I actually liked this. I know for a fact that John is a great trader as Ive seen him single handedly knock down a 30k month in profits using just 100k in June. His credentials speak for themselves but I wasnt sure how he was going to get his style to project and make sense on a DVD. Many who know me and our in my chatroom know that i dont believe in Trading books. Almost all of them and i have read a 100 suck. What they give you is broad based conceptual information but no avenue on how to take it and turn it into a system of trading from step A to Z. You can read almost any book and they will throw you a tidbit here or there but nohting that can take a novice and show him vehicle selection (in terms of finding stocks to trade) all the way to how to enter/exit them.
From watching John I knew he didnt use charts. I figured at first he was just a very very very smart guy who can trade off intuition. Its hard but Ive seen a couple. So i was dubious on how a guy who has amazing instincts was going to make a DVD. In reality John has a very precise method of trading. Method is the biggest key when learning how trade. Having a set of rules/strategies that you make automatic that you can always lean on. This takes the emotion out of trading and gives you support when you are in a slump
Whether you are Kunal or Johnwelsh or bill O’neil. You need a system to trade. You get a good outline of 1 in this DVD. John starts you off with his 10 rules of trading. These are timeless and many of them can be applied even for advance traders. Some of them are obvious when you see them like Rule 2 “dont overtrade. You see it and its like yeah..John thanks can i get my money back! But what he does is go in detail why its not good and real life examples of how he has gotten caught in the past. And in reality overtrading is a reason that 90% of traders fail. The technical timezones was something I found very interesting and how he uses them to size his positions and manage his risk. He gives you the zones in the market where there is an advantage for a trader to take on some risk and can make money.
he then moves to trading strategies and setups. It gives you good insight into identifying what he is thinking when he posts a trade. He throws out some strategies and setups that are tested and have been timeless. The Red to Green trade is a trade that every trader uses in some variation that is succesful. Where a new trader will get the most “scratch” out of the DVD is probably the way he manages risk. he goes into extensive detail on losses. how to limit losses with strategy but also how to handle them mentally when faced with them. I think for a lot of guys who are prone to blow up their accounts this type risk managment can help as he almost always puts a stop at the buy price as soon as it moves in his favor.
John encompases pretty much everything that he uses. I liked the chapter on margin. Often a lot of traders tell other traders not to use margin as its “the devil” when i reality we all proably use it! i use it a lot! but he does a good job of explaining how overnight margin now is a no-no but using margin for intrday trades on stocks that are gaining momo and working in your favor can leverage your returns.
“you build a relationship with a stock over time” that was a good tidbit on position sizing. its totally true. When you just get some random stock show up on the news or scanner you cant just go balls deep in the thing. But we all have our goto stocks that just every couple months it shows us that look. Over time once you learn the way it moves the way it reacts to news..the way it breaksout/fades then you can put the muscle on it. Obviously thats just a line…he gives some details on how he sizes his own positions from biotechs to FAS/FAZ.
Overall this is pretty dang good…there are some classic JohnWelsh moments in there too where he tries to make a joke about getting beauty sleep becaue his face is so pretty. but he totally bungled the delivery so it was this awkward kind of joke. Loved that stuff it was him just being him. Advanced traders will get be able to glean some good info from there and new traders can really use it to develop a method/get some rules of trading that they can stick on their wall and adhere too. Ive actually watched it 2x and got a whole bunch of new tricks from how to use the ViX when looking for low float runs to handling the withdrawals of breokerage into bank account. My guess is that there will be a 2nd DVD at some point as there are some things that people will ask him to go further into details. You can only fit so much in 4 hours or so.
P.s. Welsh is full of crap when he says he doesnt use charts. He actually does us them he just makes them in his head as he is inputing in so much data. He uses high/lows of the day the Ranges of stocks etc. thats how he can catch inflection points in stocks so well. All that hair jel and data mix themselves up in his brain and spit out a brain chart.