Another Interesting Pattern

Could this be a Double-Top? It doesn't meet some of the specific criteria for trading stock chart patterns, but I'm finding the looks of this pattern on a long-term S&P 500 Chart pretty interesting...
This pattern is validated when it breaks the low of the trough between the two peaks, which is around 800. The anticipated target would then be the difference between the height of the peaks and the low of the trough (so, roughly speaking 1600 at the peak - 800 at the trough = 800). Subtract that number from the breakout point (800) and this would bring our target to *0*, as in ZERO? Geez, let's hope not! But if this pattern was to play out, it could take about 7 1/2 years to do so - the time from the first peak to the second. It's times like this when I hope technical analysis really isn't a self-fulfilling prophecy.

Tuition Reimbursement?

In a depressing sort of way, I guess this is good news...Investools has finally paid for itself. I wish I could say it was due to my incredible talent and skill at trading. But no, it's because we transferred one of our IRAs last year so that I could actively trade it. If I left it where it was I would've lost $29k. So we paid for Investools by protecting ourselves from that loss. We would've left that money where it was if we weren't trading.

Now I just have to be prepared for when the market bounces. I had taken two months off from trading because it was too spastic for me. Let's just hope I have the courage to jump back in when the signs start presenting themselves again. Fear is the main reason why most people miss out on the beginnings of a bull market.

Fear Factor

There are several contrarian indicators that are studied to help professional traders determine if the market is reaching "tops" or "bottoms". These indicators aren't foolproof or timely, but are watched nonetheless. One of these indicators is the Volatility Index (aka "The Vix"), which is a measurement of fear in the marketplace. For eternity the VIX traded within a range from (approx) 10 to 45. So a couple of weeks ago, when I was talking to my sister I mentioned to her that The Vix was approaching the top part of it's range and therefore would be expected to rollover....meaning Fear would come down and the market should go bullish (even if only for a period of time).

How wrong I was...
So then I analyzed the chart further. Technical analysis teaches us that patterns, when broken, tend to have certain results. There are all sorts of patterns on stock charts: ascending triangles, symmetrical triangles, head and shoulders, double-bottoms, and so on. When there is a range, such as on the Vix, then the target price would be equal to the height of the range. But, I thought "No way is the Vix going to 80!". Here's the calculation: 45-10 = 35 (the height of the range); 35+45 (the breakout point) = 80.
And I repeat myself...how wrong I was...the Vix not only closed at $80.06 the other day, but just about touched $90.

So, now what? Who knows...I'm no longer trying to guess what the market is going to do! But, again, our education has taught us that what was once prior resistance ($45 on the Vix) may now act as support. All we know for sure is that this is a different market we're in. There are a lot of unknowns in our economy and until after the election (when one of the unknowns is removed) I'm not sure if the market will do too much.

This is how we felt yesterday...

Our Latest Decision

I can't believe another month has flown by and it was time again to decide our future. Andy's decision was easier than mine...he will continue trading (for at least another month). With the new ideas and knowledge he learned from Brian Shannon's Book, he's been able to day trade with some success. The market has been so volatile this past month it has been virtually impossible to trade on any time frame longer than that.

I, on the other hand, had a harder decision. July was a difficult month for me. There's something that is very mentally straining about trying to work (take trades) but be unable to because of fear, frustration, and a total lack of trust in the market. I know I'm not alone. I know the professionals say this is not a market to be involved in, unless you're very aggressive. A bear market is not a time to be buying stocks, it's a time to sit in cash, prepare and wait. But I feel like I'm wasting time. So, I've decided that in the meantime I will focus half of my time on discovering & starting up a new business or I will find work. I am not ready or willing to give up on the trading, I'll just go "part-time". I did have a good month in June, which shows me that I can do this in better market conditions.

If Only We Knew

Do you ever have one of those times in your life when you say, "If only I knew (blank), things might be different?". Well, I have one thing that has sat in the back of my mind this whole year that is like that.

