPLE CHARTS & ARTICLES SEE:
HTTP://WWW.SACREDSCIENCE.COM/PENICKA/GANN-SCIENCE.HTM

A DECODER FOR GANN’S TUNNEL THRU THE AIR


MAGIC WORDS THRU THE ZODIAC
Vol 1 - A Guide to the Work - Vol 2 - The Advanced Findings
Volume 1 introduces the Keys to cracking the complex symbolic
code that Gann used to conceal his greatest secrets within Tunnel.
It unveils a Masonic Gematria cypher which serves to decrypt
references and clues concealed in names, dates and other key
words thru the text. These letter/numerical conversions are used to
determine potential anchor points for the engineering of important
underlying market cycles.
Volume 2 continues the research into more advanced topics and
more deeply hidden and important cycles. The insights in these
two volumes represents efforts from 20 years of tireless research!
FOR FULL DETAILS, SAMPLE CONTENT & ARTICLES SEE:
http://www.sacredscience.com/Rundle/Magic-Words-Thru-Zodiac-Volume-1.htm

SACRED SCIENCE INSTITUTE Ө WWW.SACREDSCIENCE.COM


EMAIL: INSTITUTE@SACREDSCIENCE.COM Ө US TOLL FREE: 800-756-6141
INTERNATIONAL 951-659-8181 Ө SEE OUR WEBSITE FOR OUR FULL CATALOG OF COURSES!

WWW.TRADERSWORLD.COM October/November/December 2018 17


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Once Upon a Time
By Rick Versteeg

History repeats itself time and time again makes it possible to discover hidden order in the
apparent chaos in financial markets. So what happened once upon a time will happen again
when intertwined time cycles indicate the same energy to cause panics or bull markets. People
respond to energy whatever the source is.

History repeats itself


The research we have
complete in the last
decennium was only possible
because nowadays we have
available a vast amount of
price data as well as the
fact that computers are fast
enough to process this data
using complex algorythms.
In addition, programming
software has evolved to
such a good quality that
programming complex
models and its maintenance
is possible today. Also
science and mathematics
have made big steps in
understanding and modeling
complex interrelationships
using big data.

Consequently, we have been able


to use history to test our model and
improve it further emperically.

In simple words, we can test


our time cycles and see what
happens any time when
certain cycles are active and
how the markets respond.

The last step, was to statistically research every period and every cycle for its performance in

WWW.TRADERSWORLD.COM October/November/December 2018 19


the past and determine its significance.

For this purpose we have calculated time patterns, which are dynamic and fractal in nature, for
the Dow Jones from 1900. What a pity it is that this data mostly only is available on a daily
basis. However, it is good enough to chart the workings of cycles and compare this to the period
of the last 20 years of which we have intraday data.

The results of the analysis of the Dow confirm our statistical evidence of the intraday data,
making clear what cycles work positive or negative on average.

By selecting time cycles that are minimally are 70% correct and/ or deliver an exceptional
performance, it is possible to select Long and Short opportunities for the near future which our
models predict using time cycles and its patterns. This way we have been feeding our DeLorean
product that pictures the openings in several markets day by day for the next month.

Also we have developed proprietary trading systems that trade intraday when our software
signals to trade long or short.

Some examples of Dow history

Below we show 2 very important periods with a great impact on the financial market. The first is
one of the longest bear markets in history during 1929- 1932, the second totally different being
a flash crash of only 1 month or so in 1987.

Dow Jones in 1929:

This example shows how our time cycles strongly forecast a bear market for the years 1930-

WWW.TRADERSWORLD.COM October/November/December 2018 20


32 in which period an astonishing number of negative time cycles are present, which are
the clustered purple bars with “Bear”above it. Also the indicator below the chart shows how
red(=negative) dominates for a long period with the lowest value ever. Before this period
green(= positive) is much stronger , leading to the top in 1929. In 1932 there is a strong
positieve time cycle (big green bar), exactly where recovery starts.

Dow Jones in 1987:

Very interesting is the fact that the chart for the Dow shows a large positive time cycle (green
bar) exactly at the top in 1987, followed immediately by a very large cluster of purple bars,
which is very negative and predicted a decline. Green time cycles dominate since 1983 and
thereafter from 1985 until october 1987 as indicated by a green curve in the chart. Red cycles
(red curve in chart) are prominent in 1982 and after 1987 until october 1988. Then positive
cycles took over again until 1990.

WWW.TRADERSWORLD.COM October/November/December 2018 21


Statistical evidence

below we will show you some examples of the output of our statistics. Firstly Time cycles that
correlate highly with negative markets:

These cycles have a probability of in between 70 and 100% (win/loss, last column). The pattern/
cycle that gives the most total negative performance (-11.38% ) and most observations (20)
has been highlighted, at the left bottom every occurence is listed. A very significant cycle with
75% hitratio (1-25%).

WWW.TRADERSWORLD.COM October/November/December 2018 22


Secondly time cycles that correlate highly with positive markets:

These positive cycles have a probability of in between 89 and 100% (win/loss, last column).
The pattern/cycle that gives the most total performance (+13.30% ) and most observations
(20) has been highlighted, at the left bottom every occurence is listed. A very, very significant
cycle with 100% hitratio (1-25%).

These statistics are available for any time period from 1900 - 2018 or the total period. Also, we
can take into account that positive and negative time cycles can be active at the same time,

WWW.TRADERSWORLD.COM October/November/December 2018 23


and determine when which time cycle is stronger or will follow up on the other.

Once strength and performance has been attributed to time cycles, we can use this to predict
the nearby future.

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Special offers! write us an email if interested to get a special Tradersworld offer.

Devising a Trading system

By means of a far-reaching quantitative analysis we have been able to make a model that
reflects the energy quite well, positively or negatively, in the financial markets.

The software has been developed in such a way that it has calculated in advance when the
system is going to buy or sell. This is based on our time cycles which have discovered a hidden
order in the apparent chaos of the markets. The nice thing about this is that my original idea of
how these patterns work was confirmed, not a complete surprise of course.

In this hidden order time patterns are found that are either positive, negative or mixed and in
this way indicate whether the market is going up or down.

Of course, the question was whether and to what extent the model would predict fluctuations in
the market correctly. As said previously, we tested this extensively on price data from 1900 of
the Dow Jones and on futures data of the Dax from 1997 with minute data.

The price files from 1997 already showed that the model is working well, although we had not
yet been able to investigate all underlying data. That has now been accomplished. In addition we
have now 100 years of statistical data from 1900 onwards at hand.

Having statistial research means that we know which return and risk the different time cycles
bring about positively or negatively by analyzing price movements in the past when these cycles
were active.

Since we can calculate these time patterns with our model and know when they occur, we can
select cycles that are successful as well as having a high probability in order to use them for
future actions ( buy / sell) in the stock market.

To give an example, in the Dow Jones over a period of 100 years from a number of 50000
combinations, about 3000 time patterns have been found, which on average have a superior
predictive power. We look up these patterns found in history for the coming period in the near
WWW.TRADERSWORLD.COM October/November/December 2018 24
future and draw these green (up trend) and red (down trend) areas in our price chart. At these
points in time the trading system will automatically buy and sell, without having any connection
with that period itself. This means that historic prices are not correlated with the prediction.

The system has been running live on the Dax futures in a trial setup (not yet in the Fund) that
approaches reality for the last 6 weeks. The return has been excellent and the risk is relatively
low, namely a return over this short period of approx. 5% with a maximum drawdown of approx.
2%. Here, on average, has been traded without leverage. This was also a good test if the
software worked flawlessly.

The risk is limited, which is only possible by being in the market for a relatively short time when
the chances are the best. In addition, the use of a policy that protects profits and cuts off losses
is necessary.

Above the graph of the last month where the system was executed in real time on a simulated
account. In the table on the left you will see red arrows for the result achieved on a portfolio
of Eur 100,000, as well as below the maximum drawdown. The chart below the price chart
indicates the equity curve, the development of the return, going from 100 to approximately
105%. Finally, the green and red areas are visible, also for the near future.

Then the question remained what would happen to the return and risk if we simulated the entire
period from 2016 to the present in a good way that approaches real trading. The short-term
result is significantly good, will it remain so over the longer period?
Over the longer period of approx. 2.5 years, this simulation gives a result from 2016 of approx.
60% at a maximum risk of approx. 3.7% drawdown. Much better than we expected, but a
welcome surprise. more importantly, it is in line with the shorter period.

WWW.TRADERSWORLD.COM October/November/December 2018 25


The longer-term simulation confirms the picture of the short term. A good return with a low risk.
Here, too, you see the Equity curve that rises very evenly and in 2018 goes sideways in spite of
a declining market.

Our conclusion is that the system is ready to be introduced gradually. The question is always
how the start will be, but the limited risk certainly makes this acceptable.

Back to the future

[Please write us an email if you like our cycles! website or order system could be under
reconstruction.]

Previous article we said:

To finish we will give some forecasts for future events. Firstly we are expecting volatile, mostly negative
markets in the months of July (WEAK RISE) and August (CORRECT) to begin with. Other sensitive dates
for negative markets are around:
August 16 (CORRECT) around low) and around August 30-31(CORRECT), 25-26th of
September(CORRECT), The week of 23/24th of November 2018.(WAIT AND SEE)
Also we have projected the time waves, the specific waves that build cycles, into the future for positive
events. We mention the following. July 12(CORRECT, up trend started),16(CORRECT) - August 6
(CORRECT start up) -27-28(CORRECT)

WWW.TRADERSWORLD.COM October/November/December 2018 26


New predictions short term October 2018 applicable to DAX and SPX, see red and green in
chart:

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http://www.aquilaesignal.com/free-newsletter/,Facebook: Aquilaesignal
Special offers! write us an email if interested to get a special Tradersworld offer.

WWW.TRADERSWORLD.COM October/November/December 2018 27


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W.D. Gann’s Lost Coffee Courses
By Cody Jones

What do you do with the legacy of a trader like W.D. Gann? How do you honor the work of your
parents who had life changing events happen that led them to acquire the collection of a man
whose work is still studied to his day?

It’s been over 40 years since my parents purchased W.D. Gann’s collection of work from his
business partner, Ed Lambert. It’s been 3 years pondering the best way to honor both…

After my mother, Nikki Jones, passed away I was left wondering what to do with this collection.
Both Billy and Nikki loved collecting books and special editions. They enjoyed taking care of
the collections of rare books they acquired over the years. They also knew that the truckload
of W.D. Gann’s library, binders, charts, trunks, books, photos, education, and notes had to be
protected. It was an overwhelming task with many bumps in the road. My father made the
smart decision of building a vault where the elements of heat, humidity, and light would not
affect the collection - where it remains to this day. This collection could have very well ended up
in a Florida landfill.

My parents were collectors of unique material, as many of you are as well. I want to offer W.D.
Gann’s work to those of you who will appreciate the man’s life work in a unique and limited way.

This is the original, unpublished work of W.D. Gann-and this is the only place you can get it.
Why release it now? The primary reason is to raise the money to properly restore the extensive
collection, and secondary to be able to put out more never before seen material.
My father, Billy Jones, purchased W.D. Gann’s research in the 1970’s from Gann’s last partner,
Edward Lambert. Throughout the next decade he brought the majority of W.D. Gann’s books
back into print and compiled many of his individual courses into what are now known as the
Master Stock and Commodity Courses. What many don’t know is there are quite a few more of
those mini courses still unpublished, some of these written in the final years of his life…We will
come back to these in a bit.

My folks did not see all of Gann’s work. They saw more than anyone else-but no one will ever
see all of it-there is just so much. I constantly find pieces I have never seen, as the collection
was spread between three offices. What happens when you open the vault or search through
one of the offices is you find something interesting within the first minute or two, then more,
and more, and more. You get caught up in studying one tiny piece, or you are searching
through hundreds of charts and you see something Gann did you have never seen before, or
your eyes begin to glaze over from too much information. An exciting discovery I made this
year was his original hand drawn overlays! They were tucked in an old book in the library
here...

WWW.TRADERSWORLD.COM October/November/December 2018 29


As I am putting together this new piece of Gann’s puzzle with the unpublished Coffee course,
I have found countless (next) products. I went through 67 Coffee charts today, looking for a
specific one mentioned in the upcoming course. They are all valid in studying coffee and Gann’s
work, but is it too much…and this was just from one of the trunks. There were 2 charts that I
know I am the first to see, as the charts had the original rusty paper clip and were somewhat
stuck together with the old horse hoof glue.

I have taken on the immense task of going through the collection piece by piece, I know, poor
me. There are the thousands of charts, some which have never been unrolled or unfolded,
the boxes and file cabinets of onion paper documents, and then the job of separating and
cataloguing all of this in my own system.

We plan on releasing much of the material within the vaults over the coming years to help put
together a more complete (and true), knowledge of the man W.D. Gann. This will be his true
work, a boon to each of you looking to study his work, those seeking to become the best traders
you can be, or those simply studying the man himself. Each of those are a worthy goal, as the
man’s work was astounding, and the enigma that all of his followers have created grows-and will
continue to grow as new pieces to the puzzle are released from our vaults. This will be the first
of an exciting series.

W.D. Gann didn’t have the computer in front of him to whip through charts and tool sets as we
have. Every chart was updated daily, and some to the hour. His final binders with the complete
set of stocks and commodities he was watching and trading have the dates hand-written out into
1956. Hundreds of daily, weekly, monthly, and yearly charts were kept up right until his death
in 1955. He was still trading using the same tools he had perfected throughout his lifetime.

WWW.TRADERSWORLD.COM October/November/December 2018 30


It takes a lot of research, practice, time, and work to become as successful a trader as W.D.
Gann. Imagine throwing in a few books to write, and courses to build. The legacy Gann has left
for all of us is truly amazing.

We know that W.D. Gann made an immense amount of money from trading coffee. You will get
to see exactly what tools he was using in this trade. The charts prove he was watching for a
large run, months in advance. Just look at all of the angles culminating right here!

What will this course consist of?

So far it contains 2 unpublished Coffee Courses from the 1950’s, the coffee section from Gann’s
unpublished 1954 Commodity Review, unseen hand written notes, W.D.’s trading charts from
these courses and huge runs, rules and tools to trade and forecast the coffee market, lost data
for you to improve your forecasting ability, and current research on the coffee market!

I keep finding more items to possibly include so the final page count is not available yet-stay
tuned. There will also be some items most of you have found by scouring the internet, but they
will be scans from the originals, so in greater detail-and in color!

To keep this material out of the all seeing eye of the internet, there are safeguards hidden within
the course to pinpoint any buyers who feel the need to “share” this material. You will also be
sent a non-disclosure agreement to sign as well.

This series of releases will be printed with great care, and the future series will fit together to
make a great looking set in your library.

What is going to be the next release from the vault? Will it be the lottery binder, another
WWW.TRADERSWORLD.COM October/November/December 2018 31
unreleased course set, an ephemeris, the handwritten work of W.D. Gann, the astro course, etc.?
We will let you know, and feel free to give me your opinion or ask any questions at info@wdgann.
com

The readers of Traders World will be able to purchase the upcoming Coffee Course for the
introductory price of $2916 until mid-October.

Thanks for following the works of W.D. Gann and visiting www.wdgann.com

WWW.TRADERSWORLD.COM October/November/December 2018 32


smaLL sUPPLy smaLL sUPPLy
LarGe DemanD: LarGe DemanD:
rIsIn G P rIces rIsIn G P rIces

scIentIFIc aDVIce anaLytIcaL rePorts


on on
stocKs, cotton, GraIn marKet conDItIons

W.D. G a n n I n c P r e s e n t s
B o x o, P o m e r o y , Wa
July 2018
Readers of TradersWorld
Halliker Inc.
Dear Admirers of W.D.Gann:

We are opening up the vault with 5 big releases over the coming years!

There is so much more to be learned directly from W.D.Gann's works - Especially contained within his
unreleased material only found here. Watch www.wdgann.com for more info.

Yours very truly,


Cody Jones
at W.D.Gann Inc.

{ S U B S C R I B E t o t h e W. D. G A N N
S U P P LY & D E M A N D L E T T E R
Now at www.inspiredbygann.com
}
TRADERSWORLD.COM
WWW.TRADERSWORLD.COM October/November/December 2018 33
Review of SA MARKET FORECASTER
By Larry Jacobs – Editor Traders World Magazine

I have been following Anoop Kumar Agarwal and his weekly forecast newsletter ‘SA” MARKET
FORECASTER’ now for several months now and what I have found is, it is really different from
anything that I have seen in the market for trading and investing newsletters.

Most trading services are technical analysis, fundamental and or a combination of both technical
analysis and fundamental. How they work is that most are using standard technical analysis for
timing. That means they use a combination of technical analysis oscillators to give buy and sell
signals such as stochastics or RSI at the bottom below 30 and when the indicator crosses backup
through 30 it is a buy signal. When it goes above 70 and then crosses back down through it is
a sell signal. Many services using scanners to find the stocks or futures with these buy and sell
signals. Since many technicians use these signals and the crowd of traders causes the initial
buy and or sells signals. That is generally a good way to buy and sell stocks and futures. Also
many services use crossing of moving averages such as the 20, 50, 200 day moving averages.
Many institutions use this system to buy and sell. For example a short term buy signal is a stock
crossing the 20 or the 50 day moving average and a long term buy is crossing the 200 day
moving average when it crosses back down it then is a sell signal.

Many services also use cycles to timing buying and selling. That is subjective as cycles many
times change. You really don’t know what major or minor cycle the market is following.

Some technicians incorporate the Elliott Wave Theory. This is totally subjective. Every Elliott
Wave Technician has a different view of the market. It is hard to get even get two Elliott Wave
technicians to agree on a wave pattern. It is all based on skill and experience.

