Sami Abusaad Interview: Getting to Know a Top Trader
To help you get to know T3 Live’s growing bench of trading talent, we’ve launched a series called “Meet the Traders” so you can get an inside look at how our team operates. Today, we are proud to introduce you to Sami Abusaad, T3 Live’s Director of Education, and creator of our Strategic Swing Trader and Strategic Day Trader programs. 1) How did you first get involved with the markets? In 2005, I had $20,000 saved from an accounting job and I didn’t know what to do with it. I then found out that the second richest man in the world made all of his money from investing. That man was Warren Buffett, and I immediately became fascinated by the markets. I also read about a 21 year old kid from New York who made $1 million in less than a year. That provided a sense of hope to me. I thought “if he can do it, I can do it too!” I opened a brokerage account and funded it with $16,000. In six months, I made about $10,000. In a year, I was at $50,000. I did this by playing swing longs in a bullish market. My brother was as amazed by my results as I was, and he gave me the following words of wisdom: “If you can make that kind of money through “Buy and Hold”, imagine how much you could make trading actively!” He was referring to stocks on the“Highest Gainers/Losers” list for the day. I listened to his advice. I started trading actively every morning. Within a few months, I lost all my profits… and another $15,000. That’s when I realized that I didn’t know quite as much as I thought I did. A few months later, while scouring the Internet for trading resources, I came across Zacks.com, a financial website similar to Yahoo! Finance. Zacks.com was running a one-year trading challenge and the winner of that contest would receive a $100,000 job offer. I participated in that contest, and guess what? No, I didn’t win. But I did receive something better than winning the challenge — I became friends with the winner: he had turned $100,000 into $2 million in less than a year. He told me he had been a full time professional trader for 15 years – and that he learned it all from a small company called Pristine. He encouraged me to read their book Tools and Tactics for the Master Day Trader. Not only did I read it immediately, I registered for all of the free workshops available at the time and then went on to take Trading the Pristine Method (TPM) and Advanced Technical Strategies (ATS), which was known as TPM II. The rest, as they say, is history. (Editor’s Note: T3 Live acquired Pristine in 2014) 2) So what are you doing now? I am an active day and swing trader, averaging seven trades per day. I focus on stocks in my trading, but my trading style can be applied to all markets, including futures, commodities, options, forex, and more I am also an educator for T3 Live and serve as Lead Moderator for the T3 Live Strategic Day Trader room. As much as I enjoy trading, I think teaching is my calling. I run several education programs, including our Earnings Engine course. And in 2017, we launched a new swing trade coaching program called Strategic Swing Trader. 3) Do you use a specific trading methodology? Yes, I trade primarily 3 proprietary strategies in day trading. Gaps: I focus on professional gaps that break long-term trends and ignite new trends. Climactics: Stocks that experience a parabolic price acceleration to the point of exhaustion. 15-Minute Chart Plays: These are afternoon plays that trigger off the rising or declining 20 ma on the 15 min chart. It could be a pullback-type entry or a breakout/breakdown. In Strategic Swing Trader, I primarily focus on catching stocks during their bottoming/topping period, or later while they are transitioning. I use various patterns and advanced tactics to enter into those plays, and I try to catch them early on. Trading earnings is also very important to me. 4) How do you unwind from the ups and downs of trading? I like to take evening walks and play sports, including basketball and soccer. 5) Do you believe in setting stop losses? Yes, absolutely. But often, traders wrongly think of a stop as an exact point on a chart. I use an area, rather than an exact number. 6) Are you concerned about high-frequency and algorithmic trading? Yes I am, because they make the market more efficient. A more efficient market means fewer opportunities. However, smart traders can still find plenty of opportunities to make money each day if they put the work in. 7) What is 1 thing traders can do today to start getting better results? Trade in samples and evaluate each sample dispassionately like a scientist. This way, you can figure out what you’re doing right and what you’re doing wrong. Don’t let emotions or pride get in the way of improving. 8) What would you be doing if you weren’t a trader? I would dedicate more time to the outdoors. But in the meantime, I’m having a lot of fun teaching and trading. P.S. Looking for a more effective and consistent approach to trading? Check out Strategic Swing Trader and Strategic Day Trader.
