Posted on January 11 , 2011 In Announcements

Update for the New Year!

Helllooo readers! It has been awhile but I thought I would write an update to let anyone interested know what I will be doing in 2011. Quite a bit has happen since I posted two or so months ago. I have been working more promotions, and really figuring out what I want to do with myself. The break from trading has also given me quite the perspective on my time as a trader. So lets dive right in.

I realize now that the responsibility and maturity required to trade for a living was not present in me while I was trading. In many ways, I was looking for that quick fix a lot of the time; that thing I could depend on to take care of me. I would making money, stop caring, and then lose that money. I wrote pages and pages about the constant win and loss cycle I went through. This cycle had its roots in my mixed up motivations for trading. I wanted to make money, but I didn’t really enjoy trading. Don’t get me wrong, I liked trading as much as the next guy, but the real all-stars of the trading world simple LOVE it. They cannot get enough of the screen. They devour new information and immerse themselves in the world of finance.

That just wasn’t me. I put in enough effort so that I believed I would make money, but it just wasn’t at that elite level. My motivation would give out right as I really started to win, hence the cycle. I realized that the real pro traders approach the art willing to dive to infinite depths of complexity and distinction. I was only willing to go so deep. As soon as I had a believable conclusion (this is going up!), I was unwilling to continue probing the depths of price movement.

I will say that I WAS willing to go deeply into MYSELF, just NOT the financial markets. That distinction made all the difference. I never would be successful when my true heart’s desire was in self growth, and the markets only a means to that end.

These days, I feel trading is simply an art form that is always there for me to pursue. The same queer dissatisfaction that pervades any other art form also characterizes trading (Did you know that to be creative is to distort something? Think about it, it makes sense). There was never some end point in trading where I would have been satisfied…and if there was, it was only an illusion. I must really love price action, and price action alone, to be successful as a trader, and maintain motivation.

The direction my life is taking now is teaching, and more immediately training to be a teacher. Teaching is not so easy. I mean presenting facts is simple enough, but really being available, and giving, is rare. How many teachers did you have that really made a difference in your life, and what was that difference? It probably wasn’t just a presentation of facts, but an actual emotional evolution. In my experience, a great teacher is almost magical in their ability to bring something out of you that is great, beautiful, wonderful, and unknown until that moment.

I will be taking the teacher training from the Art of Living. They are an organization that offers a plethora of stress management courses for anyone interested. I will probably be doing a lot of traveling and teaching. I hope to meet some amazing people along the way, and learn more about myself. I think it was Socrates who said this great quote: “The unexamined life is not worth living.”

Love,

Lucas

Posted on November 17 , 2010 In Daily Updates

A Look, A Glance, A Whisper

So it appears more and more that my break will be extended, both because of the lack of funds and because I lack motivation to get back into it. I felt a little guilt and regret when I missed out on this sell off (which I think has more room to go), but for the most part, I am glad to be out of the tussle. I spent four years really engrossed in the market. I was going to school for most of that period, and had other things, but in my mind, trading was the most important thing for me. There was always this drive to get back to the trading screen, and really become a “trader.” I had this belief that if I could make it at trading, then everything else in life would fall into place.

This whole experience taught me a lot about conflict. See, in reality, for the last four years, I have been in a constant conflict within myself, and the battlefield was the market place. I was trying very very hard to conquer and win against this thing inside. I cannot even really describe what it is, but it feels bad if I am not striving for something. I think most people have it. I hear it in their speech when they say things like “I haven’t done much with my life the past couple years,” and “I need to get motivated and go achieve something.”

When I stopped trading a few weeks ago, I found myself in an awkward situation. I was lucky enough to have a steady stream of promotional work coming in, so I was making money, but I wasn’t striving against anything. I felt like I had no purpose, nothing to strive for, and I wasn’t “doing” anything. Many of the practices I had developed over the last couple years started to fall apart: I stopped exercising regularly, I stopped meditating and doing my breathing practices, and I stopped being disciplined about my sleep cycles and such. I was pretty amazed to see that all these things I had done in my life simply dropped off as soon as I had nothing to struggle against. It is like trading was the reason my life had become so structured.

