Enlightened Stock Trading Weekly Market Update: 18 September 2022

Hi, Adrian Reid, founder of Enlightened Stock trading. It is the 18th of September and this is my weekly market update. I'm a little bit late this week, I'm sorry, but Stephanie and I have been away for the weekend. We're in Byron Bay, which was amazing. I'll show you a photo later. Had a really great weekend and got to meet one of my amazing trader success system members. So very excited about that. So I'm trying something new. I need you to let me know if you like it. I'm doing video update rather than a text update mainly because right now I've been. We're driving for four hours today, so I'm kind of tired and I didn't really have the energy to write down all of my thoughts. I thought I'd just speak them and share them with you. So reply to this video, let me know. Thumbs up or thumbs down? Do you like a video update or do you prefer the old text update? So let's jump in. Let me show you what is going on in the markets this week. Here's the S and P. Really interesting because we were clearly in a bit of a bear market here and we had this big rally which had a lot of people thinking that the bear market was over and that was kind of strange. I got to be honest, I was surprised that rally went on so long because, you know, with rising interest rates and inflation and you know, fear of Russia, Ukraine and all this other garbage going on in the world.

Was really thinking that the market had a lot more downside to go. But. But a lot of people really starting to feel confident again and really buying in big. But then we had the decline and the market turned in early September. So just what's that like a week and a half ago now? And it looked like this was the first higher low in a new bull market which was like, wow, that's kind of surprising given everything that's going on in the world. So we had four massive updates and then the market just turned around on a dime. We had this massive gap down and then ended the week, this week, really, really weak and we broke that low. So it is now starting to look like this was actually a bear market rally rather than the first upleg of a new bull. But look, we don't know for sure just yet. We've got to wait and see. All I know is that you've got to have systems that allow you to profit from all different market conditions. You want something that will profit on the long side, you want a short system that Will jump in and make you money and hedge your long on the downside if there is a bear market. So the S and P looking pretty weak right now, very weak into the week and two really big down days this week, which was great for the short side trades we've got on. Here's the ASX all ordinaries index, more or less the same behavior here. We've got the big decline, massive bear market rally, decline rally and we haven't quite made new lows on the asx. But bear in mind the US has had one extra day on Australia because this is Friday night after the Australian market was closed. So we'll see what happens on Monday. But it really is, as I say, looking like we're in a new down leg in this, in this bear market. So we'll see how that plays out. Hong Kong, still an absolute basket case. Very pleased to be short in Hong Kong. If we zoom out here, you can see basically since 2021 this has been a very clear downtrend and almost all of my shorts have now hit their profit targets in Hong Kong. So almost actually back to cash, still short, but almost back to cash in Hong Kong. And if I have a quick look at crypto, here's bitcoin. And again look, if we zoom out the very strong downtrend since December last year and we've been consolidating sideways for quite a while now. There was a little bit of excitement here in August and then again this last week when the, when the bitcoin price popped above the 50 day EMA. I use the 50 day exponential moving average as a regime filter in crypto mainly because crypto markets move so much quicker than in stocks. In stocks I tend to use the 200 day because it kind of keeps you out of the fake rallies. But so we had a bit of excitement here with the price popping above the 50 day moving average and some of our systems got long again in crypto but I wasn't fully loaded. So right now in crypto things are just sort of moving sideways. We're waiting some clear direction. I think if the market drops much below 18, 18 and a half, 18,500, I think we're going to probably see some, some really big downside, which is great. If the market rallies much past 24, then you know, we might be in for some nice upside, which is great. And that's the primary message that I want you to take away from these updates. It really shouldn't matter what the market does, but what you need to do is Have a set of rules, a set of systems that will profit when the market goes up, when the market goes down, and will transition nicely between those bull and bear phases. If you don't have that, the markets can be really stressful, particularly these areas of indecision, because you're not going to know if you want to load up on the long side or whether you should wait for further downside. But if you've got systems that will turn on when the market rallies and make you money on the long side and turn on if the market falls and make you money on the short side, then it really doesn't matter what the market does.

