[00:00:00] It's good to be back on. So today I want to talk about just the ways of markets and I've started trading have changed over
[00:00:08] it's been about 20 years now, and I don't know how many times I've had big changes or big reinventions to go through but it's just a fact of
[00:00:17] I think if you're in the start-up or any business it's pretty much anything. It's going to be even relationships with people are similar too where There's a lot of growth going on and you have to change or it's not going to work.
[00:00:29] Somebody has to know what is going to stay still and I think with trading, there's since there's money involved too, it moves so fast people are always trying to jump over each other and figure out how is that market going to go from A to B?
[00:00:42] It's still going to go to A from A to B fundamentally based on earnings and interest rates and things like that like it always does but the way that it moves from A to B changes drastically over the years.
[00:00:52] So when I first started back in early 2000s it was me going home and using this program called Camtasia to record my screen and I was recording TT trading technology order books and I was watching
[00:01:07] just how does every up move look? Because every down move look, when we retrace and then we continue to go up on a busy day when there's a large move up, hasn't look. How does it look at the bottom when it
[00:01:18] pivots and turns? Do the orders come in or someone faking like they're going to sell but they really want to buy can I see that? Can I replicate that over and over again and watching those patterns?
[00:01:28] How does it look after unemployment? How doesn't look after the fed meeting? Can I figure out what people are doing? Can I learn to it's like reps and digits who reps and basketball, reps
[00:01:38] and music or piano? It's the same thing. It's reps and a skill set. Learning something. And then so then I figured that out and I made money on that and I got good at figuring out, you know,
[00:01:49] when things were not looking in the right way and when they were and then fast forward a few years go by and it works and it starts to work less and it works a little bit and it works less and less
[00:01:59] and it's working very small percentage of the time and then I noticed that certain times it works when it's busy because it seems like the machines that are now coming into the market at this
[00:02:08] time are kind of doing something different where we go from A to B but I can't quite do it the same way I used to so then you go through maybe you're struggling a little bit and you have to figure out
[00:02:18] what the hell to do about it and sometimes if you're around other people or you know people who trade you can talk and communicate. Other times you just kind of stuck for a while and it can be hard
[00:02:28] and then a good thing here is like your risk management like how hard are you forcing and losing money versus just kind of trading smaller and hanging around and dealing with your wounded ego and the feelings of whatever come up because you're not doing this well as
[00:02:43] it used to do and whatever that means for you and that's all part of growth I think to handle that handle that better and then so then back to my timeline so then we get into like the financial crisis
[00:02:55] in 2008, 2007 and Brent who I talked with a lot we've done some other podcasts together and we're actually going to do one again soon so I think it's on a different channel so
[00:03:05] I'll tell you about that if we do it but you can Google search the same thing and find Google search my name or his name and it'll come up anyways back to the story so 2007 2008 happened
[00:03:17] and he's doing a lot of spreading looking at the euro stocks versus the S&P futures so Europe in the US and he's noticing that when he's holding a longer short position and one versus the
[00:03:29] other so a spread so buying Europe and selling the US for example and he's doing a lot of that to feel the market and you can notice that weird changes in the market were hard to figure
[00:03:38] out when you owned one product but when you owned both of the products you could actually feel the order flow and you could figure out when to drop one side and just ride the market
[00:03:44] up or down so I started doing that because he was having success with it and then I started using that to get me into big moves just as a tool and then that worked great and that led me
[00:03:55] into some really good trading into 2008 when I kind of stopped doing that but then it was the financial crisis so it was like it was just really busy every day so that was to this day that
[00:04:04] stumbled and I best year actually 2008 because it was so busy remember the moves were so big it was like COVID times times six you know because it lasted that much longer excuse me getting over
[00:04:17] a cold here so that happened in 2008 and then back back to my reading order books and all that stuff so I'm doing some of that in a way but the skills that no eight became I was I've been very
[00:04:27] curious and always looking into different things and I'm reading a lot of different publications I'm subscribed into like big picture investments stuff I'm looking at short term stuff and it all kind of helps me even though I was trading short term it all kind of helped me having
