Advised #4: Teamwork wins in trading hands down full stop
11 years of cyclical analysis and trading
Hi this is Derek Frazier,
Teamwork. Most people have experience with it rather fondly. I was on a little league team that won city championships as my first real experience with teamwork. We were amazing. It was great… until we went up the road to middle Massachusetts for an all star game.. It was the first time I was hit by a 70 mph fastball and I remember it. I felt so small and weak. It was like one of those slow moving nightmares, that game. But hopefully, you have a few things you can think of that make you feel good about teamwork. It's no different in this line of work. Speaking of slow motion, this newsletter is going to introduce some fairly new stuff. I have to really suggest to you to slow down, maybe print this out and pay attention and take your time with this.
This is not one of those run of the mill email messages you're gonna get today.
It's a condensed form of a master thesis on trading called “Intra-Swing” Trading with cyclical analysis as a guide to finding multi-day or multi-week or multi-month profitable trades with small risk size from intraday order flow data!
In the previous 3 weekly issues of Advised, I discussed psychology, philosophy and basic principles for trading success. For this issue I'm pivoting to the "what" that will help traders get closer to their ultimate goal: trading profitably with confidence and understanding.
It's possible to have all 3: profitability, confidence and understanding. But I have to start real slow in explaining this. A student cannot learn enough in one month or one quarter or one year to graduate with a PhD on trading using cyclical analysis, which I think I definitely have, as of 2022
That being said, I'll make my case that you should get a partner or get on a team to achieve these standards
We all get some form of teamwork from media consumption. It's slow, unreliable and not adequate, but exposes us to another side of things. It's so easy to think we can go it alone because it's comfortable. But our destination while we're building Advised Trader will not be reached by being independent, isolated and unaccountable!
Teams give us purpose, help us find ourselves and guide us
Being on a high achieving team is the highest calling for a person
If you're new or considering making trading a profession, you should grab a trader to trade with immediately. If you're a professional that recently lost their team, then this is a reminder to get back on one.
This applies for every field, especially in trading due to the competition being fiercely aligned against US in terms of money, brains, and tech.
Without a team, you have a hard road ahead in trading. Even if you could learn the best methods and have a will of steel, it will still be hard for you.
But, of course this is the way that people trade or at least they start this way. Locked away, and isolated. They see all these gurus without teams and one may think how cool that these professional guru traders must be and how they can sit at their computer and take huge risks and jump in and out of trades with ease on weekly OTM options. And then you see their PNL. I get it. It's cool to be a cool solo guy or gal.
But it just doesn't happen unless you have deep pockets and you can really say you are the top .5% of traders. 👋
So I say one of the big things holding us back is our refusal to join a team that fits our abilities and compliments us for our needs.
Search yourself and find out if you're capable of starting or becoming part of an existing team or if you're just a trader that has a charting package and a brokerage account.
I'd say it's a really great time to find a tribe to stick with long term. Aim for 10 years or more. Something that will stay the same over time and will hold you in accountability and show the truth of trading and give rapid unconscious feedback…
OTHERWISE I THINK IT'S JUST THE BROKERS TAKING YOUR MONEY!
So here we go, let's start to build the tribe here today. Let's get going on having the same language, the same uniformity and ruleset, just with different backgrounds, ingenuity and pace.
Let's get going...
Now, I'm going to reveal the work we will start to get into.
We're going to discuss Intraswing trading.
First off, I wouldn't be doing this unless I could show you how to enter the market using intraday stops, but with large, swing trading targets. I haven't seen anyone discuss this before.
I'll do it by revealing my detailed 10 step process for repeatedly finding winning trades. I'm talking about those trades where they last for months at a time. And you actually know that they will make it to the targets, the vast majority of the time. Especially if you're on a team that has your back!
Imagine having a target that is based on price data and what has already happened. That is totally what cyclical analysis provides us.
The targets are those that are tied to cyclical projections… the meat of the move… the trend… the alpha.. Whatever. It's the awesome part of cyclical analysis, knowing that you can see changes in cyclical pressure and then adjust your trading rapidly with new information. And more importantly: Get targets that are accurate and expected based on CYCLICAL POSITION of the instrument.
It's been said that a lot of traders can enter but some just don't know where to exit.
The money is made at the exit. It's totally true, because it gives you breathing room for your returns for the year if you're a professional and it helps your confidence to see gains long term when you're still treading water with trading.
