The Advanced Trader's Package.

I have long professed that trading and forecasting are two different things. Traders’ trade and analyst forecast. When I tell this to prospective clients and traders, I get a smirk from the majority. But then the majority lose at this high risk / high reward game of trading. The ability to trade - execute and manage risk - is just as important as the method used to forecast direction. In fact, if you do your homework and read the "Market Wizards" it should become a clear and self-evident truth that it is more important. What Creative Breakthrough, CTA (CBI) is looking for, what I am looking for, are good traders. Good Traders use a little common sense along the way. They are not slaves to a system. They know that no matter how good a system is that on widely expected "news event" days to stand aside because of fast market slippage. They also have rule of thumb to avoid "option expiration" week as the program traders have the market pegged. CBI has a number of good trader/clients and I want to share some insights with you from one of them. He owns the Quad Level support and resistance indicator that we offer as well as the MoTrader indicator from CBI.

"Hello Jack,
My trading is extremely different than your typical systems trader.
It's probably 50% systematic, 45% discretionary and 5% lucky. I sell
resistance and buy support. There are a lot of things that make my
trading successful, but that's after many years of learning and studying
the way the markets move. What I have come up with works very well!!!

I wait for the market to be over bought or over sold, the more the better.
The Quad support and Quad resistance are extremely reliable in giving
me a place to buy or sell the market and where to put the stop. I wait for
the MoTrader to show me that the market is overbought or oversold with
an indication of +40 to 60 or more, or -40 to 60 or more. At that point I look
at where the market is vs. where the indicator shows support or resistance.

I will make my trade at that level and risk the next level as my stop. The
higher the level of support or resistance the better. The market very,
very rarely ever breaks through the outer levels of support or resistance, when it does it is just squeezing and ends up going in the opposite direction very fast which is the direction you want it to go.

I trade the stock index futures contracts, (S&P, ND, DJ) and have found
that the easiest one to trade with the most consistent wins with the lowest risk factor is the Dow Jones. I look to make 30 points or more per
contract and my risk are usually 30 points or less per contract. I don't look to make a killing on every trade, so as soon as I have 30 points or more and the market stops moving in my direction, I take profits!

Today, 7/19/99 was a perfect example of how my trading works. Right
on the open the DJ U9 went to 11340, the high of the day and exactly at
the most extreme level of resistance. At this time the MoTrader was at 40+
which was telling me the market was way over bought. I immediately went
Short at the market and was filled at 11330. Thirty minutes later I was
out with 50 points profit and took no heat on the trade. The market of course continued to fall, but I was happy with my profits.

I have other rules that I follow with this just being one example.
But following my rules, and keeping greed out of my trading I had 66 trades
from 6/15/99 through 7/15/99. 58 were wins, 6 losers, and 2 flat. I have
to watch every minute of the market during real time to catch all these
trades, but I never hold a losing trade overnight and very very rarely
have to carry any trades overnight. If I miss a chance because I acted
to slow I just wait for the next one. I never chase the market because
that increases my risk.

I hope this helps you Jack. I would be glad to talk to any seasoned
traders that have the indicators as a reference as we are talking, but not
during trading hours.

Take Care,
Patrick St. Marie

Thanks Patrick we have talked about this before and I could not agree more. Like I said at the top, Traders trade. When the position stops going in a favorable direction, a trader gets out all else being equal. Think about it, when you optimize a profit target all that is giving you is an average around which 49% of all positions fail to reach and the other 49% exceed.CBI provides the above indicators for TS8 and systems based on these concepts through a Broker assisted trading program called TraderAssist(tm). Call 800-618-3820 for more details or email me.

May all your mistakes be small and your luck run large,Jack F. Cahn, CMT

Continued.