“Trend following is something only a few talks about and I see why…”

Feedback in:

Thank you, Michael, for your openness and kindness. I will surely continue on this journey to becoming a trend following trader, as I aspire to become one of the greats. Trend following is something only a few talks about and I see why. I am going to give my heart and soul into this. I am curious enough to say that I’m going to join the TurtleTrader club with honor and courage.

God bless

Dig in.

“I have ZERO guidance on what I want to be doing and little way of knowing whether I am on the right track or not…”

Feedback in:

Thanks so much, Michael!

My biggest challenge with trading has evolved over time. When I first started trading currency four years ago, it was that I had no guidance, no feedback on what I was doing, and whether I was even on the right track. So I traded for a year and then stopped for a year, while I searched for training/coaching programs that didn’t cost tens of thousands of dollars. I eventually found Rolf and Moritz of Tradeciety, which offered courses on the swing and day trading, weekly watchlist videos and a forum where you could get regular feedback on your trades. Lifetime access was only several hundred dollars–a remarkable value. Within a few months, my trading started taking off, at which point my biggest challenge became guarding my time and energy and staying focused on a few goals. Because trading was going well, and several other things were going well, I kept on piling on more and more life-goals for myself until I finally hit a wall and all my motivation seemed to evaporate. Not long after this, my mother had a stroke and the next 6 months were taken up with me and my siblings looking after her and making sure she got the best care possible. I learned a lot of unsettling things about how overworked nursing home professionals are, and how easy it is for patients’ needs to be overlooked, and for family members to be very confused about what is actually supposed to be happening. Eventually, my mother had a second stroke and we brought her home to hospice care and spent 8 days taking shifts sitting with her around the clock. Remarkably, she lived for 77 years, 7 months and 7 days.

During and after that season, I spent another 18 months away from trading before I was ready to get back. This past summer, I took a few months to go back through the now updated coursework and began trading again, with the help of a ton of feedback from Rolf and Moritz. At this point, my biggest challenge was being selective and consistent. I was advised to stick to just one pattern–head and shoulder reversals–and learn it until it became second nature. It is surprising how many little variations there can be on a pattern, and how many clarifying decisions you need to make so that your rules about what will constitute a tradeable head and shoulders are “enough”. However, I was getting there, and while during the end of 2019, my trading was all over the place, by the end of January 2020, I was in a total net profit, and getting wonderful feedback from Rolf and Moritz about how far my trading had come, and how consistent my trades were looking.

By February 2020, however, as the Coronavirus became more and more of a concern, the usual mean-reverting setups I would look for and take on currency pairs began to unravel. It started with a string of losses, as typically valid setups I traded were triggered but then reversed and went the other direction, taking out my stop loss. Not long after that, there simply weren’t any valid setups to trade, as the market whipsawed all over the place, or, in many cases, currency pairs just kept on trending and trending and trending with no reversal in sight. So my biggest challenge now was, what to do when the market is in such a volatile phase, and the setups I typically look for simply don’t occur, or at least not with much confidence of follow-through.

I watched as the major indices trended strongly downward, reversing months or years of gain, and realizing that this could have been a MAJOR cash-in opportunity, where I set up for a trend following. I started listening to your Complete Turtle Trader book and decided to get myself set up with a futures account. However, just as with forex trading, I was now in completely uncharted waters again, not even yet understanding how futures markets work, how to navigate contract rollovers, etc., and not having anyone to guide me in the nuances of how one actually engages with trend following in a consistent manner than can deliver. There is so much on the charts that look obvious in hindsight, but when you start trying to work up different scenarios for how you might have walked through that and profited from a trend without getting prematurely stopped out (and then try to apply that to other trends) it quickly becomes clear that this is not at all as easy as it looks.

So with regards to my biggest challenge, that brings me full circle back to where I was several years ago with swing trading: I have ZERO guidance on what I want to be doing and little way of knowing whether I am on the right track or not.

Thanks for reading, and to paraphrase Mark Twain (or was it Blaise Pascal, or Ben Franklin?), I’m sorry for writing such a long email, as I did not have time to write a shorter one.

I look forward to checking out the intro video you sent!

Swing trading. Day trading. Stop.

An alternative.

