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Not Even Trump Can Help Twitter!
Yesterday after the close, Twitter (TWTR) announced yet another disappointing quarterly earnings report. On the surface, Twitter has the wind at its back. We just had the craziest Presidential election in history, and the most active global news flow I’ve ever seen. Black Lives Matter. Migrant crisis. Syria. The Brexit. Italy’s No Vote. Right wing nationalist movements rising worldwide. There’s never been more stuff to talk about! Heck, President Trump Tweets so often that you’d think he owns the stock. Plus, Twitter gets a staggering amount of exposure from the media. Athletes and celebrities’ feeds are constantly promoted on the mainstream media. Yet Twitter’s ad revenues DECLINED year-over-year in Q4. Facebook (FB) grew ad revenues by 53%! And Facebook has a revenue base that’s 10 times as big! So what’s the deal here? Aside from the fact that Twitter is not user-friendly and offers little in the way of instant gratification — Facebook has the greatest advertising platform the world’s ever seen. It has in-depth personal information on almost 2 billion people. Think about it. Odds are, Facebook knows: 1) Your full name, age, location, marital/family status, and employment history 2) All of your hobbies and personal interests 3) Your political affiliation 4) What websites you visit 5) What companies you buy from 6) Who you talk to 7) Where you go Twitter surely has some of this data, but it also has some major disadvantages: 1) A smaller user base, and smaller data set 2) More anonymity Speak to anyone in the Internet marketing world, and you’ll know that businesses are tossing huge sums of money at Facebook and Instagram ads. Twitter? Not many folks seem to care.
Continue Reading -->Post-Earnings Analysis: Tech in Focus
FN — Reported very strongly on Monday and continues to signal strength for my fiber thesis. The most curious thing is how little pin action is occurring off of these strong reports. More on this below. This stock would probably be up more if not for the CEO announcing he is leaving. Selling into the mid/high $30’s here probably makes sense. I still favor other names in the space. OCLR — Case in point, they have sold off since they reported a whopper and again, has shown no real upside pin action, though it’s showing a touch of a bounce today. A possible explanation here is that there have been continuing rumors on OCLR as a target for a FNSR takeout. One would think this could/should have the stock higher, but maybe some think that OCLR has risen a lot and won’t garner a big premium. My view is that the forward PSR is still just barely above 2. This is very cheap on any LT or M&A valuation perspective given the consolidation that’s occurred in the space over the last few years. I was buying some OCLR again recently into the selling. I’ll look to add more in the mid $8’s or lower should it go there. AKAM — Strong report but this stock had already soared and a guide which was largely inline just isn’t enough to keep this stock going. In the mid/high $50’s, I’ll take a gander at this one. This is also somewhat indicative of some rotation action that’s starting to emanate further in the market. Strong reports on hot stocks are seeing more flat to selling action than buying action. This is something I was harping on all the way back in Nov/Dec of last year. NEWR — Another very good report and the stock is down moderately. Again, it was close to yearky highs. I prefer SPLK and VRNS and HDP in this space. LITE — Back to the Fibers… LITE reported a good but not a great QTR at all. However, they talked about a strong forward outlook out past just one QTR and the shares are ripping. LITE has also been seeing product shortages and that’s usually well received in Tech land. Again, I would think this would engender a lot more pin action than we are seeing but that pin action might come in delayed reaction fashion as is popular with Algo trading the last couple years. TWLO — The best report of last night, hands down, was TWLO’s very big beat on the current quarter with a notably raised Rev. guide for both the QTR and FY outlooks. I’m a buyer on any notable weakness here. If one looks at how something like an ANET or several other IPO’s traded in recent years, the first year of trading is fraught with lots of raids and rumors. I suppose the machines can mess with TWLO for another QTR or two but if they keep delivering these sorts of results this could have a very substantial move higher. In the meantime, I think a range trade of 4-6pts will occur a good number of times. And guess what, we just saw a 6pt move off the recent early year lows. A break above $32.50 will break that range and setup the next higher leg. Disclosure: Position in OCLR, SPLK, VMS, HDP, TWLO
Continue Reading -->There Are More Bears Than Bulls Out in the Wild
Permabulls always say everyone’s bearish. And permabears always say everyone’s bullish. Neither side provides evidence for their views. So let’s see how traders are feeling into today’s inauguration: 1) VIX Spread – Bullish The 3-month VIX spread is at +4.51, which indicates traders are pricing in very low near-term volatility. This means traders are bullish. 2) CNN Fear & Greed Index – Neutral The Fear & Greed Index is at 49. F&G operates on a 1-100 scale, and 50 is neutral. So we’re right in the middle. 3) AAII Sentiment – Bearish The latest AAII Sentiment Survey shows that 32.8% of individual investors are bullish, which is below the long-term average of 38.5%. 4) CBOE Equity Put-Call – Bearish The CBOE Equity-Put Call ratio is at 0.71 with a 3-day moving average of 0.74. This indicates higher-than-average bearishness. 5) ISE Sentiment – Bearish The ISE Sentiment Index is at just 79 (79 calls for every 100 puts) this morning – which is a bearish reading. And the 10-day moving average is 81.3. This also indicates bearish sentiment. Conclusion Out of 5 sentiment indicators, we have 1 bullish, 1 neutral, and 3 bearish. I’ve been hearing a lot of chatter about how bullish the crowd is. But if anything, traders are leaning against the market, hoping for a fall.