Last September, or so, it came to light that Andy and I trade very, very, very differently. It was one of the main reasons, we feel, that caused us to struggle so much in our trading. We had thought that by pulling together and sharing our trade ideas that we would be helping each other...that we would make less mistakes with two brains and four eyes looking at a chart. But he was trading short term and I was trading long term, so what happened instead was that we'd disagree over the proper entry and exit points and invariably lose money because of it! But, here was the kicker - we'd usually both be right...but in our different timeframes. So, we brought up this issue with one of the instructors at an Investools seminar in Seattle last year and to our surprise he said it was a common problem with spouses who were actively trading together. Now, you would think that Investools would've mentioned this at some point in all of the training classes or online courses, wouldn't you? Especially since they continuously encourage you to 'bring someone with you' to join. But, we took this information to heart, and separated our account so we could trade individually...and we definitely noted an improvement.

This is why I say, "If only we knew this in 2006 when we started trading, where would we be now?"

Over the years, I've had a number of readers email me to mention that they had joined Investools or were stock/option traders. Perhaps some of the lessons we've learned can help you, too....

Staying in the Game

Last Friday I sold the last stock in my portfolio. It has felt awfully strange to be totally out of the market for a few days. I was itching to get back in, but also feeling relief that I was all in cash because of the intraday gyrations in the market. "Cash is a position" as they say. And right now it is not a bad position to be holding.

Andy has been trying out a new day trading strategy. The shorter timeframe allows him to get in and out without the fear of holding overnight. I just don't think I could day trade - it's too fast. You have to be very disciplined and quick on the trigger to enter and exit successfully. I like to mull things over before making my decisions. Plus, your winner can reverse on you just when you decide to leave your desk for a drink of water or a visit to the bathroom. That's too much pressure for me!

I prefer longer-term strategies. I did re-enter the market today with one option spread trade. My frustration is that I know I can't make money if I'm not in the game. And we're trading for our income. So I'm back in the game!

What Are My Options?

I realized several months ago that I really don't like trading options. Yes, they are great leverage. Instead of buying a $100 stock, you could buy maybe a $10 call option instead. Now you can afford to buy more options (1 option contract controls 100 shares). But unfortunately there is so much more that affects the pricing of an option then just the price movement of the stock. Such as volatility, delta, time decay, and so on. So there have been times when my stock moves in my direction, but I still end up losing money! That's why I don't care to trade them anymore. I've been focusing on trading stocks to fine tune my entries and exits without worrying about those hidden influences.

With this in mind, you can imagine Andy's surprise when I bought a put option today. Since I'm trading our IRA account, I'm not permitted to short stocks. That ties my hands a little. Especially in this bear market. Another good way to trade bearish opportunities in an IRA is to trade the inverse Index ETFs, such as the Short Qs (PSQ) or the Ultrashort Qs (QID). Each Index has an inverse ETF - which goes up when the Index goes down. Unfortunately I didn't get in on this recent drop of 12.5% (on the SPX)...I guess I was thinking more bullish than the rest of the market and I kept waiting for the next bounce. Ha! One thing I've learned is that "you have to trade what you see, not what you think." Perhaps I should listen more to all of this great advice!

Our Marketplace

You might have noticed a new addition to our Blog and our Website....Our Marketplace. I've decided to promote some products that I've found to be beneficial to us. Instead of adding Google Ads (which I understand does bring in income for many others), I've chosen to try and be more personal. I'll only list products or services that we've used. These are affiliate ads, which does mean that we will get a small commission for any purchases (not click-thru's) that occur when the purchases are made through our links. So, I have just one itty-bitty favor to ask - if you like what you see, please remember to buy through our links. That would be great!

Ok, maybe a second request...is there a holiday coming up? A birthday? An anniversary? Do you normally buy stuff from Amazon online? I now have search boxes for Amazon placed on both our blog and our website. If you use these Amazon links to buy what you were planning on buying anyway, that would help us as well.

And, just for kicks, I added an MP3 box on our homepage of our website. You can listen to music and if you decide you like a song, you can buy it with a click of a button. We're always looking for more songs to add to our MP3s, so I thought that might be a fun way to find new music.

