Enlightened Stock Trading: The Ins and Outs of the Market for The Start of 2023

Hey, Adrian here. Welcome to 2023. It's the 9th of January. Today's my first day back in the office, so I thought I'd do a video to share what's been going on, talk a bit about the markets, talk about what I'm doing and enlightened stock trading is doing for 2023 and to get you set up to start your trading year off well. So let's jump into it. What I want to do first is just flick through a, a bunch of major markets and talk about what's been happening over the last couple of weeks. Maybe you've been on holidays, haven't really been paying attention or just want some commentary about what's going on. So stick around for that. We'll go through each of the major markets and then we'll jump into an update on.

What I'm doing with my trading, what enlightened stock trading is doing and how we can help. So let's jump in, have a look at some markets. Now on the screen here we've got the s and P500 index. And look what's interesting here is we've had, we had this nice long clear bear market. I describe it as nice because, you know, I actually quite enjoy bear markets. You can make good money shorting, particularly when you have nice orderly declines like this. So we've had a series of lower highs here and a series of lower lows here as well. What's interesting though is we had this big rally just at the end of 2022 and that rolled over just above the 200 day moving average and started to collapse. But it found some support and just been bouncing around for the last couple of weeks pretty directionlessly and with very low volatility. And my sort of expectation on this was that the market was going to collapse further, go on to make a new lower low and then possibly bottom out for the end of the bear market. But what we had on Friday was a pretty strong rally in the S and P. And so what we're watching for now is to see whether this ends up being a new higher low or it's just temporary consolidation before a new lower low is made. If this is a higher low, basically from this point to this point, let me just draw this trend line, this line here. If this ends up being a new higher low here, then you know, what could happen is basically a rally and then moving on into a new bull market. But I, you know, I suspect what's more likely probably at this point is that this was a little bit of Temporary strength. It'll probably fake a few people to jump into the market before collapsing lower again. But I don't want to predict that and I don't want you to take a position in advance. What I like to do is I have my systems tell me how to trade. My systems give me the signals and so if this breaks out decisively above the 200 day moving average, what's going to happen for me and for my systems is that they'll get long again in the US and we'll start trading the long side. Right now though, I'm short in the US because when the market rolled over here at this point my short side system slippery dip turned on, it got fully loaded. That's just been consolidating sideways, made a small, relatively small loss so far. Just waiting to see if the downtrend continues. If that downtrend turns around and the market starts going back up, slipperdip will exit and we'll get back in on the long side in trend following. So that's where I'm at at the moment with the S and P. If we look at Australian market, let me just put this in here.

What you can see with the all ordinaries index. Whoops, here we go. The all Ordinaries index is it's been much stronger than the US market. I'll just zoom in a bit here. So we basically had three like a triple top here followed by a collapse in June, strong rally, another collapse, found a higher low and then rallied above the 200 day moving average. So it really looks like the Australian market has bottomed and started a new uptrend.

This was the low back here. We had a high low and then another new much higher low up here. What's interesting though in the Australian market is that this rally, this advance is fairly narrowly based, it's not a broad based advance and I'll show you that in a second. But this rally in the move above the 200 day moving average has caused me to get long trend following systems.

And those are, you know, there's some good positions there but they're not really hammering upwards at the moment because we had this big correction. So I'm just waiting to see what's going to happen there. But take note of this, this is the all Ordinaries index. What I want to do is show you the small ordinaries index and compare it. Actually let's put that on the same chart here. I'll just go to charts and I'll add a new chart here.

And I'll add the small ords, make this a bit bigger so you can see it. So on the top we've got the all ordinaries. On the bottom we've got the small ordinaries. And if I put the 200 day moving average on here, I'll show you what's really interesting.

Let's make that red so it's consistent and nice and thick so you can see it. So at the top we've got the all ords, which is the biggest stocks. And down the bottom we've got the small ordinaries, which is obviously the smaller stocks. And what you can see is that the big stocks have been much stronger in recent times. So up until probably beginning of 2022 they were pretty much on par with each other. But then this high, this peak that we had in April 2022, the large stocks were much stronger than the small stocks. The large stocks peaked above the 200 day moving average, the small stocks peaked below the 200 day moving average. And then with each subsequent.

