Stock Trading System
Dear Fellow Investor,
Welcome to Stock Trading Zen, a daily stock trading system that produces extraordinary returns! Each day it predicts if the S&P 500 will be up or down the following trading day.
Lots of people ask how I first got interested in creating a stock trading system…
Well… Since I was five years old I have been interested in computers. At five, my brother and I hand built a Heath-Kit computer (he was nine and was in charge of all of the soldering). By seven I started my own software company selling games and database programs I developed for the Radio Shack TRS-80 Color Computer via mail order. As a kid, you may have had friends and played outside. Not me, I had a computer and lived in my parent’s pitch-black basement. Over the years, however, my relationship with computers has served me well.
Back in the early 1990’s my roommate Dave leased a satellite dish and a computer then set out to rule the commodities markets. After a couple of months of doing pretty well trading, having no “trading system” to speak of, he got caught short lumber right as Al Gore was elected Vice-President of the United States. Lumber contracts went limit-up for three straight long November days during a time of the year that they typically folded. He was unable to exit his shorts and was instantly dead… accounts closed with hefty margin calls. While this wasn’t the outcome Dave had hoped for the entire concept of trading equities and one day creating a stock trading system intrigued me.
From 1992 until 2005 I read plenty of books on trading systems for both stocks and commodities. In 2005 I added the daily highs and lows to my Yahoo (now Google) home page. After staring at them intently for many weeks it occurred to me that there must be a reason that certain stocks went really up and others went really down on a given day that could be programmed into a stock trading system. After much research, it turns out that there wasn’t, or at least not a system that I could find. However, what I did discover is that stocks tend to work much like rubber bands, or the elastic that keeps my shorts up. It was serendipitous to discover this Pricing Elasticity Model because throughout my entire life elastic has been my friend. As a young kid I was pretty large and even husky pants rarely fit right. So, elastic was used to hold up my pants. Still today, I own an elastic belt or two!
So, what was the specific catalyst for me to create this site? The proverbial straw that broke the camel’s back? I have always loved to travel. Recently, on a trip to the Galapagos Islands with my family, while I was supposed to be relaxing and enjoying the wildlife, another problem arose with work so I was instead frantically searching for Internet bandwidth large enough to upload a multiple page Excel spreadsheet to a client. I wasted an entire day, which equated to 20% of our trip, trying to locate and then get connected to a decent Wi-Fi hotspot. At that very second I said “NO MORE!” I am a great trader and have a profitable stock trading system. So… why not trade full-time and let some other people in on this stock market system to create a community of followers, eager to share new ideas.
Quite frankly, ever since I was 14 years old and moved out of my parent’s basement, I like to have friends. This site is a way of having a group of friends dedicated to the same objective of making money in the stock market using a proven stock trading system. A real community to help maintain focus. Before this site I always knew that trading every day would lead to great things, yet, my “real job” kept getting in the way. So, one day of not trading stocks because of some stupid emergency quickly turned into two and then a week went by solving nothing that helps my family in the long run. Now, the trading signals come out of the stock trading system every day and the community and I trade them.
Please don’t think of this newsletter as a source of “hot stock tips” or “day trading secrets”. The trading signals available on this site are the trades I review myself. Your preferences and aversions to risk may be different than mine. My fundamental belief is that the markets are inefficient. Prices move up with the herd and down with the herd. My trading system simply trys to figure out when the herd will likely change direction. Prices tend to move down much faster than they move up. For each seven year cycle, less than a third of it will be spent going down, while the remainder will be spent in the up cycle.
So what’s the basis for this stock trading system? Like I said before, I discovered that the stocks are a lot like rubber bands. When stretched in one direction or another, they tend to spring back. Sure, every now and then the band breaks. This is the exception, however, and not the rule. As the rubber band continuously stretches in one direction, it can stretch further. What my stock trading system does is predict down days. When a specific stock, sector or the entire market stretches way towards the high side, I reverse my long position into a short. I call this the “Black Monday” effect even though it may not actually be “Monday”. When everyone is running in one direction it reminds me of the reel-to-reel movies I watched in third grade of lemmings falling off a cliff. Remember those? Time to start running the other direction!
The signals I send to you come directly from my farm of computers housed in a data center at Cox Communications headquarters here in Southern California. The system's signals come before every trading day by 7 p.m. Pacific time. What the trading system sends to you a prediction of the direction of the S&P 500 for the following day. This is an “always-in” trading system. It assumes that always have a position in the index, either long or short.
What stock trading software and data feeds to I use? My data comes from DTN IQFeed and Yahoo for the fundamentals. For analysis I use Worden StockFinder, NinjaTrader, Excel and tens of thousands of lines of Visual Basic code I’ve written over the last five years.
What stock broker do I trade with? I use MB Trading and Interactive Brokers. Both are outstanding. I find MB Trading to be a bit easier to program VB software for, while IB has more options of how to trade and types of accounts.
Some people do ask, “Are you trying to move the market with your stock trading newsletter?” Absolutely not, and well…. that would be impossible. Unless you are a gazzilionare it would be very difficult to personally move a stock. And why would you even want to do that? You are already a gazzillionaire!
This stock trading market newsletter is about some insight into tomorrow. I am not predicting the low or the high. I don’t trade like that because I would always be disappointed.
These trades are risky. Stay out of trading stocks on margin or you could wipe-out your account. Some stocks drop a lot before popping up or never pop up at all. If you purchased using margin you are dead, and quite depressed, all at the same time!
So what about performance you wonder? How about an average profit of 120%+ per year from 2008–2010? Does that tickle your fancy? The last 12 months are charting over 70%! Check out these charts from the trading system.
So how much does this investment newsletter cost? It's FREE. That's right, it's an absolutely free stock market investment newsletter delivered to your email box every trading day.
What else do you get for free? An Education! I know the trading system works and want others to benefit as well. You can receive this information right here on this website or via email.
The free trading system newsletter on the left-hand side really is free and is the actual signals produced by the trading system.