Sunday, January 25, 2015

New Challenge: from US$ 10k to 100k

Hi folks!

I'm approaching the challenge target at US$ 100,000 on the account we started trading last August, 2014, with just US$ 10,000, a great achievement indeed, all done in real time in our trading room.

To be very honest I did not expect to fulfill this target so fast but we got a great window of volatility in the last couple of months that has allowed us to meet that target in such a record short length of time of only a little over 6 months.

It was a great learning experience indeed for myself as I was able to put myself in beginning traders' shoes who are usually trading with a relatively small account, it made me remember how difficult it is in the very beginning to break the first barriers on Stages 1 and 2 (see trading plan below), which I do think are the most difficult ones, after breaking those first two we know it's just a matter of time (and discipline) to break through the next ones.

I did enjoy that 6 month journey so much that I decided to start it all over again, our initial plan was to grow that account up to 1 million Dollars, but as many traders have missed the beginning of the first challenge and have asked me to start again that I decided to listen to them and start it all over again, we'll start a brand new challenge on the first Monday of February, 2015.

If you want to participate you need to be a member of the Diamond Setups website where I call our trades and show exactly what I'm looking at on the charts to take a decision, members earn while they learn how I do to be consistently profitable by following a simple set of rules that I created and improved in over 25,000 hours of screen/trading time.

So we'll start trading a US$ 10,000 account with 2 contracts on ES (S&P500 e-minis) using strict risk control and by increasing the size we trade (or decreasing, if we lose and go back to a previous stage)  at the targets as shown below.

We'll go through each Stage, trading daily in our trading room until we complete the challenge's target at US$ 100,000 on the 7th Stage.

Stage 1 starts with: US$ 10,000 
Trade size: 2 lots
Target in US$: 12,000 – In ES points: 20
Time to reach target: 1-2 months

Stage 2 starts with: US$ 12,000
Trade size: 3 lots
Target in US$: 15,000 – In ES points: 20
Time to reach target: 1-2 months

Stage 3 starts with: US$ 15,000
Trade size: 4 lots
Target in US$: 20,000 – In ES points: 25
Time to reach target: 1-2 months

Stage 4 starts with: US$ 20,000
Trade size: 6 lots
Target in US$: 30,000 – In ES points: 35
Time to reach target: 2-3 months

Stage 5 starts with: US$ 30,000
Trade size: 10 lots
Target in US$: 50,000 – In ES points: 40
Time to reach target: 2-3 months

Stage 6 starts with: US$ 50,000
Trade size: 15 lots
Target in US$: 75,000 – In ES points: 35
Time to reach target: 2-3 months

Stage 7 starts with: US$ 75,000
Trade size: 20 lots
Target in US$: 100,000 – In ES points: 25
Time to reach target: 1-2 months

Join us at Diamond Setups, click here.

Tuesday, January 13, 2015

Challenge Update: Phase 6 Complete

We finally met our target at the 6th stage of our challenge at US$ 75,000, next target now at US$ 100,000, expecting to get there before 04/13/2015.

As usual we will increase the size we trade a bit more, now at 20 contracts on ES, if we lose and go back to US$ 50,000 we will decrease the size back to 15 contracts,

I'll keep you informed on our progress.

Best of luck in your trading.

Sunday, January 4, 2015

Stopped out... Next!

Do you want to be successful in trading in 2015?

If you have an edge then all you have to do is to follow the rules strictly pull the trigger every time you see that edge, if stopped out, just wait for the next setup and make sure you take it when it shows up.

If your STOP LOSS is not hit then stay in the trade and trail it until the market takes you out of the trade or your target is tested, it's as simple as that.

The problem is what most traders do instead is to skip the next trade when they get stopped out once, or they either try to outsmart the market by trying to buy it "cheaper" then what their edge is telling them and end up missing the trade by a couple of ticks or they just skip the trade due to the fear of getting stopped out again...

When they use their edge and take the trade another decision theys need to make is about whether they will scale out or not. Usually the best decision is to always use the SAME strategy as they did on the previous trade. If the trader feels better by scaling out, then they should scale out on all trades, but in my experience I see that most of the time "all in, all out traders" or "full size traders" do better than those who like to scale out. Of course these traders who hold FULL SIZE get stopped out more often but when they're right they make up for all the losses and much more, putting them ahead of those who prefer to scale out.

Let me give you an example on ES (S&P500 e-minis), the instrument I day trade on a daily basis:

Suppose you bought 4 contracts at 2050, if you like to scale out, your strategy might be to take half off at +2 points and then another contract off (25%) at +3 points holding the last contract until market takes you out. For this example we will suppose market gave you 10 points, so, you'd have made a total of: 4.25 points on FULL SIZE (half at +2, 1/4 at +3 and the last 1/4 at +10).

While those who bought and held full size have made a FULL 10 points, or more than double what you have made. If the average STOP size they use is 2 points then they'd have to be stopped out 5 times in a row to give all the profits they made back while the one who scaled out will give it all back in only 2 trades that they lose...

If you know that your edge gives you a win ratio of 60~70% then there is no reason to scale out. We DO NOT KNOW which trades will work before we trade them, some will work and some will fail, as traders we need to accept and live with that, that's the name of the game, there is no system that has 100% of winners.

Trading is not about one or two good trades but about a good SEQUENCE of well executed trades, our job as traders is to take all setups our edge tells us to take and manage the risk accordingly, that is all there is to it.

You will know if your edge is good after you've taken: 10, 20, 30, 100 trades, and not 2 or 3 trades.

So, in 2015 do the right thing and take ALL TRADES on your favorite instrument, unless you don't have an edge.