High, the small odds was weaker and weaker. And as you can see that in, in December or beginning of December, the all ords was well above the 200 day moving average. But the small ords was not able to break the 200 day moving average. So what this really shows is that in the Australian market it's the large stocks that are advancing more than the small stocks. That's a bit of a problem for me because a lot of my trend following is on small stocks. So that hasn't been doing spectacularly well in the last month or so. It's been holding up, but you know, it's not, it's not stellar right now. And I think what this really shows is that there's a big advantage in having diversification across different, different levels within the market. So large caps, mid caps and small caps. And it's probably something I've neglected in my trading really. I typically don't like trading the very large stocks because they don't move as far or as fast as small caps. I like those big trends that you get in small caps. But what this experience has showed over the last couple of months is that there's real value in having that level of diversification in your portfolio. And it's something that I've plugged and I've got a new system to really address that in my portfolio as well, which I'm pretty excited about. So that's the Australian market. Let's just close this pane now. Let's have a look at the.

The Canadian market. So let me just find that.

Here it is. Okay, so the Canadian market fairly similar picture to the Australian market, possibly a little weaker as you can see here. The most recent rally at the beginning of December last year was above the 200 day moving average. But then it subsequently fell below and is rallying again. So Canadian stocks not as strong as the large cap Australian stocks have been recently.

So again what I'm looking for here is a stronger uptrend for my trend following systems to really get long. I've also implemented a new system for the Canadian market which is a rotational system which will get me in and out of the strongest stocks in the Canadian market. And that that system is called the TSX High Roller system that's available now for students in the Trader Success System. So again, pretty excited about that. That's a new addition just before Christmas 2022 and I've implemented that which, which is really exciting in my portfolio. The real stellar performer in terms of stocks right now though is the Hong Kong market. The Hong Kong market has been much weaker than Western markets for, for quite some time. Basically been in a strong downtrend since, what's that? February 2021. And look, that downtrend was very well established and made some good money on the short side in Hong Kong as well in that downtrend. But since November 2022 this market bottomed and had a very decisive rally up and has now broken the 200 day moving average pretty decisively.

My short Hong Kong system has been out of the market for some time. My long Hong Kong system, that's Firecracker, which is part of the Trader Success system that turned on a couple of days ago and got fully loaded on the long side. So that's really cool. So that's making money now on the long side. And I think again this just shows that having international diversification is really, really powerful. A lot of the Western markets are highly correlated so Australia follows the US and Canada follows the US and so on. But having Hong Kong in the portfolio for me has been really great because when, when Hong Kong went into a bear market before everyone else, I was able to make money on the short side and then the Western markets turned down and made money on the short side in those and that was really good diversification because I was short in Hong Kong when I was still long in US and Australia. And so the declines that I got at the end of the bull market in the US and Australia were kind of dampened by the Hong Kong shorts, which is really good. It's exactly what you want in terms of diversification. And right now what's happening is I'm short in the us, but I'm long in Hong Kong because as you can see, the market's really rallied here. And so this systematic approach with different styles of systems, long and short, across multiple different markets around the world really, really helps. So I've been, I've been quite pleased that I've got that in my portfolio. So, yeah, Hong Kong has been a pretty strong market and doing well. Let's see if the rally continues. I never want to predict whether these things are going to continue indefinitely, but it certainly looks like it's made a decisive, decisive bottom. There will obviously be a correction at some point, but the Hong Kong market does tend to move fairly vigorously once it, once it picks a direction. So hoping that this, this trend continues. Let's just see how that plays out over the first couple of weeks of 2023. Let's have a look at a crypto. If we come here, find, find bitcoin.

Sorry, here we go. Let's just look at the bitcoin continuous contract and if we zoom right in here, we can see that in crypto, really, bitcoin's been doing absolutely nothing at all in the last couple of months ever since the FTX collapse. I think really the market's been going sideways, waiting for either the next penny to drop and more bad news, or for everyone to collectively breathe a sigh of relief and say, hey, the bottom is in, and start a rally. But one thing we do know for sure is that in crypto especially, low volatility is followed by high volatility. We just don't know which direction that high volatility is going to move in. Right now I'm cautious. I've taken all of my money out of crypto at the moment. I'm not suggesting you should do the same. You do whatever you want. But when FTX comes collapsed, my fear was that there was going to be some contagion effects and flow on insolvencies and so on that we weren't prepared for. So I've taken my money out of crypto just to wait and see what happens when I see net inflows into the exchanges and big, you know, obvious higher highs and higher lows in bitcoin. Then I'll get back in and start trading on the long side here again. But that's going to be my approach for crypto in the next couple of weeks and we'll just see what happens. See where this, this Tight consolidation, range breaks to the upside or the downside. If I was to guess, I would say there's probably more downside in the move. But again, I don't really like to predict. I just wait until see what the systems tell me to do. So that's my approach there.

