How I Learn from the Markets Every Day: Larry Connors on the Game of Trading
Here’s the fourth and final part of Larry Connors’ series on ETF trading and the Daily Battle Plan. Links to the first three parts of the series are available below.
The part of the Daily Battle Plan that I get the most positive feedback from is the daily analysis. And what the daily analysis does is it allows you to see what I see in the marketplace.
This makes my 29th year in the financial industry. I was hired by Merrill Lynch in February of 1982. So I’m heading toward my 30th year in this industry. And I’ve seen a lot. The bottom line is, and I really mean this, I don’t have all the answers. I never will. One thing about the markets: the markets are a game that you always learn from and the moment people tell me they have it figured out tends to be the moment right before they blow up. So people who tell you they have the stock market completely figured out, are likely on the verge of blowing up.
No one ever truly figures this game out. But it’s a tremendous game to play. The academic challenge is just wonderful, and it provides an opportunity to make a substantial sum of money while constantly testing your mind. I get to learn from the markets. I learn something from the markets nearly every day. Some days are quieter than other days. But most days I can learn something from the market.
The commentary in the Daily Battle Plan is intended to be the culmination of my experience, combined with the fact that I have access to a great deal of statistical analysis. Our database is extremely large and contains a lot of information that I condense down each morning. And what I try to do with the Daily Battle Plan and in the daily analysis is to provide you with anywhere from a couple of sentences to a couple of paragraphs explaining everything I see that is going on.
Another part of the Battle plan is that you can see that I look at markets the same way over and over again. The Battle Plan doesn’t deviate. I’m not jumping around and using fundamental analysis one day and using price another day, or different types of technical analysis, or worrying about what’s going on with Europe or whatever. I may mention these things in the Battle Plan, but we are not making decisions based upon that.
There is a consistency to our process. We are using the 200-day moving average. I’m looking at the 2-period RSI – both for the entry levels and then scaling-in – and for then exit levels also.
What I try to do with the daily analysis in the Battle Plan is to let you see what I see. And also to provide a sort of teaching mechanism that you can grow from in your trading each day.
We’re going to continue to strive to bring you the best quantitative research and strategies and education in order to improve your trading and to grow your assets. It’s a single-minded ambition that we have here. We’ve been doing this for a number of years and our business gets larger and larger each year as more customers continue to join us.
So, again, as fellow traders, subscribers, readers, all of you – thank you for being a part of this.
To learn more about Larry Connors’ Daily Battle Plan, click here
Larry Connors is founder and CEO of TradingMarkets.com
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Part 1: Larry Connors Daily Battle Plan 101: How to Find the Best ETFs to Trade Every Day
Part 2: ETF Trading with Larry Connors Daily Battle Plan: Quantified Tools for Entries and Exits
Part 3: The Road to Professional Trading: Dealing with Losses and Living with Drawdowns