Thread: JTH's Account Talk

JTH,

I want to learn and get a better grasp on how to apply your very successful trading method -- a method that results in spending a lower number of days in the market and therefore avoiding more than the necessary risks. I am convinced that other guys on this board would be able to appreciate your help and to learn from you and from other more skilled members who are also trading in a similar manner. I am aware that successful trading is a combination of Art, Science, and a Lucky tail wind behind one's sails.

The other day you posted a Chart of NDX (Nasdaq 100 Index) showing a 3rd touch of the 6-Month trend line and 3rd touch of the 100 SMA. You noticed that it was a good place to look for an oversold bounce. Soon after, you risked entering the S fund, and you made a very good run and were also able to make your intended gain, and to seek safety by doing an IFT into the G or the F fund. You were spot on, and successfully avoided the early April pullback. That was a terrific move that distinguishes you as an excellent Technical Analysis Trader!

Despite being a combination of Art, Science, and Luck, many of us see you with significant admiration. I hope that you and others are able to contribute to clarify this for the board members, and help us in getting a better understanding of how to do this.

Can you please explain some of the parameters you look for, in order to decide that you should stay invested or that you want to cancel an IFT before the deadline? For example, do you look at a the 5 or 10 minute Chart and the performance of a particular Index such as SPX, IWM, NDX, etc; in combination with trading volume, trading channels with morning highs and lows, before deciding to sell or hold before the noon deadline? Or do you have a better indicator to guide your decision? Thank you in advance!

I agree with airlift's observations regarding JTH's trading technique and technical analysis. JTH's response to his question however should be filed in a premium service...I would gladly pay a fee to read a detailed response...

Originally Posted by airlift

JTH,

I want to learn and get a better grasp on how to apply your very successful trading method -- a method that results in spending a lower number of days in the market and therefore avoiding more than the necessary risks. I am convinced that other guys on this board would be able to appreciate your help and to learn from you and from other more skilled members who are also trading in a similar manner. I am aware that successful trading is a combination of Art, Science, and a Lucky tail wind behind one's sails.

The other day you posted a Chart of NDX (Nasdaq 100 Index) showing a 3rd touch of the 6-Month trend line and 3rd touch of the 100 SMA. You noticed that it was a good place to look for an oversold bounce. Soon after, you risked entering the S fund, and you made a very good run and were also able to make your intended gain, and to seek safety by doing an IFT into the G or the F fund. You were spot on, and successfully avoided the early April pullback. That was a terrific move that distinguishes you as an excellent Technical Analysis Trader!

Despite being a combination of Art, Science, and Luck, many of us see you with significant admiration. I hope that you and others are able to contribute to clarify this for the board members, and help us in getting a better understanding of how to do this.

Can you please explain some of the parameters you look for, in order to decide that you should stay invested or that you want to cancel an IFT before the deadline? For example, do you look at a the 5 or 10 minute Chart and the performance of a particular Index such as SPX, IWM, NDX, etc; in combination with trading volume, trading channels with morning highs and lows, before deciding to sell or hold before the noon deadline? Or do you have a better indicator to guide your decision? Thank you in advance!

You are right on airlift. JTH is awesome. Good questions too! ... I think if you take the time to go back through his personal thread and blogs, you will find answers to your questions. I've done that. His stuff is -- as I said -- awesome! At the same time, I think applying those answers/his stuff effectively is the result of years of experience -- I'm definitely nowhere near that yet, and at my age probably never will be. Having said that though, if JTH ever decides to write an investment "how-to" book, I'll probably be one of the first to buy it!

Originally Posted by airlift

Can you please explain some of the parameters you look for, in order to decide that you should stay invested or that you want to cancel an IFT before the deadline?

Thank you for the kind words, it helps keep me motivated on those days when I'm just too tired to do my homework. There are so many methods I use but it isn't any one method which singularly works, it is the accumulation of those methods working with a synergistic effect and a steady hand guiding the till. Here are some of the methods I deploy and traits I find successful among traders, it is much the same approach I took when I was an avid chess player.

1) Researching, reading, watching, creating, back-testing and concluding the results. Sometimes I'll spend 20-40 hours a week doing just this.
1a) Read anything and everything you can get your hands on, also look for and filter out bias when you find it.
1b) Watch about 3-4 hours of videos a week, mostly on YouTube, if you find something you like, subscribe to it.
1c) Create systems based on any idea you come across, the more reading and watching you do the more ideas you create.
1d) Back-testing is very important and often time consuming, understand how it is very easy to skew the results by changing the variables.
1e) Make a conclusion of the system, either trash it, or add it as 1 tool (IMHO there is no 1 system which works for all situations.)