Continue Reading -->What’s Happening: It’s the Final Countdown to the Fed Mystery
We’re one day away from a very big Wednesday featuring FOMC and Bank of Japan rate decisions. Right now it looks like the BoJ is a bigger deal, since most traders think a Fed rate hikes is off the table tomorrow. Fed Funds futures imply a mere 20% probability of a rate hike. Bloomberg ran an interesting story this morning about how Barclays and BNP Paribas think the Fed moves tomorrow: Two of the Fed’s 23 preferred bond-trading partners — Barclays Plc and BNP Paribas SA — are betting against their peers and the bond market by forecasting officials will raise rates Wednesday. It’s the first time more than one dealer has gone against the consensus during the week of a policy meeting since last September, data compiled by Bloomberg show. Economists at both banks say traders have too steeply discounted officials’ intent to hike after the Fed has remained on hold for longer than expected. It’s a tricky situation to say the least. Remember, the rate decision itself is not everything. The signaling for the future pace of hikes is just as important. There is a very real possibility that the Fed hikes but signals an extremely slow pace of future hikes. But no one really knows, so be very careful when placing your bets. SPX futures are up fractionally this morning despite a -1.1% drop in oil. Yesterday, we saw large-cap tech leaders sell off into the close, pushing the index to finish roughly flat, though we saw nice outperformance in small caps and biotech. It still feels like traders are happy to stay in a holding pattern until the BoJ and FOMC news hits tomorrow, so it’s going ot be hard to make much sense of the action. In the energy patch, Brazilian giant Petrobas (PBR) cut its 5-year investment plan by 25% to $74.1 billion. Wells Fargo (WFC) caught an upgrade from Morgan Stanley — maybe I should have jumped on it, but I’ll reassess post-Fed. Tessera (TSRA) is buying DTS (DTSI) for $850 million. Bloomber is reporting that Bayer may drop the Monsanto (MON) name if their merger ever gets done — seems like a smart idea. The economic calendar’s pretty light — just housing starts and building permits. But don’t worry — we SHOULD get some excitement tomorrow… though it’s easy to forget that SHOULD is the most dangerous word in financial markets. Good luck out there!
Continue Reading -->Scott Redler’s Morning Call Express: Indecision
In today’s Morning Call Express, T3 Live Chief Strategic Officer Scott Redler discusses the action in ahead of tomorrow’s big FOMC and Bank of Japan rate decisions.
Continue Reading -->T3’s Take 3: Stocks Hit the Snooze Button Ahead of a Very Big Wednesday
Prop Trading May Not Be Right For You… But it has incredible financial benefits for many traders. Click here to learn more… 1) Holding Pattern Ahead of a Very Big Wednesday Last week, we saw a rebound in volatility as traders put the summer snoozefest behind them. But stocks quieted back down today ahead of Wednesday’s big Federal Reserve and Bank of Japan meetings. The S&P 500 was flat 2139.12. The Nasdaq underperformed due to weakness in select large-cap tech names like Apple (AAPL) and Amazon.com (AMZN). The Russell 2000 was an outlier to the upside with a 0.6% gain, and we also saw nice gains in utilities, real estates, financials, and transports. US Treasuries, retailers, and pharmaceutical names led the decliners’ column. 2) Watch the SPX 2147-2148 Pivot This morning, T3’s Jeff Cooper highlighted key levels to watch going forward: 2147/2148 is a key level on the SPX. A) It was the August low of the long summer Slim Jim. Consequently it is the Monthly Swing Pivot—where the monthlies tuned down In September on trade below the August low. B) It ties to a 50% retrace from the 2193 all-time high to the 9/12 2118 low. Interestingly, on the Square of 9 Time & Price Calculator, 2148 also points to/aligns with September 21 and the important Gann Autumnal Equinox. Of course, this is also the date of the big Fed announcement on interest rates. You can’t make this stuff up! 3) Be Very, Very Careful Shorting Biotech This morning, Sarepta Therapeutics (SRPT) received FDA approval for Eteplirsen, a treatment for Duchenne muscular dystrophy. The stock hit a circuit breaker, reopened, and skyrocketed to finish up 74% on the day. Eteplirsen is considered to be a controversial drug, so many traders – especially shorts – were shocked by the news. Over 33% of the float was sold short, which means some folks were put out of business. So please folks, be very, very careful shorting biotech. P.S. Don’t forget to sign up for our next prop trading event! Tuesday’s Trading Calendar US Economics (Time Zone: EDT) 08:30 Housing Starts (Aug): exp. 1190k, prior 1211k 08:30 Housing Starts MoM (Aug): exp. -1.70%, prior 2.10% 08:30 Building Permits (Aug): exp. 1165k, prior 1152k 08:30 Building Permits MoM (Aug): exp. 1.80%, prior -0.10% Global Economics 12:50 CAD BOC Gov Poloz Speaks Tentative JPY Monetary Policy Statement Earnings Before Open: Carnival Corp (CCL) Lennar Corp (LEN) After Close: Adobe Systems (ADBE) Copart (CPRT) FedEx Corp (FDX) KB Home (KBH)
Continue Reading -->The Morning Hammer: Ahead of the Fed, Markets Show Fear