Okay, so what are we doing in 2023? Question for you is where do you really want to get your trading to by the end of 2023? And look, there's a really good question that you can ask yourself and I'd love you to think about this and reply in the comments below. And what I want you to think about is what would have to have happened for you in your portfolio by the end of this year for you to be really happy and satisfied with your progress. I'm not talking about how much profit you would make. It's more about the development and the progression of your portfolio. So, you know, maybe you want to implement your first trading system and really systemize your trading or maybe you're already systemized and you want to really diversify and expand into some different markets or implement some different styles of systems. Maybe you've been long only making money on the way up and you need to implement a short system and so that you can make money on the way up and the way down. But whatever it is, I want you to sit back and reflect for a couple of minutes after you watch this video on what would really move your portfolio forward and set you up for a great 2023 and beyond. Because intentionally designing those things is really, really powerful. And I sat back and I reflected on my own trading and identified a couple of things that I really want to do. And the first one is complete automation. So I mentioned a couple of times late last year I've been beta testing my stock automation and that's looking really, really solid. In the next couple of weeks, all of my trading is going to be 100% automated. So I've got a great link between Amibroker and Interactive Brokers. And that's going to automate all of my trading decisions or my position size, or my order placement, or my tracking everything. So that can all be done without my my involvement. All I have to do then is monitor the process, monitor the systems and build my portfolio of systems. And the real great thing about automation like that is that allows you to or that's going to allow me to really expand my range of diversification. So.

You know, there's only a certain amount of trading activity that I was willing to do manually, but When I automate, I'm able to implement systems that require much, much more activity than what I would be comfortable.

Implementing manually. So now that I've got this automation.

Set up and working, there's a bunch of cool things that I'm going to do in my account that really are going to take my diversification to a whole new level, which I'm super, super excited about. So that means day trade systems that place a lot more orders every single day, means rotational systems where you're rotating the whole portfolio in and out of the market on a regular basis to, to capture the strongest movers up and the strongest movers down in the market. It also means diversification across more markets because, you know, I don't have to worry so much about time zones because the computer is doing the work and all I've got to do is once a day monitor all of the trades that are being placed for me. So expanding my range of systems across more markets as well. So if you haven't thought about automation, then really watch this space because over the next couple of weeks to month or so, be launching the inline stock trading automation engine for stocks, which will allow all of that and a whole lot more. And the cool thing is it can automate a whole range of different types of trading systems. So limit order entry market on open market, on close systems with stop losses, without stop losses, with profit targets trailing stops, intraday volatility, exits, all sorts of cool things, rotational systems. So I'm really, really excited about that for my own portfolio, but also for your trading if you get involved as well. So that's one thing.

I started.

Writing a book which I'm also pretty excited about. So that book's gonna go onto the Kindle store and obviously all about systematic stock trading. I'm not gonna spoil it with the title or anything like that just yet, but watch out because I'm looking to launch that in the next month or two as well. So very exciting. Est the program is back up and running this week, so coaches are back from holidays this week, so all our live calls are starting again. So if you're in the Trader Success System mentoring program, then come back, join, join the cause. And I look forward to seeing you this week. We'll do a setup for your best 2023 ever. And this this month we're doing a module in the breakthrough workshops on, on System Dynamics, Trading System Dynamics and understanding really what all of the levers in trading systems do when you pull them, what are the impacts on the performance measures and what are the trade offs and all of that just give you a really deep, intuitive understanding of how trading systems work. So that's what we're going to be covering in the Breakthrough workshops this week for all members of the Trade Success System mentoring program.

If you have the Trader Success System, but you're not in the mentoring program, if you want to really increase your level of momentum, get more support, build your level of confidence and just surround yourself with a great trading community every single week. Shoot me a message and let me know you want to join the mentoring program and I'll send you all of the details. So that's what I'm doing. And Trader Success System on the personal front, had a couple of wins. I made the decision to climb Mount Kilimanjaro with myself son this year, 2023 in July. So we started training for that, did our first couple of training hikes over Christmas. So it's pretty cool. Looking forward to getting fit again and building up to that and standing on top of the world. Well, not quite on top of the world, but on top of the world in Africa anyway, in July. And my daughter also got accepted into a program over in Oxford in England. So she's going to spend four weeks in Oxford in July on the school holidays doing a university experience program, which she is so thrilled about. Very, very exciting. So that's pretty much everything for enlightened stock trading right now. Welcome to 2023. Let's get back into the markets and let's make this your best trading year ever. And the way to do that, the best way to do that is to join the Trader Success System mentoring program because we give you more support than any other mentoring program anywhere on the market. And we'll take you from wherever you are to fully implementing a systematic portfolio that's diversified across different market strategies and time frames and trading. All of that with absolute confidence. So click the link below, join the Trader Success System and I'll see you in there. And if you're already in, see you this week in the live calls. That's all for me. See you in the next video. Bye for now.