I promise that if you apply yourself to the next few weeks’ messages I send, it will be like nothing you've ever seen in trading. I will also just give it to you straight, so you can start yourself.
Introductory overview to the 10 step INTRASWING trading strategy
What it is that I do to properly Swing trade in as few words as possible:
On the weekend...I start by looking at a weekly chart at recent FLD projections and determining if the chart I'm looking at is cyclical and it has accurate price swings. Then once that's complete I go to the daily chart for the last 6 to 9 months and calculate where I am inside the 80-day cycle.
Once that's completed I try to think about the underlying trend: asking if it is up sideways or down. Next, I examine the past previous cycles for anomalies… such as peak shadows, straddling the FLD, pause zones or if there has been a change in the cyclic pressure measured by the projections of the last two 20-day cycles. Then I decide if there is a proper time to take a trade in the week ahead, using cyclic action tools, the FLD or VTL.
If so… print it out and track the daily data everyday starting on Sunday, printing and then Friday I will write out below the weekly and daily chart a typed out message identifying the order flow that I need to see that week in order to take the trade as well as where I would like to take it and at what time, with what action tool stated above.
Chances are if you do this alone you'll at least get a trade that can move to break even relatively quickly… but you may not get a full winner though. Markets require larger stops to trade like this. SO let's move on to the “Intra” portion of the strategy.
Now it's time to look at the statistics of your chart's 20 day cycle. Does the instrument contain an anomaly that's going to prevent you from trading securely or is it actually working against you statistically? Is this chart always fighting trend? Is it having problems completing projections due to chop?
So ask, are you going to be able to make a profit from this? Does any 20-day 40 or 80 day projection have the ability to provide a profit to you considering stop size below the previous swing or above the previous swing? And, depending on how strong this trend is, does it have the ability to give you a projection on an extended basis? If this is a super trend like we saw in 2021 is it possible that you could wait for a projection to be met to the downside on a 5 or 10 day cycle to take a trade at the value area lows of any given week?
If we are in a super trend I’ll be looking to play the lows for bullish FLD projections higher or the highs for bearish extensions lower. I only trade breakouts when price breaks the 20-day FLD because that is where statistically I have the most advantage for a swing trade not moving against my stop, rapidly, as long as I’ve completed the first few steps.
When considering previous 20-day FLD breaks are they clean? Also, to enter, I am also expecting pull backs using FLD projections that get fulfilled the same day or the next day for entries.
What was the bar before the FLD break? What did that day look like on the other breaks in the past? What happened to the order book and at what time, how much risk? ETC. Detailed responses.
In the past, what did the order flow do the day before and the day of the FLD break? A detailed analysis of what traders usually did before major tops and bottoms is necessary. This wont work for every top or bottom trade, but when you consider cyclical action tools for the catalyst, then they work really well.
Try to plan what helps you understand the order flow and what you should expect. From my experience it's price breaks that go away from your trade and then back towards where you wanted it to go. On the order flow there could also be major iceberg orders that continue for an hour or more in my direction.
What I want to see is successive massive iterations of 10 to 15 sessions of icebergs in my direction for an hour or more the day of the cyclical event. And, absorption at the highs of 60 minute for shorts, or at the lows of the 60 minute bar for longs, on footprint charts or on an order book in general.
For the first hour of your icebergs, I like to see that the price can't move down (up) no matter what, it gets absorbed.. and you want to see that going yard direction for an hour. If you start to see that, it's a pretty good inclination that your trade is going to go in your direction, however it may now be difficult to find out if you have a good trade location. If you see trades at the top or bottom of the bar, that is absorption and the trade usually goes the other way when trading below (for shorts) or above (for longs) that bar.
Your next step if you can't find trade entry, though not recommended due to chop… is to wait for the 3-hour cycle to complete and then get long or if you're getting short you want to wait for half of that to complete and then go short after 90 minutes. Usually that will provide you with the trade entry if it's the day of the FLD break or the beginning of the trade in question.
An additional step for precision in a super trend, is to wait for a 1, 2.5 or 5 day FLD projection to be fulfilled in the opposite direction of your trade, to look for buying/selling. This can be done after the trade has started without you as a pullback zone as well.
If instead you get a bounce at the FLD or the trade doesn't show massive absorption and icebergs with prices leading in your trade direction then you probably have an FLD that's acting as support/resistance. In this case it is probably best to just wait until you get that 60 minutes of absorption and your trade direction BELOW or ABOVE the previous 60 minute bar for entry, with an appropriate stop… after you see absorption and icebergs in your favor. The signal bar can be continued as a signal entry for up to 3 inside bars, for a trade to be taken above/below them.