Global markets are rallying this morning as commodities rebound and the dollar retraces ahead of Wednesday’s big FOMC rate policy announcement. Traders are pricing in a mere 20% probability of a hike this Wednesday, so traders will mostly be looking for clues to see if the Fed moves in December. Europe is up nicely despite continued weakess in Deutsche Bank (DB) which is facing liquidity concerns due to the DoJ’s demand for a $14 billion payment to settle an MBS dispute. In Asia, the overnight interbank yuan rate skyrocketed amid speculation that China’s central bank is intervening to boost its currency. Traders are also shaking off terror concerns in New York City. Over the weekend, explosive devices were set off in New York City and Seaside Park, NJ. Another devices was found in Elizabeth, NY. Venezuelan President Maduro said OPEC members are close to reaching an agreement on stabilizing the market. However, such an announcement is likely not forthcoming at the September meeting next week. OPEC’s Secretary General said September is a “meeting of consultation and not of decision-making.” SPX futures are modestly positive this morning, much to the chagrin of the bears. Sentiment is leaning modestly bearish right now. As always, the bears say everyone’s bullish and the bulls say everyone’s bearish, but the numbers (which too many people ignore) are all over the place. The 10-day moving average of the ISE Sentiment Index is 91, which points to modest bearishness. The CBOE equity put-call is 0.65, which is about in-line with the 6-month average. The AAII sentiment survey shows that 27.9% of investors are bullish vs. a long-term average of 38.5%. The only data that really shows traders being complacent is the Investors Intelligence Survey, which shows that 49% of newsletter writers are bullish. So even though markets are just -2.5% off the highs, traders very quickly rushed to price in some downside. Volatility has returned to the market after 2 months of nothing, though we could end up in a holding pattern until Wednesday, which is not only has the Fed, but a Bank of Japan rate decision. There has already been chatter that the BoJ will go even further into negative rate territory. I’d love to get some excitement ahead of then, but I’m not counting on it.
Continue Reading -->Scott Relder’s Morning Call Express
In today’s Morning Call Express video, T3 Live Chief Strategic Officer Scott Redler breaks down the action in SPX, as well as individual names like ACIA, TWLO, AAPL, and NFLX.
Continue Reading -->T3’s Take 3: Stocks Get Stuck in First Gear
Learn Dave Green’s Trading Secrets Click here to start speculating the SMART way… 1) Stuck in First Gear Stocks were stuck in first gear today following a downturn in Europe overnight. European banks fell hard after Deutsche Bank (DB) said the Department of Justice is seeking $14 billion to settle a legal case related to mortgage-backed securities. Bloomberg Intelligence had estimated the settlement would be in the range of $4 – $8 billion. The S&P 500 fell as low as 2131.20, but recovered some of its losses into the close and finished at 2139.09, down -0.4%. The Nasdaq outperformed due to strength in large-cap biotech names, notably Celgene (CELG), which reported positive study data. Crude oil declined again, sending energy shares down, with notable weakness in oil service. This morning, Intel (INTC) raised its third-quarter revenue and gross margin guidance on rebounding demand for PC’s. Intel shares rose 3.0%, but failed to significantly lift the broader semiconductor universe. 2) CPI Surprise! US economic data has been deteriorating since the July 29 Q2 GDP report, which had some traders losing faith in the Fed’s ability to hike rates this year. But the hawks got a small boost today with the better-than-expected August Consumer Price Index report, the last major economic data release before Tuesday’s Federal Reserve rate decision. The CPI rose 1.1% year-over-year, beating the 1.0% consensus, while the core CPI, which excludes volatile food and energy prices, rose 2.3%. The report had traders upping their rate hike bets, and Fed funds futures now imply a 55% chance of a December rate hike, up from 50% earlier today. 3) Traders Sell the Apple News Apple’s (AAPL) iPhone 7 went on sale today after a week of positive news, though they were not easy to find. In fact, demand is so strong that some iPhone models will not be delivered until November. Earlier this week, T-Mobile (TMUS) and Sprint (S) both said that iPhone pre-orders grew substantially from last year. iPhone 7 reviews have been very positive, and meanwhile, the Samsung Galaxy Note 7 – a key iPhone 7 competitor — has been recalled due to exploding batteries. That certainly tipped the iPhone vs. Galaxy debate in Apple’s favor. However, Apple shares saw a “sell the news” reaction to the actual release today as traders locked in profits after 4 days of strong gains. Monday’s Trading Calendar US Economics (Time Zone: EDT) 10:00 NAHB Housing Market Index (Sep): exp. 60 , prior 60 Global Economics 21:30 AUD Monetary Policy Meeting Minutes Earnings Before Open: None of Significance After Close: None of Significance
Continue Reading -->The Morning Hammer: Is Today a Big Day?