If you read about W.D. Gann and his forecasting he was different than today’s newsletter writers.
Gann would state that soybeans would go up to an exact certain price and then one could short
it at the exact price with a 1 cent stop. Or the price would go down to a price and you could buy
it with a 1 cent stop. He could do this because his methods were based on geometry, astronomy,
astrology and ancient mathematics not based on the computer oscillators that technicians use
today.

Gann was one of the most successful stock and commodity traders that ever lived. He was born
in a little town in Texas and later moved to New York City and opened his own brokerage firm
and timing service. He was reported to have taken out more than 50 million in profits out of the
markets.

He based his trading methods on time and price analysis. This made it possible for him to
determine when a trend change was imminent but also the best price to enter and exit the
market.

W.D. Gann’s use of Natural Law and geometric proportions were based on the circle, square and

WWW.TRADERSWORLD.COM October/November/December 2018 34


the triangle and were very effective.

Mr. Anoop Kumar Agarwal’s trading service is one of the only services I have ever seen that is
similar to Gann’s techniques of trading. Mr. Agarwal specializes in forecasting the exact day of
the trend, months and years in advance. This is nice to know if you trade in the S&P and want to
know how the S&P is going to unfold in the rest of the year 2018. He gives you exact day wise
trend forecast for the next 6 months with amazing accuracy , his theory is astrological forecasts
never change as all future astrological events are fixed.

He puts out a Sunday’s weekly newsletter which provides day-wise trend forecast of 40 major
markets for the upcoming week/s for:

- Stocks-
- Indices-
- Commodities-
- Currency-
- Bonds-
- Interest Rates

Also he sends out live updates from Monday to Friday in his What’s App subscribers group. In
this he provides price and time targets based on trend forecast given in the weekly newsletter.
For mid-term and long-term traders along with the day wise trend forecast of the entire year,
he provides top and bottom analysis of the entire year, so in advance you know the time
window where important highs and lows are expected to be made. He also provides analysis for
projected highs and lows of 1, 2, 3, 4, 5 and 10 years. He does not claim 100% accuracy and on
rarest occasions he does prove wrong.

I asked him what he used to be so accurate in his projections and he said:


Calculations are very simple. To forecast any market, mostly we take help of three sciences:
1. Astro-physics: first trade date, time and place of the financial instrument. From this I cast
the natal chart, with the help of natal chart We can identify the significant events which will be
taking place in future and with the help of dasha and binary systems we can identify the “time”
of those “significant events “. In astrology two things are important. First “what” will happen
once we identify “what” then we try to identify “when” and there are separate tools to do that .
2. Alphabetology: here I take the help of “name science”. The name of the instrument is key
. Every name creates a separate sound and so the vibrations. This science i started applying
when one day I noticed that there was a huge fall in gold prices in Indian market but not in USA
market. And after analyzing I realized “name science is purely mathematics “

3. Numerology: every “prices” are actually “numbers” so they follow the simple rules of
numerology. With the help of it we can identify how high or low an instrument can move and
we can correlate the “time” factor with it so we can identify projected high, low & trend reversal
level of the specific time window

These three are the main tools I use. Sometimes I use cycles or geometry also to reconfirm the

WWW.TRADERSWORLD.COM October/November/December 2018 35


above analysis.
TradersWorld Magazine
All these subjects are so vast that they cannot
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20 years back I didn’t knew anything about
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I genuinely believe without the blessing of
Mother Nature we cannot predict the future.”

So if you want to take a look at someone who


uses a technique of trading that is based on
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About Our Service
Specialised in forecasting the exact day of trend, months and years in advance . If you trade in s&p and you
are willing to know how s&p is going to unfold in rest of year 2018 , we give you the exact daywise trend
forecast of s&p of next 6 months with amazing accuracy. Astrological forecast never change as all future
astrological events are fixed. In Sunday’s weekly newsletter, we provide day-wise trend forecast of 40 major
markets(stocks,indices,commodities,currency, bonds and interest rates)for upcoming week/s. Along with
trend forecast we send live updates from Monday to Friday in what’s app subscribers group . In live updates
we provide price & time targets based on trend forecast given in weekly newsletter . For mid term and long
term traders along with daywise trend forecast of entire year , we also provide top bottom analysis of entire
year, so in advance we know the time window where important high and low are expected to be made . We
also provide price analysis, wherein we provide projected high and low of 1 yr,2 yr,3yr,4yr,5yr and 10 yr . We
do not claim 100% accuracy, on rarest occasions we also prove wrong . Please read the disclaimer carefully
in our website .

Predictions for 2018


1. There will be sharp rise in crude oil prices between 19-28 October[5:19 AM, 10/5/2018
2.There will be sharp fall in US coffee prices between 5-27 November 2018
3.There will be sharp rise in gold prices between 3-29 November 2018

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WWW.TRADERSWORLD.COM October/November/December 2018 37


2018 World Cup Trading
By Kurt Sakaeda

I was surprised to hear from an old friend. He called to congratulate me on moving up in the
rankings for the 2018 World Cup of Trading. This means the world can see what I am doing. It
gives me a feeling similar to when I was a teenage boy shouting “Hay girls! Watch this!”

The problem with writing an article like this is that it is assigned in August with a deadline in late
September. So what can I write about that will still be relevant in late September?

I guess an article about overall trading strategy would work.

Back when I was a boy we had the Cold War. Every night the TV news would tell me how
I would die in an atomic fireball. The editorial pages of the newspapers told me how every
generation had to fight a big war with lots of dead. This seemed a bit over stated. As I am here
now the empirical data is that it was.

Back in 1979 a jet liner crashed outside of Chicago. I could see a column of black smoke rising
from the Adler Planetarium where I was taking my last college course. When I arrived home I
saw the news. A new aircraft type had failed on takeoff. It was a McDonnell Douglas DC10.
The news casters were predicting the end for McDonnell Douglass. I turned to my dad & said
“I bet McDonnell Douglass comes back.” He replied “You are 21 now son. You can make a real
bet with a broker.” The next day I got the last of my tuition money, put on my best Sunday suit
& went to La Salle Street. La Salle is sort of like Wall Street, but it is in Chicago. Along the
way I bought all of the newspapers to read about McDonnell Douglass. There I walked into the
brokerage closest to the train station. It was Paine Webber.

It took a couple of days for my check to clear & my account to open. Remember while we had
computers, they were IBM mainframes. Gigantic machines that had their own rooms. Fortune
smiled upon me. McDonnell Douglass continued to plummet. It had fallen from $28.00 to
$21.00.

The newspaper said that McDonnell Douglass was 3/4 McDonnell. McDonnell made fighter jets.
The remaining 1/4 was Douglass Aviation. They made jetliners. So my guess was that $21.00
was 3/4 of $28.00. So if I bought McDonnell Aviation for $21.00, I would get Douglass Aviation
for free. I called my broker and said I wanted to buy McDonnell Douglass for $21.00. He
replied, you mean you want to bid $21? I got a quick lecture about bids asks & market orders.
So I pulled the trigger with a bid of $21. I got a call to let me know I was really lucky. I got
filled at $21. That was the low for the day.

WWW.TRADERSWORLD.COM October/November/December 2018 38


A few weeks passed. I watched the TV news every evening after work. I checked the
newspapers every morning for news of McDonnell Douglass before work. Eventually McDonnell
Douglass moved back to $28 & I sold. This was my first win in the markets.

This trade was followed by things like Union Carbide, Phillip Morris, the Nikkei Market Index,
Volkswagen, Face Book, Intel, American Outdoor Brands, Sturm Ruger, Harley Davidson, & CVS
Pharmacy. The TV news had said that all of these things were going to be wiped out because of
some disaster or other. But I thought it was overstated.

It seemed to me that the news used to overstate gloom & doom. So by watching the news a
young man in the 1980’s could make guesses as to things that are overpriced or underpriced.
That sort of thing no longer happens today. Today everyone knows the news is now fair
& balanced. No news service would even think of overstating some story just to increase
circulation & there by sell more advertising.

With fair & balanced news today, we need to search for over or under priced markets with
other tools. This year I am doing it with the CFTC(Commodities Futures Trading Commission)
COT(Commitment Of Traders)report. The COT report is free. But perhaps it is not free. We do
pay for it every April 15 on Income Tax Day.

In particular, there are 9 figures that are interesting. They are:

Open Interest
Speculators Long
Speculators Short
Commercial Long
Commercial Short
Non Reportable Long
Non Reportable Short

In this case speculators means hedge funds. Non reportable means retail or small traders.
Commercial users are people like farmers & cereal factories or airlines & oil drillers. They
actually want to make or take delivery.

If one of these 9 figures reaches a record level it peaks my interest. To be fair, I combine long
& short positions to look at net positions. So I am actually looking at 4 things. You would think
that a record is rare, but due to rising world wealth more contracts are moving every day. So
old records are easily broken.

My guess is that if one of these 9 figures is making a new record the market that generated the
record is in some sort of extreme condition.
Black dots are prices. Red dots are positions.

WWW.TRADERSWORLD.COM October/November/December 2018 39


Graphic 0
This is what most books on COT trading will show. This is a near ideal case. To fully exploit a

correlation=−92.342
4.0

1e+05
CORN − CHICAGO BOARD OF TRADE

3.8

NetCommercial
−1e+05
3.6
3.4

−3e+05
3.2

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

move, you need about 6 months. As you can see when commercial traders are long prices are
also low. When commercial traders are short prices are high. To use this graph you would wait
for a trend to change direction then follow the trend until it changes direction again. The only
problem is that the commercial positions graph does not work for everything.
Graphic 1
This is the first example of a commercial graph failure. As you can see here the Brazilian Real
BRAZILIAN REAL − CHICAGO MERCANTILE EXCHANGE

correlation=78.736

30000
3200 3400 3600 3800 4000

0 10000
NetCommercial
−20000

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

WWW.TRADERSWORLD.COM October/November/December 2018 40


commercial traders follow the market. So you would be short when the market is low.
Graphic 2
Here is the second example of a commercial graph failure. The correlation shows a 7% reading.

correlation= 7.695
LEAN HOGS − CHICAGO MERCANTILE EXCHANGE

40000
800

20000
NetCommercial
700

0
600

−20000
500

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

So the price & positions have very little to do with each other. As you can see the commercial
traders were long while the market plunged.
Graphic 3
DOW JONES INDUSTRIAL AVG− x $5 − CHICAGO BOARD OF TRADE

correlation=40.165

0e+00
26000
25000

−4e+04
NetCommercial
24000
23000

−8e+04
22000

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

WWW.TRADERSWORLD.COM October/November/December 2018 41


Here is a third example of a commercial graph failure. This is the $5 Dow Jones. As you can
see the commercials were short while the market was rising back in the September through
January time frame.

So we cannot blindly follow the commercials. Before I use commercial position as an indicator I
draw the graph & calculate the correlation coefficient.

But we could follow speculators or hedge funds.


Graphic 18

correlation=87.214
WHEAT−SRW − CHICAGO BOARD OF TRADE

5.5

5e+04
NetSpeculators
5.0

−5e+04 0e+00
4.5

−1e+05
4.0

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

This is wheat. We have an example of how hedge fund positions are correlated with price. If
we get a record open position, we can start watching for a trend reversal. But like commercials,
hedge fund positions are sort of random against market prices.
Graphic 19
E−MINI S&P 500 STOCK INDEX − CHICAGO MERCANTILE EXCHANGE

correlation= 5.279
2900
2800

200000
NetSpeculators
2700
2600

100000
2500

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

WWW.TRADERSWORLD.COM October/November/December 2018 42


Here is the electronic mini S&P500. There is very little correlation between hedge fund positions
& market prices.
#2 HEATING OIL NY HARBOR−ULSD − NEW YORK MERCANTILE EXCHANGE

Graphic 20

correlation=−12.135
170 180 190 200 210 220

50000
NetSpeculators
30000 10000
Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

Heating oil is also not correlated to hedge fund positions. With a negative correlation, it may be
better to treat heating oil hedge fund positions like commercials.
Graphic 21
NIKKEI STOCK AVERAGE − CHICAGO MERCANTILE EXCHANGE

correlation=−31.268

5000 10000 15000


24000
23000

NetSpeculators
22000

0
21000

−5000
20000

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

WWW.TRADERSWORLD.COM October/November/December 2018 43


The Nikkei Stock Average & hedge fund positions are not correlated. There are more things that
should not be traded using COT data. Here are the examples.
Graphic 4
NATURAL GAS − NEW YORK MERCANTILE EXCHANGE

correlation=−4.312

1650000
60

1450000 1550000
50

OpenInterest
40

1350000
30

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

Graphic 6
NATURAL GAS − NEW YORK MERCANTILE EXCHANGE

correlation= 6.815
60

−50000
NetSpeculators
50

−100000
40

−150000
30

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

WWW.TRADERSWORLD.COM October/November/December 2018 44


Graphic 7
NATURAL GAS − NEW YORK MERCANTILE EXCHANGE

correlation=−2.824
60

100000
NetCommercial
50

50000
40
30

0
Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

Graphic 8
NATURAL GAS − NEW YORK MERCANTILE EXCHANGE

correlation=−25.044

20000 25000 30000 35000 40000


60

NetNonReportable
50
40
30

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

As you can see from the natural gas graphs, none of the COT figures correlates well with prices.
Although I think that natural gas will get better once the price spike in January rolls off the
chart.

Graphic 9, Graphic 10, Graphic 11 and Graphic 12


Correlations for live cattle are also poor. So COT is not well suited for trading live cattle at
present.

WWW.TRADERSWORLD.COM October/November/December 2018 45


LIVE CATTLE − CHICAGO MERCANTILE EXCHANGE LIVE CATTLE − CHICAGO MERCANTILE EXCHANGE

1050 1100 1150 1200 1250 1050 1100 1150 1200 1250
Graphic 9

Graphic 10

Sep
Sep

Nov
Nov

Jan
Jan

Mar
Mar

as.Date(t$asof)
as.Date(t$asof)

correlation=24.689
correlation=77.602

May
May

WWW.TRADERSWORLD.COM
Jul
Jul

Sep
Sep

October/November/December 2018
NetSpeculators OpenInterest
20000 60000 100000 140000 300000 340000 380000

46
LIVE CATTLE − CHICAGO MERCANTILE EXCHANGE LIVE CATTLE − CHICAGO MERCANTILE EXCHANGE

1050 1100 1150 1200 1250 1050 1100 1150 1200 1250

Graphic 12
Graphic 11

Sep
Sep

Nov
Nov

Jan
Jan

Mar
Mar

as.Date(t$asof)
as.Date(t$asof)

correlation=−24.612
correlation=−24.474

May
May

WWW.TRADERSWORLD.COM
Jul
Jul

Sep
Sep

October/November/December 2018
NetNonReportable NetCommercial

47
−30000 −20000 −10000 −100000 −60000 −20000
The last example is sugar.
Graphic 13
correlation=−89.041
SUGAR NO. 11 − ICE FUTURES U.S.

0.15

700000 800000 900000 1000000


0.14

OpenInterest
0.13
0.12
0.11
0.10

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)
Graphic 14

correlation=40.443
SUGAR NO. 11 − ICE FUTURES U.S.

0.15
0.14

0
NetSpeculators
0.13

−50000
0.12

−100000
0.11
0.10

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

Graphic 15
correlation=−33.170
SUGAR NO. 11 − ICE FUTURES U.S.

0.10 0.11 0.12 0.13 0.14 0.15

50000 100000
NetCommercial
0 −50000

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

WWW.TRADERSWORLD.COM October/November/December 2018 48


Graphic 17

correlation=−27.089
SUGAR NO. 11 − ICE FUTURES U.S.

20000
0.15
0.14

NetNonReportable
10000
0.13
0.12

0
0.11

−10000
0.10

Sep Nov Jan Mar May Jul Sep

as.Date(t$asof)

As we can see here the correlation between sugar prices & cot positions is pretty poor too. So I
think sugar is not a good candidate for COT trades at this time.

But I wonder if the correlation between open interest in live cattle & sugar is a useful indicator.

Unfortunately, COT is a tricky indicator. I cannot give you a simple rule like follow the
commercials. The value of any specific indicator against a specific commodity changes over
time.

Past performance is not indicative of future results. Trading Futures, Forex and Stocks involves
substantial risk of loss and is not suitable for everyone.

The opinions expressed in this article are the author’s own and does not constitute endorsement,
recommendation, or favoring by Robbins Trading Company, Robbins Financial Group Ltd. or their
affiliates.

WWW.TRADERSWORLD.COM October/November/December 2018 49


Finding Hidden Events
By Dr. Lorrie Bennett

In working with market analysis, the goal is to find a way to “see” beyond the simple chart.
How do we process the information on the chart differently to get a different view than others
and just maybe get a leg up on the market’s expected activity? How can we develop techniques
that give us a view of things not seen or fully understood?

One source of a different view is math or science. Many use the mathematical ratios of Fibonacci
or simple harmonics. Others use squares and triangles or other geometric shapes to develop a
different view than most would get. And with practice the brain can be trained to see the charts
in a different way and that could and often does lead to a small step up on the markets.

One technique that is used is Astrology. There is natal astrology and mundane astrology that
are frequently used, and many do well. The drawback is that there are points where things that
are expected to happen that don’t, or points where things happen that are not expected. Why?
Why does it work at one point in time and not another? What is happening?

The inability to answer these questions often leads to a technique being discounted or not fully
trusted. This researcher would clarify that there are two issues playing out when there is a
failure to know that a change in trend was to occur, and a failure of the market to turn when
there was an indication that it should have. The first will be addressed in an upcoming book on
The Law of Vibration by the Planets. I will address the last point in this article.

How to resolve a missed change in trend point where a turn in the


market was expected but did not occur ?
Let’s use science. A bit of free thinking starts the process and should give us a source of ideas
of how to develop a technique that can help to answer, “why didn’t the market turn?” when one
was expected. To build a technique, think about what it is that you want to see. To see forces
in the market’s laws of nature which show force are considered, such as the Inverse Square Law.
While to see key price levels the use of chemical orbital shell theory would be applicable.

