Traders' Library Blog

"Got My Ass Handed To Me”

Here is a note I got from a student:

 

"Started trading Options in Sept with $7500, was making good money in BA and LMT, so I dumped my Risk Mng, and bought 5 contracts for each. Account rocketed to $14,000, then, got my ass handed to me and fell off to $5300 !!! Haaaaa, Ouccchh, then as you advised, I put my "Pro Hat" on and started to watch my Risk Mangement like a PRO, now at $9003!!!

 

Thanks for helping me get my mind right, appreciate you Courtney."

 

Bob raises some great points.

 

First, he starts to get a case of the Midas Touch Syndrome. This occurs when you have a run of profits and start thinking you don't have to follow your rules. You just have to touch trades and they make a lot of money. But, of course, it doesn't work that way.

Just because you made some money doesn’t mean you raised your IQ by 100 points!

 

Of course you can make a lot more money if you don't use good risk management but breaking that discipline is nearly always a path to ruin.

 

Bob lived through the storm and was able to recover and put on his Pro Hat! Awesome!

 

It is important for us to always put on our Pro Hat and stop acting like an amateur. Pros make money and amateurs don't. Good for Bob!

I love the fact that Bob was able to raise his account by almost 80% after putting on his Pro Hat. Awesome!

 

I can help you with this! This is a good reason to subscribe to my new Smith’s Stock Swing Trader service. I will guide you through the stock and option markets twice a day! Watch me make a living trading! Click here to register.  

 

Twice a day I put out my action swing trades in stock and options. I’ve been crushing it! You

can learn more by clicking here.

 

 

Good trading,

Who Wins In A Fight? Day Traders or Swing Traders?

I’ve done both and made money doing both. Here’s how I see the fight.

 

Day traders are those that buy and sell a stock, futures, options, or forex and liquidate before the day ends. Swing traders will likely hold the position 1-5 days.

 

Day traders will talk about how they close out all their positions at the end of the day so they don’t have any risk overnight.

 

Swing traders will retort that they do take more risk overnight but they will also often be making money over night. Making money while they sleep!

 

Swing traders will talk about how they make more money on average than a day trader. The day trader will respond by pointing out that the swing trader takes only a few trades to the many trades a day trader takes.

 

In the final analysis, I prefer swing trading to day trading because I don’t have the patience to stare at a screen for hours each day. Seems more like a job than a way to make money.

 

To me, one of the most important aspects of trading is the ability to NOT spend time trading! To live your life instead of having a job.

 

Sound interesting?

 

Twice a day I put out my action swing trades in stock and options. I’ve been crushing it! You can learn more by clicking here.

 

Yes, you can make a living as a trader!

 

Click here to register.  

Tips On Getting The Most From All Your New Leisure Time

Imagine the sun waking you up. No alarm clock!

You throw back the blinds on your ocean-side condo. Another beautiful day.

This is the life of a pro trader. This can be your life.

Actually, the reality of nearly total freedom was disconcerting when I first did it. I had already retired twice but the third time was actually hard to do!

I had been working 16 hours a day for over 20 years. All of a sudden, I had nothing to do. I was a little dizzy and unfocused. I think the same thing happens to people who retire after a lifetime of working. So let me give you a few tips.

Create stuff to do. For me, I ended up starting to really read the news and learn more about trading, particularly the fundamentals. I developed models and back tested a million ideas.

The advantage of adding this work is that it increased my trading income! Double super whammy!

But you should find something productive to fill your time. It should be productive or else it will actually destroy you. Don’t watch TV all day.

A second tip is to be physically active. Walk everywhere instead of driving. I will decide to go to a movie. But I will walk to a theater that is a couple of miles away rather than one that is close by. I get some exercise, listen to a podcast, and stop and smell the roses.

A third tip is to be yourself. In the final analysis, being a pro trader is all about being who you REALLY are. You no longer have to know tow to a boss or customers. You get to be a good person all day long. You get to really release the incredible power inside you.

Go be that person!!!!

It took me time to really understand all the ramifications of being free when I stopped working for the Man and became an independent pro trader. It took me time to get into the rhythm. It took me time to get into the  true freedom.

We have an amazing course which can really help you get through the psychology of being financially free called Psychology of Massive Wealth. It’s super inexpensive. You can register,

Click here for information!