[00:04:39] that context so getting in front of like which banks we're gonna fail and listening to the earnings calls of the banks and watching the order books of the banks were big edges to make a lot more money
[00:04:49] and to get in front of a matter those are the catalysts that were driving the market and then then that finally passes and then in an oh nine you're kind of trying to trade on the oh eight
[00:04:59] playbook and just struggling because it's not working the same the markets are still recover but no one there's so much fear and this went on for even a couple years where no one thought the recovery was real
[00:05:08] everyone thought it was you know bullshit because I'm a homin L. Arian and Doug grossed like the the big guys they were like the red allio and and Jeffrey gunlock of the era
[00:05:18] we're always on TV time it's the new normal where everything's slow and it's gonna grow low and then it grow you know just slow growth and then the meantime the market was just quietly marching
[00:05:28] up and then you know it just kind of walk walk walk walk in the years and years of this and eventually in 2012 to 2013 people are like oh crap I think we made a bottom you know in a minute and it went by
[00:05:39] kind of slowly and those years excuse me and those years were much more narrow than oh eight oh nine so there was different strategies again it was a little tougher if I remember but the
[00:05:55] the the machines didn't really come in hard and heavy yet my theory they were I think that really started like 2015 2016 if I remember right the algos stuff and I'm sure it was happening back then
[00:06:05] but it didn't feel as different as it started to feel after that so that time there was pockets of the old way and the new way and you're kind of a lot of people were struggling that I was
[00:06:14] working around and having just like good months and then like a tough five months and then a good month and it was like that and then we started getting the hacks and the fake news on Twitter
[00:06:25] and things like that popping up 2014 2015 and then eventually people got used to that stuff and started to distrust a lot of the things that broke the news that came and then we moved into 2016 and Europe 2015 2016 and started to get more computerized and you had a lot of
[00:06:43] you're yeah European financial crisis in there in 2016 I believe it's 2011 I'm sorry 2016 was I think it was the Trump stuff the all the uncertainty around the political landscape so that created a lot of volatility and then eventually he had a lot of comments that moved
[00:06:59] the market so that was a different environment and then I believe that was 2016 yeah and then anyways 2017 we got into the crypto stuff where that was brewing in 2016 and that became
[00:07:13] a really big area to trade so that was another area for me where I would kind of get involved and I tried something very different I was in those markets I didn't know anything about them
[00:07:21] so I got a hardware wallet I started you know trading and moving funds from one crypto account to the other I was doing some arbitrage I couldn't do it big scale because there was limits and
[00:07:30] so much money I could move but I did pretty well with that and I traded that using a lot of my old skills that were just dusted off from years before that weren't really being used in the stock
[00:07:40] market for the last few years they were phenomenally valuable made me a lot of money in crypto so it's almost like everything you learn always is there for you it just doesn't work right now
[00:07:48] but it works eventually it comes back so I use those skills and divergences you know Bitcoin's going up but you know Ethereum and Litecoin are going up more Bitcoin starts going down Ethereum and
[00:08:01] Litecoin can't go down at all and they just explode one Bitcoin goes sideways stuff like that and just basic stuff worked well though because it wasn't very competitive and of course now crypto doesn't work competitive and that stuff doesn't work as well anymore so that was that
[00:08:15] and then okay so let's go forward to then we most of us are familiar with the COVID stuff that happened and it was really good old school trading for a couple months and then it kind of got back to
[00:08:26] what we're used to now so now these machines have come into the market 2015 2016 and beyond and so the problem I'm having I had is the market went from A to B and I could figure it out
[00:08:37] but I couldn't figure out how to get in and I can't feel how to get in as well I keep getting stopped out even though I'm end up being right about the moves very frustrating and so I had to figure
[00:08:47] out I couldn't I trade maybe smaller with bigger stops so I played with that for a while and then I started to focus more on news and event days because that's where I did better and I started to have a lot
[00:08:56] better success when I just traded a lot less and traded more often on the news and event days so then kind of moving forward to where we are now it we're on another change because now you have GPT and everyone's
