#829 March 15, 2017
Tharp's Thoughts
Weekly Newsletter
  • Feature: Where Have All The Traders Gone? by Van K. Tharp, Ph.D.
  • Workshops: $700 Discount for Peak Workshop Expires Next Week! August Dates Announced!
  • Tips: Did the Fed Finally Get One Right? by D.R. Barton, Jr.
  • Video: Ken's Adaptive Swing Approach, by Dr. Ken Long
  • Video: Reading Oil Trends Thru a Forex System Lens by Gabriel Grammatidis
  • FREE BOOK!: Trading Beyond the Matrix
Peak Performance 101
Following Peak 101 in April, we will have
Peak Performance 203 and
The New Infinite Wealth Workshop.
Attend all three and qualify for an $800 Discount. Click for more...

Feature Article

Where Have All The Traders Gone?
by Van K. Tharp, Ph.D.
I first started this business of helping traders and investors in 1982. Those first years in business coincided with the start of the great bull market in stocks that lasted from 1982 through 1999. My first clients, however, were mostly futures and option traders; we had very few stock traders. Equity traders really didn’t make a significant portion of our customers until the mid-1990s.

Fast forward to the year 2000 when we were teaching a workshop on trading stocks. One of my Super Traders developed a version of CANSLIM with some modification that I helped him make and he taught that system in this workshop. In March 2000, we had 70 people attending that course — the largest attendance we’ve ever had at one of our workshops. And, of course, March 2000 was just about the top of the stock market. After that record breaking event, we probably offered the CANSLIM workshop 2-3 more times before it died a natural death because people stopped attending. (Stateside, we only give workshops now at our facility in Cary that holds around 30 people seated at tables so we will probably never break that March 2000 record.)

Now fast forward once more to about 2007. We noticed that our psychological workshops had 15-20 people attending on average but technical workshops were always packed. Ken Long would give his trading system workshops at least 3 times a year and the attendance was always at least 30 people. This went on for a number of years but by 2016, more people were attending our psychological workshops than the technical workshops.

Here are some other disappearances I have noticed. If you went into any Barnes & Noble bookstore in the late 1990s, you would find about 40 cases of investment books. And all of my books would be there, often multiple copies. Today, if you go into a Barnes & Noble bookstore you will find perhaps 2 cases of investment books — mostly Robert Kiyosaki, Jim Cramer and the usual crowd. And you will probably not find any useful investment/trading books. While eBook sales are probably now bigger than the sales of hard bound books, those certainly have not come close to accounting for the lack of physical book sales.

In February of last year, The Van Tharp Institute hosted a booth at the Traders Expo in New York City. The event planners claimed the attendance was about 4,000 people. The attendance at that expo used to be about 15,000 people. There was only one weekend evening for the event and huge lines formed at our Trading Beyond the Matrix book giveaway. On the other days, the lines were not nearly as long so I suspect 4,000 was the attendance over the entire event.

What can we conclude? People are afraid of the markets. The GFC of 2008 was probably the last straw for many investors and traders. Most people in the markets at that time didn’t practice risk management through effective position sizing strategies. They didn’t know how to make money in volatile down markets (something which is fairly easy and that we teach), and got wiped out (actually, they wiped themselves out).

Fast forward to today — let’s look at the stock market right now. On March 1st, I prepared my monthly update on the market. My 25-day Market SQN® score, my 50-day Market SQN score, my 100-day Market SQN score, and my 200-day Market SQN score were all Strong Bull and the volatility was Quiet. I’ve been doing the market type report for over 10 years now and that’s the strongest showing I’ve ever seen. And the strongest ETF of the 500 plus that we watch in our world market model report was the one representing the DOW 30 (DIA) with a Market SQN 100 score of over 3.0. I’ve never seen that before.

Look at the chart below of the S&P 500 (using the ETF SPY). It’s been easy money since Donald Trump took office. The red line is the 10 day moving average. And it’s been above that red line for about 75% of the time since November 2016. In the 75 days since November 21st there have been 20 all-time new highs in the S&P 500. Twenty of them — that’s more than 25% of the time.
So, look at the chart of the DIA (Dow 30) below since last November. It’s pretty similar. And remember the Market SQN 100 for that ETF is currently over 3.0 which is very, very strong.
Okay, and just in case you are not convinced, here is a chart of the NDX over the same time period. It’s up over 10% in just two months.
While a strong trend doesn’t necessarily mean the trend will continue and a Strong Bull Quiet market also doesn’t necessarily mean it will continue, I think the lack of interest by investors could easily mean that this market could be strong for a long, long time. How long? Well, I think one indicator could be when everyone wants to come to our workshops and learn how to make money in this market. But of course, by that time, it will be too late.

