[Chris Scoreboard Johnston]

Correction of my above post, bonds are at 11300 not 11100 a 20 basis point typo!

Rs – there is a very strong seasonal rally tendency for bonds starting in July (lower rates). That did not tell us we would get 1000 Dow Points or 100 s&P points. It did tell us to look for it to happen, and if it did, look to the long side, or at the very least pass on shorts. Normally, we get a lag of a month to 4 months between the bond market moves, and stocks following. This time they occurred simultaneously which made this tougher to enter.

I am watching the bonds very closely, if they were to break down tommorrow on the non-farm report and break the uptrend, that would be bad news for stocks eventually. I hope they hold up and we get a stock dip, for the buy spot.

Nobody can predict the future all any of us can do is make educated guesses about what is likely to happen based on historical relationships.

[Chris Scoreboard Johnston]

Thanks sddude for giving me credit for calling this bull market. It is amazing all of the heat I took for telling people I was looking for a rally at the end of this year. The lesson to be learned from this has been commented on by colombo, the effect interest rates have on stock prices.

This big rally that we have had in bonds has been so powerful, that it even kick started the mid-term election rally earlier than it normally starts. Divergences between bonds and stocks have occurred at most major high and low we have had in the stock market, just look at some charts.

I mentioned in my blog at the time, and in here, that bonds were breaking their downtrend when the price was at 10814 and now we are at 11100. I have also warned many people in here about the GOLD market as well. This has always looked to me like a speculative top, accompanied with all the standard media BS that goes along with such events. Oil is a bit different, but again I made many comments about this as well. The trends in these markets are both heavily down at this point. RSeiser can back me on this as well. When we had lunch up here, I told him I was looking for a downside break in GOLD, this was a few weeks ago. He at the time I recall was looking for an upside breakout.

I mentioned repeatedly the importance of 574.50 which just broke. The last line in the sand is probably somewhere in the 520’s which is where moving averages come in on monthly charts. The biggest problem GOLD has is an overly bullish sentiment, which is bearish.

I am no economist, and my opinion about long term macro economic cycles is no better than anyone else’s in here. However, I think we have seen enough examples of economists being the wrong people to listen to about timing investment decisions. These people are very smart, but not necessarily correct.

I also do not share the dire economic view alot of people have in here. I do not think a severe recession/depression is coming. It may happen, but it has not yet. You can always exit on short notice in stocks if this start to look bad. I do think mid next year, say between my-June and the fall we will have a sharp drop in stocks due to cycles.

Also, the one thing that concerns me about this rally in stocks is the prominent divergence between the S&P 500 and the DOW. This rally is very narrow, which makes me think a sharp pullback could occur. I am hoping or that to load the boat on the longside. With bonds being this strong, I think this pullback, if it happens will be short in nature.

Some of my friends in the trading world are perplexed at how far this rally has gone, with some of the internal weaknesses at hand. I also am surprised, and have not gotten nearly the profit out of this that I should have because it occured in advance of my model by a couple of months.

[Chris Scoreboard Johnston]

[Chris Scoreboard Johnston]

I think it becomes clear with a post like that your true intentions.

Have you ever made a postive comment in here? What would it take for me to post in this blog for you to make a postive comment about it? If you wish to talk my cell is 949-554-4150. I think you know my email at this point.

You ask for proof, and I provide it, then you belittle it.

I sure hope that everyone else who is seeing this play out sees you for what you really are, just someone for some reason trying to antagonize someone else.

Why don’t you tell all of us exactly what you are trying to accomplish here? You still seem to be acting like you are in the third grade to me. You have made fun of Peter Lynch and his trading concepts and now Tom Balwin, who is next Buffett?

I love you to little buddy

[Chris Scoreboard Johnston]

I do not think we are going to have a significant drop unless the trend in bonds turns back down. High puts is actually a bullish indicator in my opinion. This indicates high overall pessimism, which is generally in place at market bottoms. Generally I want to sell bullishness and buy bearishness in my trading, once they get to extreme levels. What we would want ideally for a selloff, is the opposite of this, very low puts.

There are certainly some aspects of this rally that are suspect, but I am not shorting it. I am hoping for a drop to buy into.

[Chris Scoreboard Johnston]

JES

I completely agree that stock picking is very difficult. Most of the traders who consistently beat the indexes are people you have never heard of and there are not alot of them. I think I saw a stat recently that showed that only 5 newsletters that had been published over the last 20 years had beat the indexes each of those 20 years. That is obviously a very small amount.

If you just listen to Cramer one time you can come to realize how arbitrary a decision to buy or sell an individual stock can be. His process is so random as to how he decides whether he likes or dislikes an individual stock, and he is a very intelligent guy.

My website describes my approach which is systematic, and why I believe it gives me an edge over most people. Very few people are disciplined enough to develop a set of rules and follow them without deviation. Of all of the traders I know, only one of them does this as well as I do.