Here was my schedule when I was trading:

•Wake at 5:15 AM, get on the computer, listen to the morning mentor room, look up news, etc.
•Trade from 6:30Am-9AM
•Do breathing practices and meditate from 9AM-10:15AM
•Traded from 11AM-1PM
•Exercised from 1AM-2:30 PM
•blog post and plan from 3PM-4pm
•Free time from 4PM-7PM
•Meditate from 8Pm-8:45PM, then go to sleep.

Just looking at that I kind of cringe inside. I mean at first, when I had this schedule, I thought I was winning the war. I was doing what I needed to be doing to become a “trader.” Overtime though, I noticed that I started to hate everything I was doing. When the weekends came, I felt free and absolutely binged on alcohol, partying, video games, and movies. It was like a cycle where I built up all this energy during the week, and then spent it all on the weekend. Sunday afternoons and Monday mornings were an absolute hell. I hated getting back into the schedule, especially because I saw more and more that whatever I was doing was NOT working.

Here I was, a “trader” full time; everything I wanted to be. Yet where were the golden gates? Where were the bottles of champaign, caviar, and the easy life I had imagined? The main question was: where was all the success that would shut up that thing in my head which was urging me to fight for more. I was fighting because I truly believed, and still do on a feeling level (even though intellectually I know it’s never ending), that if I eventually won, the fighting would be over. The conflict would be done at some point in the future when I became good enough, or whatever, to win in a big way. THEN I could settle down and relax.

It never came, and you can only fight for so long before you just get worn down. When Pete said something in the mentor room, I just snapped, I couldn’t keep fighting like I was. I couldn’t keep doing the cycle over and over again. I had to be free. After I quit trading, it didn’t take too long to realize that I was still fighting the same fight that I had run away from in the market place. In fact, the fight is everywhere; in trading, in video games, in jobs, in relationships, or anything else where you have an emotional investment. I realized that I did not quit trading, not really. I was still working on the same skills outside of trading as I was while trading, but just in a different way.

I think the realization that I was just going to work on the same problem outside of trading as inside of trading eased the guilt and motivation to get back to the screens. I know that I will continue to grow, learn, and open my mind. But for now, I will be doing it in a different way, and hopefully a less intense way. Other then flings, I haven’t had a girlfriend for years, maybe I will try that for awhile. I also haven’t had a job where I really interacted with people for years, so I would like to do that as well. There are all kinds of things out there to try; trading is not the end all be all measurement by which to look at life. I will keep updating blog posts, but they will be more separate, and broad based. I still read DTF’s and Fozzking’s blogs though, keep up the good work guys.

Love,

Lucas

Posted on November 4 , 2010 In Daily Updates

Close the Door, Open the Window

Tomorrow’s Plan:

Today’s Trades:

Today’s Journal Entry: The End

Dear Pete,

I have now been with Keystone for about a year. In the past year, I have learned many things. It was probably the most enlightening year of my life. I learned how little I knew about myself and the market. I learned what disappointment, anger, and sadness really taste like. I also learned what courage, confidence, humility, and success really are. I would not trade the experience of this year for anything!

You were a big part in making that happen. I now realize that my growth with Keystone is coming to an end. I love trading, I love the planning and the execution, but day to day, it is absolutely killing me. I feel constantly torn, and maybe I just don’t have what it takes, I don’t know, but I do know that I cannot go on like this.

My grandmother just died, and while I was not close with her, my mom is going through a rough time with the transition. Money is getting tight on all sides, and I am working part time to try and hold everything together. I don’t think it is fair for either me, you, or keystone to keep trading.