So then what part of science could be used to find periods of time when shocks that change the
market trend should be occurring? What would you call these shocks? Well would they not be
points where the foundations of the markets shift or adjust themselves. Much as earthquakes
change the foundations of the earth’s crust, so a study of tectonic plates and earthquake theory
might provide ideas for finding when movements of the market’s foundations could be expected
to occur, or do and cannot be seen.

Science has achieved a certain ability to study the tectonic plates via seismometers placed both
at and below the surface of the ground. They have found that the earth moves even if we as

WWW.TRADERSWORLD.COM October/November/December 2018 50


humans cannot sense it. But what they have also found is that the animal kingdom is more
aware of these events than man who is often distracted by just living life.

When scientists study the large earthquakes, one common finding is the movement of animals
away from the epicenter area. It is as if they know about the upcoming events and have reason
to be fearful of those events. So how would they know? The animals, because of their lower
position on the ground and the usual position of four feet on the ground, can detect the seismic
events that are occurring deep within the fault lines that are preparing to shift.

For those wishing more background understanding I would suggest a study of VLFE, LFE and
SSE events in the science of tectonic plates. For this article lets just admit that they occur
and are detectible by the current advanced instrumentation. It is these events that create
the animal’s responses due to their body position and sensors in the inner ear. They respond
strongly due to fear. Humans have the same sensor, we just don’t listen as well to the unheard
warnings, or do we? My position is that we do, we just don’t know it.

For example, in the beginning of 2017, a call was made for a change in trend January 4-7
of 2018 and another for April 16, 2018. These calls were made by a technique of combined
astrology and astronomy that I have utilized for years. When early January came it appeared
an error was made. I knew the market trend change would occur, so patience was required but
it took another 3 weeks before the main DJIA fall occurred.

How does one resolve the “miss” and still have confidence in the techniques? How many times
have researchers thrown out their ideas because they didn’t occur. How many times have
“predictions“ been deemed wrong when they were not? I have read many predictions that left
the predictors subject to scorn for calling for an earthquake only to have it “miss”. But, they
did not miss the call, it was just that the movement was not evident. The event occurred, just
not at the Earth’s surface. It occurred as a LVFE, VFE or SSE, and only geologists knew it had
occurred.

I discovered this some years ago as I was working with transits and determined that events
should have been occurring but were not. That is when I discovered the SSE that were
subsurface. The events were occurring but not where it was evident. That led to a tremendous
correlation of research on earthquakes and stock markets that has increased my confidence in
the techniques developed.

So, what can we use as a seismometer for stock markets? Is there something that will tell when
sub-surface events are occurring that shift the foundation but are not clear? Yes, there is.
The instrument to use to find the ”fear” factor in humans and market interaction is the Volatility
Index from the Chicago Board of Options Exchange, also known as the VIX. It is known as the
fear index or the fear gauge. Just what we are looking for to measure fear in the markets. The

WWW.TRADERSWORLD.COM October/November/December 2018 51


VIX is a measure of perceived market volatility in either direction, including to the upside.1 It is
the volatility that helps show the fear. An important point is that the events can occur in either
direction. Therefore, the VIX becomes usable both for change of trend or for points of additional
strength or acceleration in a move, creating parabolic or hyperbolic moves in the market.
Let’s look at the DOW for the predicted January event. First the VIX is added to a chart of the
Dow Jones Industrial Index (DJIA):

Four dates have been marked which correspond to points where the VIX changed direction
from low or decreasing volatility to increasing volatility ( Jan 5, Jan 26, Feb 26 and Apr 17). On
January 5 the VIX turned out of a low at 8.92 to a significant run upwards while the April 17th
date was one of three low points after the major high of the VIX. The current article is focusing
on the Jan 5 date.

What happened in the DOW on January 5th was unremarkable, but looking below the surface to
the instruments that comprise the DOW we find the following:

WWW.TRADERSWORLD.COM October/November/December 2018 52


Two DOW components began downward turn from their highs: AXP and PG.

11 began flattening from their upwards trajectories: CAT, CVX, DIS, DWDP, XOM, GS, IBM, PFE,
UTX, VX and AAPL

WWW.TRADERSWORLD.COM October/November/December 2018 53


Another 10 entered a state of parabolic price moves: CSCO, KO, HD, INTC, JNJ, JPM, MRK, NKE,
TRV

The final 8 had mixed moves of up and down: BA, MSFT, MCD, UNH, V, WMT, WBA

And some had a delayed or second top which occurred on Feb 26 for BA and MSFT being most
notable.

WWW.TRADERSWORLD.COM October/November/December 2018 54


In the writings of Gann, the student is admonished to learn the market leaders, market followers
and those that turn with the market. The leaders would be followed from the lows of a market
while the followers would be followed from the tops as to rise out of the lows requires strength
and to fall from the tops requires weakness.

When using the VIX with the DJIA, take an expected turn date which is gathered from another
technique such as astrology and numbers, count and evaluate the underlying components for
indications of strength, weakness, or neutrality. One would look at those components of the
DOW that turned at the expected turn date, those that began a parabolic or hyperbolic move
and those that flattened.

Those that turned with the event would be considered the weakest of the components at the
highs while the strongest at the lows, while those that entered parabolic/hyperbolic moves would
be considered the strongest or weakest components depending on high or low position, while
those that flattened would be considered as between the two extremes.

Further research of turns should be made with these groupings to see if they continue as a
group overall, and the leaders at highs or lows would then be a predictor that the market was in
fact turning with the event. This technique is not meant for short term market analysis but for
longer-term analysis.

By learning the market’s leaders from the lows and highs and then those that follow, a view of
what the possible effect of an astronomical or astrological event can be evaluated, and may be
a point of validation that the predictive technique has validity, even if it does not result in an
earth-shaking event.

For more information about my work and my 4-volume series on Gann’s Law of Vibration, please
see:
http://www.sacredscience.com/BENNETT/Law-of-Vibration-Series-Introduction.htm

WWW.TRADERSWORLD.COM October/November/December 2018 55


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Risk-Based Trading and Investing
By: Thomas Barmann of NeverLossTrading

As an IRA holder, swing trader, day trader, long-term investor: You are striving for a return on
investment based on your available capital. The preservation of your capital in combination
with producing constant returns is the key to the trading and investing success you are striving
for.
Risk-based trading and investing focuses on minimizing the possible loss for a worst case
(maximum loss) scenario; considering that you and other market players take alternate and
simultaneous moves in the presence of uncertainty.

Why uncertainty?

You are making an assumption for the future price move of an asset and you apply an
appropriate strategy to produce a meaningful return; however, what you can control best is the
risk you want to accept per trade.

In essence, three components shall be considered at every trading and investing decision:

- A system feedback on how likely the expected future price move will happen.
- The trading strategy, where you decide how to cope with the potential price move and statisti-
cal volatility to consider.
- Finally, the odds-based decision making process, integrating the trade setup and the chosen
strategy under a strong risk control.

Graphic-1: Risk Relation to System and Strategy

WWW.TRADERSWORLD.COM October/November/December 2018 59


In a trading or investing firm, risk management plays a major role, to not expose the company
towards unbalanced risks. Private traders and investors however, rarely pay attention to a solid
risk management; thus, let us help you with the six components to consider in operating with a
structured risk assessment:

1. Probability of the setup to conclude as expected


2. Expected reward
3. Assumed risk: entry to stop
4. Probability of the trading strategy to profit
5. Trade repair ability
6. Correlated or uncorrelated risk (portfolio appraisal)

Let us show you, how we are applying a percentage-based risk assessment:

Graphic-2: Risk Appraisal Components and Percentage Risks

Imagine trading the E-Mini S&P 500 and based on daily signals.

Graphic-3: NeverLossTrading Daily Chart for the E-Mini S&P 500 Futures

WWW.TRADERSWORLD.COM October/November/December 2018 60


Graphic-3, in combination with the risk table, let us conclude as follows:

• Between August 17th and August 31st, 2018, the chart shows two confirmed trading op-
portunities (spelled out price entry threshold surpassed in the next candle: Buy>2857,
Buy>2877.50). This way, you can operate with buy-stop orders.

• Applying our risk table assessment for both situations, they are allowing for a 3% risk in
relation to the overall capital held; thus, by accepting a $1,300 risk per trade (system-
defined entry to stop), a capital of $43,333 is required to participate in the trade.

• Both trade signals had a 3-candle target, where you either closed the trade at the closing
of candle-3 (situation-1) or at target (situation-2).

• In case you want to trail the trade upwards, use the red-line of the blue-framed uptrend
indication and exit at the second #5-candle signal on the chart.

The overnight margin for this /ES trade was $7,700 (your broker might offer a more favorable
minimum margin; we used the maintenance margin of the CME).

In consequence, you are having a capital of $35,633 left for further investments that are not
highly correlated to the S&P E-Mini Futures: Crude Oil Futures would be such an uncorrelated
asset. So let us check the charts for the same time frame:

Graphic-4: NeverLossTrading Daily Chart for Crude Oil Futures

Graphic-4, in combination with the risk table, is letting us conclude as follows:

• Between August 21st and August 31st, 2018, the chart shows two confirmed trad-
ing opportunities with the following rewards risk setup:

WWW.TRADERSWORLD.COM October/November/December 2018 61


o Situation-1: Buy>65.90 with a $700 risk and $3,200 reward.

o Situation-2: Buy>68.97 with a $900 risk and $1,150 reward.

Both situations allow for a 5% risk tolerance of $43,333 or $2,166 with the
following position size:

o Situation-1: three contracts at $3,720 margin/contract: $11,160 of capital.

o Situation-2: two contracts with a capital need of $7,440.


By combining the crude-oil futures and the E-Mini S&P trades, a solid income was generated
in the matter of 10 days; however, at max. only 44% of the available capital was engaged and
thus, we need to look for further opportunities to produce a return:

Graphic-5: Income Statement and Maximum Risk Assessment

Graphic-5 shows you how a solid income was generated in a matter of 10 days: 30% ROC;
while plenty of capital was still left to strive for further opportunities:

To engage your trading capital, we propagate to strive for multiple streams of income instead of
focusing on one: Acting risk-based, as demonstrated here.

By producing $13,300 of gains, the August 31st capital was raised to $56,333 and increases the
tolerance levels for the upcoming trades:

Graphic-6: Risk Levels after Trade Gains

In case the required capital needs are outside of your risk tolerance, you can trade a derivative
of the S&P 500 Index future, like SPY options, where you can tame the overall risk requirement

WWW.TRADERSWORLD.COM October/November/December 2018 62


in $100 increments.

There is always a way to participate in the price move of the underlying by moving to a different
asset class, that moves directly correlated with the observed symbol, but knowledge is of
essence. This is where we step in: We are 10 years in business and open for new students. If
this is for you, experience how the NLT-systems perform live.

Schedule your consulting session:

Call +1 866 455 4520 or contact@NeverLossTrading.com

Now that you understand how to trade risk-based so you can prevent drawdowns, let us talk
about the prerequisites to establish in conjunction, summarizing them in a simple graphic:

Graphic-7: Prerequisites to Successful Risk-Based Trading and Investing

The basic behavior for a short-term trade, a swing trade or a longer-term investment are the
same; day traders just have less time to decide and need to be best prepared by their system;
hence, graphic-7 is applicable for every trading or investing decision.

1. How to find High Probability Trade Setups

You are in need for a system that produces high probability trade setups on multiple levels. The
example above showed you that you had more than 50% of the capital left with which you were
for example able to engage in trades on higher or lower time frames; key is that you trade at an

WWW.TRADERSWORLD.COM October/November/December 2018 63


attainment rate at or above 65%.

High probability trading systems are based on underling changes in supply and demand rather
than on a mathematical correlation like Moving Averages, RSI, MACD, CCI and other standard
indicators portray. With NeverLossTrading, we have those indicators categorized and put together
in a chart for you, helping you to engage into situations that give you a high probability to
predict the future price move.

Continuing our swing trading example of the E-Mini S&P 500 Futures; we now go a level higher,
making our decisions from the weekly charts, using an example of NeverLossTrading Trend
Catching model.

Graphic-8: NLT Trend Catching Weekly Chart for the E-Mini S&P 500

Trading the future, Situation-1 required a $2,650 risk tolerance, Situation-2, $3,200. Both
situations are outside of the set risk tolerance: What to do?

We move to a derivative and operate with SPY options, where we are able to tame the risk in
$180 risk elements. According to the risk agreement shared, both situations allow for a 3% risk
acceptance; based on $43,333 capital: $1,300. Following this principles, this would have been
achieved:

WWW.TRADERSWORLD.COM October/November/December 2018 64


Graphic-9: SPY Option Trades on /ES Signals

Contracts to #-of Investment Return


Buy Contracts Capital
1 SPY Calls 7 $1,260 $795
2 SPY Calls 7 $1,260 $2,226

Concluding both trades in the set time frames, a solid return was achieved by swapping to a
different asset class, which allowed us to participate in the price move of the underlying and
staying in tune with our risk agreement.

Calculate it up: There is still plenty of capital left to participate in additional opportunities; thus,
read on and experience why it is important to trade and invest with multiple streams of income.
In the example above, we assumed the entire paid premium as 100% risk; however, we teach in
our mentorships how to reply repair operations to reduce the overall risk drastically, in case the
trade goes wrong.

If you want to learn how to trade options as explained, contact us for a free consulting session:

Call +1 866 455 4520 or contact@NeverLossTrading.com

2. Why and How to Trade with Strict Rules

Most successful traders use a rule-based trading system. This is no coincidence.


A solid rule-based trading system automates the entire process of trading.

As a result, your trading and investing system shall cover every aspect of trading, and leave
virtually no decision to the subjective mind of the trader:

The system provides answers for each of the decisions a trader must make while trading. The
system makes it easier for a trader to trade consistently, because there is a set of rules which
specifically define exactly what should be done. The mechanics of trading are not left up to the
judgment of the trader.

If you know that your system makes money over the long run, it is easier to take the signals
and trade according to the system during periods of losses. If you are relying on your own
judgment during trading, you may find that you are fearful just when you should be bold; and
courageous when you should be cautious.

If you have a rule-based trading system that produces constantly high probability trade setups,
and you follow it consistently, your trading will be consistent despite the inner emotional
struggles that might come from a series of losses or a large profit. The confidence, consistency,

WWW.TRADERSWORLD.COM October/November/December 2018 65


and discipline afforded by a thoroughly tested rule-based system are the key to many of the
most profitable traders’ success.

All NeverLossTrading Systems are rule-based trading systems. The rules cover every aspect of
trading and leave close to no decisions to your subjective judgment:

Step 1: Deciding for your trading perspective (time for a return).

Step 2: Which assets do you want to focus on as a day trader, swing trader or long-term investor
(best a combination of), and let your system or a signal provider produce those opportunities for you.

Step 3: Choose your trade signals: Clearly defined entries, exits, and stops.

Step 4: Find applicable trading strategies.

Step 5: Position size with the odds in your favor: Algorithm-based reward/risk assessment and money
management.

3. Engage into Multiple Strategies


In what was shared, you see that capital engagement is a challenge for every trader to solve. To
demonstrate how this can be solved, let us share a simple financial plan made for a trader with
key focus on swing trading and longer-term investing. We adjust the financial plan individually to
the specific wants and needs of the trader or investor, considering preference and the available
time to trade.

Graphic-10: Financial Plan Example

The above table shows how a swing trader is striving for a 15% monthly return by engaging in

eleven trades per week, on a 65% attainment rate, focusing on multiple streams of income to
achieve the set goal.
As you can see, there are multiple streams of income generated, distributing the capital risk-

WWW.TRADERSWORLD.COM October/November/December 2018 66


based to various time frames and trading/investing strategies.

Taking a conservative approach, we do not pro-rate weekly into monthly attainments; we rather
apply a little discount and still help you to strive for a solid return on investment.

We hope this shows you what is needed to be a successful trader and you see trading and
investing success has multiple prerequisites to fulfill.

Now you have the chance to either develop or establish everything on your own: took us more
than 10,000 hours; or, you trust in a market-proven system and education provider:

Call +1 866 455 4520 or contact@NeverLossTrading.com

4. Consider Trade Repair


On a simple approach: If you can repair your swing trades and long-term investments, you can
leverage your overall results by more than 50%.

Imagine you had the ability to reduce your losing trades to about 40; while often even better
results are attainable.

Let us jointly calculate what this will do to your trading:

• Example: 100 trades

• One dollar reward and risk per trade

• You win 65 and lose 35 trades = $30

• Assumption: With protection, you only lose 40%

Let us now calculate the effect on the overall result:

What the leverage trade repair abilities bring to our financial results is substantial: a 70%
leverage in our example.

There is sure a bigger systematic behind the actions to apply for the trade repair and we teach
that in our mentorships: one-on-one, to ensure we give you the tools on hand needed.
Depending on your available time and willingness to add swing trading and long-term investing

WWW.TRADERSWORLD.COM October/November/December 2018 67


to your skills, repairing your trades on high capital engagement makes a key difference to your
long-term success. On day trades, the ability to repair your trades is very limited; hence, you
take the stop.

If we include the trade repair, the above financial table looks as follows:

Graphic-10: Financial Plan Example with Trade Repair

Take a look at the assumed monthly return and you will see what the 50% leverage trade repair can
potentially allow for.

5. Summary
The biggest threat for every trader and investor is drawdowns:

When you reduce your capital by 50%, you need to produce a 100% return to get back to breakeven.

Risk-based trading is helping you to prevent drawdowns and encourages you to spread your capital
over multiple positions; allowing for multiple streams of income; helping you to strive for a multiple of
the overall index progression institutional investors measure themselves against.

Aside from applying risk-based investments, it is essential to operate with:

• A high probability trading system: ≥65% attainment rate.