2) Make a plan, if it's too ridged it will snap or too flexible and you will get bent over
2a) The Long-game, map out your IFTs a full year in advance, with broad seasonal zones.
2b) The Mid-game gets mapped out about 30 days in advance, this falls in line with the 2 IFT limit. I've found many folks don't think about the mid game, this is the most important timeframe for TSPers. Hence, it is typically better to start off the month already invested, then jumping to G/F while still having 1 IFT to jump into the markets with. This is where many folks get left behind, there is nothing worse then watching the markets take off without you and being unable to deploy an IFT.
2c) The Short-game gets mapped out 3-7 days in advance, I scout potential entries and exits based on what the markets are doing now and how it fits into the Mid & Long term plans. I don't know what I'm going to do the next day, but I do know how I'm going to react to what happens.

3) Perspective, watch price and volume over multiple indexes over multiple timeframes, get a feel for the action
3a) Nothing substitutes time spent watching the price action, get into the pocket and stay there. If you take a break, you'll lose the feel.
3b) Every night I'll review the major indexes on the 15-minute, hourly, and daily timeframes. Sometimes (if I have a question) I'll dig into the 5-minute charts to see the interaction with trendlines. Weekly, I review the Weekly & Monthly Charts (stepping back to view the forest.)
3c) The Futures play an important role on determining the personality of the markets. I watch the futures at least every hour until I go to bed, then any time I wake up (usually 2am & 4am.) Think of the markets as a bi-polar patient, sometimes they are happy, or vice versa. It's important to understand and correlate the futures vs. that day's price action, sometimes those relationships change. Just like with the markets, if you have a good night's sleep, then you may have a great day at work. But if you tossed and turned all night long, then the next day you might have some volatility.
3d) The most important thing for us to understand is that we cannot impose our will on these markets, we can only choose to accept the outcome and find the proper reaction. "Being wrong and moving on" is an important part of not getting stuck in a bad position for too long.
3e) Being in the pocket. Every night, you should ask yourself at least 3 questions about how you think the price action will go. Ask yourself about the upside, downside, and middle, look at every possibility without bias. Then wait for the markets to reveal the answers with the price action. If you had guessed the price action correctly, then you are in the pocket and reacting correctly. If you are out of the pocket, don't try to force it, just try to figure out either what you missed or what you didn't accept (meaning your bias.)

4) Confidence gained from experience and planning. As an example, if you look at Intrepid Timer, he is usually confident to the point where he comes off as being arrogant. Yet he also understands the markets are not going to bend to his will, he has the flexibility to adapt, yet stay within the confines of his plan. You can't buy that sort of confidence but you can rent it through his Premium Service

I hope this answers your questions

Originally Posted by gronk007

I agree with airlift's observations regarding JTH's trading technique and technical analysis. JTH's response to his question however should be filed in a premium service...I would gladly pay a fee to read a detailed response...

As to the Premium service, I have not been offered one and would likely decline any offers at this juncture in my life. Reason #1, I have not yet met my own standards. Reason #2, I am a member of the USAF and a SNCO, my primary duties are to take care of those under me and I take that responsibility seriously. When work calls, I turn off the TSP switch, that switch gets turned off various times of the day and is very unpredictable. It would not be fair to have so many folks dependent on someone who could not give them their undivided attention.

That is one of the best posts I've read...thanks again JTH!


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Beautiful channel on TZA

Attachment 28229

Originally Posted by JTH

Thank you for the kind words, it helps keep me motivated on those days when I'm just too tired to do my homework. There are so many methods I use but it isn't any one method which singularly works, it is the accumulation of those methods working with a synergistic effect and a steady hand guiding the till. Here are some of the methods I deploy and traits I find successful among traders, it is much the same approach I took when I was an avid chess player.

1) Researching, reading, watching, creating, back-testing and concluding the results. Sometimes I'll spend 20-40 hours a week doing just this.
1a) Read anything and everything you can get your hands on, also look for and filter out bias when you find it.
1b) Watch about 3-4 hours of videos a week, mostly on YouTube, if you find something you like, subscribe to it.
1c) Create systems based on any idea you come across, the more reading and watching you do the more ideas you create.
1d) Back-testing is very important and often time consuming, understand how it is very easy to skew the results by changing the variables.
1e) Make a conclusion of the system, either trash it, or add it as 1 tool (IMHO there is no 1 system which works for all situations.)