So what are you doing right now? This is the kind of market that everyone wants — when making money is easy. Are you up 5% on the year like the S&P 500 or the DOW 30? Are you up 10% like the NDX? Or are you sitting on the sideline too afraid of disasters that might happen in the future so you don’t see what is going on right in front of you.

I’d value your input. What’s happening with you and the market right now? Let me know at van <at> vantharp.com

Peak Performance 101
March 31-April 2, 2017

Is This the Workshop for You?

Peak Performance 101 not only helps you install Dr. Tharp’s model, it also helps you overcome self-sabotage. You’ll be able to free yourself from internal conflicts that keep you from performing at a peak level. For example:

1. Are you always looking for a new trading system? Or, are you always trying to improve the one you have?

2. Do you find your trade setups never quite fit all of the personal criteria you need, so you have trouble entering trades?

3. Do you get anxious about the market or about risking your money, so that you have trouble pulling the trigger?

4. Do you get excited about the market, or do you get distracted and fail to follow your system's rules?

5. Does a losing trade take your energy away for the next trade, or conversely, does a winning trade make you confident about the next trade?

6. Is your trading (or your life?) ruled by the "negative" emotions of fear, anger, or greed?

7. Are you constantly losing money because you don’t have a strong plan to guide your trading, or because you simply don't follow the plan you created?

8. Do you have a performance ceiling where you fall apart or stop doing well? Do you earn $100,000 and then just seem to stop trading? Or, do you reach the million-dollar plateau and then start losing heavily?

Overcome Self-Sabotage

Those are common patterns and if you answered "yes" to any of them, then likely you are experiencing some form of self-sabotage. This workshop would help you identify and resolve the conflicts causing these behaviors – as well as leave you with the tools to address conflicts that come up in the future for you.

If you’re really committed to trading success and willing to do whatever it takes, you’ll find that you've become a different person after this ground-breaking workshop.

Seven money-making benefits are waiting for you. They’ll help you keep your losses smaller, make more consistent profits and be more relaxed about your trading.

1. The three ingredients of success.

After the Peak Performance Trading Course, you’ll thoroughly understand how these three key ingredients can control your life. Most of all, you’ll know how you can control them.

2. The components of a low-risk idea.

You must understand what makes up a low-risk idea. It’s not what you think.

3. Why position sizing™ strategies are so critical to your bottom line results!

Few people understand this critical concept, yet it means the difference between consistent top performance and mediocre performance for most people.

4. 15 ways to develop rock-solid discipline in your trading.

Discipline means controlling your mental state. Most people allow their mental state to control them. In contrast, real winners maintain discipline that allows them to charge ahead of others in the field.

5. Dr. Tharp’s Top Tasks of Trading for successful trading and investing.

The workshop will help you install his model so you can trade like other successful traders. You’ll have tools at your disposal that the average investor or trader never even thought about.

6. How to act quickly with sureness and confidence.

One trait all the best traders and investors have in common is extreme confidence in what they’re doing. Confidence is the one quality you must develop to attain your peak level of performance. At the Peak Performance 101 Workshop, you’ll learn how to develop the kind of confidence only the best traders and investors have.

7. How to develop a plan for trading that will set you way above the crowd.

There are certain disciplines—certain techniques used within a specific structure—that give the professional trader and investor the edge over amateur investors. Dr. Tharp understands these disciplines. He is an expert at coaching others to use them.
Participants in this course will get to meet and network with some really great people who a lot in common with each other. Once you attend Peak Performance 101 you have met the prerequisite to attend other workshops in the Peak series (202, 203, & 204). Plus if you have interest in applying for the Super Trader Program this is a qualifying workshop to submit an application.

A Recent Email From A Student:

"The Peak Performance Workshop is the single greatest transformational and supportive trading activity I've have ever been apart of. The course helps the trader gain an insight about him/herself that is unavailable otherwise. When first taking the course I was looking for a single objective or takeaway that would advance my trading.

After attending the workshop I now see that just as with trading no single aspect contributes greatest to success. Combining all the techniques taught will allow for major transformations just as dieting and exercising will allow someone to get into better shape over time. I highly recommend the course to anyone preferably before you begin trading to save yourself some hard felt emotions."—Sincerely, Davon Albury
Learn More About, or Register for, Peak Performance 101
The $700 Early Enrollment Discount Expires Next Week on:
Peak 101, March 31- April 2
Peak Performance 203, April 4-6, and
The New Infinite Wealth Workshop, April 8-10
Attend all three and qualify for another $800 Discount. Click for more...