I thought yesterday would be a big down day for the market with yet another string of economic data misses, and I was wrong. Equities were pretty strong yesterday, with nice action in biotech and large cap tech. This morning is another story. Deutsche Bank (DB) said the US Department of Justice is seeking $14 billion to settle its MBS probe. DB is not willing to pay that much and the stock is taking a bit hit. That’s helping push European banks down -2.4% in the early going, while the broader Euro Stoxx 50 is off -1.4%. In analyst-land, Nicholas Smith of CLSA said he is “absolutely certain” that the Bank of Japan will stop buying Nikkei 225-based ETFs to boost equities. However, said the bank will not stop buying — they will simply shift their purchases to the Topix and JPX-400. SPX futures are taking a -0.4% dip this morning, following Europe down. Apple (AAPL) is up premarket as iPhone 7 goes on sale. Canaccord also raised its target price to $140 from $120. However, the big news today is the CPI report which hits at 8:30 a.m. ET. The market is split right down the middle on rate hikes. Fed funds futures imply a 50% chance of a December rate hike, down from 60% last week. Economic data has been slipping hard since the July 29 GDP report, and it seems like traders just started paying attention to this important trend. This CPI report will be the last major economic data release before the September 21 rate decision, so there’s a chance we end the week with a bang. The only problem is we can’t figure out what kind of bang. Yesterday, we got a huge batch of dove-supporting bad data and gold and US Treasuries still fell. And equities seem to be reacting randomly to Fed chatter and data too. So even if you gave me the numbers now, it still wouldn’t be easy to trade this CPI report. Near-term, I’d keep a very close eye on Apple (AAPL) and biotech because they’ve been holding up the market. Apple’s got a chance of a sell-the-news reaction today as we see 10 million news reports about iPhone sellouts. Biotech’s still a wild card because the whole sector is moving on takeover chatter surrounding individual companies. Today is also quad-witching options expiration, so get ready to hear everyone’s cockamamie theories on what it means for the action. (I think it’s completely random) I’d also keep an eye on oil. Good luck out there!
Continue Reading -->Wells Fargo May Be Buyable Soon… and 4 Other Thoughts on Today’s Market
1) Wells Fargo’s Trip Wells Fargo (WFC) is coming under a ton of heat for its fake credit card account scandal, and it looks like it’s about to form a triple bottom with its February and June Brexit lows. I’m putting it on my long radar. I’m sure the company will pay a penalty, beef up employee oversight, and get a stern talking to from the powers that be. The optics are awful, but this scandal will eventually pass. If British Petroleum (BP) came back from its oil spill, Wells Fargo can recover from this. 2) Buy the Bad News? Today’s economic data was mostly lousy, yet the hawk trade — dollar up, banks up, gold down — is still going. So it looks like traders just weren’t surprised because the data has been so lousy lately. Fed funds futures barely budged. They’re pricing in a 50% chance of a December rate hike, essentially unchanged today. Or maybe folks just want to see CPI tomorrow before pressing dovish bets. 3) The Apple Market As I write this, the DJIA is up 58 points. Apple (AAPL) accounts for 23 of those points. I thought the stock was peaking near-term yesterday, but it’s above $115 for the first time since December 2014. 4) Donald’s Health Donald Trump released lab test results for the first time today, showing normal cholesterol, blood pressure, liver function, and thyroid function. Now I try to steer clear of politics, but people are increasingly focused on the health of the candidates. Anything that’s good for Donald tends to be good for biotech (IBB) — even though like Hillary, Donald has called for negotiating Medicare drug prices. 5) Sentiment Update AAII sentiment is 27.9% bullish, well below the 38.5% long-term average. The ISE Sentiment Index is at 76 this morning, indicating moderate bearishness. Yesterday’s Investors Intelligence survey showed that 49% of traders are bullish, slightly down but still fairly high. So sentiment remains very mixed. Traders are spooked a little, but not freaked out.
Continue Reading -->Scott Redler’s Morning Call Express: Losing Momentum
In today’s Morning Call Express, T3 Live Chief Strategic Officer Scott Redler breaks down the action in SPX and IBB, as well as individual names like AAPL and BABA.
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