As to the comparison to the Harvard MBA’s, I do not know one single trader who is consistently profitable who has a background like that. I do not know why that is the case, but if I had to guess I would say that it has to do with over optimization in their models. Curve fitting your research to closely to data becomes more of a danger the smarter you are. There is an argument out there that says that being too intelligent becomes a negative for trading.

Maybe that makes me a dumb…. LOL! Once again, all the contest result was designed to do was provide proof of a return in an account. If you want a second one, you can go to the following website. http://www.precisioncapitalmanagement.com.

This was a small account that I traded a few years ago which you can see by the dates. It was funded with the amount it was because that was going to be the target client, in the 30 – 50k opening balance range. This table was approved by the NFA after the previously described 6 month delay they gave me. So now we have a second account that shows a superior return. This company is defunct because I closed it after running tired of paying salaries for staff for something that just was going nowhere. However, the employee that created the site which I think is lousy by the way but he was so insistent on keeping it the way it is, has lifetime free hosting. As a result, I think that site will stay up until a time when for whatever reason he decides to take it down. I have no contact with him at this point so I do not know what he is doing with it.

It is possible that business could be re-started at some point, since the NFA approval is already done. It was still up when I checked the other day. I will certainly change the format of the site as it looks crappy to me. You will see that return is better than this years in percentage terms. This year has not been a good year for me so far trading.

I do not believe there is any luck at all in trading, you do your research, develop your systems, and make the trades. If you have read my commentary in here this year regularly you know that I have been telling everyone a big rally was going to take place this year. Now it is here. I did not get the low in terms of the buy point, but my model has not given me the entry yet. How did I know? I didn’t know anything, it was just my research that told me this would happen and it was correct.

Follow Stevie Cohen and Bill Dunn. They are traders that have beat the indexes year in year out for many years in a row. Bill Dunn is not open to new investment, he has had I think over 20% on his fund for 25 straight years. ( Not sure about this but I think this is accurate ). He is the Tiger Woods of that field.

As in all fields what the experts tell you as far as indexing etc is full of conflicts of interest. The older I get the more I realize that about 80% of what is perpetuated on the public is disengenous BS designed to enrich the insiders. RE is a perfect example of that with all of the statements by Leareh etc.. Brokers are notoriously bad traders so whatever you do, do not buy stocks recommeded by brokers.

I hope I have answered your questions, this is the best that I can do to address them. You have to keep in mind that I have studied the markets and traded them for more than 20 years, so I should be a little bit better at trading than most even if I am a dumbo.

[Chris Scoreboard Johnston]

Heavyd

To answer your questions:

First – this is the only account I have entered in the Robbins Trading Contest. As I had explained earlier, the reason I entered this contest is to have something published by someone other than me showing my returns. I have no interest whatsoever with Robbins, but they are now pursing me for obvious reasons. These results are independently audited at the end of each year to determine the final standings. I fail to see a conflict of interest. I have over a million dollars in my trading accounts at other firms, and a much lessor amount at Robbins. This is the only contest of this type that exists, so this is where you have to go to be a player.

Second, in general I risk 5 or 10% of my account balance on each trade, in this particular account it is 10%. This account has never been in the red this year because it started off with several wins in a row. It did have one streak of 3 consecutive losses a couple of months ago. At that point it dropped down from a 62% return YTD to 17%. Now it has had 5 straight wins following those 3 losses taking it back to 45%.

Other entrants I believe have much higher risk settings than I do which is why they have such big returns. One guy went from 90% to behind me in the last month, so clearly he was risking large amounts.

I have dipped my toe into the managed money world, and anyone who has dealt with the NFA in this forum would understand why I am trying to run a business that does not deal with them. They delayed me for over 6 months over 3 words on my website. I was paying a staff of people during this time. It wound up costing me so much money that I went a different route for the time being. I could have sued them as they are not technically a government agency, but I just decided to stay clear of them for the time being.

I will eventually run a hedge fund, but there is substantial expense in setting one up. Further, the govt is about to go witch hunting them and probably rightfully so. I want to stay clear of that shakeout for the time being. I can make enough money trading on my own to live the way I want, but was convinced by a broker friend of mine to go public. He knew my results and thought I could attract alot of money once they became public. This whole thread and other comments over the last few months are exactly why I did not want to ever deal with the general public.

Someone essentially calls me out to show proof, I do it like nobody else in this blog has ever done. Has anyone else ever shown anything remotely similar to this proving what they claim? Then I get comments like a few that have been made here about website hits etc.. I appreciate the spirit of your comments and I hope that I have addressed your questions.

I have been a private trader for awhile and am just going public, my results have been good over time. Some years have been much better than this one, some worse. I have had a few very big years percentage wise and a few that were barely ahead. Just as in any trade, I do get better and more consistent as time goes on. I also have other accounts that trade S&P systems which are not for the public at this point. They are very volatile and not for everyone’s taste in my opinion.