Continue Reading -->Trump Pumps Up Pipeline Stocks, and I’m Holding On
Way back on December 11, 2015, I tossed the Kayne Anderson MLP Closed-End Fund (KYN) into my retirement account, back when it was around $14. President Trump signed orders to expedite the goverment’s review of the Keystone XL and Dakota Access pipelines, which is driving up shares of MLP’s, with KYN breaking through $20. KYN’s second biggest holding is Energy Transfer Partners (ETP) (19% of the fund), which is building the Dakota Access pipeline. This is a nice gain, but I’m not selling any. Why? Because KYN’s 4 most recent quarterly dividends have been returns of capital, not actual income. That means KYN has been distributing fund assets back to fund owners. So there are no actual income gains — they’ve all been from price appreciation. Assuming these pipelines go through, and assuming we see more domestic oil production under Trump, KYN could actually start distributing real income back to shareholders. That would be a huge catalyst, possibly breaking KYN out of its 8-month channel. Also, KYN is trading at a mere +0.2% premium to NAV vs. a 3-year average of +3.8%. That premium has actually gone as high as 16.4% over the past 5 years. So I’m going to let it ride. It’s come a long way but I don’t think froth has set in.
Continue Reading -->T3’s Take 3: Yellen Goes Hawk, Spikes the Dollar
1) Yellen Goes Full Hawk Today, Federal Reserve Chair Janet Yellen gave a speech at the Commonwealth Club in San Franscisco, and she swung her hawk hammer. Yellen said the Fed is close to meeting its dual mandate of full employment and price stability, and that Fed officials expect a few rate hikes this year. The US dollar immediately ripped on the news, gaining 1.7% against the yen and 0.7% against the euro. The dollar in strength put a hurting on gold, which fell -0.7%. The ever-volatile gold miners ETF(GDX) dropped -1.5%. 2) Stocks Bounce Yellen’s hawkiskhness drove a rebound in stocks, and the S&P 500 managed to squeeze up 0.2% to 2271.89. That’s not exactly exciting, but there were some signs of strength under the hood. The Russell 2000 rose 0.5%, and the Nasdaq Biotech ETF (IBB) rose 0.8%. Yellen’s hawk talk drove the S&P Financials ETF (XLF) up 0.8%, with Regional Banks (KRE) up 1.1%. Retail, energy, and US Treasuries led the decliners’ column today. After the close today, Netflix (NFLX) reported better-than-expected Q4 earnings and surged over $10. 3) Jeff Cooper on Gold This afternoon, T3 Live’s Jeff Cooper issued the following analysis of gold: Yesterday, GLD gapped up into a shelf of resistance from the spring of 2016 around 115. Today, after treading water in the early going, the bears came out to play. GLD is pulling back into the gap window from yesterday. GLD and the miners have done a lot of work and are entitled to inhale. However, GLD is doing something it hasn’t done for many moon: GLD has delivered a Golden Cross with the 50 week crossing above the 200. Click here to learn more about Jeff Cooper’s Daily Market Report.
Continue Reading -->Jeff Cooper’s Morning Call Express: Respect Your Stops
In today’s Morning Call Express, T3 Live’s Jeff Cooper breaks down the action in SPX and talks about the important of stops. Click here to learn more about Jeff Cooper’s Daily Market Report.