If you don't have an edge I can teach you a good methodology that you can expect to work on 70-90% of the trades, if you day trade ES or swing trade currencies (EURUSD, USDCAD, USDJPY).

It's a really simple learn and use, all visual. When you sign up you will join us in our trading room where I make the calls on the instruments I mentioned above and I show you exactly what I'm looking at on the charts to take that trade, you will learn when to pull the trigger exactly the same way I do to be consistently profitable.

Check our website to know more about the system and feel free to send me email with questions in case you have any doubts/questions on what we do. Click here: Diamond Setups

Let's make it happen in 2015, you can do it!

Happy New Year!

Sunday, December 14, 2014

Challenge update: Phase 5 Complete

Hi traders!

We've finally reached the 5th target in our challenge!

The US$ 50,000 target has been met and we've started the 6th Phase on the challenge moving to our next target at US$ 75,000 trading 15 lots within a max period of 3 months.

Actually I really think we can make it much faster than that, to achieve the target of US$ 25,000 trading 15 lots I need to make less than 35 points on ES on full size, as we make an average of 10 points a week, do the math.

But, of course, we might lose on one of the weeks so, if that happens, it might take us a bit longer to achieve that target which we really think will be met sooner than most expect.

Our rules are very clear, we add to the number of lots we trade as we reach new targets and *IF* we lose we can also decrease the number of lots we trade which so far has never happened.

For those who are not familiar with our "Million Dollar Challenge", we started trading a US$ 10,000 account from the beginning of August  by trading only 2 lots on ES with the first target at US$ 12,000 ...and now we are at our 5th target at  US$ 50,000+ having reached the 6th Phase of the challenge.

If you want to see how the phases are set check this blog post below:

Walking the talk

I'm really happy to have been able to do that in real time in our trading room but I'll be very honest here, I could have done it even faster if I had religiously followed the Diamond Setups system. :)

I can explain.

Our system has several different strategies for taking profits according to each trader's own style, but one of the most common strategies is called: MT

The "MT" strategy consists in taking half off on all trades at +2 points (8 ticks) and then another 25% off at +3 points and trail the remainder 25%, really simple, but if we were able to hold FULL SIZE we'd do it much faster! But it's psychologically "easier" to scale out...

Even without a perfect execution I could move fast through the first 5 phases, let's see how we do now with 15 lots on the 6th phase.

If you want to learn how I do it, join us at the Diamond Setups website and learn a simple but effective system to trade and win consistently.

Best of luck!

Wednesday, October 8, 2014

Challenge update: Phase 3 Complete

Once again we made it way ahead of planned date to meet target in December, thanks to the volatility on ESZ4 giving traders several chances to make it big every single day, but the truth is in the great majority of trades we made were not big winners, but several small winners.

We made over 100% in a little over 2 months as we started the challenge on August the 4th.

Here we go on Phase 4 now, trying to take the US$ 20,000 account to the next target at US$ 30,000 trading 6 contracts, *IF* we lose and go back to US$ 15,000 then we would decrease size back to 4 contracts, but we are looking forward to finish one more phase, moving closer to our main target.

We don't know where market will turn, but we do know the "key levels" where it might, on most of the time we are right.

I'll keep you updated, best of luck.

"Don't ever quit. Success seems to be connected with action, successful people keep moving, they make mistakes but they don't quit."  Conrad Hilton

Sunday, September 21, 2014

Challenge update: Phase 2 complete

Phase 2, the second target on the challenge at US$ 15,000 was to be achieved in 4 months/16 weeks, this week has been the 7th week since we started the challenge and we are already there, way ahead of my time expectations.

When I started the challenge in our trading room, traders were really excited about having a doable plan to achieve targets and were ready to face the challenge no matter what, day after day, week after week we'd fight to meet those targets.

We had a tough start as we lost right on the first week, so psychological capital got low at the very beginning but we quickly recovered and now have achieved targets on Phase 1 & 2. The rules are very clear on position sizing and risk management and we are ready to move on to our next target at US$ 20,000.00 or double size of the initial investment.

Deadline to reach this target is 2 to 3 months and the number of contracts is set to 4 on ES (S&P500 e-minis) from now on, but in case we lose and go back to US$ 12,000 then we would decrease size back to 3 contracts.

We know discipline is key and although we are not disciplined 100% of the time, as we do take profits too early sometimes or give up on a trade before our STOP gets hit, we have been doing really well, way above expectations.

Have a great week everyone!

"I think to be in the upper echelon of successful traders requires an innate skill, a gift. It's just like being a great violinist. But to be a competent trader and make money is a skill you can learn." - Michael Marcus, Trader.

Michael Marcus is a commodity trader who, in less than 20 years, is reputed to have turned his initial US$ 30,000 into $80 million.

Saturday, September 6, 2014

First target met - Phase 1 Complete


I finally met my first target on Phase 1, three weeks ahead of time as my plan was to make it in maximum 8 weeks.

If I was able to meet the initial 20% target I know it is possible to meet any target as long as I move without rushing, slowly but steadily, having patience to go through the bad days with confidence on the system and the discipline to follow its rules, any trader can definitely make his way to success.

On Monday we continue our challenge and start Phase 2, the next target is US$ 15,000, I will increase the size by 1 contract and will now trade ES (S&P500 e-minis) with 3 lots, expecting to meet next target by maximum November, the 8th.

The rules are clear when I reach the next target at 20 ES points (US$ 150.00 per point trading 3 lots) I will increase size again by 1 more lot, but if I lose and go back to US$ 10,000 then I would have to decrease back to 2 lots and start all over again.

"We all have dreams. But in order to make dreams come into reality, it takes an awful lot of determination, dedication, self-discipline, and effort." - Jesse Owens