• Trade rule-based with clear cut entries, exits, and stops.

• Apply multiple strategies, allowing you to trade asset prices that move

• Repair your trades to leverage your returns by reducing losses.

To put all this details in motion for you, you now have the chance to establish a trading system, the
systematics, and rules on your own or you engage with a system and education provider.

If you like to see which of our systems and mentorships suites you best:

Call +1 866 455 4520 or contact@NeverLossTrading.com


We are looking forward to hearing back from you.
If you are not already subscribed to our free trading tips, reports, and webinars…sign up here.

Best regards,

Thomas Barmann
Disclaimer, Terms and Conditions, Privacy | Customer Support
WWW.TRADERSWORLD.COM October/November/December 2018 68
Combining Andrews and Elliott Wave to
Find the Third Wave

By Ron Jaenisch

Over the years the question of whether the Andrews lines and rules can be used in conjunction
with Elliott wave to locate the popular third wave has come up several times. Third waves are
popular with Elliott wavers because they often result in long and strong moves. In this article
you will see that it is possible and that using the earlier - 1970 era Andrews rules (verses the
stuff on the web) makes it much easier. We will examine the two stock trades that were written
about, before the orders were placed, in the Andrews Email group this year.

The last trade was TYL. The step by step procedure was pretty easy. First the top was verified
with the New Major Andrews Pivot Indicator (MAPI).

Then as you can see on the chart price went down and zoomed past the Median Line. After the
down move price went up in what many Elliott wave enthusiasts may call an ABC. During the
ABC and the C wave, Advanced Andrews students would probably note that a shakeout pattern
has formed. Price went beyond the down sloping median line parallel that is drawn. Note that
price also did not make it up past the smaller median line, at the area marked with a C.

WWW.TRADERSWORLD.COM October/November/December 2018 69


This article was written on August 23, 2018 and what occurred thereafter will be something
you can see in your charts. With this stock, rather than go short outright put options were
purchased. This is due to the fact that the major indices had that possibility of reversing
at the slightly higher, MAPI in the near future. Going higher and making a top could easily
influence most widely followed stocks and TYL could still go a bit higher. This would give us the
opportunity to get more very cheap put options. It is during the month of September that stocks
typically have the strongest decline.

A trade that was completed earlier in the year was with Maxwell. Once again after noting that
the top was verified by MAPI the median line was drawn and it was noted that on the way to the
pivot marked #1 prices zoomed past the Median Line.

As can be clearly seen on the chart, thereafter price reversed back up and made an ABC
correction which went past the upper median line parallel. This was the short area. There after
price went down to the lower median line parallel where profits were taken.

WWW.TRADERSWORLD.COM October/November/December 2018 70


As can be seen in the Maxwell chart below, price did not make it up to the Median Line. Andrews
taught that when this occurs price makes that up in the next move ( which would be down )
Advanced Andrews students would notice that price also formed a shakeout pattern prior to the
down move.

Standard Elliott wave theory would suggest that another thrust wave down is likely in this case,
since it is obviously not a correction pattern. Price at this point could go sideways for weeks
before doing going down further. Andrews techniques found that there were several lines coming
together near the lows and waiting for further decline was probably not worth it.

When using Andrews techniques, my mentor professor Alan Andrews would always say “When
you do your analysis of a chart you start at the left of the page, not on the right.” This is due to
the fact that a series of events occur prior to a long and strong move that puts a lot of $$$ into
your pockets.

WWW.TRADERSWORLD.COM October/November/December 2018 71


Start Today!

15 Day Demo Trial

Testimonials:
Special Offer $675/yr normally $1500/yr “I've known Andrew for a number of years. He
knows cycles better than anybody I've ever met,
Click to Buy Offer ends December 30th and I've studied cycles all my life”
Harry S Dent
At Market Timing Report, our aim is to issue high probability, low risk trade Renowned Forecaster and New York Times Best
Selling Author
research across various markets including commodities, stocks and
foreign exchange. “I believe you get what you pay for and you have
a superior product.There are others that try to
do what you do but they miss the target so
Often markets will demonstrate periods of rising prices, periods of
many times. This is as good as it gets for analysis.”
declining prices and periods where prices consolidate. Prior alerts to Chris Fletchall Hedger and Trader, USA
possible and probable turning points are highly useful to our clients.
This allows them to: “Andrew Pancholi’s Market Timing Report is
consistently the most accurate cycles forecast
there is for traders of major markets”
 Potentially enter a trading campaign earlier and stay in longer Peter Temple Futurist - Speaker - Cycles Expert,
World Cycles Institute
 Avoid entering a campaign when the market could potentially reverse
direction I have subscribed to many newsletters over the
years and by far this is the best. The reasons are
 Aid option traders who are seeking steady movement in the underlying the combination of these 3 factors. 1) Its concise.
prices Typically, under 18 to 25 pages covering many
markets with predictions cleanly laid out
segmented nicely so you can access and review
There are 3 elements required to enter a low-risk trading campaign: the information quickly. 2) Its accountable. In
 Market hits price target; each issue, he goes over the last issues predic-
tions, to demonstrate the accuracy. It’s sort of a
 A Key time cycle is present; “backtest” of the plan so you will become more
 A trigger setup is in place;. confident and comfortable with his predictions
3) He tells you how he does it. He will show you
the trendlines, pivots, and other cycle concepts
Market Timing Report has developed proprietary systems based on 18 years as well as pitchforks, how they are drawn and
of research into market behaviour. Our research shows that markets do why they are drawn, so that you can understand
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confidence in his predictions. These 3 factors
Whilst regular seasonal cycles often reflect consistent change in price when combined offer a very unique value that is
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WWW.TRADERSWORLD.COM October/November/December 2018 72


Something Big Is Brewing!! History
Predicts The Future
By Andrew Pancholi

Autumn, or as many call it “The Fall” during the eighth year of every decade sees the
recurrence of some very messy financial cycles.

On 7 September 2008, the US government took control of two of the largest mortgage
financing agencies of the United States – Fannie Mae and Freddie Mac.
That was big. Or at least so it seemed.

Eight days later, on 15 September 2008 Lehman Bros blew up.


On this particular Monday, they would file for bankruptcy and at the same time attain a
world-record that no one would aspire to hold. The big number was $691-$693 billion.
The stock plummeted 93%.

Ironically, in my personal world, on Sunday afternoon – the day before Lehmans would
dominate the world’s headlines– some friends of mine had visited me in the countryside.
They were seeking counsel on how to manage their £50 million property portfolio – all
leveraged of course – fearing that times were about to get hard.
Looking at the numbers, one property stuck out.

That was one that I suggested they immediately sell on. After all it was in a prime location,
had much equity in it and would sell very very quickly. “No," was their immediate and
raised response. “Not that one! That's a keeper and we have our best tenant in that one.
He is a senior portfolio manager with Lehman Bros. Pays on schedule, pays top dollar
and that fully covers our mortgage and then some on that one.”

It’s funny how the world can change in 24 hours. Funny is probably not the most
sympathetic word.

By the way over the next 18 months that property portfolio, the vast majority of which was
financed by interest only mortgages, would turn from an asset value of £50 million all the
way down to £-10 million – a £60 million swing. My friends lived through it and
astonishingly still speculate in property today!

So mid-September 2008 was bad – that is for sure. But the “car crash” was far from over.
You see, 10 days later on Thursday, 25 September 2008, the OTS – Office of Thrift
Supervision – seized WaMu.

Apparently, when looked at in terms of assets under management, Washington Mutual


Bank’s closure was the largest banking failure in the history of America.

WWW.TRADERSWORLD.COM October/November/December 2018 73


The score on the door was just shy of $328 billion.

And of course, this took place right on schedule in the hundred year cycle from the 1907
Rich Man’s Panic which was also known as The Knickerbocker Crisis.

JP Morgan was personally involved with bank bailouts back then. His legacy reappears a
century later.

History repeats.

You do, of course, need to remember that the Global Financial Crisis had begun a year
earlier in 2007. September 2008 was the acceleration of the fallout.

So it seems we’re at the 10 year anniversary of a series of financial crises specifically


leading to bankruptcies.

Regular readers of The Market Timing Report know that the 30 year cycle is important.
Let’s venture back to 9 September 1988.

“The Financial Corporation of America” files for bankruptcy.

They became another casualty of the “Savings and Loans” crisis.

At the time they claimed the world record for the greatest loss which all the way back in
1988 stood at $33.9 billion. A mere 10th of what WaMu would lose 20 years later.
Moving away from the world of corporate bankruptcy, the 20 year cycle sees Russia in
dire financial crisis.

This really had begun on 17 August 1998 when the Russian government was forced to
devalue the ruble.

On September 2, 1998 they abandoned the floating peg policy and the currency floated
freely with inevitable consequences.

Within three weeks the currency had lost more than two thirds of its value.
The same macro cycles repeat in industrial production.

Most readers will be familiar with the 144 year cycle.

That cycle, when added to the panic of 1873, resolved to last year.

This was known as the Jay Cooke crisis and related primarily to railroads and specifically

WWW.TRADERSWORLD.COM October/November/December 2018 74


their financing.

Richard White, in his excellent book, Railroaded: The Transcontinental’s in the Making of
Modern America notes that by the end of 1874, half of of America’s iron foundries had
closed. Iron was the principle material involved in the creation of railroads.

The equivalent 144 year point is approaching now and the American steel industry is very
clearly in the spotlight being one of the focal points of the tariff wars that the present
administration have orchestrated.

Specifically, White notes that foundry bankruptcy doubled from “5183 in 1873 to 10,478
in 1878.” He tells the story of how the American railroads went into depression. From
September, 1873 to the end of the year, 25 railroads defaulted on $150,233,250 worth of
outstanding bonds. In 1874 71 railroads defaulted with bonded debts of $262,366,701.
1874 is the equivalent point to 2018.

The above cycle repetitions suggest a likely debt default increase in both the financial and
manufacturing industries. This cycle will become prominent from September 2018
onwards.

Geopolitically, the cycles arena is hotting up.

Whilst we don’t want to get too far ahead of ourselves, it is worth mentioning this month
that 6th October will mark the 45th anniversary of the outbreak of the Yom Kippur War.
This conflict only lasted 20 days but had massive repercussions for the Western world.
Please refer back to the January 2018 special edition which is available to all subscribers.
This covers matters in detail.

This war was predominantly fought in the Sinai desert and the Golan Heights.
Egypt, Syria and other Arab nations formed a coalition. President Anwar Sadat of Egypt
stated that the objectives were to, “recover all Arab territory occupied by Israel following
the 1967 war and to achieve a just, peaceful solution to the Arab-Israeli conflict.”

It was far from this.

Several days earlier on 23 August 1973, Sadat had made a clandestine visit to Riyadh.
His mission was to seek the support of Saudi leader, King Faisal.

The Egyptian Premier received much, much more than he was expecting.

It is alleged that Faisal promised half a billion dollars of support to the war chest. But
more importantly, he would not fail to use oil as the predominant weapon.

WWW.TRADERSWORLD.COM October/November/December 2018 75


And so the scene was set.

Returning to the present day, President Trump is announcing a series of sanctions against
Tehran.

Iranian oil exports are set to plummet.

Oil exports are the basis of Iran’s economy and the primary source of revenue of this
nations foreign currency. The Shah of Iran led the oil price rise 45 years ago.
These sanctions are set to come in on November 4 this year. I’m already seeing a
significant set of cycles across an array of markets for the end of October and beginning
of November. This could well escalate into a serious crisis.

As you can see, the 45 year cycle is shining a spotlight on the same subject albeit in a
different light.

This crisis is far from over.

In fact, it is just beginning.

For those of you with grandchildren – forewarn them about the year 2063, 45 years away
from now. There will almost certainly be an economic crisis relating to energy then –
regardless of whether oil still exists or not.

At The Market Timing Report, not only do we show our readers how to anticipate
geopolitical events, we also look at timing the markets.

Much of our content is based on the work of W D Gann. I have been lucky enough to
have shared a very long standing friendship with the late Nikki Jones and Cody Jones
lasting over two decades. The Jones family have been owners and custodians of Gann’s
work. Much of this is NOT in the public domain but I know Cody will be releasing some
gems soon.

Forecasting short term cycles is quite a challenge but take a look at this chart of the
S&P500.

WWW.TRADERSWORLD.COM October/November/December 2018 76


Below the chart are spikes.

These are not volume.

You can see that when they peak, the market changes trend.

See how it has happened in the past.

The arrows show you where the histograms peak and see how the market turns!
But most importantly we can see likely FUTURE TURNING POINTS.
These histograms are derived from The Market Timing Report System.

They work in different time frames.

In the chart above you can see where the longer term turns are likely to the place.

Below you can see where these can be fine tuned into daily turning points.

WWW.TRADERSWORLD.COM October/November/December 2018 77


Again see how the tall spikes in histograms - circled in green - pick out daily turns -
circles in red.

This time you will see two rows of histograms.

These are two different predictive cycle sets.


These highlight some of the short term ‘daily’ turning points.

OUR REPORT IS NOT FOR EVERYONE

Regardless of whether you are a fundamental trader or a technical trader, the timing of
trade entry is absolutely critical to your profitability.

After more than 20 years of research and study of cycles, our proprietary software system
generates turning points in different time frames.

This is a complex process.

The purpose of this monthly letter is to provide you with an overview of critical time zones
when trend changes are highly likely.

You do not need to worry about the complexity as we take care of this for you.

For the most part trend changes are reversals but from time to time accelerations can
occur. We also combine this with seasonality – a powerful and commonly used system.
We enhance this with out proprietary forecasting models.

WWW.TRADERSWORLD.COM October/November/December 2018 78


We are not infallible - inevitably a very small percentage of these turn points fail or
displace by a bar or two - but we do believe that this information, especially when
combined with your existing techniques and risk management, can give you a VERY
SIGNIFICANT EDGE.

This research looks at very many aspects of forecasting and we leave no stone unturned.

Our super macro cycles go back thousands of years.

Believe it or not - present day economic events are forecast from cycles over the few last
centuries.

So WHAT IS THE MARKET TIMING REPORT?


The Market Timing Report:
• Focusses on S&P 500, Crude Oil, Gold, EURUSD, Dollar Index
• Is published monthly
• Identifies high probability turning points
• Highlights macro monthly and weekly turning points which are beneficial to investors
• Highlights daily turning points which help shorter term position traders identify
individual days when markets are likely to change trend
• Of course, when a daily turn point lines up with a weekly time window, you have a high
probability change in trend
• Shows high probability seasonal set ups - and when these tie up with our daily turn
points, high probability turns can take place
• Shows high probability directional move days
• All information is derived from the Cycles Analysis “Profit Finding Oracle” Program
• Is based on seasonality, cycles and other proprietary methods
• We periodically look at geopolitical trends - our readers were forewarned about
forthcoming massive change in the USA four years ago! It is deeply evident now.
So act today to be within the “inner circle” of The Market Timing Report subscribers who
benefit massively from what is coming up ahead.

I realise this may not be for everyone. We only want to create successful traders who can
use this information to enhance their existing systems.

So I am going to take ALL THE RISK and want to offer any new subscribers a full NO
QUESTIONS ASKED 28 MONEY BACK GUARANTEE. If you don’t like what you read, just
send us a message and we will immediately refund you in full, no questions asked.

You have nothing to lose!


Click on this link to gain instant access!
https://ws227.isrefer.com/go/MTRMA/larry/
We look forward to having you on board!

WWW.TRADERSWORLD.COM October/November/December 2018 79


WHERE DO YOU FIND THE
MONEY TO SAVE?
By Jacob Singer

The seven deadly sins...food, clothing, firing, rent, taxes, respectability


and children.
George Bernard Shaw.
Major Barbara.
Financial independence occurs by spending less than one earns over a long period of time. There
are plenty of books in a bookstore telling you how to invest the money you save, but with taxes
as your silent partner, where do you find the money to save? Must you live like an aesthetic and
forego all pleasure just to prepare for retirement? Is that shoebox to live in, in a neighbours
back yard a necessity?

To borrow money to live is also not an option. This is what a credit card offers. Banks encourage
you to borrow money from them at a high interest rate via a credit card and to live beyond your
means. If you have a credit card, and I am sure you do, make sure that you limit your purchases
to an amount you can pay off monthly. This is a MUST!

Borrow money, yes, but only if it is to purchase an appreciating asset and the greatest
appreciating asset there is, is the house you intend to live in for the rest of your life. As an
example, Warren Buffet one of the richest men in the world, is still living in the same house he
purchased, when he started his career.

So, how do you start a budget, and above all, how do you balance your budget? Where do you
find the cash you need to save every month, cash that will pay you a compounded return. A
little bit of thought will offer a number of answers.

The first thing you have to do is to identify those answers, and then tackle each one separately.
No two readers will have exactly the same problem and arrive at the same answers, nor will
they confront their problems in the same way. Suggestions I therefore make should be adapted
to suit your personal circumstances.

For starters, examine your present income, future income, pension plan, life insurance policy
and anything else regarding your finances. Carefully study the numerous methods offered to
defer taxation and especially look for ways to reduce unnecessary expenses, something that
each and everyone of us has, whether employed or not. Your financial planner/accountant can
assist you in reducing certain expenses – for example deferring taxes - but you are the only one
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who can reduce daily living expenses.

I will now show you how to prepare a plan to reduce daily costs and expenses and suggest
where you can find the money to invest.

I look for savings in the following places.

Present Income.

Future Income.

Rearranging your life insurance policies.

Tax deferral strategies.

General daily expenses.

For the purpose of the following examples, let us say that you would like to find $100 per month
to save. This means $20 from each of the above sources. See... it is already a lot easier. $20 is
far easier to find than $100.

You will use this $100 to increase your monthly savings, or increase your monthly mortgage
payment or even dollar cost average (investing a fixed amount every month) into a stock
market or mutual fund growth account. There are many, many avenues for investing, but finding
the money to save in the example shown, has only five avenues.