Continue Reading -->Ifan Wei Interview: From the Boxing Ring to the Trading Floor
To help you get to know T3 Live’s growing bench of trading talent, we’ve launched a series called “Meet the Traders” so you can get an inside look at how our team operates. Today, we are proud to introduce you to Ifan Wei, one of our moderators in the T3 Live Black Room. 1) Welcome Ifan! Tell us a little bit about yourself. I grew up in Texas. I attended the Haas School of Business at the University of California, Berkeley, where I boxed for 4 years. Upon graduation, I began my career in marketing in big tech and the NFL. So even before I became a trader, I had the privilege of exciting, fulfilling, and challenging opportunities. Trading is a progression of that. 2) What’s Tougher? Trading or Boxing? Progress came more naturally in boxing, but both have their challenges, both physically and mentally. 3) Do you think your boxing background has helped you as a trader? Yes, absolutely. I think training for any competitive event makes you stronger mentally and emotionally. And competing in sports emphasizes a cycle of practice and preparation to be highly functional in a stressful, dynamic arena. That can help any trader. 4) How did you first get involved with the markets? My dad has always kept an eye on the markets, but not as a very active participant. So while I was aware of its existence and daily fluctuations, I was not introduced to price charts until an accounting class case presentation. Comparing company 10/K’s and curiosity about the impact on a company’s stock price led me to charts. So, there wasn’t a seminal moment that turned me into a trader. I just progressively became more interested in reading charts. 5) How would you describe your trading methodology? I use a top-down approach to technical analysis in order to anticipate momentum. I speculate on momentum based on two strategies: broken support/resistance and climactics (parabolic exhaustion). My most common strategy is when support or resistance is broken overnight, producing a gap in price at the open. To time my entrie, I use variations on 2 basic repeating patterns: bases and retracements. 6) What is your day-to-day focus these days? My #1 focus each day are stocks that gap. While most stocks gap each day, I am looking for the outliers. Inside the universe of the 2,000 most liquid equities, I focus on the extreme gainers and decliners. Typically, I am looking for a pattern/entry in the direction of the momentum. Other times, I am looking for signs of parabolic acceleration into exhaustion. If that sets up, I will begin to look to play against the trend. 7) What is the 1 thing you wish you knew when you started as a trader? The importance of patience. I did not know what kind of trader I was when I started. While I was fortunate enough to get an education at the beginning of my trading career, I lacked the self-awareness and understanding to internalize and apply it. 8) Do you believe in setting specific stop loss and target prices? Yes. A stop loss is there for me to know when I should admit I’m wrong. If the trade sets up again, then I can always re-enter. My targets come from the concept of support and resistance areas, and I trail my stops when those areas are reached. 9) Are you concerned about high-frequency and algorithmic grading? Yes, but my risk management acknowledges that anything can happen at anytime. I don’t make any specific adjustments in my trading to account for them. 10) What is 1 thing traders can do today to start getting better results? Track your trades. If you already track your trade entries and exit, be sure to journal your thoughts throughout the trading day. Log your observations. You will pass on trades that work, and pass on trades that don’t work. These decisions can be just as enlightening as the trades that you take. 11) What book should every beginning trader read? I’ve read and reread the commonly cited classics like Reminisces of a Stock Operator, Trading in the Zone, and The Zurich Axioms. They’re great. But I think anything that provides self-reflection and introspection can help you become a better trader, even if it’s not a trading-specific text. Psychology/philosophy books like Thinking, Fast and Slow and The Tao of Jeet Kune Do can be just as enlightening for a trader. 12) Are there any traders you look up to? I admire Sami Abusaad, Mark Harila, and Kurt Capra, my co-moderators in the Black Room, as well as my previous mentors. I try to keep in touch with a number of other professional traders. Consistency is a quality that they all share, and they are key to longevity in this business. They vary in style and approach but are consistent day-in and day-out in their method. 13) What would you be doing if you weren’t a trader? I’d probably still be in sports marketing. I have friends working for the big agencies and teams who still love what they do. Click here to learn more about the T3 Live Black Room
Continue Reading -->4 Real-World Investing Lessons You Need to Know