2) Make a plan, if it's too ridged it will snap or too flexible and you will get bent over
2a) The Long-game, map out your IFTs a full year in advance, with broad seasonal zones.
2b) The Mid-game gets mapped out about 30 days in advance, this falls in line with the 2 IFT limit. I've found many folks don't think about the mid game, this is the most important timeframe for TSPers. Hence, it is typically better to start off the month already invested, then jumping to G/F while still having 1 IFT to jump into the markets with. This is where many folks get left behind, there is nothing worse then watching the markets take off without you and being unable to deploy an IFT.
2c) The Short-game gets mapped out 3-7 days in advance, I scout potential entries and exits based on what the markets are doing now and how it fits into the Mid & Long term plans. I don't know what I'm going to do the next day, but I do know how I'm going to react to what happens.

3) Perspective, watch price and volume over multiple indexes over multiple timeframes, get a feel for the action
3a) Nothing substitutes time spent watching the price action, get into the pocket and stay there. If you take a break, you'll lose the feel.
3b) Every night I'll review the major indexes on the 15-minute, hourly, and daily timeframes. Sometimes (if I have a question) I'll dig into the 5-minute charts to see the interaction with trendlines. Weekly, I review the Weekly & Monthly Charts (stepping back to view the forest.)
3c) The Futures play an important role on determining the personality of the markets. I watch the futures at least every hour until I go to bed, then any time I wake up (usually 2am & 4am.) Think of the markets as a bi-polar patient, sometimes they are happy, or vice versa. It's important to understand and correlate the futures vs. that day's price action, sometimes those relationships change. Just like with the markets, if you have a good night's sleep, then you may have a great day at work. But if you tossed and turned all night long, then the next day you might have some volatility.
3d) The most important thing for us to understand is that we cannot impose our will on these markets, we can only choose to accept the outcome and find the proper reaction. "Being wrong and moving on" is an important part of not getting stuck in a bad position for too long.
3e) Being in the pocket. Every night, you should ask yourself at least 3 questions about how you think the price action will go. Ask yourself about the upside, downside, and middle, look at every possibility without bias. Then wait for the markets to reveal the answers with the price action. If you had guessed the price action correctly, then you are in the pocket and reacting correctly. If you are out of the pocket, don't try to force it, just try to figure out either what you missed or what you didn't accept (meaning your bias.)

4) Confidence gained from experience and planning. As an example, if you look at Intrepid Timer, he is usually confident to the point where he comes off as being arrogant. Yet he also understands the markets are not going to bend to his will, he has the flexibility to adapt, yet stay within the confines of his plan. You can't buy that sort of confidence but you can rent it through his Premium Service

I hope this answers your questions




As to the Premium service, I have not been offered one and would likely decline any offers at this juncture in my life. Reason #1, I have not yet met my own standards. Reason #2, I am a member of the USAF and a SNCO, my primary duties are to take care of those under me and I take that responsibility seriously. When work calls, I turn off the TSP switch, that switch gets turned off various times of the day and is very unpredictable. It would not be fair to have so many folks dependent on someone who could not give them their undivided attention.

I do all this by proxy through the JTH free service. At least I wish I did.

"What retirement investors need is steady appreciation and reinvested income from dividends."

Did the bull market happen without you? Here

Originally Posted by Birchtree

"What retirement investors need is steady appreciation and reinvested income from dividends."

Did the bull market happen without you? Here

That article sounds like it's talking about plans like our L Funds.

Originally Posted by JTH

Reason #2, I am a member of the USAF and a SNCO, my primary duties are to take care of those under me and I take that responsibility seriously.

JTH,

I was so proud of you when you made the above statement. I'm so happy to see the core values of the USAF SNCO alive and well. I spent 32 years in the Air National Guard both as a full time military technician and as a traditional guardsman. I retired in 2011 with the rank of SMSgt and also took my responsibilites as a SNCO very seriously. I demanded alot from my troops and expected thier best, but I always took care of them.There was no greater compliment for me than having my troops give testimony at my retirement ceremony, of how much they had accomplished because of my influence. Keep up the good work, it is well worth the effort and thank you for your service.

Dang, too many AF folks around... sigh

We need more Navy people to get involved here...