Suppose you decide to increase your monthly mortgage instalment by $100. If you are earning a
small wage, this may sound difficult, and in most cases, impossible. Most people will wait till the
end of the month to calculate how much is left over after meeting their monthly living expenses.
They will then place that leftover cash into a savings account. If you follow this method, you
are beaten from the start. In order to win at saving, you should make the payment at the
BEGINNING of the month, while you still have funds. In other words PAY YOURSELF FIRST, and
learn to live off the balance.

As an example, let us say that you have a twenty-year mortgage. Most times you will be able to
arrange a mortgage with payments to be made over 25 years, if not longer, but for simplicity in
the calculation shown below, I will use a twenty year mortgage. You have borrowed $150,000
from your bank and have locked it in for the full twenty years at, let say 8% interest. Of course
you would not really do this. You would ask your financial planner for their opinion on rate
trends and lock in the rate accordingly. If rates are rising, you want to lock in for the long term,
let us say two to three years, but if rates are falling, you want to review your mortgage rate as
often as possible, so you would look to a three to six month term.

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Below is an example of what happens should you increase your mortgage payment by $100 per
month. I have taken these figures purely as representative for my example.

Amount of loan...................$150,000
Annual interest rate .................8%.
Compoundings per year ..........12
Payments per year (monthly) ..12
Therefore monthly payment..$1,254.66
Number of payments needed
to pay off the mortgage...........240

Paying and additional $100 per month on your mortgage the following happens.

Amount of loan.......................$150,000
Annual interest rate .......................8%.
Compoundings per year ...............12
Payments per year (monthly) .......12
Therefore monthly payment.....$1,354.66
Number of payments needed
to pay off the mortgage............201.69

a. The number of months needed to repay your mortgage has been reduced from 240
months to 201.69 months, an approximately 38 month reduction.
b. Had you put the $100 per month into a saving account over the 38 months, you would
have saved $3,800 ($100 x 38 months).
c. Savings of interest that would have been paid on a mortgage would be $27,897
$1254.66 x 240 = $301,118.40.
$1354.66 x 201.69 = $273,221.38.
$301,118.40 - $273,221.38 = $27,897.
d. Interest you would have earned on the investment in a bond at 5% pa = $326 and you
would have to pay tax on this interest earned. Let us assume that your after tax inter-
est earned = $196.

(5% compounded x $100 invested over 38 months = $326. At a marginal tax rate of
40% pa, the tax on $326 interest would be $130, giving a net return of $196. Obvi-
ously this will vary depending on your tax rate, but I have chosen a maximum figure
for this example).

Your Savings (c) on paying off your mortgage = $27,897


Your Gains had you followed b and d above, (b + d) $3800 + $196 = $3996.

To sum up, if you pay an additional $100 per month off your mortgage, you would save $27,897
in interest. Furthermore you will gain $3,996, money that you would have normally paid on your
mortgage, plus interest. Your savings from this $100 monthly sacrifice over the 25 year period,
would therefore be $31,893 ($27897 + $3996)...a considerable amount.

SOURCES FOR FINDING MONEY TO SAVE.

1. Present Income.

You will look for $20 every month out of the salary you are presently earning. It is very
difficult to wait until the end of the month, so I will teach you how to write a cheque
for $20 every month out of your present income and make it a part of your regular in-
vestment program. It is not a large amount, but as I have shown above, it can carry

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tremendous saving power. This does lead you to ask the question, ‘What is better,
paying off the mortgage, or placing the money into a tax free savings account?’ That
is a decision you will have to make. Admittedly seeing money ‘grow’ in a savings or in-
vestment account is far more satisfying. In this exercise however, I will only consider
paying off a mortgage.

2. Future Income.

The next $20 may take slightly longer to achieve because it is based on income you
have not yet received. Most employees receive an annual increase in salary usually
tied to the inflation rate. A conservative average would be about 3% per annum or
the inflation rate, whichever is the greater. A 3% per annum increase on an income of
$24,000 is $720, or $60 per month. If you had to set aside one fifth of this increase
which is approximately $12, in two years you will achieve more than your target of
$20. Each year then, you are paying an additional $20 per month off your mortgage
out of present income with an additional $12 every year from future income.

If you are lucky enough not to have a mortgage, either because you have paid it off, or
because you do not own a home, then theoretically you will be paying this money into
a savings account that is tax free.

3. Rearranging your Life Insurance Policy and examining your Pension Plan.

Up to now it has been relatively easy to find the additional $20 per month for each cat-
egory to meet that target of $100 per month. Very little self-discipline has been neces-
sary. The next $20 is perhaps more difficult to find, because it must be found from sav-
ings on other essential payments. One that affects most readers is life insurance.

A word of warning. Under no circumstances should you at any stage place the
welfare of your family in jeopardy unless

a. You put into your long term savings plan, every cent you save on premiums, by
re-arranging your life insurance policies.
b. You discuss your intentions in detail with your financial planner and insurance
company.

A word of warning, beware of the insurance agent who places to much stress on the point
that endowments and other types of ‘savings’ policies are essential, particularly for your heirs.
The agent may be looking after their own interests and commissions, which are based on the
amount of premiums you pay. Finally, be absolutely satisfied as to the reputation and financial
strength of the company you are dealing with, and that includes a Bank.

The main reason you take out a life insurance policy is to provide instant cash should accidental
or premature death occur. Your policy was taken out to provide your family with adequate funds
to tide them over while they readjust to the changed circumstances resulting from the death
of one of the breadwinners. Never forget that in today’s world, it usually takes the combined
incomes of two breadwinners to support a family and create wealth. The male in a family with
children, should his spouse die, usually has far less difficulty in finding another spouse to help
him support the family. The female on the other hand, finds it much more difficult, because few
males want to take on the responsibility of looking after children that are not their own. The
male therefore, should always carry the higher insurance.

This is the present custom, but in today’s society the wage gap between men and women is
rapidly narrowing and there are many families where the woman is the higher earner. In these
families, all the variables should be carefully analysed, such as, will the widow want to remarry

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should her husband pass away? Will she be able to afford the expense of having someone care
for the children while she is at work? Medical statistics show that women live longer than men.
The majority of men also marry women much younger than themselves. They do die sooner
than their wives leaving widows with many years of life ahead of them. Have the insurance
policies of husbands taken into account their wives longevity?

Many insurance agents will tell you to insure your life for five to seven times your yearly gross
income. This is not necessarily the best way to determine how much insurance you need. Sit
down with your financial planner and prepare a needs analysis. A needs analysis helps you to
determine how much the survivor will need to pay off all existing debt, including the mortgage.
For example, if there are minor children will they need full time day care? All these expenses, no
matter how small should be considered.

In the needs analysis worksheet, shown in Spreadsheet 1, I have allowed for all possible
expenses at death. I have calculated the amount of additional capital needed should one of the
spouses die. Should you decide to use a simpler plan to determine the amount of money your
family will need each year, list all possible yearly expenses, then multiply that total by twelve
and insure your life for that amount calculated. For example, if you have determined that
yearly expenses amount to $25,000, take out a policy for $300,000. This will allow a payout of
approximately 8% per year ($24,000) and leave most of the principal intact for retirement or
the children’s education. (Of course the 8% is subject to variation, so do verify and try and fix
the rate.)

In deciding what kind of life insurance you are going to buy, stay away from life long plans like
whole life, universal life, term-to-100 plans or any other participating plan. These permanent
insurance policies are really only suitable for estate planning once capital has been accumulated.
What you need to look for, is maximum coverage for the least payment... maximum coverage
when you need it most, when you are building wealth.

For most families, term insurance is the only option that makes any sense. It is cheap and
covers everything needed. It does not include an investment vehicle and it pays off only when
you die. You pay a set yearly premium for a specified period of time, from one to twenty years.
You can reduce the amount insured as you create wealth during your life time. A family starting
life could for example, begin with a 20 year term with a fixed yearly premium. The premium is
‘lost’ at the end of 20 years, which is why it is so low. For short term protection, you can take a
five-year term, but then you should establish renewal conditions beforehand. After five years,
you can either sign up for a further five year plan at a higher rate, or you can reduce your
insurance to get the same rate or even scrap your existing plan altogether and work out a new
one. This will depend on the value of the assets you have accumulated over the five years.

If you opt for a short term policy, make sure that the policy allows you to renew without an
additional medical examination. Look for a convertible Term-to-100 non-participating policy. You
could be told that if both you and your spouse buy policies, it is cheaper to buy them together. It
is cheaper, yes, but that could be because it is less flexible.

Finally, if you do not smoke, or attempt any high risk venture, look for a discount. For example,
if you are scuba diver, but only dive once a year when on holiday, you can arrange with your
insurance company, that when you are scuba diving, the policy is void. For the period of time
that you intend to scuba dive, you can take out a separate policy to cover the days you are
diving. The savings can be considerable.

By looking carefully at the premium you are paying on a policy, you can and should be able to
find the $20 savings every month.
From my book,
THE SENSIBLE APPROACH TO FINANCIAL FREEDOM

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Profit Blueprint from Selling
Options on Expiration Day
By Dan Gibby

Numerous strategies exist to profit in trading stocks, options, ETFs and other instruments.
Master Trader combines Technical Strategies (MTS) with option trading to teach investors and
traders how to generate income and wealth in the markets.

Our approach applies to any tradable instrument that be charted. That might sound odd to
you because of all the marketing that revolves around specific courses focused on Forex,
Commodities, Stocks or Equity Futures. The truth is that they all follow the same foundational
technical analysis concepts.

Master Trader Technical Strategies (MTS) shows supply and demand imbalances through
candlesticks and chart patterns, and we profit by trading around those high-probability setups.

All of our trade recommendations are based on how bullish or bearish we are on the price
patterns that we use on multiple time frames (MTF). We then choose either Income or
Directional Strategies to best match our bias and trading time frame used.

Sounds simple, doesn’t it? It is when you put the various parts of technical strategies and
options strategies in a systematic process or plan to follow. Our seminars teach others how to
do this for themselves and manage their own funds.

Buying Versus Selling Options

Buyers of call and put options pay money (premium) for the right to buy (call options) or sell
(put options) the underlying on or before the expiration date at an agreed upon price (strike
price).

The maximum loss is the amount they paid for the option and allows them to speculate in the
direction of the underlying at a much lower cost. They should profit if the underlying moves in
the intended direction, but it is not guaranteed. Let me explain.

Options are time depleting assets and decrease in value each day. Theta is the Greek that
measures the rate of decay based on time, and expires more rapidly into expiration. Thus,
option buyers can still lose money if the underlying moves in their favor, but not fast enough to
compensate for the loss in time decay. Because options are more expensive when volatility is
high, the value of the option will also change as volatility expands or contracts (measured by

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Vega).

Option sellers receive money for the obligation to buy or sell the underlying within a specified
time. As options sellers, we take the other side of the option buyer’s speculation (bet) based on
our interpretation of chart patterns.

Our option income strategies are designed to take the buyers’ money – literally - and get “Paid”
to determine price levels that will not be violated until Expiration!
For the educated trader, trades are based on a systematic process; for the uneducated, the
educated trader is awaiting to empty your pockets.

The Master Trader Method (MTM) combines specific chart patterns - that we have used for
decades -- and volatility analysis -- to sell short-term expiring options to generate income every
week. It’s a deadly accurate combination and strategy.

Below are various pictures of bullish patterns that we would consider selling bull put credit
spreads on depending on the overall pattern on MTF and the net credit received. This strategy
involves selling puts at a strike price at or below support and simultaneously buying further
OTM puts to limit maximum defined loss and also reduce the capital required to maintain the
position. The difference in amounts is the “net credit” received and represents the spread
seller’s maximum potential gain if the spread expires worthless.

Our Weekly Options Trader specializes in selling options and credit spreads around compelling
chart patterns like the above (bullish and bearish) which expire in 10 days or less. It is
designed to profit from the rapid time decay inherent in short-term expiring options.

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Some believe that the retail traders of short-term options have no edge because they have less
predictability over the control of a specific outcome. They provide research suggesting that it
is best to sell options with an expiration of around 45 days and that selling short-term options
provides no edge. We disagree as you will soon learn and dismiss any research to the contrary
since it is based on “mechanical trading” without reference to technical analysis.

Because of the ease of the strategy and statistical “edge” that exists in selling options around
compelling chart patterns, these trades are available in all market environments – trending,
choppy, or even a volatile mess.

It has been reported that over 85% of options expire worthless, particularly for the novice
casino’s “gamblers” who buy cheap options hoping to make a quick buck.

So, why not stack the odds of success on the side of the option seller, similar to the casino
operator or insurance company?

Master Trader agrees with industry-respected trading psychologist Dr. Alexander Elder, author of
Trading for a Living among others, who says “People buy Hope, so Price that Hope (and FEAR)
and then SELL it to them (at inflated prices)!”

This is why we love selling options – but use technical analysis (price pattern analysis) to give us
the confidence that a short-term bottom or top is at hand. When we are wrong, we either stop
out or use other adjusting strategies to manage the position with the charts.

At Master Trader, we teach how to intelligently buy options on directional trades by putting the
odds in your favor, but sells options using charts to generate monthly income through time
decay in any market environment because of the ease of finding and trading the setups.
This article will show you why selling options on expiration day using our methodology is
incredibly reliable and profitable. With the recent popularity of weekly options which expire
every Friday, this sets up many trade opportunities.

It allows you to generate income from selling options that expire in hours, profiting from rapid
time decay for merely calling a top or bottom on a stock or ETF for the current trading day!
Those novices who don’t believe in selling short-term options in fear of “gamma risk” (which
measures directional risk) don’t believe in, or understand, technical analysis -- so of course
gamma should be a concern to them!

Options traders who do not believe in charts are ignoring the most reliable measure of direction
– the trend of the underlying! MTS defines the trend and trend changes without all the esoteric
analysis tools like trend lines, Fibonacci, Elliot Wave, Ichimoku Cloud or the countless others.
Any trader who does not use technical analysis – which provides a directional bias -- will not
know how to intelligently manage trades going against them. Most simply roll the losing

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position (i.e., close it and reinitiate it further out in time at the same or different strike prices) to
postpone the loss, receive further credit for the roll because of the additional time premium, and
“hope” they can make back their loss through time decay.

However, without having a directional bias, that rolling strategy on stocks in strong trends will
inevitably lead to closing the trade at close to maximum loss. The MTM would dictate just
closing the trade at a small loss if the pattern setup failed or using some other option adjusting
strategy consistent with our bias of the stock at the time.

Option traders who just trade by the “Greeks” -- and are unable or unwilling to use technical
analysis in their trading because they think it is useless -- will find this information quite eye
opening.

Let’s look at an example using Tesla.

With a gap to Major Resistance and immediate selling, under the 30-Min. low we shorted the
out-of-the-money (OTM) $360/375 Bear Call Credit Spread for $.59/share, with a stop loss over
the day’s high. The option expired worthless into the afternoon like a melting ice cube as the
stock retraced. This would be $590 profit on a 10-lot with a breakeven at $360.59/share.
We make full profit if the stock expires within the breakeven point which is highly probable using
charts. We also make money from our directional bias in the chart, and from any volatility
contraction, allowing us to close the short option positions prior to expiration near full profit.
Think of it this way. If you were going to make a prediction as to where you will be the next few
days, weeks, or months, which would be the most accurate?

When selling options expiring the same day, those unknowns are reduced exponentially!

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Selling Expiring Options on Earnings, Gaps, News, and SPY
We particularly love selling options -- with the charts as always -- when volatility is spiked
because of news, earnings, selloffs, or other market/stock fear.

This is because when volatility rises, option premiums rise. Whether from a bearish selloff or a
bullish climactic run higher, we get paid much more for the options that we sell.

The SPDR S&P 500 ETF (SPY) has multiple expirations each week, giving us more profit potential
to use this strategy throughout the week! One of our favorite patterns is when we get a bullish
reversal on SPY after a multiple day selloff to support because premiums have been rising on the
selloff.
Here’s an example of SPY where it had 10 red candlesticks in a row -- and then it gapped up
from an ugly close at the low, which was on support and the rising 200-day moving average.

Next, we simply wait for a compelling intra-day setup. Notice on the 15-min. chart on the right
that after its bullish gap up, it retraced and at the low closed with a bullish Bottoming Tail (BT),
setting up a higher low.

Over the BT’s high, we shorted the OTM $259/249 Bull Put Credit Spread for $.45/share that
expired in a few hours. On a 10-lot, that would be $450 premium which would be full profit
provided SPY closed above the short $259 strike, which it did.
Here’s an example after AMZN’s huge earnings gap and bearish intra-day setup that expired
worthless. We shorted the OTM Bear Call Credit Spread as shown for $1.10/share, which
produced 12% return on capital (1.10/$8.90) for the days’ risk. With the far OTM $1900 short
strike, AMZN would have had to rally against us over $45 before hitting our breakeven!

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Checklist for Selling Options/Spreads on Expiration Day
Here is what we do each option expiration day in the Master Trader Green Trading Room to look
for these types of compelling setups. It is typically on Friday for most options, but also have
different days depending on the stock or ETF, plus multiple days each week on SPY.

• Scan your own Universe + Gaps/News/Earnings/High Implied Volatility/Index ETFs.


• If you get a compelling bullish setup, short OTM put options/spreads, stop under support.
• If you get a compelling bearish setup, short OTM call options/spreads, stop above resistance.
• Follow your Trading Plan for profit targets and trade management.
• Close into Expiration if you want to avoid any assignment risk (which still could happen even
if the stock expires OTM if the option holder gives the broker a timely exercise notice for
whatever reason, such as favorable post-market news).
• Be aware of extended trading hours beyond 4 pm ET where certain stocks and options are
still trading.