So what are our systems doing this week? Interesting week because in the US market, I'll just go back to the chart over here. In the US market we had this rally and this subsequent decline caused the slippery dip which, which is my US Short system to turn back on. And so we got fully loaded on the short side earlier in the week and we had a couple of really nice days as a result of that. So very pleased with the way that's playing out in Australia. The short side system is on as well, so we've got some exposure there. But my trend following positions in Australia are holding up pretty, pretty well. So mostly I'm still fully loaded on the long side in Australia. In Hong Kong, as I said earlier, I'm still short, but a lot of my shorts are now closed out. I've only got a handful left and I've got absolutely nothing on the long side. In crypto, it's a bit of a mixed bag. We're fully loaded on the short side with our fallen angels system that comes with the crypto success system. On the long side I've got a fair range of holdings. Some of the trend following systems, some of them have turned on with that pop above the 50 day moving average. But I don't have 100% exposure on the long side. So the portfolio is still sort of hedging its bets a little bit, I guess I would say. So we'll wait and see what happens. If the market gets stronger from here, then we'll definitely load up more and the systems will do that for us pretty quickly. And if the market collapses, then those systems again, they'll exit pretty quickly as well to cap the downside. And look, this is the key thing that I want you to get out of these updates. Just make sure you've got a portfolio of systems. That means it doesn't matter for you what the market does. If you can make some money when the market goes up, if you can make some money when the market goes down, and at the very least keep your head above water when the market is sideways, then trading becomes very, very stress free. So that's really what, what I want you to aim for as a trader. So in trading psychology this week, one of the things I noticed talking to a lot of my or a number of members is a theme of patience came through a lot. And so my thought for you is that patience is one of the most important attributes or characteristics of successful traders. And if you finding that you're getting impatient with losses or with losing trades that you want to exit, if you're getting impatient with your equity curve, waiting for it to make new equity highs, if you're getting impatient with your winners and you're wanting to close them out to bank those profit, if you're getting impatient with any aspect of your trading, then that presents a real problem and you need to do some work on that. Pardon me. And what I find the main driver of impatience in trading is actually a lack of confidence in your rules. So my suggestion is if you're finding yourself impatient with some aspect of your system, you want to dig in and investigate why that's bothering you and do some system testing, some back testing around that. So often a lot of times people get impatience with winners and they want to bank those winners and close them out so that they can have a win, so they can feel that victory that they beat the market. And so if you've got a big win and you want to close it out, instead of closing it out, what you want to do is look at how big is that win and how long has that trade been going? And let's say you've got a 100% winner, you've doubled your money in that trade and the trade has been open for 50 days, maybe what you can do is take your system rules and back test those system rules with an additional profit target of 100% or a 50 day time stop or something like that to show you what is the impact of acting on that impatience. And if every time you are up 100% in your system, if you exited that stock so that you didn't have to feel impatient, would that make the system better or worse? And if it makes it worse, then you know that the impatience that you're feeling in that case is a bad thing and it boosts the confidence you have to follow your rules. And similarly with the time stop, if you're feeling like, oh my God, how long Is this trade going to go for? It's been going 50 days. How much longer do I have to hold this stock? I want to move on, I want to find something else that's moving. I want to make more money and you want to close that trade. Put a time stop in your system and backtest with and without the time stop, compare and often what you'll find is that that impatience is actually not productive. So it will destroy value in the system. But by testing it, you can see it and that helps you build confidence in the original rules. Patience is the most important attribute for successful trading or one of the most important attributes. But the way you build that patience is by building 100% confidence in your rules. So if you've got 100% confidence in your rules, it's very easy to be patient and just follow them. If you're not 100% confident, the task is to do the back testing, do the analysis, dig into it until you have that confidence so you can be patient to follow those rules.

If you're feeling that way and you're not part of the Trader Success system and you want to know how to do that backtesting, how to build that confidence, then come and join us in the Trader Success System membership and you'll learn how to back test, how to evaluate rules, how to test your hypotheses, how to understand whether some of your drivers.

Your psychological urges are good for your trading or bad. How to actually evaluate that quantitatively so that you know whether or not to follow those, those urges or not follow those, those.

Those feelings. So training psychology was, was the big thing this week.

I usually highlight do a member spotlight or a member wins. And what I wanted to do today is just say a really big thank you to Akim. Akim is one of our amazing members and he's been working with me for quite some time now and he's an amazing trader. I really love all of our time on our Zoom meetings together, but I want to highlight Akim because this week I got to meet him face to face and I've met very few of my students face to face. So for me it was super exciting. So, Akim, thank you for coming to visit Australia. He lives in Germany normally, but he was visiting a friend in Byron Bay and he said, hey, I'm gonna be here, can we meet? So Stephanie, my wife and I, we went to Byron Bay, we met Akim, we had an amazing meal and actually I'm not vegan. We went to this vegan restaurant and it was sensational. Really, really great food. And then we had breakfast together a couple of days later. We had an amazing time in Byron and I got to hear a bit more about Akim's life, how he came to where he is. And I just want to give him a big shout out because he's an amazing, inspirational soul spirit, very calming influence, very clear thinking, hugely perceptive, and it really shows through in his system development and in the way he executes his trades. So, Akim, super, super job. So great to meet you and I was thrilled to spend some time and definitely love meeting you as well. So thank you so much. So, news from est.

Really, the main thing we're focusing on right now in light and stock trading is betting down the new members portal and the new forum. So we've launched the trader success system portal and we've launched the crypto success system portal and we've got the.

Course material all loaded in there. We've got students in both portals. We're getting amazing feedback. And the new forum, which thankfully, thankfully takes us off Facebook, is working fantastically well. So that's going great. And that's probably the biggest news from est. We're just pushing, pushing ahead on that.

And.

Okay, so the next part of the update is on the home front. So personally, what's going on? What's happening with Adrian? Well, we had a really cool weekend in Byron. Like I said. Stephanie and I went to Byron and met Akim. We also spent some time together. We had a fantastic time walking on the beach and.

Taking in the sights. I'd never been to Byron Bay. I didn't know what all the fuss was about, but I got to tell you, it's a fantastic town and they have amazing food. And.

I looked for the best coffee shop I could find. And often when I'm in a new town, I'll just Google, you know, best coffee near me and I'll look through all the reviews and everything. And we didn't have a single bag coffee shop. I went to at least half a dozen during the week, during the weekend, and they were all good, which is pretty astounding. And had one of the best dishes I've ever had in my entire life. The tuna tartare that I had at Beach Bondi was. Sorry, Beach Byron was amazing. So if you're ever in Byron, you want a fancy meal, go to Beach Byron and have the tuna tartare was sensational. So look, that's it for this week. I hope that's okay. I really just didn't have the mental energy to write, I find it much easier to speak so if you like this video and you want more video updates, reply. Tell me you want video updates. If you hated this video and you want more text updates with my written thoughts, reply to this video and tell me you want text updates. Either way, if you're not in the trader success system and you're worried about how to make money if the market continues on the downside, or if you're worried about whether or not you need to load back up on the long side, then come and join the trader success. You won't regret it because you immediately get a portfolio of profitable systems that work in a range of different markets, in a range of different market conditions over a range of different time frames and strategies. So it's a really great way to quickly diversify and stabilize and turn your trading into profit. So hope that helps. Let me know whether you like the video update and I'll see you in the next video. Bye for now.