Next step is to put your stop below/above where the icebergs were but probably below the previous day for longs and above the previous day for shorts at the end of the day if the trade moves in your direction you can move to stop down/up to above/below one of the swing highs/lows of the intraday data.
Your job is not complete… you've accomplished the intraday portion of your task and now the swing trading starts to where you have to wait for your cyclical projection target to be achieved based on the 20, 40 or 80 day FLD (recommended)
And, if there is no target then that is not cyclical trading. What you have is a super trend or pseudo trend and targets are not available… you're in uncharted territory. The best thing you can hope for is an exit based on the theory of “m” shapes in the market or “translation of the peaks”. For instance if you're taking a trade at the beginning of an 80-day cycle you could wait for the second half of the 40-day cycle or the second 40 day cycle of the 80-day cycle to sell. And you could wait for the end of the 80-day cycle by average days if you are a seller and then watch for opportunities to take profit that way, below price entry.
Look at these examples of what I mean about long term cyclical entries
Next week I'll provide absorption and iceberg examples, as well as trade entry examples of the 60 minute price action entry method stated in the above 10 steps.
BTW, sometimes, when taking trades like this, with big confidence in the analysis, it is possible to use option spreads that are OTM. I use them to construct positions that are entries from cyclic events happening in the marketplace. The trades above are examples of that. Pull up your charts, and see that they were good for months or at least weeks.
I got these from cyclical analysis.
Not from buying or selling moving average crosses or RSI, balance sheet forensics, commitment of trader reports, etc. It’s just not necessary. And it hasn’t been since Hurst released his material over 50 years ago. It does help to know fundamentals obviously. And thats part of the teamwork aspect of trading presented in the issue.
BUT ALL THE INFORMATION IS IN THE CYCLICAL ANALYSIS!
With that being said, I want to train my own traders that want to stay with me on this process of evolution towards a better way to trade. Maybe some will want to dive in and some may even want to become limited partners some day. 😁
4 steps to take if you dont want to attend the webinar
It's not that difficult. You just need to put in work and research and learn.
First, read the cycles course by JM Hurst.
next, get your own software to examine cycles (ask if you need a recommendation)
Third, examine brokerage accounts that allow you to safely take a 2% account size stop and still afford the minimum share size for stocks as well as the proper sop location on the daily chart as I stated.
Lastly, My examination of cyclical analysis reveals that I agree with the masters of old: trade stocks
It's going to take you years to figure this out. I consider myself one of the best at this. And it has taken me a long, long time to the point I am ready to ask you and other investors to trust me with their time and money! I live very well and I take care of my family and have enough to spare. Im very happy with my accomplishments, and I hope you can join me for the webinar where I can elaborate on the concepts discussed and make you an offer for learning this stuff once and for all… WITH TEAMWORK
Remember this whole system .. It's all designed to get you to fail.
The markets want your money, you're what’s called “dumb money” for a reason.
We all repeat the same stupid mistakes over and over and hope for someone to rescue us.
But for those that trust the process and can have some patience… ATTEND THE WEBINAR:
The trader will:
be given a job to do on a team
learn to trade while actively engaged in the market
understand the 10 steps above with entries and exits pulled from daily chart, but executed on the intraday chart with the price ladder and order flow for evidence needed
understand intraswing trading as stated above in the 10 step process
So come to the Webinar for Advised Traders & anyone is welcome to attend with a truly special offer for staying for the entire webinar presented at the end, so be sure to check it out!
For those that think this is technical analysis, and its rubbish, let me remind you: You will never experience this type of trading where you can enter on an intraday chart with confidence that you are trading in the right direction. This can only be achieved through cyclical analysis and none of the following will help us accomplish it:
Price action trading
Fibonacci, Elliot etc
Buying low and selling high vice versa
Buy and hold
Regression to mean (could be technical and fundamental mix)
☝☝Why you don't want to do the above type of trading anymore ☝☝
Always fluctuating, always having to wait, always holding something, pressure to be a bag holder, always letting someone else make your decisions, never in tune with the market
Traders don't do this. They don't wait for a position to produce a move in their direction for 6 months or more.. That's crazy! Cyclical traders like us… wait until they get a profit that they have seen as acceptable, from a valid target. Targets from cycles are provided as a means to define the entire trade before it is taken..