New testimonial

 

Below is a testimonial received from Paul, who I have known for a number of years now and has continued to make progress as a trend follower:

New testimonial from Germany

Julian is trend following trader from Germany who I have worked with over the last couple of years. Here is his testimonial which he kindly forwarded:

Christmas 2015 offers

I have a selection of discount offers open on the e-book, 1-2-1 training and mentoring (both annual or quarterly instalment options) - click on the links for more details.

These will run until 31 December 2015.

New testimonial

The beauty of a robust trend following methodology is that it can be applied to any market, in any part of the world. I have spoken to other traders (both new and experienced) in the UK, the US and the Far East, who are now applying it to their own local stock markets, as well as the other main markets around the globe. Tonight I received the following testimonial from a new trader in the Netherlands:

Another couple of nice trends

I've posted two more charts here (one long trade, one short trade) that once again show the value of riding a trend for absolute returns. Both gave valid signals as per the system rules when these price moves started, and if you were lucky enough to trade them, then congratulations!

Training and mentoring for non-UK residents

When I initially started offering training and mentoring services, the intention was to solely provide this for people in the UK. As it turns out, due to the popularity of the blog and the general Twitter feed, I have been able to correspond with people in Australia, the US, Singapore and Hong Kong as well as other parts of Europe.

Homeserve continuing its uptrend

UK stock Homeserve which I hold keeps on ticking up nicely following its breakout, and also held up well during the early part of last week, when the markets fell quite sharply.

Supergroup - limiting your open risk

UK stock Supergroup gave back some of its profits today, after a torrid rise over the preceding few sessions (chart shown below). Some would say that you should have closed your profits, and they may be right in this particular case. However, experience has taught me that you shouldn't necessarily close your position simply as a result of a strong rise like this. Why?

The three critical areas of a trading system

There are three aspects to using any trading system, that you must be able to stick to. I have likened  these three areas to the legs of a bar stool - if one of the 'legs' is deficient or missing, then the stool (and your trading system) will fall over. These are:

Calling my own trades on Twitter

As from Monday 09 July I will be calling any new positions or set ups via a new protected Twitter feed @TraderSteveUK. These will be called in 'real time' and will give entry price, initial stop levels, and what expiry spreadbet I am taking.

The e-book travels east

I received a nice testimonial this morning from Chris, who is based in Hong Kong:

"I have long been an admirer of those who can trade a trend following system. I like the idea that all you need to know is technical analysis without worrying about any fundamentals. However I don’t have confidence to trade such a system because of the relatively low winning percentage (typical of a trend following system). After reading Steve’s e-book, I believe I can finally apply this to my own trading.

REALLY want to speed up your development as a trend follower?

As from Monday 09 July I am re-launching the subscription area of the blog. This will entitle you to:

• Access to a regular weekly webinar where the movements in the general markets and in any individual stocks can be discussed, run through scans along with covering, risk management, trend following psychology, Q&A's etc;
• Access to a new protected Twitter feed whereby all my own positions will be tweeted in 'real time';
• Access to a detailed performance log covering the trades tweeted;
• A free copy of my e-book, The Trading Triangle.

3 months free access to this will be available for anyone who undertakes 1-2-1 training, and for those people who have joined the mentoring programme, they will have access for the full 12 months.

Anyone who has previously bought the e-book separately and wishes to upgrade to this option, please contact me at trader.steve@btinternet.com.

For full details and pricing click here.

Proper stop placement

An important thing to remember when placing your stops based on the charts is that these are a solely a guide to the stop placement that you should use. You will see on plenty of charts where price has just touched the exit signals or pierced them very slightly, before price reverts to going in the direction of the trend. This can be frustrating, however what the chart shows may not necessarily mean that you have been stopped out.

Some pointers for you

I've shown charts of three US stocks that to highlight some points of interest which are covered in my e-book.

Dean Foods was the subject of a recent post here and it's still trending up nicely. Remember this broke out to the upside after failing to break down while the general market was going down, and therefore was showing good relative strength. Now that the trend is developing nicely, there's no need to run for the exits here - just trail that stop up as per the charts (and remembering to take into account the spread when placing your stops), and keep holding until the trend ends.

Stun gun company Taser sports a curious chart in that the trends apparent here seem to have been the inverse of the general market! After an uptrend towards the end of last year, the stock went into a profitable downtrend from mid-December through to mid-March, while the markets were trending up nicely. Then it formed a new base and broke out to the upside near the end of April, carried on up through out May and is currently consolidating. As I've said before, I try to have one or two stocks that are going in the opposite direction to the general market, as they can highlight unusual relative strength or weakness in a particular stock. This is a prime example of that.

The final charts is that of Arena Pharma. As you can see, this gave a false start during April when the previous long signal only produced a small profit before being stopped out. However, a new long signal was generated just before the big gap up towards the middle of May, then consolidated, before moving on up again. This is a good example of a good looking set up that failed (which can easily happen), but then gives you a great trend on the next signal. Failed signals like the first one are frustrating, but they are part of the game for trend followers. As an example, imagine you traded  a basket of commodities, and gold gave you six failed trades in a row. Would you take the seventh signal, which happened to be the one that generated a huge trend, and covered the losses of the previous six trades and still gave you an overall profit? Just because a stock (or any instrument for that matter) generated a loss on a previous trade, if the setup still looks good, you should consider trading it. Arena Pharma is a great example of that.