Trust me, I want to keep trading, I want to keep doing my daily plan. I feel like if I quit now, I will be a failure, and I may be giving up something I won’t have a chance at again for years. I feel like I am giving up an opportunity of a lifetime. At the same time, just a simple remark this morning about participating sends me for a loopdey loop. I feel like I am constantly falling behind on the changes at Keystone, and am constantly trying to keep up without angering you or confusing other students.

I really need a break. I need to assimilate everything I have learned and gain some stability. I feel like with the changes at Keystone every couple months, I will have a very hard time doing that. Not only that, but I have a tough time keeping straight what was said at the morning game plan and how I should be trading because of it. It is like constantly trying not to make mistakes and constantly failing.

So I am going to give myself that break. If at some point in the future, there is an opportunity to rejoin Keystone, I would love to have that conversation.

Last Note

Well I am done. I hate to do it, I really want to keep trading, but at this point, I need a break from pulling my hair out. The email I sent to my boss pretty much sums it up. Basically it has been a constant battle with him. I am participating too much, too little, not in the right way, yada yada. I am just done fighting, and I feel like every morning I get up and get my boxing gloves on. I feel like I am trying to listen to the market, and at the same time trying to juggle following the keystone method.

So from here, my options are few in the trading arena. I don’t have much money, I paid keystone about seven grand over a year to trade with them. Despite leaving, I will say it was worth every penny; this last year has been amazing. If anyone knows of some opportunities in prop firms that are looking to hire, I would appreciate any info. Otherwise I will be doing some promotional work, and slowly saving up some money so I can trade for myself. I tell ya, this whole experience will one day be looked back on as such a huge lesson for me, but at the moment, I am just tired.

Love,

Lucas

Posted on November 3 , 2010 In Daily Updates

Things May Get Wacky, But Don’t Get Trapped

Tomorrow’s Plan:

The Fed had its high wizard meeting today and all its magical talk. I think the number was something like $600 billion in initial purchases, with another $300 billion later. I don’t really know, but the market liked what it heard enough to make some new highs on increasing volume. VIX made a big whooshing sound as all the air went out of the risk premium in SPX options. As with any Fed meeting, the next few days to a week will probably be pretty screwy. Expect large, confident moves in one direction, and then the exact opposite the next day. This happens because people want to take a confident position from the news. They get some type of confirmation, they enter a position, and then hold hard and fast. This fuels the move in the opposite direction on the following day.

I saw a chart from shadow trader last night that basically said bullish sentiment is at its highest reading since the wheel was invented, or something along those lines. As a trader, we have to be contrarians, and so the short side just looks marvelous with how extended the market is. That being said, I am not going to be shorting! I think the short side is probably a trap for at least the first few bearish salvos. Lots of traders want to sell the news, and I think that is definitely going to be a profitable trade here, but it is the obvious trade. Obvious trades just love to whip and act crazy, and then move as intended after stopping a bunch of traders out.

So I am basically looking to exit my trades into “confirmation.” When the bullish or bearish move is confirmed on a lower time frame by taking out some significant level, my plan is to be getting out into those moves. The real skill comes from determining how much “confirmation” is needed given the day’s internals and market rhythm.

My Best Ideas:

•SHORT KSS: This was a beauty today, and I hope some people were able to trade it under the 51 level. It rallied in the afternoon and might offer more chances to short it for the rest of this week. I still want to see it remain below 51.

•LONG JNPR: This puppy sure looks good after today. This might have some MATD action tomorrow, but after that, any pull backs look good.

•LONG HPQ: This stock broke out nicely today and has some free room to run for about a point and a half.

•LONG BRCM: I like the situation this stock is in. It gapped higher on earnings and has since consolidated while holding the 40 level. I think this could be one of those stocks where it starts going straight up in the morning, and you just have to jump on and sit in it for as long as possible. We will see!

Best of Luck Tomorrow

Today’s Trades:

Today’s Journal Entry:

Last Note

Lucas

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