2017: what a year it has been

It was year 2 of my immersion to the ZFT system. 

Overall it was a very successful year. Smashing my expectations of what could be possible. Although, maybe that early DYM was a sign of things to come. 

This December I've taken an extended break from ms market. During this time, I've focused on my intangibles. Spent precious time with family and friends. Enjoying the fruits of my labor. And remembering my whys. 

I also reviewed my trade statistics. They gave me a good picture on my profile as a trader. An average of about 7-10 trades a month. Good cutloss discipline. A tendency to hold on to winners. Remarkable improvement in bounce plays. 

Yet, there is still room for improvement. I have identified these profit leaks and will focus on making the necessary tweaks in my trading algorithms. 

This 2018, I plan to venture into the world of crypto trading as well. FOMO is real guys and girls. Just waiting for my coins verification which is taking forever. I will take part in the XXk to 1M challenge that the other members of the core are currently undertaking. It should be a very interesting endeavor. 

Thank you again 2017 for the multitude of blessings. 

Get ready 2018, here I come. 

Foreign Intelligence

In this era of globalization, it's a wonder that some people would still base some of their trading decisions on which broker is buying/selling a stock. 

This is especially baffling when people would be influenced if people would buy just because a certain broker, usually a 'foreign' broker, is buying.

Is it because of some remnant of colonial mentality? Which is defined as the following: 

Are foreign brokers (if foreigners really are the ones doing the buying/selling) really superior to local brokers? 

Do they have access to some super secret formula that cannot be shared to local brokers? 

Are they really omniscient that they will not take in losses? Or make bad trading decisions? They are still people after all. 

What if I open an account in one of these foreign brokers, will my processing unit be automatically upgraded with this so-called foreign intelligence? 

The idiocy of some stock market myths astound me sometimes.

TROPHY TRADE: PXP

Been getting a lot of PMs on how I spotted or traded this stock. 

Here are my answers in a condensed form. 

1. How do I you screen stocks? 

I answered this during the class with the Eternus batch. I usually group stocks into certain categories. Then I'll select the best ones.

This is my selection process: 

With that out of the way, I'll place that stock on my watchlist. Then I will stalk it until it shows me an optimal buy area. Usually on breakouts. 

2. Where did you buy?

This is the simplest explanation I can give without revealing the tribe's secrets. 

First buy was on the breakout here:

Second buy was somewhere here: 

3. Why did you hold?

My trade objective for this was to trend follow. So I just kept moving my stops up. 

My stop could either be the ff: 

- previous resistance that was broken

- breakdown of a box

- a set price

4. All in?

Yes. This is my trader profile and I know and accept all of the risks that could happen. If you can't take it then please DO NOT go all in. 

Lastly, the obligatory port snaps. This is the reason why this is a trophy trade for me. The gain that I got for this trade has been the biggest ever in monetary value in my whole trading career. 

As boss zee said, it might be time to level up. 

Wasn't able to take a snap of my other port. But all three of my ports had PXP. The last port reached only about 80+% up at the highest. 

Take note though, this port snapshot was taken at the end of 09/25. I was not able to sell at the highs. But that is alright with me. It is the risk I am willing to take since I am doing trend following. 

It's all about setting expectations. And with that I always remember this quote: 

"As long as you accept the fact that you will never be able to sell at the highs, you will be fine."

Again my eternal gratitude to my mentors, Zee and Kap. Along with all the other mentors who push me to be the best trader I can be. 

Form a wall

So.

Group buys. 

I've been hearing about it being discussed a lot recently. For the uninitiated, it means that someone will tell a group of people to buy at an identified support. Like a wall. 

In the NBA, it works. As seen here in this video clip below. Turn up the volume to hear the coach tell it to his players.

Defenders literally just made a human wall to impede the person who is inbounding the ball to see the person he's going to pass the ball to. Easy. 

Now, in the stock market, it's a little bit different and sometimes doesn't work. Let's say the people involved in the group buying are the nova corp ships in Guardians of the Galaxy. 