Famous GooRoos Predict Massive Stock Market Plunge

Famous gooroos  are calling for a dramatic plunge in the stock market:

 

- Andrew Smithers says, “US stocks are now about 80% overvalued.”

- David Stockman: “a gigantic, horrendous storm,” is not far away.

- Jim Rogers: the greatest crash of our lifetime will happen “later this year or next.” “A $68 trillion ‘Biblical’ collapse is poised to wipe out millions of Americans.”

- Marc Faber says he sees a plummet of 40% or more and “it will end very badly, extremely badly.” “Investors are on the Titanic.” Stocks are about to “endure a gut wrenching drop that would rival the greatest crashes in stock market history.”

- Harry Dent says, “We’ll see a historic drop to 6,000… and when the dust settles – it’ll plummet to 3,300.”

 

I’m about to run to Walmart to buy guns, ammo, and freeze dried food!

 

Here’s the problem. These gooroos keep predicting the end of the world year after year and are wrong year after year.

 

Then, when the market finally actually collapses, they will talk about how they predicted it ten years ago!

 

In other words, the more wrong they are, the more they will talk about how they predicted it years in advance! They will turn their incredible failing into a marketing plus!

 

Really?!

 

The lesson? Ignore gooroos. They are in the business of selling you books or newsletters. They are not in the business of making your money.

 

In fact, they are HARMING you by keeping you from investing in the greatest bull market in history! Your retirement and your family and YOU are harmed by their bogus warnings.

 

To me, the most important thing is to make money now in the market. To me, we should obviously be concerned about a large drop in the market. But we can make money in bear markets! So I want to trade right now, make money, and not crawl into a cave.

 

I have a course coming up designed exactly for this.

 

The first one is 2 Day Income. It will teach you how to create a second or even primary income right now to provide for your family. Click here to learn more.

 

Ignore the gooroos. Build your own income to attain financial freedom.

 

 Here’s the link to learn more. By the way, we will be live streaming for our international students.

Don’t leave $3997 unclaimed!

I want to give you $3997 off high level training that can create a great life for you and your family and get you on track for retirement.

 

I’ve put together a short video to explain it. Click here to view.

 

This promotion is part of an experiment. You can view the video for free by clicking here now.

 

Thanks!

 

Good trading,

Courtney

 

P.S. This is an experiment so we may end it any second now! Check it out here.

He Started Screaming…

I was with a friend this morning. Bright and early.

 

My friend was screaming at his computer. He was losing big money on a trade, over $20,000.

 

“I can’t believe its going down! They just reported great earnings!,” he exclaimed.  

 

The price moved lower.

 

“I’m hoping it bounces!”

 

“Sell it,” I said calmly.

 

“But it should bounce here!”

 

“Get out now. Clear your mind. You can always get back in after a minute. But your will have a clear mind. Right now, your mind is blown. You have no objectivity or discipline.” I explained.

 

he was extremely agitated and kept looking at his screen and yelling. I kept repeating my advice to get out.

 

I left him screaming at the screen and walked out.

 

Let me give you the back story. He is a very experienced trader with perhaps 20 years of experience but he doesn’t trade very often. He started again about a month ago.

 

He consistently made money. He proudly showed me how he was doing it. I told him I was nervous that he was making so much. I was worried about his risk management.

 

He told me that he just risked a couple of hundred dollars on each trade. He told me got out very quickly if he started to lose money. I felt a lot better after that.

 

But this morning he revealed that he had lost $40,000 yesterday and was down $20,000 today and had big losing days during the last week. He had made about $80,000 in the previous three weeks but was now net down for the month. That is why he was freaking out.

 

One problem was that he was trading to make money to support another business. So he was putting a lot of pressure on himself. I think that pressure caused him to take too big a risk.

 

One of the keys of trading is to keep cool and not put pressure on yourself.

 

Two ways to do this:

1. Trade smaller size. Cut your positions down to the point that you simply don’t care if you if you have a losing trade.

2. Get your psychology straight. This is the ultimate way to really enjoy your trading and to increase your profits. Click here to learn about my course on the Psychology of Massive Wealth. It is the cheapest course in the world compared to what it will do for your psychology about money.

