I didn’t realize I was trend following (since I haven’t finished your book I am not 100% sure yet, but it looks like it). I didn’t even realize trend following was a thing. It was quite a nice surprise, when by accident, I came across your book on the shelves. I have avoided all books and web pages (other than scanners) on investing and trading. My theory has been that the industry was a quagmire of bullshit (based on my background of Scientific communications and hence the need for proof and explanations). However, I had been stopping in at bookstores randomly, in the hopes that my theory was wrong. So far, with your book, there may be some hope.
The Elliott Wave Principle posits that collective investor psychology, or crowd psychology, moves between optimism and pessimism in natural sequences. These mood swings create patterns evidenced in the price movements of markets at every degree of trend or time scale. In Elliott’s model, market prices alternate between an impulsive, or motive phase, and a corrective phase on all time scales of trend, as the illustration shows. Impulses are always subdivided into a set of 5 lower-degree waves, alternating again between motive and corrective character, so that waves 1, 3, and 5 are impulses, and waves 2 and 4 are smaller retraces of waves 1 and 3. Corrective waves subdivide into 3 smaller-degree waves starting with a five-wave counter-trend impulse, a retrace, and another impulse. In a bear market the dominant trend is downward, so the pattern is reversed—five waves down and three up. Motive waves always move with the trend, while corrective waves move against it. The patterns link to form five and three-wave structures which themselves underlie self-similar wave structures of increasing size or higher degree. Note the lowermost of the three idealized cycles. In the first small five-wave sequence, waves 1, 3 and 5 are motive, while waves 2 and 4 are corrective. This signals that the movement of the wave one degree higher is upward. It also signals the start of the first small three-wave corrective sequence. After the initial five waves up and three waves down, the sequence begins again and the self-similar fractal geometry begins to unfold according to the five and three-wave structure which it underlies one degree higher. The completed motive pattern includes 89 waves, followed by a completed corrective pattern of 55 waves. Each degree of a pattern in a financial market has a name. Practitioners use symbols for each wave to indicate both function and degree—numbers for motive waves, letters for corrective waves (shown in the highest of the three idealized series of wave structures or degrees). Degrees are relative; they are defined by form, not by absolute size or duration. Waves of the same degree may be of very different size and/or duration. The classification of a wave at any particular degree can vary, though practitioners generally agree on the standard order of degrees (approximate durations given):
-Grand supercycle: multi-century
-Supercycle: multi-decade (about 40–70 years)
-Cycle: one year to several years (or even several decades under an Elliott Extension)
-Primary: a few months to a couple of years
-Intermediate: weeks to months
-Minor: weeks
-Minute: days
-Minuette: hours
-Subminuette: minutes
Amazing.
Elliott Wave prose is almost as good as Scientology: Definitely No PhD Required.
My guest today is Tim Larkin, one of America’s leading Pro-Victim Rights and Personal Safety Advocates. He has had a 25 year career training over 10,000 clients in 52 countries in how to deal with imminent violence. His books include How To Survive The Most Critical 5 Seconds Of Your Life and Survive The Unthinkable. His newest book is When Violence Is the Answer: Learning How to Do What It Takes When Your Life Is at Stake. Tim’s father was an officer in the Navy. He knew at the age of 13 he was going to be a Navy Seal. His whole adolescence and early adulthood was dedicated to that goal. After college he started his Seal training. Toward the end, with just a couple weeks left of rigorous training, he went out on a routine training dive and a wave hit his ear. Tim burst his eardrum and his career was over. This was the first time, at age 21, his body had failed him. Sometimes the smallest things, like an eardrum bursting, can change your whole course of life. This lesson learned early on by Tim translates to everything he now teaches.
The topic is his book When Violence Is the Answer: Learning How to Do What It Takes When Your Life Is at Stake.
In this episode of Trend Following Radio we discuss:
Las Vegas shooting
Simulated shootings
Asocial violence
Non-verbal cues
Disabling one of your sensory feelings
Navy Seals
Exploiting the human body
Knowing principles not techniques
Violence is a 50/50 endeavor
Killing with kindness first
“Violence is rarely the answer, but when it is, it is the only answer.” – Tim Larkin
I am a member in the [country] military and have been serving for the past 12 years and I am looking to change careers in the next 5-8 years. I was wondering if you have any contacts here in [country] that are Trend Traders that could possibly be open to mentorships/coaching?
The reason why I ask is I have read your books “The Complete TurtleTrader”, “Trend Commandments” and I am currently reading “Trend Following” All have been really insightful and have given me a direction in the type of trader I want to be. I understand that there is a lot that I can learn on my own, but to be able to learn from someone with a wealth of experience and who is currently “in the business” and can give me an opportunity to learn through osmosis would be highly beneficial.
I suppose that this is a weird request and I assume that you may have received requests like this before.
Any help would be greatly appreciated.
Cheers
[Name]
Not an odd request. It’s what I do. You may consider a next step.
I’m a big fan of your podcast, and want to start trend trading. I’m a UCF student and actually just met Toby Crabel as he did a private meetup with the young investors club at UCF. I’ve been trading since January, but just blindly trading. I’m going to quit my Internship at Lockheed starting January to take the risk of being an independent trader for my last semester before having to start to pay off my student loans. Hopefully you can show me the right steps to being a successful trend follower.
