Welcome to the Trader-X blog!

> TRADEthemove.com - my thoughts
> meditationSHIFT (formerly "tad")- just say "om"

Saturday, December 27, 2008

Looking ahead to 2009

My trading

2008 was my most profitable year ever. I am blessed, fortunate, and thankful. But as I analyze my trading, I realize that it has become more complicated than I want.

Currently I have fourteen distinct setups that I scan for and trade every day. Yes, they all revolve around the core principles of Fibonacci, Candlesticks, and basic patterns/setups related to support and resistance. Nonetheless, as I get older I realize that my ability to keep things "under control" gets more difficult. I want simple - extremely simple - and my goal in 2009 is to ensure that I reach and maintain that goal.

As I stated above, the overriding rationale for simplifying is because I am getting older, and in my case getting older equals getting [a little] slower. The secondary rationale is because I want to free up more time during the day; I plan to to travel more in 2009...climb some mountains, trek around Europe, et cetera. I would like to be able to limit my trading - on most days - to around 3 hours. So I need to focus on the open and the first few hours, and the highest probability setups during that time. The final rationale is that simple is just better. Over the past five years I have simplified my life in general - I became a minimalist, donating a lot of stuff I don't need or use to charity. I decluttered my home and my mind, and I made great efforts to have what I need...and need what I have. Don't get me wrong, I am very comfortable and I enjoy the finer things. I just don't live in excess.

Back to trading - many readers would argue that my trading is already simple. It is, but I think I can reduce the number of setups I trade from fourteen to around four or five - while at the same time increasing my profitability because of the increased focus. So I am taking the first few weeks of January to study, test, develop, and refine how I will be trading for the rest of 2009. Posting will be light during that time, so check back or subscribe to Trader-X via a reader or email (see links in the upper right hand corner of the blog).

Trading tools

I have gotten many emails over the past few months about trading software. I am amazed at the number of people who are trying to DAY-trade by using Yahoo! charts or some equally insufficient charting tools provided by an online (web-based) broker.

This may seem harsh - and I don't want to lose readers - but you will not be successful if you do not use the correct tools. If you are using web-based charts that do not provide the flexibility to draw Fibonacci lines or plot [automatically] Pivot lines, or give you the ability to draw trendlines...you will not be able to make money DAY-trading the way that I do. I am emphasizing DAY-trading because you can probably get away with less functional charting if you are SWING or POSITION-trading. But why would you want to use less functional charting regardless?

If you are committing your hard-earned money to this - or any - venture, why would you want to use tools that are substandard and hinder your chances of success? Everyone knows this is a hard business, and the majority of people who try eventually fail. Why would you stack the odds against yourself even further? It is tantamount to a surgeon operating with a pocket knife and a bottle of whiskey...and your money is the patient with little chance of surviving.

The main argument I hear is that the tools I use are too expensive. Too expensive? If the tools I (and professional traders) use are too expensive, then quite frankly you are not ready to trade. You are either undercapitalized, or you do not have the proper mindset. If you are undercapitalized, stop trading until you have enough money. If you are just cheap - well, stop trading until you change your attitude.

I use a direct access broker and RealTick software - and for the record, my software is free because of my volume of trading. But even if I had to pay $300/month for it, I would gladly do so because I know without the proper tools I will not succeed.

The Trader-X name

I receive numerous emails every month that go something like this:
"I was reading your other blog..."
"I was looking at your software..."
"I was looking at your book on Amazon.com..."
"I was thinking about taking your seminar/course..."

I have addressed this before, but it needs to be repeated often:


There are numerous people/products that have chosen to use the name Trader-X. I will not go so far as to say they are trying to cash in on this blog, but I have been using the name for many, many years - and thanks to all of you and my fellow bloggers this blog is somewhat popular.

The bottom line is this - do not spend any money on anything with the Trader-X name because you think it is me...it is not. And don't read any other blogs that you think I am writing...I only have this one.

If you want to spend your money on something, look at the top of my blog for things I recommend ("FRIENDS AND COOLS STUFF").

Thank you for reading, and best wishes to everyone in 2009!



juan said...

Hello..I am new to this site and am just starting to learn to trade… but I love your stuff and insights...I am looking for opinions on the best trading books… I have read Robert Dorfman's Hedge Fund Trading Secrets Revealed, which was fantastic,..I learned so much….and Richard Arms’ Stop and Make Money: How To Profit in the Stock Market Using Volume and Stop Orders. both are very informative and gave me great info on how all this stuff works… Anyone have other recommendations?

Anonymous said...

Happy new year and thank you so much for your wonderful blog. Reading your blog have helped me so much. Your insights and wisdom have refined me into a consistent trader. I am considering seriously about going full-time into this. You freely gave so much and I appreciated that.
God bless you, Trader-X.

Attitude Trader said...

Two of my favorite subjects: minimalism and attitude!

Thanks for sharing your experience and insights with us.

Best wishes for 2009.


David said...

"It is tantamount to a surgeon operating with a pocket knife and a bottle of whiskey...and your money is the patient with little chance of surviving."

Best analogy I ever heard. I wish you all the success in 2009.

DK said...


hypr said...

It would be cool to see a post on your 14 setups and several user polls which people can vote on the best/worst setups.

That would be one huuuuuuuuuuge post.

Dinosaur Trader said...

I'm looking forward to watching you successfully simplify.

Lead the way!


Trader-X said...

hypr-first, none of them are "bad" setups or I would not be trading them.


Second, unless you cut me a six-figure check I don't think I will be revealing ALL my strategies...I already put enough on the blog!

Thanks for reading.

ralph said...

X: with 14 set-ups, are they 7 long, 7 shorts, or 14 longs and 14 shorts?

Trader-X said...

ralph - probably more like 9 and 5; what I actually call 14 setups many people would call 9 or 10, because some of them just mirror one another, or are very close in structure.

Anonymous said...

Dancing with Lions - By Trader X

copyright 1999
chicago trader. who used trader x moniker first -you or him?

Trader-X said...

Thanks for the comment anon - I didn't say I was first. Rumor has it there was a guy in 1929 using the name.

Happy New Year.