 

Check out my online course, The Psychology of Massive Wealth. I address this issue detail.

 

 

Good trading,

 

Where In The World Can I Trade?

 

The flippant answer is anywhere your little heart desires.

 

Which is almost true! But let’s be a bit more realistic.

 

First, you need to have an OK internet connection. It doesn’t have to be great but it needs to be OK. I’d say it needs to be over 1 MPS but preferably 5 mps or higher.

 

Most broker platforms and charting packages don’t require much bandwidth to work. Heck, nearly all brokers have phone apps that you can trade on!

 

My preference is to have the fastest speed possible but you don’t require it.

 

Occasionally, I will go to a hotel and they advertise high speed internet access but it isn’t. You can usually do three possible things to solve this problem.

 

First, ask to move rooms. Sometimes the WiFi gizmo is far from your room and they can move you to right next to is.

 

Second, plug in an Ethernet cable into your computer. You will likely need an adapter to do this but Ethernet is far faster and more reliable than WiFi.

 

Third, go to Starbucks! Free WiFi! Not fast but good enough. Hey, you need a cup of coffee anyway!

 

In the US, I always travel with a portable WiFi. It’s basically a cellular phone in a small square box. Usually works well wherever cell phones work well.

 

It is a bit of a luxury as it costs me about $80 per month but I feel more secure having it around. Particularly when I am in small towns with poor WiFi.

 

Do you have any questions on Trader’s Life? What do you want to know about the life of a pro trader? Send me a question to support@wealthbuilderllc.com and I’ll answer it!

Announcing! 2 Day Income Seminar!

 

We are pleased to announce a brand new course to help you create a first or second income in trading.

 

It’s called 2 Day Income.

 

I will be teaching ONLY high reliable techniques for making consistent money from the markets.

 

You don’t need to be a millionaire to retire. You need the income of a millionaire.

This course is designed to give you that income.

 

You don’t need a lot of money to start. Perhaps $1-2000 only. So this course can help just about anyone.

You can sign up by clicking here.

 

I’ll show you how to use stocks and options to make money just about all the time. You won’t have to take a lot of risk. A vast majority of your trades will be winners if you follow my simple instruction.

 

I’m going to teach you some powerful strategies:

- Courtney’s Covered Calls

- Ratio Back Spreads

- Naked Writes

- Butterflies

- Mr. 2

- Gulp

- And much much more!

 

I’m going to also gift you how to track and analyze your trades.

 

This course is critical if you are going to retire when you want to.

Check it out here.

Why You Shouldn’t Be Afraid Of Stock Market Drops

Imagine the stock market plunging. You look at your brokerage account online and you get sick to your stomach watching the red number get larger.

 

You are frozen. You hate the market going lower but you hope it will turn around soon.

 

You’d hate to sell your positions and take a loss.

 

You’d hate to sell your positions and then watch the market skyrocket. That would be terrible!

 

But you don’t have to suffer at all! There are things you can do right now to protect yourself against such a problem.

 

I’m holding a FREE webinar next Monday at 11 AM PT. You can register here now.

 

I’ll be showing you why I think we will see a drop in the market.

 

More importantly, I’ll show you how to protect your portfolio from being ravaged by the market. You will receive specific instructions.

 

Click here to register for free.

 

Oh, and I’ll also show you ways to make money!

 

I will be sending out a replay if you can’t make it but you have to register to get the link.

 

But you have to register by  clicking here!

 

 

See you there!

Five Reasons The Stock Market Will Drop

 

I’m looking for the stock market to drop soon. Here’s why in a nutshell:

 

     1. Seasonally, September is the worst month and August is no prize.

     2. We haven’t had a 5% correction in over a year. That is an extraordinary stat. The market normally has at least one 10% correction each year.

     3. The market is complacent. Volatility is very low. People are falling asleep. Of course, that means that the market is about to become more volatile and I think the volatility will be to the downside.

     4. Sentiment is very very bullish. Surveys show that market participants are overly bullish. If everyone is bullish, who is left to buy?

     5. Momentum is waning. Momentum indicators are getting weaker which usually means that the market is about to dive.

 

I’ve put together a free webinar next Monday at 11 am PT on Will the Stock Market Collapse?

 

I will go into detail on the five points above plus much much more analysis.