The bond trading system I offer in my service to the public is what is featured in the contest with the previously stated risk parameters.

PW – it is the way comments are phrased in here and in life in general that dictates the response you get. For example, to use a specific prior instance regarding the year ending in 7 mid year correction. I do not recall the exact way the critique was phrased but it was some sort of reference to back to the future I think. You can refer to it as some type of futuristic whatever the phrasing was or you could say, “I am not familiar with that, what exactly is that cycle? It sure sounds unusual?”

This would have gotten a clear concise nice response from me, but when it is belittled with me having learned it from one of the greatest traders who has ever lived, it creates a negative reaction. Doesn’t that make sense? I am not here to teach bedside manner. It is so easy to hide behind some screen name and be completely anonymous. I choose to deal in a very straight forward manner with people. It is how I think someone should conduct themselves, but to each his own. I do not need to hide behind a false name.

Anx – to address your comments about emotion. Actually most successful traders are very emotional and passionate about what they do. I am an ex hockey player, wrestler, and martial arts guy, so yes there is some fire in me. I am glad I have it. Just read a few interviews with Tom Baldwin or Paul Tudor Jones. Tom Baldwin threw a pencil across the bond trading pit and it stuck in the head of another trader when they were arguing over on OUT TRADE. Please do not comment on the OUT TRADE, it is an industry term that refers to settling of trades at days end in the pits. He wrote a check on the spot for the $125,000 fine and through it on the floor, said fuck you to the exchange official, and walked away. Baldwin is generally considered the greatest bond trader who has ever lived. Bill gross cannot shine his shoes. Gross may have made more money than Baldin from fees but not near it from trading. He is an emotional guy but funnels that emotion properly.

You are correct that being emotional in trading would be a negative. I am a systems trader, who follows exact rules with no deviation which removes all emotion out of trading. It is the best approach to this business in my opinion. The passion comes in with the research aspect of things.

With all of this having been stated, I wish all of you in here well. I have just had enough of all of this and I wish I had never even mentioned that I was a trader to begin with in here. I think this blog has turned into alot of personal attacking on people, and as a result is not the great forum it used to be. Many online trading chat rooms have suffered the same fate. At some point you need a moderator to keep things from getting out of hand.

I will be a the meetup day gathering but probably will not participate in here any more. I am thankful to have met the people I have met through this blog. There are some really great folks in here.

Best wishes to all of you fine people in here.

Chris J

[Chris Scoreboard Johnston]

SCOREBOARD

what the refs won’t take your calls about your loss? Go double down on those options, you gotta love em where they are now if you liked em alot higher!

[Chris Scoreboard Johnston]

My god I finally got in again, probably took 75 tries. PW thanks for that post and it is exactly correct. The Robbins Trading Contest is the pre-eminent trading contest of its kind in the world. It is the only one with real money traded.

Pencilneck – what a great blog handle, I use both Genesis and Trade Station for data and software. Doing this for a living you always have to have a back up in the event something happens to disrupt one of your sources. I also have an aircard on a notebook to access wireless data in case cable goes down. Cox is notoriously unreliable. Also, thanks for visiting the blog.

The trades in my Robbins account are the exact trades from my trading service, with no others included, managed very conservatively. This is why it is only a 45% return. My own personal accounts have done better due to lower fees, and more aggressive risk paramaters. The whole purpose of entering the contest was to have an independent accounting of what someone would have achieved just following every trade.

Some cleints have far exceeded that return according to emails I have gotten. To poke fun at Robbins Trading simply exposes you for the clown that you are. Call Larry Williams and tell him you think Robbins is a joke. Maybe it is you that is the joke? Has it ever occured to you that maybe you should research some of these comments you make before you make them? You seem smart enough to itleast find out if what you are saying has any bearing at all before running your mouth.

This firms site would not by definition have that sort of traffic, it is not an educational site. Trading markets.com has the highest traffic of any of them, yet that is a money losing company according to it’s owner who I know.

BTW anx, just a heads up on a new innovation you probably have not heard of that actually is a fairly good idea, so I do not want you to poke fun at it, electricity actually works. It is not a futuristic idea that is folly. You are just upset with me because I exposed you for a lack of options trading knowledge. Ironically, I never intended to do that, I was just trying to educate everyone else in here as to what options are and are not. Also, do not average down losing trades like you mentioned you might do. That is right on the list of something that should never be done when trading.

I doubt you were ever an athlete, but as an ex-athlete there is a common saying I live by. The Scoreboard talks and BS walks. I have the Scoreboard and you are the BS, so you should walk. Go walk and blame the referees for your loss.

SCOREBOARD!!!!!!!!!!!!!!!!!!!!

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