Products and services - discounts and commissions

As I now offer a range of products and services, I have tidied up the look of my blog and re-designed the links so a summary of what is available can now be accessed from a single click.

There are also a number of discounts and commissions available, depending on whether you have previously acquired my e-book, or introduce someone for 1-2-1 training or mentoring.

To find out more my services, together with the discounts and commissions available, click on the services tab.

For sight of testimonials from people who have previously purchased my e-book or undertaken training, please click here.

The three elements to trading success

There are three compenents to effective performance as a trader:

• Money management (risk control);
• Self management (trading psychology);
• System management (a historically proven, systematic method for entries and exits with a positive expectancy)

Trading is a bit like a three-legged bar stool, in that if one of these areas is missing or deficient, then you will not make money over the long-term - the bar stool will topple over.

My e-book, The Trading Triangle, covers all these areas and is a great introduction to trend following, the most consistently successful method of profiting from the markets.

Don't say I didn't tell you...

As mentioned in a recent blog post here, there have been political manouverings over the last week, culminating in the Spanish government obtaining a bailout for its banks last night. Next weekend we have the re-run of the Greek elections, whoch potentially has major consequences for the Eurozone, and the markets themselves. This has all resulted in increased volatility and a bounce in the general markets - again, this is one reason why I tend to shy away from trading the indices themselves, but rather concentrate on trends in stocks.

I also stated that the psychological aspect of trend following will be tested, and from speaking to other traders this has indeed been the case. The 'giving back' of a portion of profits is all part of the game from a trend following point of view. From here, will the markets carry on upwards, or will will downtrend re-assert itself? All you need do is control the controllable (refer this post) - your own positions, your risk and your emotions and let market do what it wants.

The US indices are close to reverting to a neutral position, however the FTSE has acted the strongest over the last week - the drop in Chinese interest rates boosted mining stocks, of which the FTSE has a number. The DAX is still weaker, and remains on a short signal:

Regardless of this, if you were short individual stocks over the preceding few weeks you should have made some nice profits. I have posted several recent examples of nice trends - there are plenty more from where those came from. If you haven't made money, then get yourself a copy of my e-book or book some 1-2-1 training and find out what trend followers would have been looking for, and see what profits you could have made.

From here, the markets will do one of three things - go up, go down, or go nowhere. Volatility will remain high so remember to either embrace it or stand to one side. Trend followers will have no emotion, and will put to one side their own political beliefs about what they (personally) want to happen, or even what they THINK will happen - we will simply follow price action, wait for any signals and act accordingly.

Political intervention and trend following

For those who have a copy of Market Wizards, go and read the interview with the Investment Biker himself, Jim Rogers, who was part of the famous Quantum Fund with George Soros. For someone like me who does not profess to understand economics in great detail, it is an interesting read.

The financial markets at this point in time are in a downtrend, with the possibly that this could accelerate and have much further to fall. The situation in Greece, and to a lesser extent in Spain and Italy, will have major ramifications for the future of the Euro and the Eurozone itself. Last week also saw disappointing news from the US jobs market which contributed to the sharp falls on Friday. As a result of this, we have to consider the possibility that certain governements will try to intervene in the markets.

We saw intervention here in the UK back in 2008 when the Financial Services Authority banned the shorting of certain stocks, principally in the banking and financial sector. This lead to a one day spike which meant I got kicked out of some of my short positions, before the predominant downtrend re-asserted itself. There is the possibility of this happening again, both in the UK and elsewhere, along with further printing of money via QE3, or some other measures. For what it's worth, gold spiked up on Friday and is now on a long signal.

There is no way of predicting what lengths various Governments will go to, in order to 'prop up' the financial markets. However, prices will go where they want to go, so you still need to follow the principal trend in the markets, which is currently down. However, it is almost a given that volatility will increase as a result. As always, strict risk control will be required, and the psychological aspect of trend following for those who practice it will be tested.

To those individuals (especially if you did not use such a strategy in 2008) - if you able to accept and embrace the volatility, still ride the trends by sticking to the rules, and avoid making silly psychological errors, this year could be ultimate proving ground for your development as a trend following trader.

Hargreaves Services

Another winner today on the short side is UK stock Hargreaves Services. The chart shows a nice consolidation with a failed breakout to the upside in April, before starting a new downtrend early in May, as a prelude to a sharp fall on a trading update released this morning. Again, the system scans I use identified this when the intial downtrend was signalled, and you would be sitting in a nice profit.

Diamond Jubilee discount offer on The Trading Triangle e-book/training

To celebrate the Queen's Diamond Jubilee, I am running a 50% discount offer on my e-book, The Trading Triangle, which will run for this week and the UK bank holidays next week.

To order and download your copy, please go here.

Alternatively if you want to get some 1-2-1 training, there is also a one-off discount available for this too. If this interests you please email me at trader.steve@btinternet.com and quote 'JUBILEE OFFER'.

To see testominials on both the e-book and the training available, please go here.