After 13+ years of looking at the market on a daily basis, and flushing a whole bunch of cash down the drain on idiotic trades, I’ve grasped a few realities about how money moves in the real world — far away from the textbooks and theory pushed at your average business school. Here are 4 of them 1. What You Know, Everyone Else Probably Knows, Too. Investors have a tendency to overestimate the uniqueness of their ideas, even though we’re all drinking from the same information cup. Furthermore, the presence of social media outlets like Twitter (TWTR and Facebook (FB) have drastically accelerated the speed at which investable information is distributed. That means that with few exceptions, everything gets priced into the market pronto. So if you’re thinking of buying bank stocks because The Fed’s about to raise rates, or shorting Apple (AAPL) because of slowing revenue growth, slow down and take a deep breath. It’s important to understand the past and present. But to be a successful investor, you’ll have to predict the future — a far bigger challenge than skimming through 10-Ks and listening to earnings calls. In other words, focus on examining not where the fundamentals and newsflow are, but where they may be going. Remember, when a guy on TV tells you a stock is good because it’s trading at X times earnings and has Y in cash on its balance sheet, he’s simply repeating the bare minimum of what the market knows. As men wiser than me have said, “What the market knows is not worth knowing.” 2. Timing Is Everything. When looking at the market,it’s important to understand not only “the what,” but “the why.” But the more I think about it, the more I’d argue that “the when” trumps both those considerations. Let me tell you a story. I once interviewed at a hedge fund that was making a major bet on its prediction that the then-growing housing bubble would implode. Smart money, right? However, that interview took place in early 2003, right before the Housing Index (^HGX) doubled. Likewise, a lot of folks were short FitBit (FIT) year as it crashed and burned from that $51.90 high hit last August. But a lot of bears got smashed on the 73% rally that precded the drop. So when you have an investment thesis in your mind, ask yourself, “What makes now the right time to bet on this?” Furthermore, if the S&P 500 is skyrocketing, it is entirely likely that junky companies rally big-time. Likewise, if the market’s in meltdown mode, even the best of the best can get smashed. Apple (AAPL) closed out 2007 at $198.08. But in 2008, even in the face of enormous earnings beats and the halo of the iPhone’s unprecedented success, Apple finished the year at $85.35 — a drop of 57%! You may be smart, but remember: Sometimes Mr. Market just does not care about what you think. 3. You Are Probably Suffering From Confirmation Bias. The Oxford Dictionaries defines confirmation bias as “the tendency to interpret new evidence as confirmation of one’s existing beliefs or theories.” Translated into financial terms, it means that if you’re bullish on gold (GLD), you interpret everything you see as bullish for gold. I know the power of confirmation bias from a horrible experience with a former tech highflier called Rackable Systems, which changed its name to SGI (SGI) after it acquired Silicon Graphics in 2009. In 2006, Rackable Systems was a momentum King — kind of like newer names like Acacia (ACIA). It was pulling in boatloads of money selling energy-efficient servers to major data-center operators like Microsoft (MSFT), Amazon, and Yahoo (YHOO). And then — let me point out that I had complete knowledge of this — competitors like Hewlett-Packard (HPQ) decided they wanted some of those data-center dollars. Maybe I should have imagined what would happen if Rackable lost Microsoft (34% of revenues) or Yahoo (26% of revenues) as a customer, or at the very least, the margin pressures that could be introduced in a more competitive server environment. However, I viewed the new competition as nothing less but confirmation that Rackable was on the right track. And then Rackable crashed from $56 to under $10 as earnings collapsed. It is impossible to stay perfectly objective when performing research. But you can stay one step ahead of your own bias by regularly asking the question, “Am I just telling myself what I want to hear?” 4. In Isolation, Valuation Ratios Are Useless. Investors often take a simplistic view of valuation ratios, automatically assuming that if something is “cheap,” it’s good, and if it’s “expensive,” it’s bad. But you’ll often see cheap stocks get cheaper and expensive stocks get more expensive. How many times has someone told you that Salesforce.com (CRM) is overpriced? Next, look at the stocks’ chart since it went public: A P/E ratio, like every other valuation ratio, is 100% meaningless in isolation. It is far more important to examine how the “E” part of the equation is changing. (Or sales for EV/S ratios or EBITDA for EV/EBITDA ratios, etc.) A company trading at five times earnings can look awfully expensive following a bad quarter that destroys future earnings expectations. That’s how a stock like GoPro (GPRO) can go from $98 to $50 to $9 in the blink of an eye. It also works the other way around — a high-priced momentum stock can suddenly look cheap if earnings come in ahead of expectations and forward estimates rise.