When the 'leader' of the group says, let's all buy at this price to support our beloved stock! 

We cannot let it fall! 

We will support it as only we can! 

They will form a wall, like this:

Pretty impressive huh? 

But in reality, if Ms Market really wants to break supports, IT WILL BREAK SUPPORTS.

The wall that they built can come crumbing down with just a simple selldown.

And what happens to the people in the wall? 

Instant investors or 'ipits' just like the unfortunate pilot in one of the spaceships. 

So. 

Going back, group buys. 

Obviously I'm not a fan. We do not advocate it in the tribe. It only appears that way sometimes because we all follow one system. And in the unlucky instance that we are unwilling members of a wall, we know how to eject or cut fast to lessen the risk. 

*I admit this could have been better executed by Money Growers with one of his patented videos + dubbing. 

Internet advice

There has been a disturbing trend of people asking for advice online if they should keep holding to a losing position. Most of the advice given is the usual mixture of the following: 

a) It's just a paper loss. It's not really a loss until you sell. 
So, don't sell. (genius logic)

b) Average down or peso cost average. The price is going lower so you can buy more shares. (unli-money mode)

c) It's ok, I'm currently down as well. Let's hold it until it goes up again. (hopefully in the next month or year. Or years. Or decade.)

d) Cut your losses and start again.

Now, who do you think will the fellow asking advice will follow? Sadly, most of the time, it's either a, b or c. Why? Because it's the one where they do not have to admit that they made a mistake. 

Don't get me wrong. There are some people who would give genuinely good advice for these lost souls but they are a dime a dozen. And sometimes their voice gets lost in the sea of people giving false hope and wrong advice. Sorting through all the bad advice will take a lot of time and effort. 

Remember everyone, the internet is dark and full of terrors. There are a lot of wolves in sheep's clothing. Just waiting for you to show weakness and they will pounce. 

The said people asking for stock advice in FB groups remind me of people who fall victim to online photoshop trolls. Here is an example:

If you want to see more, go to this site: Photoshop Troll 

If you know anyone who "needs" photoshop help. Send them to this site: http://www.photoshoprequest.com/ That's the site where they get their victims. Enjoy! 

A Tale of 2 Traders: SSI

This is a story of two traders who bought a stock. This story is completely true. The names have been changed to protect the identity of the buyers. 

Once upon a time there was a stock IPO. This certain trader, YP, loved the fundamentals of the stock. He thought the owners were reputable people and their name recall would carry their stock to the moon. YP knows Alpha is a technical trader, though has no idea that Alpha is ZFT trained. 

We begin our story sometime in back in July or August of 2015, YP would ask me from time to time what I thought of SSI. 

iAOTS with no sign of support

When it went back to the IPO price. I said, sell.

When it went to 6. I said SELL.

When it went to 5. I said SELL.

When it went to 4. I finally asked, why are you asking me for my advice if you're not going to listen? The chart is telling me there is no support or reason to buy yet. 

The only thing that he said was that he's already in too deep and would rather just become an investor. He still believes in the owners. That the owners won't let the stock be down for long. 

Fast forward to now, about a year and a half since that time. Finally, SSI looks to be showing some signs of strength. Slowly it seems to be on the long road to recovery. 

By my rough estimate, YP's average should be somewhere around 7-9 pesos. So from about a 60-80% loss, it should be now down to about 40-50%. Not bad. (Pardon my math, despite being a robot and a trader my math is very very bad)

As for me, I bought SSI using nothing but charts and was able to be up by a good amount. The road to breakeven for him is still ongoing. If ever it gets there for him, I'd like to believe that I'll be there cheering him on since I would have made another entry for SSI.

I hope that this story could be used as a sort of caution for people to stop loving a stock. Because it might be too late for some to realize that stocks won't love you back. 

Deja vu

2GO's weekly chart reminds me sooooo much of ION's daily chart back in 2015. 

Just an observation. Not hyping or bashing. Just the random musings of a robot. 

