Stick with what’s working

The last few months have been a little crazy in the market, and I felt like there was no better time than to ask what you’ve been focused on. 

Especially when the market’s so news driven, it’s critical to go back and look at the basics of what we’re doing and why. 

It also reminds me of my garden…

I haven’t given you an update in awhile, so I figured now’s the time…

And it’s a great trading lesson…

Remember a couple months ago when I told you about the rough time I was having with my garden? I had over 30 types of fruits and vegetables, none of which I knew how to grow. I planted them too close together and not in ideal spots for the hot Texas weather, and I didn’t give them enough sun or room to breathe.

Of course I didn’t follow the recommended planting methods such as using garden soil, compost, and trellising what I should’ve trellised. As you can imagine, it didn’t go well, with bacterial diseases and bugs basically ruining majority of my garden.

There went a couple thousand dollars along with a TON of time. 

But, I wasn’t deterred, and I found an amazing gardener named Zoanna (basically the coolest name I’ve ever heard of), and she taught me all about how to grow vegetables in Texas. So, I started again this fall, this time with proper spacing, soil, and planters. Apparently veggies do not like Texas, clay soil. Who would’ve known?! (cue sarcasm.) 

I grew things that grow well in Texas, such as this beautiful malabar spinach plant. 

I’ve never heard of malabar spinach, but I thought I’d give it a try. And, look at this. It’s growing better than anything else in my garden. I’m so glad I gave it a chance!

I’m also overflowing in oregano, parsley, rosemary, and basil. Who would’ve known I could grow a nice herb garden! I still haven’t figured out many amazing recipes to use it for, though. 

I also took a stab at house plants. Clean oxygen, anyone?

I love these crazy fire looking plants. And, so far I’ve kept them alive (since I researched them and learned about how to care for them!)

What’s the moral of this story?

I ruined my garden the first two times around because I ignored the basics. Ignoring basics in trading is one sure way to get yourself in a tough spot. 

Let’s talk about some of my key, trading basics.

Can you answer these questions?

  1. What setups are you using? Setups are the technical patterns you use to get into a trade. It’s your high probability moment in time!
  2.  What type of strategies are you using? This could mean options strategies, such as long puts or calls, butterflies, or spreads, or it could mean sticking with ETFs and futures instead of options.
  3. How about your risk? What’s your risk on your overall account, along with your risk per position?

Drop a note, and let me know. What are you focusing on? What do you need help with?

What have I been using?

As for me, I’ve been using primarily my Stacked Profits strategy that I taught in July. 

Butterflies have been a really low risk way to get involved in the market, and sit through the ups and downs. They’re also a lot easier to hold than basic calls and puts.

I’m maintaining low risk in this overall market environment and focused mainly on reversion to the mean type trades instead of directional trend follows. There are a couple trend follows out there, for example Gold and Bonds, that we’ve been focusing on in the mastery, but beyond that it’s been short term, reversion to the mean.

1 thought on “Stick with what’s working”

  1. i have been using basic calls puts, account down to approx. 16,000 dollars, on higher stock options i use verticals, all trades have been ave 1,000, use support & resistance to start the trades, but seem to be wrong more than right. never used the butterfly trade, will have to study that one, been thinking about credit spreads for small steady income but dont have confidence in my ability to put on the trade.


Leave a Comment

Up Next...

A Sorely Needed Pullback…

Hey traders! The market is finally pulling back today after what has been a phenomenal run. While pullback days aren’t very enjoyable when you’re long, ideally, you’ve been taking profits on the way up and trimming positions at market extensions. As I was on vacation, I have been flat, minus a small position I entered … Read more

Read More

Top Hot Zone Tickers Today…

Hey Traders! I’m back from vacation and ready to locate some setups. Whenever I come back from a break, I have a regular process I do to identify spots to focus on. It goes something like this… Start with the major indexes (Nasdaq, S&P) and the Magnificent 7 stocks (Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta, … Read more

Read More

Happy 4th of July!

I hope everyone is enjoying their summer so far and looking forward to the shortened week! If you’re here in the United States, I hope your holiday is safe and enjoyable. I will personally be taking some time off this week to spend time with family and enjoy the holidays. I love cooking with my … Read more

Read More

Subscribe Today!

Want my up-to-date analysis, setups, top trading tips, and more? Be a Five Star trader, and join my free newsletter today!

Sign Up Now