I'm seeing more traders trade on "teams" with other experienced market players. Sometimes it is to share and exchange ideas and strategies, as in the case of the trader I interviewed today. Others do so to pool their accounts and share in the profits, which is more rare. Here I talk with a full-time currency trader, Derek, about how he watches news and price to spot places where the herd of new traders is lining up. Derek is the quintessential veteran trader who prides himself on selling to the masses when they are buying and buying when the masses are heading for the exits. Derek tells us how he gauges momentum in the currencies in order to know how long a trend will last and the signs in price charts that tell he and his team the trend is petering out. His analogy of buying car insurance and why he uses stop losses is one of the best I've ever heard.
Karen has been trading stocks full-time for 20 years and has traded successfully through all types of market conditions. In this interview we talk about the simple ways she spots support and resistance the specific moving averages she has found that work best on specfic timeframes. We also talk about the homework she does in the evening and how she determines which stocks she will be watching the following morning when the markets open. I ask her how she developed her discipline and ways she decides where to set her stop losses. Karen talks about why she never sets strict profit targets and instead waits for the market to give her specific signals that something has changed. Finally, we talk about the software she uses that has helped her tremendously in getting a feel for the stock market and allowed her to get better at predicting short-term moves. The day we did this interview, the market had a large drop. We talked about how she trades those volatile days and how she shorts the market with option strategies.
"I trade like a rat." That's one of the first things my interviewee said in this interview. Once he explained what he meant, it made a lot of sense. In this interview I speak with a very interesting trader who has found a way, he says, to "drain the banks" (listen in and you'll understand what he means). He is a currency trader who uses candlestick chart patterns to find trades that are statistically valid. What he means by this is that certain currency pairs have a way of repeating their behavior on a short-term basis. He looks for those patterns and jumps on them for quick profits. He looks for those patterns to appear again and again and then develops a specific strategy around that behavior, including detailed stops and profit targets. We discuss at length why he works to make 2% on his account every single day. It doesn't always happen, but that's his goal. Here we talk about the specific candle patterns he watches for, why he checks the statistical profitability of his trading strategies and why he gives them away for free on his friend's website.
One area of trading I haven't tackled here at TraderInterviews.com is penny stocks. Frankly, because it's an area of trading I didn't think many successful traders were into. But over the last few years, more and more traders are having success - with a few caveats. Michael Goode is one of those traders. He monitors low priced stocks that are being "pumped and dumped" by penny stock promoters, shorts them, and waits for the inevitable fall that comes after early buyers realize the company has minimal revenues, over-hyped plans, and little substance. In this interview I talk with Michael about how he finds penny stocks to short, why he remains cautious when trading them and how the entire "pump and dump" scheme works. Different than other interviews I've done recently, you'll find some valuable tips and tricks (along with a few warnings) for trading penny stocks for profit.
Chris is a full-time trader. Although by "full-time" I mean he trades the E-Mini S&P contract for about 90 minutes each day. In this detailed interview, I talk with Chris about how he waits for specific setups on the charts and jumps on them quickly for profits. We discuss the timeframes he watches (they are a bit unusual) and why he looks for specific pivot points on those charts in order to find areas of support and resistance where traders are lining up. We also discuss his stop losses and why he scales out of a position when he reaches a pre-defined profit target area. Like most successful traders, Chris has learned to let the market tell him when it is time to buy or sell and is very good at not setting a bias outside of what the market is telling him. Listen in to hear how a very good trader makes a living in the markets for just 90 minutes each day.
Markets traded and discussed in this interview: E-Mini futures