Workshop Schedule

March 2017
April 2017
Attend two events and get an additional $500 off. Attend all three and save $800 more.
May 2017
June 2017
August 2017

Trading Tip

Did the Fed Finally Get One Right?
by D.R. Barton, Jr.

You know my name but who are you? Just another American who saw too many movies as a child? Another orphan of a bankrupt culture who thinks he's John Wayne? Rambo? Marshal Dillon? — Hans Gruber (Played by the wonderful Alan Rickman in the movie Die Hard)
By the time you read this article, the Federal Open Market Committee (FOMC or simply the Fed) will have raised the Feds fund rate by a quarter of a point.

After the announcement, the market will have bounced up and down but unless the revised statement (which includes the rate decision) contains a surprise, the market probably won’t have moved all that much.

And that’s a good thing.

The market believes that the Fed got this one right. What does that mean? It means that the FOMC is raising the baseline Fed funds rate at the right time and it signaled its intention to do so in a manner that allowed market participants to include this inevitability in their decision making.

A good villain has to get a few things right here and there to stay a good villain. This time, it was just the Fed’s turn.

Creating a Good Villain

Every little kid knows what makes a good villain —

  • They have a big motivation often trying to take over the town or the world (sound familiar, Fed?).
  • They are worthy opponents and they win early skirmishes to show their prowess (does this hold for the Fed? Roger that).
  • And good villains remain at the center of the storyline because they’re interesting or powerful or both (double checkmarks for the Fed).

Great villains, like Alan Rickman’s Hans Gruber in the first Die Hard movie, get lots of things right and at times during the story, they even seem like they have it all figured out — that their triumph is inevitable.

And that’s where the Fed comes in today — after getting so much, so wrong for so long, the Fed has to turn in a convincing performance. Getting one thing right now allows it to return to being the super-villain that it is and keep itself in the center of the storyline.

Let’s return to late 2015 when the Fed really botched things and led the market into a plunge in early 2016. This time around, the Fed had to use their propaganda machine much better — and it did that. In fact, the Bloomberg news service followed how the Fed orchestrated the current communication campaign and how the futures prices indicating the probability of a rate hike reacted:
LPL Financial analyst John Canally chimes in with an interesting chart of 2-Year Treasury Note yields. Canally rightfully points out that 2-Year Notes are the most sensitive to Fed actions. You can see a similar effect in prices that Bloomberg chronicled (the chart above) as you look at the short-term yields below:
While nothing is a sure thing in financial markets, the only real surprise today would be if the Fed didn’t raise rates. One addendum — a 50 basis point raise (half a percent) would add much volatility to the markets and is in my estimation, a miniscule probability at best.

The Fed has taken its share of grief for messaging quite poorly in past. Let’s recognize when they do it right as well.

Your thoughts and comments are always welcome — please send them to drbarton “at” vantharp.com

Great Trading,
D. R.


Ken's Adaptive Swing Approach
by Dr. Ken Long

In this 8 minute video, Dr. Ken Long provides the conceptual framework for his adaptive swing trading approach. By looking at longer term trends, short term key price levels, and incorporating mechanical swing trading system signals, his adaptive approach allows traders to lower risk and increase confidence by identifying price patterns across multiple timeframes. Ken provides a few examples of how the adaptive swing approach has worked for some recent trades.


Reading Oil Trends Thru a Forex System Lens
by Gabriel Grammatidis

Last week, our Forex instructor Gabriel Grammatidis recorded a short video about oil. Through the lens of one of his trading systems, he clearly sees what oil is doing and where it’s going — but even he admits that it’s hard to imagine. Still, he understands what the charts are saying.
About the Author: Gabriel Grammatidis is a successful full-time trader and graduate of the Super Trader program. He has extensive experience trading Forex and shares his knowledge at his Forex and Live Forex Trading workshops, held regularly at VTI.

Read about the system - System 1: Busted Breakout. Learn more about the flexibility that Forex offers you by watching a video segment from the workshop (What is the reality of Forex trading?). You can see some practical example videos of the system trades on Gabriel's website, IntuFX.com.

For more information on the Busted Breakout psychological dynamics see his article in the Traders' magazine. Gabriel can be reached at gabriel "at" vantharp.com.

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The Red Pill for Traders and Investors

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Cary, NC Workshop Information
For a list of nearby hotels for our Cary, North Carolina locations, click here.

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