Thank you for using our website and blog for your future purchases!
And this is the end of this not-yet-paid-for advertisement.

Freedom

Earlier this month I spent the weekend attending The Millionaire Mind Intensive. It was a great seminar, and as the name implies, intense. Intense because it was long - approximately 40 hours in 3 days. But, more importantly, intense because of the activities that you do to try to determine what is stopping you from being financially free. Call it self-evaluation, reflection, inspection, whatever. Sometimes things can get ugly when looked at under a microscope. Almost all of us have had past experiences or prior role models that created a negative belief of money or rich people. But in addition to determining what is stopping us (usually fear), you must first know what you want and why. It is only with a clear vision of your goal that you can reach it. "Clarity is Power".

So, with this seminar...and watching The Secret...and doing some searching within my heart...and talking with Andy, I've realized that my goal hasn't changed. Or, I should say "our" goal. We want to travel, we want to be financially free to do so on our terms. We want to spend our time volunteering or working with our park service. We want to enjoy life.

With this, we have extended our Trading Time Limit to the end of July. Our initial deadline was April 30th. Our trading was showing signs of consistency at that time, so we extended our deadline to May 31st. Then May brought us all sorts of technical issues with Prophet Charts (the charting service we use). So much so, that Andy opened a new brokerage account with TradeStation because their charts are platform-based vs web-based. That caused us to extend our date to June 30th so he could learn the new program. And here we are - June 27th.

Today we decided we need one more month to make our final decision. What decision, you ask? It's the decision as to whether stock trading is in our future...as to whether this is the opportunity for us to reach our goal of being financially free to live our dream. We want it to be. It's a business we can travel with. It's a business that, hopefully after this learning curve, will allow us more time to enjoy life on a daily basis. We've recently read a new trading book that has shown us what we've been missing to increase our probability of winners. It's simple and sensible and we're both going to begin incorporating some changes into our trading strategies. So we need more time to see if this is indeed the missing link. But, boy oh boy, I wish we weren't in a bear market right now....

Motivational Quotes

It all started with a forwarded email. The email introduced us to The Sales Movie - a great motivational video. Since then, we've come across several others as well from links on other websites.

So before you start clicking on links, go get a drink, get comfy in your chair, relax and just watch these videos. They're just a few minutes long each, but I believe the impact will last longer than that. And, do what I do...watch them again in a couple of days!

The Sales Movie
212 - The Extra Degree
Power of Attitude

This is the way to conduct business...

One Saturday every month we meet with our Investools Discussion Group. This is a group of other people who live nearby and started with Investools (stock/options trading) about the same time as we did. It gives us a great opportunity to share thoughts and experiences with others.

Well this past Saturday we held our meeting on Cliff and Sandy's boat. Now, this is how all business meetings should be held! We motored from their house down the New River to the Intercoastal.


Then we anchored in Lake Sylvia and held our meeting.

It was a great day, even if we had to put up with some rain. At least it didn't start blowing until we were heading back up the river. Thanks again Cliff and Sandy for such a nice treat!

I Was Pretty

A Yiddish Proverb says:

With money in your pocket you are wise and you are handsome...and you sing well, too.

Well, last week I was pretty...and could sing, too. I felt like I was finally hitting my groove with trading. I was gaining some confidence back and was watching my account creeping up. I thought I was finally hitting a new threshold on my account - one where the market fluctuations wouldn't dunk me back below. But then Mr. Market reminded me that the profits that were there were only 'on paper' and he quickly took them back.

We're finding this current market has been very difficult to work in. The best descriptive word I've heard has been "schizophrenic". Up one day, down the next. We're hoping the market will start trending soon to actually make it easier. Because our time is running out. We have both a time deadline and a financial deadline. If we can't make this work soon enough, we'll be forced to make a change. We've already begun looking at alternative businesses, but it'll be hard to find something we are interested in *and* can take on the road with us.

Got any ideas?