Continue Reading -->Scott Redler: 4 Life Lessons to Get You Through the Bad Times
One year ago today, I was laying on my belly, staring at the floor… and wondering if I’d ever walk again. But let’s rewind the story a bit. I’ve been a competitive racer since I was 30, finishing over 50 triathlons and marathons, including two Ironman events. I’ve also coached runners and raised money for the Steven M. Perez foundation, the Leukemia & Lymphoma Society, the American Cancer Society, and the R. Baby Foundation. I keep all the mementos in my man cave: Steven Perez was my best friend since we were roommates at SUNY Albany. In 2007, he was diagnosed with Chronic Myelogenous Leukemia. Steven’s doctors did all they could to treat him, and our circle of family and friends pitched in to help. But after 6 weeks fighting the toughest battle on Earth, Steven passed away. I was horribly depressed, and only one thing seemed to help: exercise. So to raise money for The Leukemia & Lymphoma Society and the newly-formed Steven M. Perez Foundation, I completed my first Ironman triathlon. That’s when I really became a serious endurance athlete. I’d been racing for years, but finishing an Ironman was a whole new level for me. Unfortunately, my success came with a price. Years of serious training and racing took a big toll on my body. I had a lot of wear & tear, and I never really recovered from it. And throughout 2015, it was obvious that something was very wrong with me. My left leg was atrophying, and it would go numb if I stood for too long. My back was killing me. I had a hard time getting out of my chair, and I was barely sleeping. And I looked horrible. I was pale and losing weight, and I was shorter because of my shrinking leg. At Thanksgiving, a doctor friend was pumping me with injections just so I could stand up to cook! I spent 3 months in physical therapy, but deep down, I knew it was nothing more than a band-aid. I was wasting my time because I was afraid to face the music. But I couldn’t take any more of those scared looks from my wife and son. Even our dog Cadence knew something was wrong! So I finally came to my senses and just gave up. I visited Dr. Mitchell Reiter, a New Jersey-based orthopedic surgeon and spine specialist. Dr. Reiter diagnosed me with a sequestered spinal disc, which was putting tremendous pressure on my spinal canal. I was quickly scheduled for a Laminectomy operation to fix the problem. And that’s how I found myself laying on my belly, staring at the floor… and wondering if I’d ever walk again. Now, I’ll admit I was being a little melodramatic. Laminectomies have a pretty high success rate. And I trusted my doctor. But when times are tough, it’s hard to stop thinking about every little thing that can go wrong. The surgery was a success, and I began my recovery. It wasn’t easy. I could barely get up for days. My wife was carrying me around the house! And my friends moved the Christmas tree up to my bedroom so I could see it without going on a never-ending journey to the living room. I took 2 weeks off work. I never had that much time off before, and being away from my trading screens made me stir crazy. By the time I returned to work, I was 20 pounds lighter and my face was the color of skim milk. My own videographer didn’t recognize me, even though we’d been working together every day for over a year! But as much as my body changed, my mind changed even more. I began appreciating the little things. Forget the Ironman — suddenly, just getting through a stretching session was a big deal! Being pain free felt better than any medal I ever won! And I may never do another triathlon again. But you know what? I just ran alongside my son Chace as he finished his first 5K! He took home the gold, and I’ll never forget crossing the finish line with him. There are 4 simple, but valuable lessons to be learned here: 1) The Darkest Hour Is Just Before the Dawn Those last few moments before my surgery were some of the darkest I’ve ever been through. And you know what? That was the bottom. Things only got better. 2) Your Goals Should Change When Life Throws You Curveballs I used to think I’d be a high-level competitive racer forever. That may no longer be realistic, and I’m okay with that. I love coaching, and I’m more than happy to run smaller races until I get a better idea of my long-term prognosis. I don’t have to be “elite,” whatever that means. I just want to be the best I can be. 3) You Probably Have More Support Than You Think My family stepped up for me in ways you can’t imagine: That’s Celena, Chace, and our dog Cadence. I would not have made it back without all three of them! My parents were great too, always checking up on me to make sure I was doing okay. Aren’t they cool? And it feels silly now, but I was really worried subscribers would be ticked off while I was gone! But you were awesome — I received hundreds of supportive Tweets and emails, many of which included your personal stories of dealing with your own health problems. And not a single Redler All-Access subscriber cancelled due to my absence! That showed me that we are all part of a powerful global community. Here are some of our friends from Ukraine: (I’m in the front with the pink socks!) So just reach out when you need a hand. Odds are, people will there to help, and they’ll be happy to do so. 4) It’s Okay to Want to Give Up… Just Don’t We all go through rough times. Some have it worse than others, but we all have our own
Continue Reading -->Meet the Traders: 11 Questions with Mark Harila
