Dr Brett Steenbarger Voice Seminar

Before I start my family obligations for today, I was able to get up early and attend a voice conference where Dr. Brett Steenbarger was the presenter. I try to review everything Dr. Brett has to say in his posts on the WebLog on his personal site, his Blog, and now really look forward to new events like this Voice Conference.

I Feel he goes above and beyond at freely sharing market insight, thoughts, and research. I take everything to heart and have been able to tweak and grow my trading from the enormous quantity of market details he shares on these sights.

I'll edit in a link when the recording of the conference is made available for replay. Or just watch his site for the direct post on this great event.

Very Good Conference

Dr. Brett went through some topics that were beneficial to me and my future as a trader. Two "simple setups" were presented. If you are interested, review the replay to get a direct understanding of these setups. The details of these two setups have not and will not be posted. These details are only available from this voice conference.

For these setups, recent market conditions are researched to determine if there is an "Edge" that could be exploited going forward. See a recent example of When Large Cap Stocks Outperform Small Caps. The odds of both successful and unsuccessful trades are presented along with the historical average return.

I found it interesting to hear how Dr. Brett then utilizes this research to place his own trades. One setup had a positive expectancy over the next four day period. Dr. Brett does not just buy and hold for this entire time frame. Instead, intraday trades are placed in the direction that the research shows has an edge. Before entering the trade, current market conditions are evaluated to determine that they support the researched edge.

I could see some similarities in Dr. Brett's trading and my own. We both place a position and "take off" some profits for the "psychological win" perspective of our own trading. Then a portion of the position is allow to run (market permitting) for more profits. Dr. Brett takes off 3/4 of his initial position where I'm using 1/2 the position for my first profit taking.

There are also many differences in our styles. I'm willing to take more entries per day and potentially have small wins, losses, or scratch trades probing for profitable trend moves to trade. Currently I'm not doing research to set any probable expectations for the day or near future. My current goal is to correctly react to the price action as if forms for throughout the day. I need to evaluate if similar research could help my trading, but that is further down the road.

One of the points presented matches my thoughts about trading and can be found in this blog's first post titled: My Start. The point being that every trader needs to find "their trading style" to be successful. One should not assume a trading style is a match to their personality. A strategy needs to be tweaked and become "your own" style. Don't just blindly try to mimic someone else's trading style and "Hope" to become a successful trader. (There is that Hope word again...)

After the conference, I found myself with a new vitality and interest to dive deeper into several concepts from the call.

My Main Take Aways

Review postings - I plan on researching Dr Brett's posting to review additional comments on "Reversal" and "Breakout" patterns. These are post I have read in the past, but now want to re-review to gain a deeper and refreshed understanding. I'm sure I'll have more posts on my thoughts from this review yet to come.

This interest comes from conference comments about "momentum peaks" and their characteristics. I saw an interesting alignment between these momentum peaks and some of my own trade setups. I just may find some additional setup ideas or even trade filters to help reduce losing trades.

Average ES Volume - I want to dust off and complete a prior project, developing an Average Volume Indicator. Dr. Brett calculated a table for the average volume for each 15-minute trading period in the ES (S&P Futures) for the past 20 days. See his post: Volume and Opportunity in the Stock Market. I feel this will help me judge volume much better for my trade setups.

I have stated that I like to see increased volume as price moves in the direction of the trend. See the Volume section of the My Trade Setup posting. Without an increase in volume, price will be more likely to reverse. But as volume falls off during the slower midday trading period it becomes more and more difficult to judge volume. Understanding if volume remains above the average for each time period should help me improve my volume perspective.

Journal - My purpose for this blog is a journal primarily for my own benefit. If others find reviewing my thoughts and asking questions also helps them in their trading then all the better. From my past computer consulting days I often conduced training classes. For me, I found that striving to describe and convey knowledge to others improved my own thoughts and depth of knowledge on a topic.

The topic of a "cognitive journal" was presented in the conference. The cognitive aspect should contain "challenging self talk" that would "interrupt the thought process." The interruption is to examine or re-evaluate the details and help make sure the right decision was made. Also, harmful "negative thoughts" are removed and details thought of in a positive light.

This made me think about my recent blog comment from Friday's Trade Setup Review. I found I had to tell myself in the Flip a Coin section of my narrative that while I wanted to enter a long trade, my recent entry signals were actually Short signals. I feel I actually kept myself from putting on a losing long trade when my emotions were tell me to get long.

So what is the take away... To make sure that this blog covers the cognitive aspect for my own self review of my trades. I'll review the chapter on journals from Dr. Brett's Enhancing Trader Performance book to make sure I'm covering the bases.

I always find excellent trading tidbits in Dr. Brett's posts. He shares his market details with the true intent of helping other traders be successful. I applaud him and also thank him as I have benefited from his sharing.

Trade Wise, Trade Well
John