[00:09:10] programming and doing things and you have um you know the potential which we're going to see when and we have he had humans for years portfolio managers making algo isn't making it harder to figure
[00:09:21] out how they're getting in and out of the market dark pools and things that have been going on for a while but there's something probably coming where there's now an artificial intelligence
[00:09:30] figuring out how to better move the market from A to B that people aren't really thinking about it as much as the machine is time them a way to do it or try to try to have a way to do it and this
[00:09:40] very well may have been going on in the financial markets for a long time and the AI stuff may be more consumer facing right now so everyone's talking about it but it's been in the system for a while I'm sure that's
[00:09:51] the case so I don't know how much of an impact it will have on the on the market but my bigger point of saying all this I'm still getting to my bigger point my bigger point though is just to kind of walk through
[00:10:00] all the changes that have happened and how you've needed to be curious and willing to learn and try different things because what you'd once did that worked well might just stop working and it's not personal
[00:10:11] it's just the nature of change and in the market you see that a lot in a changes fast and the changes aggressively in the cycles keep getting shorter so so now it's okay so what do I do now
[00:10:23] and I've been using a lot of the artificial intelligence tools to test thought experiments and ideas and program things that I thought about in the past or things that I wonder what this looks like
[00:10:34] I wonder what that looks like and I'm looking at futures and stocks and I'm looking at everything you know gold cryptos and just trying things out testing things and sometimes you're surprised what
[00:10:44] you find and I couldn't even do that before so I can do that now so I can use my experience in my mind to to test things that I couldn't test so that's a way that I'm evolving and adapting
[00:10:55] and I found that when things get more structured instead of discretionary then it's almost like a mixture of there's the discretionary Brad who trades and then there's the guy who is the general
[00:11:07] of the system who now is running something more structured and it's easier to actually move your size up when you're structured because the losses are less personal they're just built into the
[00:11:14] system and then your job is to not think as much during the day and think more when the market's closed and keep retooling and adapting what you're doing if I'm still trading discretionary
[00:11:24] but I'm also doing that stuff so it's like there's a second thing going on here for me so there's two things going on not just one and I hope in the future I'll be evolving more towards this
[00:11:35] structured trading with rules and system based with my discretionary flare and then of course I'm fed days or when it's busy I'll just be trading myself because that's better for me to do
[00:11:45] but that's the market we're moving into and that's the way that I'm adapting and this was not the case you know while back it might have been if I had these tools but I didn't have these tools so
[00:11:55] and whenever whatever what I was doing was working back then I guess it didn't really matter but it's just always thinking that way always moving forward I spent a lot of time
[00:12:04] probably a couple of years or more than that just kind of watching the paint dry at my screen waiting for the times where I saw opportunity and meanwhile I'm sitting here with you know
[00:12:12] a healthy mind and body and I wanted to work and I'm thinking there's a better use of my time and sitting here waiting for just waiting all day for things and it's almost inhuman to be that
[00:12:22] patient to wait to wait and so having these projects and having things going on is exciting and then you're kind of waiting by accident and then your trade shows up and you can do it because
[00:12:31] you're not screwing around doing something stupid so that's I've given the story in the past about how Branson I used to watch dead wood on HBO during a slow month and then we had a good
[00:12:40] month and everyone else just traded the garbage range and didn't do very well so we always laugh about that but sometimes the best thing to do is nothing is to wait and it's often hard to do
[00:12:51] without being productively distracted so that's what I feel like I'm doing now and that feels really good so I'm just kind of sharing what I'm doing and it's a good way to move I think because it
[00:13:03] makes me feel good and it's exciting so I know that that's a good thing whenever I've been curious and excited before something good usually happens so that's the the direction for now and
[00:13:14] I think a lot of things are going to be changing the next few years so we're going to see how that's going to play and there's more people in the market than ever so I think that's good for all of us to
[00:13:21] have a lot of people doing different things and the game goes on so how can we how can we handle it how can we adapt to it and that's the fun of it so I'm hopefully come back on here a
[00:13:31] little more frequently but in Branson I are going to come on again and talk about some stuff but that's it for today.