Conclusion
For those swing and day traders who use technical analysis to trade, selling options and spreads
on expiration day using the Master Trader Method (MTM) can generate reliable consistent
income. In fact, some traders specialize in this strategy and only trade on expiration day.
When you trade stock, you must be right on direction to profit. In selling OTM options around
compelling short-term turning points, you profit from the rapid decay of the option’s value into
expiration in just a few hours – and the stock can still go against you somewhat to make full
profit!

Not combining technical analysis with option trading is like driving an automobile blindfolded.
Similarly, being unwilling to sell short-term expiring options using the MTM out of fear of gamma

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(directional) risk naively eliminates huge
opportunity from your option trading strategy TradersWorld Magazine
toolbox. Good trading! Premium Subscription
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Dan Gibby, Chief Options Strategist at


MasterTrader.com, possess more than 25
years’ experience in equity and options trading,
with expertise in technical analysis, using
options to hedge and speculate, and portfolio/
asset management. He formed Master Trader
with Greg Capra to provide education to stock
and option traders as well as consult for money
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The Invisible Wall that Separates
You from Your Potential:
Establishing a Disciplined Impartial
Trading Psychology
By Rande Howell

“I see the potential, but I keep hitting an invisible wall. My


trading mind is in good shape one minute and then, out of nowhere,
a switch goes off. I don’t see it coming. That’s where I keep falling
apart – I even see it happening right in front of my eyes. It’s like I’m
a spectator and I am paralyzed from doing anything. My impartial
trading mind flies out the window, along with my trading rules. When
the dust settles and I can see clearly again, I see that I lost control
again. I keep trying to stay impartial, but I keep losing that battle.
It’s frustrating because I’m trying hard, and I’m so close. That invisible
wall is what keeps me stuck where I am as a trader. If I could get
past it, it would make all the difference in the world.”

Why Do You Keep Hitting a Psychological Wall Despite Your Best


Intentions?

Traders try hard, and then even harder, to achieve disciplined impartiality in their trading. This
is an emotional and psychological mindset where fear and eagerness to act are not present
in the trading psychology of the trader while he is in the act of live trading. To achieve this
mindset, traders try to develop nerves of steel where emotion (in theory) is not allowed in the
mind and where their trading mind has the patience of an ambush predator. They become
emotionally tough. Yet the harder the trader tries to achieve this elusive mindset, the invisible
wall is still there thwarting their best efforts. Emotions still break through into the mind of the
trader. The disciplined impartiality that the trader is trying to achieve falls apart when the mind
is hijacked by emotion. Defeat is snatched from the jaws of victory again, again, and again.

This scenario is played out every day by nearly every trader who has not learned how to develop
his emotional nature and psychology specifically for trading. What understanding, knowledge,
and skill is missing in the vast majority of traders that keeps them stuck at “the Wall” despite
their motivation to win and become a consistently profitable trader? The answer starts with
the lack of awareness of how the brain operates when stressed and the quality of mind that
emerges from that brain challenged by the uncertainty and risk that the brain experiences. This
is huge. This scenario is played out every day by nearly every trader who has not learned how to

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develop
his emotional nature and psychology specifically for trading. What understanding, knowledge,
and skill is missing in the vast majority of traders that keeps them stuck at “the Wall” despite
their motivation to win and become a consistently profitable trader? The answer starts with
the lack of awareness of how the brain operates when stressed and the quality of mind that
emerges from that brain challenged by the uncertainty and risk that the brain experiences. This
is huge. What you do not know about the brain and mind experiencing the stress of trading will
hurt you. Just check your trading account for confirmation. That blindness to understanding the
relationship between the brain and mind is at the core of why you keep hitting “the Wall” in your
trading.

It’s not about trying harder. Plenty of traders have already proven that trying harder, by itself, is
not going to work. If trying hard and being persistent were the answer, traders would be awash
in money – but they are not. What is required is waking up to a very different world. Probably
the hardest task a trader will ever do is to have the epiphany that the brain and the mind are
one unit. The mind that you bring to trading emerges from the brain. It is not separate. Rather,
the mind is part of the potential of the human brain - AND THAT POTENTIAL IS SHAPED BY
EMOTIONAL LEARNING. Every time you have expectations of what will happen in a trade, you
are experiencing the historical emotional learning that shapes the engaging mind. Every time
you experience fear, you are in a limbic memory that swallows the moment in which you live.
Every time you feel the urge to act impulsively (you guessed it), you are experiencing a limbic
memory and learning that creates the mind with which you engage uncertainty and risk. Every
time, no exceptions.

There is no mind “out there” that is separate from the biology of the brain and, in particular, the
survival instincts of the limbic system (the emotional brain) of the adaptive organ called your
brain. If you are listening carefully to what I am saying here, you hopefully are waking up to a
very different way of understanding your trading psychology. In this new way of understanding,
your biology, your brain, your emotions, your perception, and your thinking (acting as one unit)
are all interconnected every time you look at a chart and make a trading decision. And your
brain has a different agenda than you (as long as you are in misalignment with survival purpose)
which, for the struggling or stuck trader, occurs most of the time you are risking capital with an
uncertain outcome.

Go back and carefully read the vignette in the beginning about the trader hitting his Invisible
Wall WITH THIS NEW UNDERSTANDING OF THE INTERCONNECTION BETWEEN BIOLOGY, BRAIN,
EMOTION, AND MIND. The trader is thinking that the problem in his trading is in his mind.
But the mind is a creation of the brain with a heavy dose of the limbic system (aka emotion)
influencing the perception of his mind. He never saw the emotional hijacking coming because
he did not have the eyes to see the profound influence that the emotional brain (limbic system)
has on what he “sees”, much less on what he is instinctively reacts to. The limbic system sees
threat to life in any uncertainty while the thinking brain (seeing through the eyes of logic) sees

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opportunity in uncertainty. And what he does not know about his emotional brain is, in fact,
hurting his capacity to become the trader he could be. How about you?

The Impact of the Agenda of the Emotional Brain on Your Trading

First, you do not have a brain – your brain has you. “You” are not separate from the brain; “you”
are a creation of your brain. And what exactly is this brain doing while you trade? In essence,
it is headquarters for adapting you to survive in the world to which you are born and live. It
literally creates a virtual representation of the world (of reality) based on its default biases,
emotional learning, and experience.

You do not see, then believe. Instead you believe, then see your perception of reality from those
beliefs. This is a critical distinction. So you are never seeing and experiencing the reality you
believe you see. Instead, you perceive a story that the brain has made up that explains all the
“stuff” going on in your world. That is exactly what your rationalizing thinking brain does – it
creates stories or narratives that make sense of the world in which you live. The question is not
whether that story is true or not. The question for you is whether this invented story is effective
at extracting capital from the markets or not.

The prime directive of the brain (and in particular the emotional brain) is to produce a story line
that allows you to survive in the short term at all costs. It has no interest in long term benefit.
For the emotional brain evolved in a time and place where staying alive was a big challenge.
The world of our caveman ancestors was a dangerous place and there was no such thing as
psychological discomfort. All threat was a threat to biological existence. The thinking brain that
pondered future possibilities did not develop until much later. Everything was focused on short
term survival. Therefore the brain adapted our ancestors for short term survival in the face of
biological threat and this developed into our default programming. Out of this prime directive
came the fight/flight response to threat. This bias is alive and well in your trading performances
today – lurking behind the radar of your thinking mind.

You experience this very successful adaption for short term survival (but not for trading) every
time your fear holds you back from entering a trade (“what if I lose?”) or exiting (“it may turn
around and save me from losing”) trades. You also experience the emotional brain’s survival
instincts taking over the rational thinking brain every time you jump into trades (urgency to
chase prey) or revenge trade (beat the danger of loss into submission). The problem is that
the lions, tigers, and bears that the super-fast, short term survival emotional brain was built
to protect us from no longer exist in the modern world (or in the trading world). This is the
problem that has to be solved for you to get past the invisible wall that holds you back in
trading. Your emotional brain thinks you are back in a dangerous world and it is far more power
than the light-weight thinking brain you ask to trade under the pressure of uncertainty.

But that is not all. Your brain is also built to control outcome, predict outcome, and to be right.

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And it hates, hates, hates uncertainty. It will do anything to avoid the perception of uncertainty
and its link to vulnerability (there is that threat stuff again) and the fight/flight response. If
you set out to find the very worst scenario to expose the emotional brain to (with all its biases
built around short term survival instincts), you could not have created a tougher situation to
expose your brain to than in trading. In trading, you have no control over outcome. That is a
scary predicament for the emotional brain. And successful traders have to give up the illusion
of control to bridge the gap between inconsistency and consistent profitability. Your emotional
brain, your caveman brain, may have done a great job until it got to trading. Now its strengths
become your weaknesses as a trader. That has to change if you are going to move to the next
level as a trader.

Developing Your Potential as a Trader

You have now heard the bad news. But there is good news if you have the internal courage and
fortitude to redesign the brain and mind that trades. It is not magic. It is done through coming
to a very new understanding of the way brain, emotion, and mind work together. It requires
learning how to regulate emotions before they take over your mind. It also requires that the
emotional learning of your limbic system be updated from its default programming (that is what
you brought to your trading performance) into a brain and mind that is trained to operate in an
environment of uncertainty (with associated risk) from a mind rooted in disciplined impartiality.
If it were easy to do, everybody would be doing it and there would be many more successful
traders than there are. The vast majority of traders will chase trading success blindly, never
understanding the world they have stumbled upon. The skills needed are emotional regulation,
mindfulness, mastering your fears, and developing aspects of your brain and mind that remain
untapped. These are not present from most traders, except for the courageous few who are
willing to face their fears – and master them rather than conquer them. And those traders
are willing to step out of their comfort zones and intentionally change the way they engage
uncertainty.

Instead of trying to control the outcome of external events, they recognize that real power is
nurtured by mastering the self that engages uncertainty – the very thing that your emotional
brain does not want to do. Until you realize the power of the emotional brain over the thinking
brain, the invisible wall will hold back your greatest efforts. You have to work the emotional
brain in order to create the thinking required to manage uncertainty. That emotional brain has
to become comfortable with uncertainty and not knowing. This is where you realize that you
never had control over outcome. But you do control the mind that you bring to the management
of uncertainty. It is the psychological edge you develop by mastering your emotional brain that
runs the thinking brain’s perception. This is the key to the door in the invisible wall.

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www.OddsTraderApps.com

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After the Trade is Made
By George Krum

In the last issue of TradersWorld we updated our targets for USDCHF, GBPUSD and AUDUSD and,
once again, we can report that all targets have been met. This adds to the long list of price and
time targets that we have accurately forecasted on these pages since the beginning of ’18.
Therefore, in this article, we will focus on a few innovative tools for managing trades. Or, in
other words, what do you do from a technical point of view after you have identified the trend,
assessed the risk profile of the trade being considered, determined price and time targets, and
finally pulled the trigger.

One quick answer is to do nothing and simply wait to reach your target and book your profits.
Unfortunately, markets rarely move from one point to another in a straight line. One must
always be prepared to adapt to changing market conditions, to decide whether to book profits or
let them run, and most importantly, to avoid losses.

We offer several trade management tools to facilitate your preparation and analysis, many of
which have been briefly mentioned before, but here we’ll focus on just four of them: CIT Angles,
CIT Waves, CIT Cloud and CIT Pivot.

There are two types of angles that can be of tremendous help in managing trades.
We’ll start first with the DIY (do it yourself) angles. Once you have zeroed in on a price target
zone you can draw these angles from recent pivot points, connecting recent swing highs or lows
with the target price. This way you create your own bullish or bearish target angles, which can
easily be adjusted upwards or downwards as price and time progress.

The attached chart of USDCHF (Chart 1) summarizes this technique.

Chart 1

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NOTE: this is a 4h USDCHF chart, and the yellow rectangles represent the weekly target zones
as determined by CIT Channels (our weekly forecasts for the SPX, Gold, Oil and G6 currency
pairs can be followed here).

The second type are the automatic CIT Angles. CIT Angles solve the age old problem of finding
the correct rise (step) for a given price level, adjusted for volatility. The 1 x 1 angle shows where
price and time are in balance, thus telling you at a glance whether price is in a strong or weak
position.

The advantage of angles over other indicators is that with a properly drawn angle one can
immediately tell what the expected price target and range is for a given future time period,
whether a price swing is likely to continue or about to end, and (if there is already a trend in
place) whether the trend is strong or weakening. Another advantage of angles over trendlines
is that angels are drawn from only one point (a swing high or low, or any other point of your
choosing), while trendlines require at least two. In practice, once the trade is initiated and the
angles are drawn you will always know whether your trade is moving in the right or wrong
direction and whether a change in trend has occurred (Chart 2).

Chart 2
Another option, made possible by CIT Angles, is to apply a SAR (stop-and-reverse) line. This
color coded line tracks the interaction between price and angles and gives instant buy, sell or
hold readings (Chart 3):

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Chart 3
Besides angles, the other two trade management indicators which we’ll discuss are CIT Waves
and CIT Cloud.

The CIT Cloud is another color coded indicator which displays the trend and changes color when
a change in trend is detected. Similar to angles, you want price to be moving above the cloud
(for bullish targets), or below it (for bearish targets). Once a change in trend is underway, the
CIT Cloud will change color in the following sequence: green-yellow-red, or red-yellow-green
(Chart 4)

Chart 4

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Closely related to the CIT Cloud is the CIT Pivot Line, which is also color coded for user
convenience. As with the Cloud, you want to be trading in the direction of the Pivot line, long
above it and short below (Chart 5):

Chart 5
And the last indicator to include in this discussion is CIT Waves. Although the CIT Waves are
displayed below the chart panel, they provide invaluable clues about the trend, the direction of
the swing you’re trading, and it’s nature – corrective or impulsive, directional or not.
Rather than being based on wishful thinking, subjective interpretation, or predetermined count
quota and nomenclature, CIT Waves are grounded in strict rules and simple principles which can
be summarized as follows: in an uptrend, bullish waves (swings) should last longer and gain
more points than bearish counter-trend waves/swings. The opposite is true for bearish waves /
swings. As long as the length of directional swings is longer than the length of counter-trend
swings, a directional wave is in progress. This abstract notion is best illustrated by the two
charts below (Chart 6 and 7)

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Chart 6 & 7
Despite all the news noise constantly bombarding the market, the corrective/counter-trend
swings/waves never exceeded the duration of the preceding bullish waves/swings and, therefore,
the top swing indicator never changed color. As an added bonus, you can use the CIT Waves as
an unbiased guide to help you identify and label your own wave counts (if wave counting is what
excites you). Please be aware that the numbers on the wave chart are not part of a wave count,
but reflect the number of bars between successive swings.

The bottom line is that when you encounter a trend like this, it’s better to take trades only in the
direction of the trend; indiscriminate news-inspired betting on trend reversal is not a profitable

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strategy. This can be illustrated by a simple price wave, which clearly demonstrates that the gain
from countertrend/bearish swings is far less than that from bullish swings (Chart 8):

Chart 8

In summary, entering a trade and hoping for the best is not a winning strategy. It is important
to have at one’s disposal tools that help manage open trades, and the indicators discussed above
provide you with several different approaches to do so effectively.

For more information about our technical indicators please visit CIT for TradingView and NinjaTrader 8

PS The publication of TradersWorld 71 couldn’t have


been timed more perfectly, as all the tools mentioned in
this article would have positioned you correctly for the
10.10.18 sell-off, or would have provided you with the
tools to avoid it, or to cut your losses.

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ANOTHER SHADOW EXPERIENCE
by Al McWhirr
www.EminiScalp.Com

In this article, I would like to talk about our EminiScalp Shadow Auto Trade Strategy in a bit
more detail and show a day of trading the CL. I previously mentioned our EminiScalp Shadow
Auto Trade Strategy in issue #69 of TRADERSWORLD Magazine.

For this article, we chose the morning of August 29, 2018. There was no specific reason for
this particular day other than it may be considered a typical trading day. Please allow me clear
up any misconceptions about “typical trading days”. The following represents my personal
observations and opinions. On a typical trading day, there are usually stops as well as successful
trades. The number of stops and profitable trades can vary each day, but the goal, no matter
how many stops a trader may experience, is to hopefully end the session with profit.

I am a proponent of auto trading for a variety of reasons. Manual trading requires constant
visual attraction to the screen looking for set ups. Once there is a set up, then there is the
entry, usually a very emotional action. Once in the trade, then the wait until either the stop or
target is hit. Duplicate this action a number of times during the day, and the trader could end
up being an emotional and physical wreck. Having your eyes glued to the screen looking for a
set up is draining. Once the trader spots the set up, then the brain goes into overdrive making
sure that this is, in fact, a verified set up as per whatever rules you trade by. Now the entry. If
there is hesitation and you execute late, the entry may end up being a few ticks from where it
should have been and this may reduce any possible profit.

In the early days of my trading, I was excited about having my eyes glued to the screen
watching the charts and watching price move. Over time though, I actually dreaded watching
and waiting. I have no interest in what causes prices to move, as long as it does move. When a
setup occurs, according to my rules, I act. Since I am a scalper, and my primary goal is to take
quick profits, there is no real need for me to know the technicalities of the market I am trading.
As long as the price moves, there is a possibility of profit. Attempting to outsmart all those
entities that make the price move is fruitless, at least in my opinion. There is not much chance
that a day trader will know something that the investment houses and banks don’t. So instead
of guessing where price may go, I wait for a price entry setup as per my trading rules.

With the stop and target already set, I just let the market do what it does. The goal of trading is
profit and this goal can only be achieved when all the necessary parts are working together. First
and foremost are the emotions. When emotions get out of control the trading experience may
suffer and this can result in erratic entries and exits. The trade management is a very important
element of success and I will discuss this shortly. Of course, the trading method or strategy is a
major component to trading success as long as the previous factors are considered.