A Recap

Here's our route from this past year. We had a wonderful time. We did so much that sometimes we have to stop and try to remember all of the things we did: hiking to the top of Half Dome, crawling through lava tubes, taking a boat tour around Crater Lake, having family and friends visit us along the way, fossil-hunting, and so much else! So much of it seems so so long ago.

To compare this year's route to prior years, you can check out our website Map page.

It was a different year for us on the road, though, since we were trying to work. It added some challenges and frustrations for us, true. But in reality we still got to travel and re-visit 13 states and add 17 new National Park sites to our growing list. I'm sure the next time we go back out on the road it will be easier. The satellite dish was working well for the last two months of our trip (it hurt me to call and suspend our service!). And we'll be more accomplished traders by then with some extra cash in reserves. I joked with Chris the other day that we'll be "millionaires" soon enough. I figure that if you don't set that as your goal, you'll never achieve it, right?!

Well, until we get back out on the road again, I'll continue to post periodically when we get involved in the fun activities here in our home town. Right now? Andy's in our roof-top jacuzzi and I'm using the WIFI now available on our pool deck looking at the ocean and the New River. Coming soon? The Winterfest Boat Parade and then we'll be in Philly for Christmas.

Driving Days

We had a beautiful drive from Idaho to Provo, UT. There was snow on the mountains and some times on the ground close enough to touch, but it didn't lay on the road. I took a lot of pictures on this drive and on our arrival in Provo, so I thought I'd post them as a video for something different.

We would've loved to have stayed in the Provo/Salt Lake City area longer because there is so much to see and do here - the Capitol, Uinta Brewing, Mormon Temple, Timpanagos Cave, and more. But, we realized that we were really craving some warm weather! We miss exercising and wearing shorts and feeling the heat of the sun. I know, we're soft! But we just feel it's time for a change...so today we drove to the southern border of Utah to St George.

It was a full driving day for us. But we had to get some work done, so we stopped at a rest area for lunch and put up the dish! This is why we have satellite!
We were able to get on the road early and still get to check the market for potential trades before the market closed. Perfect.

And now we are all toasty warm again...the weather forecast is in the 80's. Yea!

More Motivation

While in Auburn/Bellevue area we found some extra motivation to make trading work for us. Rush hour traffic. Our RV Park in Auburn was only 30 miles away from the class. We figured with highway driving it wouldn't take that long. Unfortunately we didn't realize how bad rush hour can be! It took us 1 1/2 hours to drive to class on the second morning.

If we can be successful in trading, we'll never have to worry about those ugly commutes again!

Auburn, WA - Investools

Some of you might be scratching your heads saying, now why would they be hanging out in the cold and rain in Seattle-area when the rest of the country is 85 degrees and sunny!? Well, we realized that Investools was offering several classes in the area, and since we were in the same place at the time the classes were being offered, we thought we'd take advantage of them. The first refresher class we took was Beginning Stocks which was the same weekend Andy's Mom and sister left. Tomorrow there is a refresher class on Advanced Technicals. We were about to leave the area with the plan of hitting this class in San Francisco at the end of October, but it filled up. So we decided to stay in the area this past week and take it in Bellevue. Getting back to the basics should help us with our trading.

Get Away

Calgon! Take me away! That's how we've been feeling lately. The frustrations from unsuccessful trading and satellite problems had been building. When you are sitting on the shores of Lake Chelan watching the sunset and you realize that you are not appreciating its beauty...that's when you realize that you need to do something.

Oddly enough, "things" kept popping up around me relating to the topic on our minds. First, Chris writes a post on her blog regarding making a life, making a living. This is what we are struggling with. In prior years on the road, we were just traveling. Oh, and was that wonderful! But since last year we have been trying to earn an income in order to stay on the road. This changes things. Especially when you're not earning any money and investing a lot of your time. We are basically putting in 'full-time hours' watching the market, looking at stocks, studying, etc. We started stock trading to have the flexibility to travel. But without the income, our traveling may need to come to an end.

