Entries by Peter Brandt

Trading Psychology – The Human Side of Trading

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Overcoming self and mastering Trading Psychology is an individual struggle – this is why consistent long-term traders have developed a tremendous and unbiased awareness of self. When I came into the trading business in the mid-1970s there was a saying around the Chicago Board of Trade that went something like this … “If you want to know yourself – all your insecurities, character faults, issues of pride, areas of greed or selfishness, unresolved traits, etc. – just become a trader. How true! Self-awareness and managing the Human Side of Trading is a hallmark of every great trader I have known over the years.

Factor Member Monthly Webinar – Sep 22nd

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Recorded live September 22, 2016

Discussion Points

  • Edge - The nature of a trading scheme that provides it with the ability to carve out beta against its appropriate benchmark universe
    • Classical chart patterns - in and of themselves - provide no meaningful trading edge - in fact, no trade identification mechanism provides a meaningful edge
    • Win rate - in and of itself - provides no meaningful trading edge
  • Factor’s Edge - Factor’s edge is attributable to four primary things
  1. An emotional separation from the need to be right
  2. Aggressive risk and trade management protocols resulting in many non-injurious losses - protecting trading capital in the SINGLE DOMINATE PRIORITY
  3. Identifying and committing to very selective highly asymmetrical reward-to-risk trades
  4. Allowing the odds to provide a few trades that work immediately and provide profits of 350 to 450 plus basis points each
  • Soybean Oil - Walking through the trade

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Sample Member Q&A’s

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Here at Factor, we receive so many great questions covering Risk Management, Trade Management, Classical Charting Principles, The process of Trading, and the Human Aspect of Market Speculation. As followers of our public blog, we wanted to share just a handful of these Q&A’s with you.

Significant Factor Alert – Sep 20th

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This has been a remarkable week in the markets I have been following and featuring in Factor Updates and Alerts. I have established four different positions this week -- and it is only Tuesday -- so I figure an Alert is appropriate.
Cotton -- the rally today completed the inverted 6-week H&S pattern that has served as the retest of the underlying 2-year double bottom. I initially had a stop order in place, changed it to an alert early today, then bit the bullet and bought the market almost an hour after my alert flashed. I believe the market is now poised to trend to the initial target of 78.48 with the low 90s a possibility.

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Is it a massive Natural Gas Head & Shoulders bottom?

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Is it a massive Natural Gas Head & Shoulders bottom?

I last covered the Natural Gas market within the public blog back on June 20th, with the post "Natural Gas Rising".  Natural Gas posted a 21-year price low in Mar 2016 and the bottom took the form of a 7-month Natural Gas Head & Shoulders bottom on the daily and weekly charts. The target of this H&S at 2.934 was quickly met on Jun 29. The Factor participated in this H&S pattern in its proprietary account and discussed the pattern within the Factor member Updates (See here for details on the Factor Service).

 

Natural Gas Head & Shoulders - Monthly chart - Factor Trading

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Natural Gas — A massive H&S bottom?

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Natural Gas posted a 21-year price low in Mar 2016, as shown below on the quarterly graph.

1The bottom took the form of a 7-month H&S bottom on the daily and weekly charts. The target of this H&S at 2.934 was quickly met on Jun 29. The Factor participated in this H&S pattern in its proprietary account and discussed the pattern in the Factor Update.

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Soybean Oil Next In Line

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Soybean Oil Next In Line

There is some analog history for a bull trend in Soybean Oil to follow a bull market in Soybean Meal by six to 12 months. I would define the Apr-Jun 2016 advance in Meal to be a bull market. The H&S forming on the weekly Soybean Oil graph is my current favorite developing pattern.

Factor is long Soybean Oil with a decided interest to extend leverage. This market has the potential to be a 1000 basis point trade.

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