 

Most importantly, I’ll show you how to hedge your existing portfolio and how to make money in the dip.

 

But you have to register by  clicking here!

 

 

See you there!

Glittering Profits In Gold

Gold has probably already started a massive rally that can make fortunes for those prepared to take advantage of it.

 

Several key factors are lining up to create an incredible opportunity.

 

I am broadcasting a free live webinar on July 31 at 5 pm PT. Click here to register.

 

I will lay out the deep fundamental reasons why this will be the biggest rally of the year.

 

I will show you the current technical situation so you will understand the current pressures in the market.

 

I will give you my personal trading plan and I will hopefully making money in the expected bull run.

 

This webinar is free and you can claim your seat by clicking here.

 

There will be a replay but you must register to receive the notice of the replay. So do it now while you are thinking about it.

Do You Deserve To Be Rich?

 

How did you answer that question?

 

How you answered that question will determine your financial life.

 

Go on, ask yourself that question again. Be truthful. Dig deep to find the answer.

 

Nearly everyone feels that they don't deserve to be rich. They feel deep down that there is something inside them that is defective. They feel that they aren't fully formed. They feel that they are small inside. They are afraid that people will finally realize that they are a fraud on some level.

 

Is that the psychology of a rich person?

 

So many of us are still children deep inside. We were told over and over again that we were doing something wrong as children. Of course, we never lived up to our parents' expectations. We failed.

 

Then we went to school and repeated the same feelings of inadequacy.

 

Then we got a job and repeated the same feelings of inadequacy.

 

Not everyone goes through this but the vast majority do.

 

It is often only when we become adults and attain competency in a job that we start to feel that we are worth something inside. This is the beginning of feeling that we deserve to be rich.

 

It is impossible to get rich and stay rich without feeling you deserve it.

 

You will always sabotage yourself before you get rich. You don't ask for a raise to a level you deserve. You don't invest in stocks because you are afraid you will lose money.

 

But you do deserve to be rich!

 

You are a human being and, as such, have value. Real value. Are you perfect. Of course not. But you don't have to have perfection to be worth something. Perhaps even a lot.

 

You need to stop focusing on your faults and focus on your values. You are a good person. You do a good job at work. And so on.

 

You become what you focus on so stop focusing on your faults! Of course you should acknowledge them and try to correct them. But don't obsess over them. Heck, don't focus on them much.

 

Instead, focus on what you do well.

 

Dwell on your competencies, on the things you do well. You should be living your life here.

 

I know that I'm a poor proofreader. But I know I'm a pretty good writer. I could obsess over my poor skill. I could take courses in proof reading. I could study it til I get it right. But going through all that focuses my mind on the fact that I am a failure at proofreading. I will begin to think I don't deserve success. I will begin to think I don't deserve to be rich.

 

Instead, I should just hire someone to proofread and instead focus on the area where I am successful, writing. Then, I will have people compliment me. I gain some measure of importance in society. More importantly, I will revel in my competence. My self esteem will grow. I will feel that I deserve to be rich!

 

You can't get rich if you don't believe you deserve it. Change your mind by changing your focus.

 

Get rich. You deserve it.

 

Check out my online course, The Psychology of Massive Wealth. I address this issue in gory detail.

How To Become Rich…Really Rich

The major reason why people don’t get rich is their own mind. 

 

They’ve been trained to not be rich.

 

I’ve put together two things to help you overcome that and become truly rich. Rich in money and rich in spirit.

 

The first is my amazing course The Psychology of Massive Wealth. This is an online course where you receive training every single week for months so that you can truly understand and actualize the content without getting overwhelmed.

 

The second is that I have put together a live weekend seminar with Adam Markel, truly one of the masters of a wealth mentality. He has literally trained tens of thousands of people on how to actually get rich without selling out. He is one of the best trainers in the world today.

 

The live seminar will literally change your mind! Change it to where you want it to be!

 

You can get all the details by clicking here.

 

The tuition for both the Psychology of Massive Wealth and the Live 2 Day Master Class is only $147. Amazing!

 

Check it out here.

 

This bundle is designed for people who are frustrated with their life and want to improve their life.  Also check out CourtneySmith.com/How-to-become-rich/

Trading Techniques Are Assets For Your Trading Business

I believe that trading is a business and should be treated as one.