This is why our satellite issues have added that much more stress for us. I haven't been able to focus on work as much as I need too because a lot of my time has been spent on the phone with tech support. I do need to say, however, that Motosat has been very responsive. They now understand my frustrations and I think I have every top employee working with us to get it resolved. They even sent a technician to our RV last week to look things over. Now, that's a challenge since we're always moving! They just happened to have someone on their way from Spokane to Seattle and was passing within miles of us. It's all about finding the right satellite with the right frequency, and we're hoping this third satellite is the magic one for us.

The other day this quote from Arthur Ashe came to us:

From what we get we can make a living. What we give, however, makes a life.

We have talked for years about giving back - donating time to the NPS or Habitat for Humanity or some other organization. But it's hard to give your time when you are applying so much of it to trying to earn an income. We still want to be charitable and we hope to find a way to incorporate that back into our lives.

So, the question is...how does someone who is traveling and visiting all of these beautiful places, actually "get away"? Backpacking! Leave behind the computers, phones, the RV with the satellite dish attached to it, noisy neighbors and tight RV spaces, and try to disappear into the woods...and that's what we did! We heard about the remote town of Stehekin on the other end of Lake Chelan and decided to go camping for the weekend.

Crooked River Ranch, OR - FMCA Rally

Our friends Jim & Chris were speaking at the FMCA Rally. So on Tuesday we went over to see them and tour the exhibits. Wow! The fairgrounds were crowded. We don't go to many rallies, so the last time we saw this many RVs in one place was at the Life On Wheels in Moscow, ID.

The first booth we visited was Motosat - to talk about the issues we've been having with our Datastorm Satellite Dish. Even that day, we could not access any secure sites (again), so we ended up working at the Redmond Library. After talking with Maurice at Motosat we are going to try switching satellites again. I'm not expecting life with technology to be perfect, but the frequency of our problems have just been too much for us. Jim, who installed our dish for us, even came over last night to check our equipment to see if there were any setting issues on our side. But everything looks good here, so hopefully switching satellites will help us.

We also had to visit some of the awning booths. Our four-year old vinyl awnings are beginning to show their age. While Andy was washing the RV the other day he almost pushed the brush through a part of the awning that has dried out. Yikes! This will be an expense.

After touring the Rally we went out to dinner with Jim and Chris and then had them over to our place. We really wanted to show off "our" canyon. And I'm glad Jim looked at our computers and setup - it's given me some peace of mind that there is nothing glaring on our side.

Technology

Aaah, life is wonderful when technology works. I'm sure you've had those moments where you wanted to throw your computer out the window, right? Well lately we either wanted to throw the computer, kick the satellite dish off the roof, or fire a rocket into space to knock the satellite out of orbit. Our emotions get crazy when things don't work right.

First, we had off/on problems with the satellite we were on (called SatMex 5). Everyone on it at the same frequency were having issues. So finally I switched to a different satellite (Horizons 1). I would've eventually have had to do this anyway because SatMex 5 wouldn't work in the far northwest where we're heading. Every satellite has a "footprint" as to what region of the earth it can cover. Then after switching satellites ("This will just take one hour."), I had software problems and other issues that took two days to resolve.

Just prior to that, we couldn't access the internet because of foul weather. Not where we were (it was sunny and gorgeous), but there were thunderstorms in Germantown Maryland where the Control Center is.

Then there were a couple of days when we couldn't access secure sites (https). Hello! We're trading - we have several brokerage accounts that we couldn't access to buy/sell. That wasn't good. The next week there was a day we couldn't access regular sites (http). That's where our educational site is and our stock charting program. Weird stuff.

Our last campground in Klamath was hidden in towering pine trees. It took us two days and three sites before we found a campsite that had an opening to the south that our dish could use to locate the satellite.

So now we've arrived in Crooked River Ranch, OR...and at this point I'm utterly paranoid that whenever we move we'll never get internet again...and the dish went up and did exactly what it was supposed to do - it found the satellite on the first try. Aaahhh...life is good.