30-Yr Wall Road Vet’s Survival Guidelines

Within the letter I wrote earlier this week concerning the thrilling new stuff coming down the pipeline for the Monument Merchants Alliance (You possibly can learn that right here)…

I discussed that Chris “CJ” Johnson (formally of Cash Morning) will probably be becoming a member of the workforce because the Lead Host of Monument Merchants Dwell and Senior Analyst.

Chris isn’t some e-newsletter author theorizing about markets from a cubicle. He’s a 30-year Wall Road veteran who’s lived by each crash, bubble, and manic episode the market can throw at you.

He constructed his repute as a quantitative analyst monitoring hundreds of thousands of information each day by proprietary forecasting fashions he’s been refining since 1998. His contrarian calls and technical experience have been featured in Barron’s, The Wall Road Journal, and USA As we speak.

Now, because the lead host of Monument Merchants Dwell / senior analyst, CJ brings that very same data-driven, contrarian strategy to our members. He doesn’t comply with typical knowledge as a result of typical knowledge creates typical losses.

Now, he’s touring along with his household this week…

And we’re hoping to formally introduce him to the group subsequent week on Monument Merchants Dwell (extra to come back on Monday)…

However to assist introduce him, he gave me an inventory of his 10 buying and selling commandments that he likes to comply with.

These ten commandments come from three a long time of him watching merchants succeed and fail – and studying precisely what separates the 2.

They’re battle-tested truths he discovered shedding cash, earning profits, and watching hundreds of merchants do each. Some will really feel apparent. Others will problem all the pieces you suppose you understand about markets.

However he has discovered that all of them have one factor in frequent: they work. Observe them and also you’ll have an edge.

He says should you ignore, and also you’ll develop into one other statistic.

THE COMMANDMENTS:

1. The Development Is Your Buddy The only most dependable sign available in the market is the 50-day shifting common. It will get the day-to-day directional transfer proper roughly 67% of the time. When a inventory is above its rising 50-day, you purchase dips. When it breaks under, you cease pretending the basics matter. Combating the development is voluntarily selecting worse odds – and the tape punishes that.
2. By no means Run with the Crowd Crowds chase tops and panic at bottoms. Your edge comes from doing the other. One of the best buys occur when promoting strain peaks and compelled sellers are handing you shares. One of the best sells occur when euphoria blinds self-discipline. If you happen to’re not early, you’re not worthwhile – and should you’re following the herd, you’re already late.
3. Don’t Combat the Tape – Know Your Breaking Level Worth motion doesn’t care about your opinion. When the tape disagrees with you, it wins each time. By no means danger giant losses for small positive aspects – the “pennies in entrance of a steamroller” drawback. Each loss you’re taking is tuition. Pay it, study from it, and transfer on with clear self-discipline.
4. Overbought Can Get Extra Overbought – Low-cost Can Hold Getting Cheaper Valuation traps destroy portfolios. Technical indicators don’t cap how far a squeeze can run or how low a damaged inventory can fall. Shares don’t obey your sense of “affordable.” Overbought alerts can develop into launchpads. Oversold alerts can mark the beginning of a collapse. Play the development, not the elemental story you’re telling your self.
5. Sensible Cash By no means Tells You What It’s Doing – However It Leaves Tracks Establishments don’t announce their strikes. They go away footprints. The choices circulation exposes these footprints higher than any earnings name, analyst word, or headline. Open curiosity clusters, skew shifts, and weird name shopping for will at all times inform the reality lengthy earlier than CNBC does. Observe the information, not the narrative.
6. Brief Sellers Are a Bull’s Finest Buddy Brief curiosity is saved power. When the development turns increased, shorts develop into pressured consumers – accelerating upside momentum. Among the most explosive rallies are born from heavy brief positioning. Don’t worry the shorts; use them.
7. Spherical Numbers Are Pure Help and Resistance Worth gravitates towards simplicity. $10, $50, $100, $1,000 – these ranges act as psychological anchors for each retail and institutional gamers. Breakouts above spherical numbers entice shopping for. Breakdowns by them entice promoting. The extra zeros, the extra essential the extent. By no means ignore these zones.
8. Volatility Is Your Finest Buddy Volatility creates alternative. It widens ranges, breaks correlations, and forces emotional gamers to make errors. You revenue from these errors. Static circumstances reward passive investing; risky circumstances reward expert execution. A relaxed tape provides no edge. A shaking tape provides a lot.
9. Hypothesis – Not Fundamentals – Drives Inventory Costs Fundamentals construct long-term narratives, however hypothesis strikes shares at this time. Capital flows, choices positioning, liquidity pockets, and sentiment swings dictate value. Fundamentals matter ultimately – hypothesis points now. Play what traders imagine, not what accountants report.
10. There Is an Exception to Each Rule No single commandment works 100% of the time – which is why danger administration is your solely true fixed. Nice gamers adapt. They acknowledge when circumstances shift and regulate, slightly than forcing a technique onto a tape that now not respects it. Flexibility isn’t non-obligatory; it’s survival.

YOUR ACTION PLAN

Chris says these aren’t options! They’re the distinction between earning profits and donating it to smarter gamers.

We’re wanting ahead to introducing him subsequent week…

And for all the common content material he will probably be producing (FOR FREE) within Monument Merchants Dwell.

Take note of your inbox subsequent week for the livestream particulars.

FUN FACT FRIDAY

December’s “Santa Claus Rally” brings vacation cheer to Wall Road! Shares usually climb over the past 5 buying and selling days of the yr and the primary two of January, with the S&P 500 averaging a 1.3% achieve since 1950 – up 80% of the time! 🎄📈

Blame festive vibes, bonus money, or bullish retail merchants. Watch the market whereas sipping cocoa – it’d present you positive aspects!