The only thing constant is change

So, after 2 weeks away from the market. It's time to go back to the charts. The first quarter of 2017 was extra special. I wonder what the rest of the year will bring. If it's even half as good of the first quarter then 2017 should be a banner year. Good thing that this time the market has my full attention. 

Just finished setting up Amibroker and I must say it's pretty awesome. Kinda late to the party since majority of traders in the tribe already use Ami. It was just that old reliable COL JAVA was working for me so didn't feel the need to switch. But since everybody knows that JAVA is being retired in all web browsers, change was inevitable.

Ami having shortcut keys and automatically saving my robotic drawings is a new thing for me. Makes me wonder why I didn't make the switch earlier. This should be fun.

What's not fun is $CHP. Reminds me of the slow death of $SSI in the last half of 2016. 

 $SSI circa 2016

$CHP, how low can you go? As of right now, nobody knows.

This is a sad reminder why I absolutely hate downtrending stocks. Still not sure why a lot of newbie traders our there in the Philippine market are so engrossed with looking for 52wk lows or all time lows thinking of it as a sale. Maybe there is a reason why it's trading that low? Whatever it is, I wouldn't want to touch them until the selling pressure has abated. 

Anyway, here's a video of one of my favorite books, Who moved my cheese? by Spencer Johnson. It simply states that in life we will encounter change in all shapes and forms. How we react to that change will determine our success. Enjoy!

Reaching for the moon: ALCO

For this year I've set very aggressive monthly targets as my quota. I wanted to see just how near to those targets I can get. I knew it was a challenge since the bar was set really high. 

Thinking of the targets reminds me of a quote I heard a long time ago. Something that has resonated with me ever since. 

It's stuck with me since it meant to always, always, ALWAYS set your goals high. For even if you fail to reach your goals, the effort that it took to try and reach those goals will still bring you a long way from where you started. 

Going back, this year, I've set my quota to be 25% a month. With the power of compounding interest, that should bring my port to an all time high by the 3rd quarter of the year. At first, I thought it was daunting but the universe seems to be telling me otherwise. 

How else can I explain the fact that with just 3 winning trades, I've reached DYM status in record time. 

Quality over quantity I'd like to think. 

I love Excalibur

So my 2017 has been off to a roaring start. Already about a third of the way to reaching my yearend goal. Hopefully I get to catch more monster plays. 

Bounce Play: VITA

In the stock market world, we should all learn how to earn money during uptrends and downtrends. This is because of the simple fact that the market cannot go in one direction all the time. It shifts constantly from one to the other. 

For my neural networks, one is far easier than the other. Just look for the outlier, the strong stocks and then buy high and sell higher. If it doesn't continue on upwards, then just sell quickly or cut losses accordingly. Simple yet very effective. 

The other side is buying downtrends or bounce plays. These are the stocks that have been battered and broken and don't seem to have any immediate upside. But if you are able to catch this at the point of reversal, oh so juicy returns in a short amount time!

VITA was one of these stocks that came from a recent high and just seemed to resist making any kind of significant bounce. It just continued to go lower and lower and lower for a couple of months. It didn't look like there was any end in sight. Especially when looking at the daily charts. No sign of strength right? 

Sometimes what I do, when the daily charts don't give me any clear picture, I switch to the longer time frames. 

Now, let's take a look at the weekly chart and it looks much better. There seemed to have been a support formed at the 50MA and darvas levels. 

When I saw this, I instantly made my plans and set the corresponding buy (as near to the 50MA as possible) and cutloss points (break of the 50MA). I was ready and lying in wait on the first day of the year. 

Fortunately, I made the right decisions and everything worked according to plan. 

Wasn't able to sell at the high of the day but that's OK. It went far and beyond my expectations for the first trade of the year. It's a different kind of rush to be able to buy at the almost absolute bottom. And then watch it bounce in a most spectacular way.

I imagine it must be just like what this sterling earthling felt when he caught the cup of beer one-handed in a sea of people. 

Here's a toast to catching more fantastic bounce plays in the future.