 

One of the keys to your trading success is understanding that your techniques are assets of your trading business.

 

Our trading business has really just three assets:

1. Money

2. Our brains

3. Our techniques

 

So our techniques are one of our key assets.

 

A profitable technique is like a business with a successful line of shoes. That line of shoes should continue to make us money for years.

 

Yet most people take that incredible asset and trash it. They don’t follow the rules. They don’t trade every day. They cherry pick instruments and trades.

 

In other words, they actively try to destroy that asset rather than nurture or grow that asset!

 

Amazing!

 

I’ll talk in other posts why I think that is but it never ceases to amaze me how little thought is given to this asset.

 

They would really pay attention to it if it was a regular business but they trash it in their trading business.

 

Your goal as a trader is to accumulate assets, all three of the ones listed above.

 

One of the amazing things is that you can create a legacy for your children with these trading assets. You can turn over your profitable technique to your children and let them build even more wealth!

 

You might say that your kids will never trade. They don’t have to! Turn over the trading to your broker and let them do it!

 

Stop and look at your trading business as a real business. You techniques are one of the key critical assets of that business.

 

We have an amazing course that really can turbo charge your trading business. It’s called How To Quit Your Job Trading Stocks and Options. This online course is created to give you all the info you need to create a trading business trading stocks and options. 

 

I know you would profit tremendously from the course. Click here to learn more. I’ve created a 4 part free video training that explains it and actually reveals a super cool technique.

 

Click here to register.  

 

A Fantastic Strategy For Short Term Stock Trading Profits

I use a group of powerful techniques for short term trading of stocks. I find them to be very powerful so I use them just about every day. It is a great series of techniques if you want to make a living as a trader or make a nice second income.

 

This group of techniques are called Mean Reversion. What does it mean?

 

It simply means that the price of a stock will go back to its average. Let me give you an example that happened to me last week.

 

The chart show FXI which is an ETF which mimics the Chinese stock market. You can see that the price was coming down early in the period. Now look down and you will see a single black bar. That is a buy signal from my technique ETF Ecstasy (EE).

 

EE is telling me to buy on the close that day. So I did.

 

The market then took off, skyrocketing much higher.

 

The first profit taking point is the five day moving average which is the thin red line. You can see that the price closed above that right away. But I kept the position because it closed near the high of the day, thus showing a lot of strength.

 

Great trade! Lots of profits!

 

So why buy at that point?

 

Mean Reversion simply states that a market that has moved away from the average will bounce back to that average. You can see that happened perfectly here.

 

But it is important to only trade in the direction of the trend. EE uses the 200 day moving average to determine the trend.

 

So we had a bull market. Check.

 

The market moved sharply against the trend. Check.

 

Buy and look for the market to move back in the direction of the trend at least a little bit. Check.

 

I'm going to explain this Mean Reversion concept in futures emails to you because I think it is amazingly profitable.

 

I also just launched a brand new service called Smith's Stock Swing Trader (SSST). I'm really proud of this service because it is so easy to use and, so far, incredibly profitable.

 

You can learn much more about it by clicking here now. I think you will gain a lot by clicking!

How Much To You Need To Spend To Make Money Trading?

Not much.

 

You need a brokerage account but they are free.

 

You need a computer. But that computer doesn’t need to be very sophisticated. I often trade on computers that are years old. The computer I am typing this on is almost four years old and it is my main computer.

 

In fact, you can trade on your phone or tablet so you don’t even need a computer anymore!

 

You need an internet connection. I like a fast connection but you don’t really need one. You need a stable connection that doesn’t cut you off all the time. I’ve traded in third world countries where the internet went in and out. I could run my trading operations but it was frustrating.

 

You need a charting program. There are many great charting programs that are free. I use ProRealTime.com and Stockcharts.com. They both have great services that are free. Real time prices cost money on both of them but position traders don’t need that.

 

In addition, your broker is almost certainly going to give you free charting. It’s usually OK but I prefer the two above because I can program them with my super tricky indicators.

 

So the bottom line is that you need to pay for internet and that’s it!

 

That’s about it!

Massive Rally In Gold Coming Now?

 

 

There is a potential massive rally in gold coming up. The potential is so huge that I wanted to share it with you right away.