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Trading Management

I mentioned previously that the trade management is a very important key to trading success.
When a manual trade is entered, there are those traders who have a difficult time in controlling
their emotions and as such, may exit a trade early. They may not wait to see if the price reaches
the target. If price goes against them, the emotions kick in and they may exit the trade and not
follow their trade management. This is why I prefer auto strategies as most of the emotions of
entering and exiting are not a factor. I say most because some traders still may manually exit a
trade before it is completed.

In regard to the ratio between stops and targets, well, there is no ratio, as far as I am
concerned. Determining a stop price is dependent, in my opinion, on a number of aspects.
One facet to be considered is the market and the other is the way the price trades within that
market. Please let me make it clear that I am a day trader and a scalper. Just like many
traders, I want to enter a trade and I want out of the trade, preferably with a profit, as soon as
possible. In any case, for me to achieve this goal, my stops and targets may differ, depending
on the market I am trading. I have determined this by watching the market. I have always said
that screen time is crucial. It will not only tell you where the possible targets are, but it may also
make you aware of stop areas once you have determined a set up and entry area.

Below, I have included a number of screen shots illustrating a morning of trading the CL on
August 29, 2018. The images will help me explain my rational regarding stops and targets.
Firstly, as mentioned, I don’t see any “ratio” between stops and targets. Stops and targets, in
most cases, are dependent on your individual risk tolerance, as well as the method or strategy
you may be using along with the market you are trading. As a hypothetical example, let’s say
you are trading the NQ. Watching and studying your charts over a period of time, you have
observed that when your method initiates an entry, if the price does not move in a positive
direction from the entry, it usually will go against the entry price up to 10 ticks before it reverses
and moves in your direction. If your profit target is 6 ticks and your normal stop is 6 ticks, then
you may be getting stopped all too often. Since this is the only method you are using, what do
you do? I would say that you may have to increase your risk, not your target. If your emotions
can withstand the price going against you more often than you would normally like, it may
result, in the long run, in more successful trades. In this case, the ratio rule of stops and targets
is not a factor. The market movement and conditions are a factor. Traders move the price and
traders are creatures of habit, because they are people. So, in my opinion, there is quite a bit of
repetition in the markets and this should be taken advantage of. One approach to overcoming
the need to close out the trade if the price goes against you, is to consider an auto trade
strategy. An auto trade strategy, once set up, searches for entries, enters when the conditions
are met, and closes out the trade.

I will briefly elaborate on our EminiScalp Shadow auto trade strategy after we take a look at our
trading morning of August 29, 2018.

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FIGURE A
The Shadow is set to go at 9:30 AM east and our first trade takes place just after 9:49 AM,
shown in Figure A. I am sure that many traders may say that there were setups from the open
up to our first entry. Maybe so, but our strategy is engineered to enter trades when a number
of conditions are met, and these conditions are consistent at all times. Some methods and
strategies may notice possible entries where our EminiScalp Shadow does not care to enter, but
our strategy does what it is suppose to do and that is all that matters.

Anyway, the first entry , #1 was at 9:49. Although the price went to 69.03 or so, the profit
target was set to take 5 ticks. We are scalpers and even though we might believe that there
may be more profit to consider, we also realize that there usually many more trades during the
session. The strategy attempts to close out at a profit as soon as possible, and then wait for the
next entry.

Entry #2, which took place at 9:54 with an entry of 69.11, was also successful. Entry #3 at
10:08 at 69.02, resulted in a stop. We have our stop at 8 ticks and our target at 5 ticks. Many
may believe this is not a feasible ratio, but being familiar with how the CL trades, using the
150 tick chart, we have determined that this management serves our needs. So, trading 2 CL
contracts, trades #1 and #2 showed a profit of $200. Entry #3 had a loss of $160.00. We are
not finished yet, so let’s move on.

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FIGURE B
Figure B above shows the time period of about 10:30 to about 10:36. During this time period
we had entries #4 and #5, both resulting in profits. So far, out of 5 entries, with the target set
at 5 ticks and the stop at 8 ticks, there should be a profit of $240.00. That would be 4 trades
at $100.00 per trade, and 1 trade loss of $160.00. For many traders, their trading day may be
completed. After all, why risk losing when there is a profit. But, let us move on.

FIGURE C
Figure C above shows the time period between 10:39 and 10:45. The EminiScalp Shadow
had an entry at 10:41 for another possible $100.00 gain. So far the SHADOW Strategy is up
$340.00.

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FIGURE D
In Figure D above, shown from 10:49 to about 11:08, the SHADOW has two long entries
resulting in a possible profit of $200.00, $100.00 for each long entry. So far we have SHADOW
entries showing hypothetical profits of $540.00. (Yawn), sorry. Our morning is coming to a
close, so let us look at the final screen shot.

FIGURE E
Figure E above shows the time period between 11:29 and about 12:10. Here, we have 2
SHADOW entries, but only one is active. Entry #9 is the active entry. We have to wait until
it is completed before any other trades can take place. If there is an active SHADOW entry,
other SHADOW entries areas will appear, but there will not be another entry until all previous

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SHADOW entries are completed. In this case, #9 at 69.31 was still active when #10 appeared,
so no other entry. Entry #9 was a success, resulting in a $100.00 gain, making the morning total
of $640.00. So even though there was a stop, the results of SHADOW entries for the morning
were positive.

Let me stress a few points as you read this article and view the screen shots. I use the word
“hypothetical” because that is what I need to do legally. Please refer to our EminiScalp.com
disclaimer on our website. Also, I only displayed the SHADOW for the morning of August 29,
2018, but there were still entries in the afternoon. Realizing your monetary goal before the
trading day is complete is just great.

When there is an EminiScalp Shadow entry, the entry price is printed on the chart. Our trade
management set on the DOM is a 5 tick profit and 8 tick stop. Observing the way the CL price
moves and taking into account other related factors, this management works well. There may
be certain times that I may increase my target, but the stop is usually set at 8 ticks. If I want
more profit, I can add another contract or two, as this is less stressful that hoping price moves
further. Also, there are other markets to trade as well. Trading the NQ, YM and CL make up a
nice team for me.

Personally, I prefer trading with my auto strategy. There is a lot of: “if this, then that” as
well as many other rules of logic built into the algorithm of our EminiScalp Shadow Auto Trade
Strategy. I attempted to create it with the way I think and perceive the market and it works
well for me. You may ask why a SHADOW entry may appear, as in Figure D, and not take the
entry. I have designed the SHADOW to allow active trades to complete before another SHADOW
entry can be taken. For example, trade #9 took place at around 11:46. But, if you did not begin
trading until 11:50, you would have missed this entry. If this is the case, and if the SHADOW
was active at 11:50, when you began your trading day, the SHADOW entry at about 11:52
would have been active for you. The strategy can be set where there will be trades every time
the SHADOW determines an entry, but I don’t see the need for that. Personally, I would rather
complete the trade I am currently in before I enter another.

The EminiScalp Shadow has some other fine qualities as well. If you take a look at the indicator
strip at the top of the NinjaTrader chart, you will see a green button that says “DisableShadow’.
When the button is green, the SHADOW is active and ready for trading. If this button is clicked,
it will turn red and this disables the auto trade, BUT, the entry price will still appear. This is great
if you want to watch the chart live and see the entry areas, but not take any live trades.
There is also a yellow “Close” button as well. By clicking this button, an active SHADOW trade
will be closed out if the stop or target are not hit prior. From experience, you may see something
on the chart you don’t like and as such, the close button takes you out of the trade.

The SHADOW also has the capability of turning itself off and on at specific times of the day. If
you prefer no entries at news times, such as 10:00 AM on some days, you can set the SHADOW

WWW.TRADERSWORLD.COM October/November/December 2018 108


to turn off at 9:55 and back on at 10:05, or
any time you chose. If turned off, the entry TradersWorld Magazine
areas will still display, although there will Premium Subscription
be no entries during this time. You are able
Get everything we have for only $19.95 per year
start and stop the strategy up to six times
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simultaneously during the trading day, as well
as set your specific start time and end time for
the EminiScalp Shadow Auto Trade Strategy.

As with all of our methods and strategies, Our


EminiScalp Shadow Auto Trade Strategy is only
compatible with NinjaTrader 7.

Hopefully this article sheds some light on the


auto trade experience. Thanks very much for
reading my article. QUARTERLY MAGAZINE SUBSCRIPTION
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WWW.TRADERSWORLD.COM October/November/December 2018 109


Trade What You
See,
Not What You
Feel
By Damon Pavlatos

Today’s traders are faced with information overload. Whether you’re a fundamental trader who
monitors real-time news feeds from multiple sources or you’re a technical trader who relies on
an array of indicators, oscillators and algorithmic displays on multiple charts to help make your
trading decisions. Simply put, it’s not easy.

While the execution software, connectivity, educational and advisory choices can be
overwhelming, the playing field for today’s traders is nearly level and far fairer than the days
before the markets became electronic. Traders can currently execute their trades electronically
in milliseconds from a desk at home and can immediately see the fills instead of blindly taking
minutes or hours like the days when the exchange floors were their only choice.

From my first day on the exchange floor, way back in 1977, I immersed myself with any
information I could find on trading. My interest in technical analysis came from a trader whom
I met on the floor after a few months on the job. It was his research and diligence that peaked
my interest, so I asked him to teach me how to chart. Fortunately, he was gracious enough to
show me his technique using William Delbert Gann, Edwards and Magee and other miscellaneous
strategies. I quickly came to appreciate the value of his work.

Using the charting and trading knowledge I acquired from the experienced traders on the floor I
was able to parlay that and purchase a seat on the Mid America Exchange as a member trader
in 1979. The Mid Am exchange was a secondary exchange that followed the CME and CBOT.
The products and technology were archaic compared to the exchanges today. The quotes were
written on a chalk board and the pits were small with no liquidity. After a few years I realized
trading wasn’t so easy and I needed more capital to trade with and ultimately returned to
the CME where I continued to grow my knowledge base and expand my experiences working
alongside some of the best traders in the industry.

Shortly after returning to the CME I started offering my own charting service and I began
providing my market analysis services to Member traders and firms. By 1986 I was executing

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orders for large institutional traders and hedge funds in the S&P pit. I learned so much from my
time on the Exchange floors and with successful traders that I was able to lease my first CME
seat and trade for myself in the S&P pit in 1987. However, just my luck, I started 2 months
before the crash of 1987 but was able to weather the storm successfully and continued trading
as a member.

Suffice it to say, I’ve learned much in my 41 years in the Futures Industry and nothing more
important than this: Volume is King. I spent 23 years on the Chicago Mercantile Exchange
(CME) floor and 18 years off the floor trading electronically and managing my firm, Future
Path Trading. While I’m very fortunate to have both experiences on and off the floor, Volume
has proven to transcend all industry trends, changes and paradigm shifts and remains most
pertinent today.

So the question for me now is this: What can I pass on to you from the knowledge I received
from the floor and what information can I share from my own trading and market experiences
that can help make a meaningful impact on the quality of your trading?

Conceptually speaking, the overall idea of trading has not changed. I’m sure you may have
heard the description that the market place is a live auction. Well it is…however it’s a live “two-
sided” auction. In the mid 1980’s Peter Steidlmayer, who was the founder of Market Profile,
described the market basically as an auction process. But back then there was no way to display
volume or any trading data real-time, so Peter used the 30-minute time brackets provided by
the exchanges (A-Z) and repurposed them to better identify areas of high and low activity. Floor
Traders originally used these lettered brackets for marking the time on their trading cards to
indicate when the trade took place. The 30-minute brackets were broken up into letters. For
Example: Bracket (A) stood for 7:00-7:30 and (B) stood for 7:30 to 8:00. When a trade was
made at a new price for the first time this letter would be placed on a vertical graph at the price
that correlated with the time bracket displayed by the exchange. This would begin to build out a
bell type of profile curve.

The idea was to more easily identify the areas of support and resistance, the most traded areas
and the highest and lowest concentrations where price overlapped. The main idea was to
better identify how the market treated new highs and lows as well as identifying what type of
market we’re dealing with. Using volume-based price behavior theories to understand the type
of market you’re dealing with is, in my opinion, critically important towards how to trade it and
what system to use.

On the floor, if there were no institutions or large players trading the markets and there was
low volume at the tops and bottoms of the day with price consistently returning to the middle of
the range, it would have been a sell rallies and buy dips type of day. Tops and bottoms would
look like spikes on a bar chart or single prints on a market profile chart. This type of action was
signifying there was no interest at those prices and is sometimes referred to as a failed auction.

WWW.TRADERSWORLD.COM October/November/December 2018 111


Typically, you would not use a volatility breakout system with these types of conditions. Traders
on the floor would wait to see when a new high was made and watched if increased volume
came in from the bigger or longer time frame buyers. If there was very little volume at the top,
they would fade the market by selling into it. The reverse would happen if the bigger funds
and players began to buy on a new high this would confirm a continuation of the move in that
direction.

Markets are always searching for a fair price and it’s a trader’s job to identify what type of
trading day they’re dealing with and who has control. Either you have the longer time frame
traders (hedge funds, institution traders, algorithmic systems) or you have the short time frame
traders (small retail, member traders and market making programs). The Market Profile concept
is one that can help you identify which one is in control.

See example #1. is showing the market using the original style Market Profile and Volume
profiles both ways. This day was a typical slow day controlled by shorter term traders.

On the floor of the exchange, before electronic markets were available, there was very little
of an edge if you were not an exchange member. The advantages and edge that an exchange

WWW.TRADERSWORLD.COM October/November/December 2018 112


member pit trader had was significant. Pit traders could see the volume coming into the pit. By
the time a trader off the floor could react the market had already begun to move.

As I stated earlier, Volume is King and it’s one of the most important indicators that I use
to confirm breakouts. In my opinion it is the only real-time technical indicator that does not
lag. Now to be clear, this has changed since the early days before electronic trading. Before
electronic trading was introduced, volume was estimated on the floor of the exchange and it was
incorrect since they used a 3-day average. However today, volume does confirm breakouts from
chart patterns in the manner of traditional technical analysis.
Since volume is reported to most trading front-ends in real-time, decisions can be made in
milliseconds and predictions can be more accurate.

Note: that if the day has light volume, there are low odds that any afternoon move will be able
to sustain itself. Light volume days tend to trade sideways. On large volume days if a trend day
is forming you can expect a continuation in the direction of the trend.

Through my career as a floor broker I was privileged to have executed trades for some amazing
traders such as Paul Tudor Jones, Louis Bacon, Monroe Trout, Toby Crabel, Linda Raschke (who
is my wife now) and many large index and hedge funds. The exposure and experiences gained
from these traders has helped me understand the markets better. By executing orders for
these truly brilliant hard-working visionaries I was able to formulate and then refine my own
key decision-making philosophies. I benefitted so much from my time on the Exchange floors
and with these successful traders that not only was I was able to own three seats and lease two
more but was also able to start my own electronic trading firm, FuturePath Trading. There I
was able to transfer and develop some of the best components of these methodologies to the
electronic trading screens via our PhotonTrader order entry software.

I developed PhotonTrader to deliver what I believe to be a crucial set of tools for today’s
trader. From order entry to speed of execution and the ability to identify trade flow in multiple
ways.

First, Volume candles help identify how much volume is occurring during a breakout or validating
a trend by visualizing the change in the volume in the direction of the trend. These volume
candles widen the bar as volume increases. It is far easier to see volume this way verses
volume displayed on the bottom of the chart.

WWW.TRADERSWORLD.COM October/November/December 2018 113


This is an example 2. below displays PhotonTrader using Photon volume candles on a
5-minute NQ chart. Increased volume in the direction of the trend is confirming the up move.

Second, non-volume based, indicators can be helpful only if you combine them with volume. My
experience from the floor reminds me that volume still confirms breakouts and can still be very
effective at validating buy and sell signals. However, be warned, I feel using a regular market
depth to try to read order flow is dangerous. Market Maker systems and algorithmic systems are
always playing games with the bids and offers.

In my opinion, you’re better off looking at a time and sales feature showing what is really trading
(fills) and if it’s traded on the bid or the offer. Below you will see the PhotonTrader Market Depth
feature displaying on the left half as a traditional market depth. Only the first bid and offer
displaying volume is important. The right half is a time and sales feature that will show you the
size of the trades filled and if the trade was executed on the bid or the offer.
This feature also allows you to filter the minimum size trade you want to see. This is most
effective if used at key periods such as tests of highs and lows as well as confirmation of support
and resistance levels.

WWW.TRADERSWORLD.COM October/November/December 2018 114


Example 3. Shows the PhotonTrader Market Depth feature

Remember there is no system that is 100% right, these tools are meant to be helpful and
not meant to be a guarantee for success. Every trader should find a platform, indicators and
methodology that’s the right fit for the style and time frame they are comfortable to trade in.

Early on, in the beginning of this article, I mentioned that we are overloaded with information.
Keep it simple and try not to over think the markets. I hope you received some helpful pointers
from my article. If you have any questions on the information contained within this article, my
software or trading in general please feel free to contact me. Phone: 312-907-1112 or email me
at Damon@photonservices.net

Also, be sure to follow me on Twitter @DamonPavlatos for my market perspectives

Risk Disclosure: Futures’ trading contains substantial risk and is not for every investor. Risk
capital used to trade Futures is money that can be lost without jeopardizing one’s financial
security. The contents of this article that Damon Pavlatos has provided, displayed or conveyed
in this article is not intended to guarantee success or positive results using this material
and information. Damon Pavlatos is not responsible for the accuracy of this material in this
presentation and it is only the opinion and trading strategies used or acquired by Damon
Pavlatos. This may be considered a solicitation for business. There are no claims or use of trade
history or P&L from past performances used in this webinar.