“I’m a fairly new trader and I feel there’s information overload…”

Feedback in:

Hi Michael

I’m a fairly new trader and I feel there’s information overload when it comes to trading and it’s hard to know where to start and begin. I’m nearly 60 but I have a desire to learn to trade profitably.

Every book I read on trading or TA gives you chart reading skills and some money management strategies and they tell you to design your own ‘trading plan’ which is great but what I really need is a ‘trading plan’ that is already developed as there are too many factors that I wouldn’t know how to put together myself with limited experience.

I have purchased your book on the ‘Turtle trend following system’, I’m still waiting for delivery but I’m hopeful that this will have a trading plan written out that I could follow?

After I read it I intend to buy your ‘Trend Following’ book to further my education.
I’m far from lazy or wanting to be spoon-fed but I just can’t seem to be able to write a trading plan that I would feel comfortable following.

Perhaps later I might consider doing your ‘turtle’ course but unfortunately, it’s beyond my financial capabilities at the moment and being from Australia our dollar is rubbish and it would cost me nearly double what it costs in the US.

The other thing that I feel is difficult for me is finding out how to sell short and how to trade the different markets such as commodities, futures, different indexes, etc on leverage as I haven’t done that before. I will soon trade my own Super Fund (401k) I think it’s called in the states and I’m told that I must use Saxo brokerage for international shares and probably futures and commodities, is there any advice or tips about how I can learn to trade instruments other than equities, please?

Many thanks for your help

Kind Regards

Yes. My website, books, and podcast are filled with info.

Ep. 853: Mark Perry Interview with Michael Covel on Trend Following Radio

Mark Perry
Mark Perry

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My guest today has insights. Very unique insights. I am very lucky to keep bringing great minds onto this show. An excerpt from his piece that inspired me:

On April 28, 1961—a decade after General Douglas MacArthur was fired for defying Harry Truman on Korea—the controversial commander hosted President John F. Kennedy at New York’s Waldorf Astoria Hotel, where MacArthur and his wife lived in a suite on the 37th floor. The contrast between the two could not have been more obvious: MacArthur, then in his early eighties, was mottled, frail, and walked with a slight stoop, while the newly inaugurated Kennedy was young, fit, and vibrant. The two sequestered themselves in MacArthur’s suite, then posed for photographers, the young president obviously proud to appear with the aging legend.

Fortunately for historians, Kennedy recorded notes on his Waldorf Astoria discussion, committing MacArthur’s advice to a personal memorandum that he later referred to in White House policy discussions. The meeting itself was the subject of news stories and featured on national newscasts that same day. Later, the meeting provided grist for two generations of Kennedy-besotted commenters who debated whether the young president, had he not been assassinated in Dallas, might have recoiled from committing tens of thousands of U.S. troops to a winless war in Southeast Asia—a course of action taken by Lyndon Johnson, his successor.

It turns out that Kennedy’s memo of the Waldorf Astoria meeting (now at Boston’s John F. Kennedy Presidential Library & Museum) is crucial for historians for a number of other reasons. It offers not only a glimpse of how the young president intended to navigate the treacherous waters of the Cold War, but suggests how one of America’s most celebrated military officers viewed what might be called the grand strategy of the American Republic: that is, whether and how the U.S. might win its dangerous struggle against the Soviet Union. Finally, the Waldorf Astoria meeting tells us how MacArthur’s most famous warning—to “never fight a land war in Asia”—has come down to us, what he meant by it, and whether, in an age of American troop deployments in at least 133 countries, it retains its meaning.

Bio: Mark Perry is a military, intelligence, and foreign affairs analyst and writer. His articles have appeared in the Nation, the Washington Post, Foreign Policy, and the Los Angeles Times, among other outlets, and he is a frequent guest commentator and expert on Al Jazeera television network. He is the author of eight books, including Grant and Twain, Partners in Command, and Talking to Terrorists. Perry has served as editor and Washington bureau chief for a number of publications, including Washington D.C.’s City Paper and The Veteran, the largest circulation newspaper for veterans in the nation.

In this episode of Trend Following Radio:

  • MacArthur’s Last Stand Against a Winless War
  • The Origin of the Vietnam War
  • Ancestor’s Legacy
  • Domino Theory

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