 

I co-wrote my first book in 1980 on seasonal price tendencies. Seasonals are repetitive price patterns that occur at the same time every year.

 

We are now coming up to the most important time of the year for gold. Prices rally about 90% of the time in August!

 

Take  look at the chart. The blue line shows what the price of gold has done so far this year. The black line shows the expected seasonal price movement. As you can see, the price has followed the seasonal pretty well.

 

But the killer is the how the black line shoots up in just a few short weeks. That shows that the price of gold normally shoots up strongly.

 

You can invest in gold through stocks, options, futures, and CFDs.

 

I’m going to be looking for any sign of strength starting in about a week as a buy signal.

 

Want to know my exact entry and exit strategy? Want to follow me as I hopefully make a ton of money? The best way is to subscribe to my amazing weekly video newsletter, Trade Smith. http://register.wealthbuilderllc.com/trade-smith/

Click here for more info.

How To Predict The Stock Market One Year In Advance!

I did a special webinar a while ago where I taught and demonstrated how to predict the stock market one year in advance.

 

I also showed how to predict market crashes one year in advance!

 

This recorded webinar is absolute free and you can watch it by clicking here now.

 

It really is remarkable training!

 

I reveal all the rules and insights so you don’t need me anymore. All the tools to do it are free.

 

So click here to view it!

Your 30 Day Trading Challenge

Focus is one of the most important part of trading and life. You need to be able to focus or you won’t get anything done.

 

I teach that people, other than day traders, should only spend 15 minutes a day on their trading. Why? Because they can focus for that long and not much longer. I’ll write more about that later.

 

Another way to focus is to create a tight schedule and then stick to it. I’m going to propose that you create a 30 Day Challenge for your trading.

 

Sit down right now and get ready to take some notes.

 

I want you to create a Challenge for yourself to accomplish in the next 30 days. Let me give you some suggestions:

1. Execute flawlessly for 30 days.

2. Make money every day.

3. Learn something new every day.

4. Talk to another trader every day.

5. Have your equity higher at the end of 30 days than today.

 

You figure out what you should focus on to make yourself a better trader and a more profitable trader. Have a problem with psychology? Feel fear when you put on a trade? Then give your self 30 days to conquer this problem. Better yet, don’t feel fear every day for 30 days.

 

This 30 Day Challenge is a great way to make sharp jumps in your trading skill. It creates focus.

 

To help you, here’s a link to fill out a simple form for your 30 Day Challenge. I don’t want your name or email. You will be anonymous. But filling this form out will be a great way to commit to the 30 Day Challenge.

 

In 30 days, I’ll write another letter asking for your experience with the 30 Day Challenge.

 

Click here to fill it out now!

 

I’ll report back to you what other people are putting down as a 30 Day Challenge so you can get some inspiration for your own 30 Day Challenge!

 

Here’s the link!

Amazon Eats the World

Amazon announced today that they are buying Whole Foods (otherwise known as Whole Paychecks). This is powerful for several perspectives.

 

Amazon is moving more and more into the real world. I’m in Beverly Hills right now. I can order from Amazon and two local grocery chains and have the food or products delivered to me in less than two hours! Now I’ll be able to have my Whole Foods delivered to me as quickly.

 

In addition, AMZN has been opening bookstores over the last year to experiment with different business models from traditional book stores.

 

What this also means is that the prices in Whole Foods stores are about to be slashed. Amazon knows how to run lean, better than Whole Foods. So we can now expect Whole Foods to compete on price with the big grocery chains which means Whole Foods revenues are about to explode.

 

It is also setting up a collision with Walmart. Walmart is now the country’s biggest grocer and they do an amazing job at it. Amazon is taking the high end with Whole Foods but you can bet that Amazon will find a way to dive even deeper into Walmart’s territory as the same time Walmart is trying to revive their online presence to attack Amazon.

 

These are two great companies but Amazon has been online longer. In addition, Amazon has made themselves a platform for all sellers so they are a bigger footprint. I never want to count out Walmart but I give the edge to Amazon.

 

I’m really bullish on AMZN stock! I think today’s announcement is a great opportunity for both swing traders and position traders to buy AMZN.

 

The best place to keep up with my specific stock trades is my weekly video newsletter, TradeSmith. Please check it out here.