WWW.TRADERSWORLD.COM October/November/December 2018 115


Using Market Phases To Catch
Big Swings In Any
Market Condition
By: Michele ‘Mish’ Schneider Director of Trading
Education and Research for MarketGauge.com

In today’s trading world, with the plethora of social media, have you wondered which talking
heads, analysts and so-called experts to follow? Can you sift through and choose from the
onslaught of investing recommendations? And if so, do you have a trading plan that gives you a
specific and repeatable strategy to help you control risk and maximize profits?

Having spent twelve years as an independent commodities floor trader in New York, I learned
many invaluable lessons. Perhaps the number one lesson was on following trends and
momentum trading. Although at the time floor traders relied little on charts and more on order
flow, old-fashioned high frequency trading, and trend chasing, I was an exception. I kept hand-
drawn point and figure and bar charts. I was the “go-to” chartist for many of the top traders.
From my years on the floor, over the last 20+ years, we have adapted to electronic trading by
charting and following 6 market phases.

The beauty of following phases is two-fold. First, we advise that new investors who seek an
education become an expert in one thing. Secondly, becoming an expert in phases as the “one’

WWW.TRADERSWORLD.COM October/November/December 2018 116


thing is easy and not time consuming.

Phases act as a navigation system. At any given time, all instruments are in one of these six
phases. The key is to identify the phase, and then, intelligently employ a trading strategy based
on the phase.

Each phase evokes an emotion. It is important to understand the overall mood of investors and
how that impacts price and the phases.

Beginning with the top of the wheel, the Bullish phase corresponds with euphoria. After all,
who doesn’t love a market rally? However, human nature tends towards pessimism as much as
it survives on hope. The Caution phase represents anxiety that investors feel once the market
or an instrument runs out of steam. Sometimes, that Caution will abate and bring the phase
back to Bullish. Other times, the anxiety spreads, hence the Distribution Phase, or the phase
of fear. Quite literally, money redistributes from a particular instrument to cash, or some other
instrument. From there, should things go from bad to worse, the Bearish Phase evokes despair.
We humans are genetically programmed to fail. Yet, the worst-case scenarios often bring out
the best of us as well. Therefore, after a Bearish phase, hope eventually returns. Thus, the
Recuperation phase. Incidentally, that is my favorite phase. It is also the phase when you
see “smart” institutional money return. From hope, should everything remain stable, comes
optimism or the Accumulation phase. The opposite of the Distribution phase, cash returns to the
market or instrument. Finally, should the optimism become contagious, we return to a Bullish
phase.

How to Determine the Phase


Moving averages are lagging indicators in that they average past prices. Moving averages are
useful for identifying the direction of a phase and for calculating support and resistance levels of
price. The longer the timeframe of the moving average, the more it filters out the “noise.”
Simple moving averages (SMA) are calculated by adding the closing prices over X period of
time, and then dividing it by X. For example, a 5-day moving average adds up the closing prices
of the last 5 days of activity, then divides it by 5 to get an average. As the days move forward,
the last day drops and the new day replaces it. Hence, a line forms that offers traders a lot of
information.

For the purposes of identifying phases, we use the simple 50 and 200-day moving averages
(DMA). If you want to look at phases on a longer timeframe, the 50 and 200-week moving
averages work equally well. Plus, the same principles apply.

WWW.TRADERSWORLD.COM October/November/December 2018 117


Phases are determined by the position of the SMAs to one another, the slope of the MAs and
where the price is relative to both.

The chart of the S&P 500 ETF SPY, dates from November 2007 until July 2009. Textbook, all six
phases traded during that time period.

For a Bullish phase, the 50 (blue line) must be above the 200 DMA, (green line). Ideally, the
slopes of both MAs are either neutral to positive. The more the slopes incline during a bullish
phase, the better the momentum is in the direction of the phase. The time for buying a Bullish
phase is when the price is trading above both the 50 and 200 DMAs. You want the least amount
of risk. Once a phase confirms or retraces to the breakout, your sell stop is tight, sitting under
the moving averages.

Back in November 2007, the phase was Bullish, but the slope on the 50 DMA was beginning to
neutralize. The move to a Caution phase was no surprise.

In a Caution phase, the 50 is still above the 200 DMA. The slope on the 50 DMA starts to
neutralize to slope down. The price breaks below the 50 DMA. Number 2 shows the SPY in a
Caution phase. The slope on the 50 DMA, just days after the Bullish phase began to weaken,
turned down. Between Numbers 2 and 3, the price popped back over the MAs, and back into a
Bullish phase. However, the negative slope on the 50 DMA suggested that Bullish phase was frail
and not one to follow.

Consequently, the news about Lehman Brothers hit the tape. Just before Number 3, the price
deteriorated from a Caution to Distribution Phase. The 50 remained above the 200 DMA, the
slope on the 50 DMA declined further, while the slope on the 200 DMA began to neutralize. The
price fell below both MAs.

At the start of 2008, with news of an impending mortgage crisis, Number 3 shows a “Death

WWW.TRADERSWORLD.COM October/November/December 2018 118


Cross.” That represents the start of a Bearish phase. The 50 turns down below the 200 DMA. The
slopes on both MAs become more negative. The price trades below the MAs.

Since the emotional condition of investors in a Bearish phase is one of despair, that is an
excellent time to patiently wait for hope to return. Note that the period from Number 3 until
Number 4 took about a year and a half. That extended bearish move generated tremendous
gains for the shorts. It also prevented smart buyers from entering the market too early.

Furthermore, it allowed those who know about phases to come back into the market at the most
advantageous time-during the Recuperation Phase. During that phase, the 50 is below the 200
DMA. The slope on the 50-DMA should begin to neutralize or start to turn positive while the 200-
DMA slope remains negative. That will take longer to stop its decline. The price begins to rise
above the 50 DMA.

While institutional money returned to the market, most investors were too afraid to buy, even
with the Federal Reserve’s help through Quantitative Easing. However, as stated earlier, the
Recuperation phase as my favorite phase, those who bought at that time, had no pain and lots
of gain.

Number 5 shows the Accumulation phase. The 50 is below the 200-day moving average. The
slope on the 50-DMA is positive. The slope on the 200-DMA is beginning to neutralize in slope
after a long period of having a negative slope. The price is above both the 50 and 200-DMAs.
Optimism returns.

Not too long after, the SPY had the opposite of a “Death Cross,” or a “Golden Cross.” That
move back to a Bullish phase was the start of an extended rally. Sadly, it took another four
years before much of the public participated in the rally. But phase watchers had an amazingly
profitable head start!

Did you need to rely on lots of other technical indicators? No. In fact, the simplicity of the
phases and how perfectly the price lined up with the MAs offered traders a really low risk with
huge rewards. Plus, it required very little analysis and time.

Trade Example-3D Systems (DDD)

As I believe 3D printing is a megatrend in infancy, 3D Systems is a company I keep tabs on.


DDD is a perfect example of using phase changes to establish a long position when the “smart”
money buys. It is also a perfect example of offering buyers’ multiple opportunities to enter and/
or add to core long positions.

Coming into 2018, DDD had been in a Bearish phase. With time and patience, we waited for
the price to return over the 50 DMA (blue line). However, for a phase change to have a more
statistical chance of working, we also waited for the slope on the 50 DMA to turn up. The price
consolidation at Number 1 was a perfect time to enter long. The Recuperation phase confirmed.

WWW.TRADERSWORLD.COM October/November/December 2018 119


The slope on the 50 DMA was up while the overhead 200 DMA (green line) remained negatively
sloped.

As aforementioned, the Recuperation phase is my favorite phase to buy. Nevertheless, Number


2 shows that although the price had not moved up that much from the initial entry, the “Golden
Cross” setup offered traders a phase change to Bullish. The price sat right on the MAs, letting
those who wished to add or enter the trade for the first time a tight risk. The slope on the 50
DMA was now rising and the slope on the 200 DMA flattened.

When phase changes work out as well as the one in DDD did, you not only have multiple
opportunities to add to a winning position, you also gain confidence that the trend should stay
intact. Furthermore, with the instrument in a Bullish phase, you can let your profits run.
The initial entry price was $10.00. The second chance entry price was around $11.00. With
proper trade management, it is best to raise the stop to breakeven once you have money in the
trade and take out all the risk. Then, you can confidently let the trade run its course.
Number 3 illustrates the earnings gap higher. This represented a third opportunity to buy if you
were not in the trade prior to the earnings report. It also provided a chance for those long at
much lower prices to take some profits and let the core position ride.

Thus, DDD is a classic example of all the reasons to watch and trade phase changes. You were
able to enter early, add on strength, and take off the initial risk once the trade was in the
money. Additionally, you could lock in big profits on the gap up, thereby taking advantage of
having the wind at your back. Finally, as an expert in that one thing-phases, the trade was not
time consuming.

What is the hardest part of capitalizing on a good trade entry? Is it that you get out too soon?

WWW.TRADERSWORLD.COM October/November/December 2018 120


Do you let your losers run for way too long?
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Michele ‘Mish’ Schneider is the Director of


Trading Education and Research at www.
marketgauge.com. You can get Mish’s daily
market insights from her free blog called
“Mish’s Market Minute” at www.marketgauge.
com/mdaily-tw/. In addition, she runs a
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Read articles explaining classical trading
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WWW.TRADERSWORLD.COM October/November/December 2018 126
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WWW.TRADERSWORLD.COM October/November/December 2018 127
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Written by Many Expert Traders

The book was written by a large group of 35 expert traders, with high qualifications, most
of who trade professionally and/or offer trading services and expensive courses to their
clients. Some of them charge thousands of dollars per day for personal trading! These
expert traders give generally 45-minute presentations covering the same topics given in
this book at the Traders World Online Expo #12. By combining their talents in this book,
they introduce a new dimension to finding a profitable trading edge in the market. You can
use ideas and techniques of this group of experts to leverage your ability to find an edge to
successfully trade. Using a group of experts in this manner to insure your trading success is
unprecedented.

You’ll never find a book like this anywhere! This unique trading book will help you uncover
the underlying reasons for your lack of consistency in trading and will help you overcome
poor habits that cost you money in trading. It will help you to expose the myths of the
market one by one teaching you the right way to trade and to understand the realities of
risk and to be comfortable with trading with market. The book is priceless!
Parallels to the Traders World Online Expo 12

Trade the Markets with and Edge $3.99

This is an important book discussing the use of different strategies methods


about trading.

It was written by over 30 expert traders. The book was designed to help you
develop your own trading edge in the markets to put you above others who
don’t have an edge and just trade by the seat of their pants. 90% of traders
actually lose in the markets and the main reason is simply that they don’t have an edge.

All of the writers in this book are very experienced and knowledgeable of different ways. Each
of them has their own expertise in trading the markets. What sets these traders apart from
other traders? Many think that beating the markets has something to do with discovering and
using some secret formula.

The traders in this book have the right attitude and many employ a combination of fundamental
analysis, technical analysis principles and formulas in their best trading strategies. This gives

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them a trading edge over other traders. If you want to be successful at trading, you too must
have your edge. One needs to find successful trading strategies and implement them in their
own trading method.

The purpose of this book is to present to you the best trading strategies of these traders so
that you might be able to select those that fit you best and then implement them into your
own trading style. I wish to express my appreciation to all the writers in this book who made
the book possible. They have spent many hours of their time and hard work in writing their
section of the book and the putting together their video presentation for the online expo.

Guide to Successful Online Trading - Secrets from the Pros


$3.99

This is one of the finest trading books you’ll ever see about trading. The
reason is that it comes from a group of expert pro traders with multiple
years of experience.

Trading as you know is extremely difficult. It is estimated that 90% of


traders lose money in the markets. To help you overcome this statistic, the
pro traders in this book give you their ideas on trading with some of the best trading methods
ever developed through their long time experience. By reading about these trading methods
and implementing them in the markets you will then have a chance to then join the ranks of
the 10% of the successful traders.

The traders in this book have through experience the right attitude and employ a combination
of technical analysis principles and strategies to be successful. You can develop these also.
Trading is one of the best ways to make money. Apply the trading methods in this book and
treat it as a business. The purpose of this book is to help you be successful in trading.

From this book you will get all the strategies, Indicators and trading methods that you need
to make big profits in the markets.

This book gives you:


1) Audio/Visual Links to presentations from pro traders
2) The best strategies that the professional traders are using now
3) The broad perspective you need in today’s difficult markets
4) The Exact tools that you need to make profitable trading decisions
5) The finest trading education

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CRAIG TRADING: Craig Haugaard made 300.9% in his World
Cup Trading Championships® Account in 2014 - Want to
Know How? $3.99
This book contains an interview that I made with Craig Haugaard, third-place
finisher in the 2014 World Cup Championship of Futures Trading® with a
300.9% net profit. I asked him many questions on exactly how he did it.
In the rest of the book I explain to you how to use the indicators that Craig
used to make his 300.9% return.
Here are the indicators that he used:

• Seasonality
• MACD
• Stochastics
• Moving Averages
• Trailing Stops
• Fibonacci Retracements & Extensions

All of the charts in this book are produced using my favorite charting software Market-Analyst®.
I have also arranged for you to get a FREE trial so that you might have the chance to actually
work with these indicators with a real charting platform.
You will also be able to view the video presentations that I personally created so you can
see how these indicators can be setup and followed with clear and concise step-by-step
instructions. After you understand how these indicators work, I would then recommend that
you go to WorldCupAdvisor.com and consider following Craig Haugaard’s real-time trades.

This one-of-a-kind book teaches you how to identify the direction of the markets and trade
the markets by using popular trading indicators. This is done by concise instructions backed
by learning videos, hands on practice with real trading software and by following real-time
trades of a master trader.

Mastering Your Trading: Learn from Expert Trading Advisors


“Mastering Your Trading” is the perfect source for learning
various methods of trading the market from expert advisers.
$3.99

This book focuses on various methods of trading developed by many top


trading advisors. There are 17 well written articles and it is packed by insight
that can benefit the beginning to the expert trader. This is a must read. The
trading methods and strategies presented in this book can help to succeed
in today’s volatile market environment. From preparing your psychology to the demands of
timing the market and managing the risk, this book tells it all.
The book provides you the tools that are necessary for making the right trades and when to
get in and out of the market. The book covers:

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• Price and Volume the only True Indicators
• Uncovering Market Secrets
• How to handle capital exposure
• Secrets of Safe Profitable Day Trading
• Using Social Media Sentiment Cycles
• How to Dramatically Improve Your Trading Psychology
• How to Handle Trading Losses
• Using a Market Scanner to Save Time
• How to Stop Guessing
• How to Get the Right Trading Computer
• Simple and Practical Trading Tips
• And much more…

This book is an enhanced Edition which means that the articles are backed with audio visual
presentation links. Most of the presentations are in HD quality and are put together by the
writers of the articles in the book and really help the learning process.

Successful trading is based on knowledge and having the right psychology to trade the markets.
This book will lift your trading to a much higher level and will save you an enormous amount
to time.

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Trading with Success $4.99
This book contains an interview in Chapter 1 with Rob Mitchell, who
finished in 2nd place in the 2014 World Cup Championship® of CME
E-mini Trading with a 57% net profit.

Rob Mitchell is the president of Axiom Research & Trading, Inc. and has
been a trading system developer for over 20 years and has developed a
number of commercially successful trading systems. He has at various
times been the largest eMini S&P trader in the world. Rob has also acted
as a Commodity Trading Adviser, has traded for hedge funds and has won
the Robbins World Cup eMini trading championship in the past. Rob is
a trading teacher and mentor and is the founder and head trader of Oil
Trading Room which is devoted to providing advanced educational resources to traders at all
levels.

In the rest of the book I will explain to you some of the trading ideas of Rob that he uses in
both his Oil Trading Room and in his World Cup Advisor Account. You can then actually see and
understand how some of his ideas work.

I am not going to tell you exactly how Rob used the ideas to make his return of 57% on a
$10,000 investment. That information is not public and belongs only to Rob.

I will tell you some of the trading ideas he uses and help you understand how these ideas work.
I would then recommend that you go to World Cup Advisor and consider following Rob’s trades.
You will be able to automatically mirror Rob’s trades in your own brokerage account with World
Cup Leader-Follower AutoTrade™ service. You will also be able to see what his trades look like
on your own charts and better understand why he made the trades.

Takumaru Forex Trading $4.99


This book contains an interview in Chapter 1 with Takumaru Sakakibara,
who finished in 2nd place in the 2014 World Cup Championship of Forex
Trading® with a 122.6% net profit. “Takumaru’s largest drawdown
(cumulative peak-to-valley percentage decline in month-end net equity
during the life of the account) was -21.5% from 6-30-15 to 10-31-15.”

“Please remember that past performance is not necessarily indicative


of future results.”

“Please remember that Forex trading involves substantial risk of loss,


and past performance is not necessarily indicative of future results.”

In the rest of the book I will explain to you some of the trading ideas Takumaru said he used

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in the championship. You can then actually see and understand how his ideas work.

I am not going to tell you exactly how Takumaru used the ideas to make his return of 122.6%
on a $10,000 investment. That information is not public and belongs only to Takumaru.

I will tell you which indicators he used and help you understand how these indicators work.

Michael Trading: Learn about some of the trading tools he used $4.99
Michael Cook, was the first-place finisher in the 2014 WORLD CUP
Championship of Futures Trading® with a 366% net profit. In this
book there is a detailed interview with Michael with questions and
answers of exactly what he used to win the championship. In this
book I will explain to you the indicators that he said he used in the
interview. You can then actually see and understand how they work.
Here are some the indicators and methods that he said he used: 1)
Moving Averages 2) Seasonality 3) Cycles 4) Seasonality 5) Price
Patterns 6) William’s %R 7) Long with Stops 8) Commitment of
Traders Report You will also be able to download a video presentation
that I personally created so you can see how these indicators can be
setup and followed in a step-by-step manner. After you understand
how these indicators work, I would then recommend that you go to WorldCupAdvisor.com and
consider following Michael Cook’s trades.

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