To help you get to know T3 Live’s growing bench of trading talent, we’ve launched a new series called “Meet the Traders” so you can get a direct introduction to our team. Today, we’d like you to meet Mark Harila, who is a moderator for the T3 Live Black Room on our Virtual Trading Floor®. Thank you for joining us Mark! 1) Tell Us a Little About Yourself Mark. The hardest question I have to answer these days is “so what do you do?” My wife and I own 9 small businesses. Yes, 9. But I identify as a trader because that’s what first comes to mind when people ask what I do. Before I entered the trading world, I worked on over 30 installations across all branches of the US military. I enjoy traveling, and I love spending time with anyone who can handle a few quips and a little sarcasm. 2) How did you first get involved with the markets? I have been interested in the market for as long as I can remember. When I was in high school, my economics teacher held an investing contest and the winner was guaranteed an A for the semester. This piqued my interest doubly: a chance to get an easy A and learn how to make money? It turns out that even then I was a trader, not an investor. Every day I ran to the paper to see how my stock picks did and figure out what to buy or sell next. Between my competitive nature, a ton of reading, and lots of trial and error (so much for an “easy A”), I got an A in the class. But more importantly, I stoked a lifelong love affair with the markets 3) How would you describe your trading methodology? I am a technical analyst and trader. Many people believe technical analysis is about learning patterns. The truth isn’t that simple. Technical analysis is about understanding the psychology and emotions of market participants. If you can understand others traders’ emotions, expectations, hopes, and fears, then you will have a greater understanding of price movement. I tend to look for multiple elements converging in an area, with a compelling reason or impetus (such as a gap, void, pattern matching the market bias. etc) to find high quality patterns that are most likely to move in my direction. 4) You’ve said that when you started trading, you focused on learning on only one pattern at a time. Is this something you recommend to all new traders? YES! In T3 Technical Strategies, we teach a number of patterns but not every pattern is for every trader. When I started with our system, I spent weeks trading only one pattern until I knew it inside and out. I thought I was learning which setups worked beest, what time frames I should trade, which amplifiers were more likely to help, etc. But what I was really learning was my own psychology, preferences, and most importantly, my weaknesses. And believe me, there were more than I expected. The bottom line is, in order to be successful, you need to know yourself first. And by focusing on mastering each concept in isolation, you’ll essentially create a customized methodology that works best for your personality. 5) What is your day-to-day focus these days? My focus is on everything and nothing. It changes based on the time of day and the opportunities that present themselves. In the morning I focus on gaps, especially those that create huge emotional reactions in traders, like euphoria or pain. Later in the day I focus on my universe of about 900 stocks that meet my daily volume, ATR (average true range), and price requirements. I keep all 900 on 15-minute thumbnail charts sorted by sector. At lunch, I scan the entire universe in search of my afternoon trades. 6) What is the 1 thing you wish you knew when you started as a trade? I can’t say this enough: Novice traders look for ALL the reasons TO take a trade. Professional traders look for ALL the reasons NOT TO take a trade. My job as a trader is to find everything wrong with a trade and all the reasons it might fail. Then and only then can I take a trade in accordance with my plan. 7) Do you have a certain risk management strategy for cutting losses? Every trade I take has a clearly defined Stop Loss, Entry Price, and Target. I wrote Stop Loss first because it’s the most important, and because adhering to stops is non-negotiable. The stop is predicated on a chart area that if violated, represents a significant change in the trade. At that point, I no longer want to be in that trade. I risk the same amount of money on each trade, and the number of shares I take is predicated on the entry and the stop. In other words, my entire trading plan is a risk management strategy to cut losses, and Losses are an inevitable part of trading. They are even acceptable when viewed as a cost of business — I consider losses to be an education expense. 8) Are you concerned about high-frequency and algorithmic grading? There is no question in my mind that HFT’s and Algos can affect trading. But, I am not concerned about them. In fact if you know what to look for, they can give you a number of opportunities. 9) What is 1 thing traders can do today to start getting better results? I’m going to give you 3. First and foremost create a written plan. Trading without a plan is like cooking without a recipe. It can be done but you can expect mixed results. Plus, it’s nearly impossible to replicate your successes you don’t know how you got them. Second, track your trading activity, and don’t limit yourself to your P&L. You should be noting which setups you use, trade management tactics, what happened after you got out, and whether the trade met your plan. If you are not tracking
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