Yesterday we laid the foundation for our machine learning trading algorithm (no Ph.D required.)

Ready for more?

Today, we'll piggyback on yesterdays but instead of looking back we'll predict stock movements for tomorrow! 📈💡

Let's dive in! ⬇️ First of all this is not investment advice

Do not consider this a fully tested robust system, this is for informational purposes only

By the time I'm done with this, I hope you are able to start digging in on your own...lets gooooo

Are you ready to have your mind blown?

You can build a cutting-edge, machine learning trading algorithm in Python, that's profitable, without a Ph.D, in a few minutes

It's easier than explaining AI to your parents

let's goooo Fire up Google Colab.

It's a web based tool to code, but in the cloud. No more "it works on my machine" excuses.

Go to and create a new notebook.colab.research.google.com

Bruce Kovner - one of the original Market Wizards took $3k from his credit card in 1977 and now has an estimated $7.7 bn

Here's 19 lessons from the legend

Another GOAT thread: 𝗞𝗼𝘃𝗻𝗲𝗿 𝗼𝗻 𝗠𝗼𝗻𝗲𝘆 𝗠𝗮𝗻𝗮𝗴𝗲𝗺𝗲𝗻𝘁: He emphasizes the importance of not personalizing losses. Successful trading involves sound techniques, not emotional reactions.

Here's a podcast I did breaking down market regimes and characteristics + strategies for each regime

It's about 30 minutes long or even better bookmark this tweet so you have reference

A 🧵for future reference What is a makret regime?

Market regimes are methods to use a number of characteristics that happen over and over when a market is trading in a different regime.

You can have price and direction based regimes, economic regimes, volatility regimes and many more

Having the best tools in the world means nothing if you don't know how to operate them correctly.

They mean nothing if you don't understand how to maintain them.

They mean nothing if you can't improve with them.

Let me give you an example.🧵 If you had a Formula 1 race car, let's say the Red Bull race car, even though it's one of the best race cars in the world, would be very hard for nearly ever person to drive

Now put yourself in the position of driving this race car, on race day against the best in the world

For those who would like an extensive reading list, this is the Commandant of the Marine Coprs (USA) reading list.

Every Marine is given a reading list based on rank to read. The Commandant is the highest ranking Marine and commands all Marines. Nice one to bookmark and start working through.

In this weeks market overview email I shared "the framework"

And today it played exactly how it should have for $ES

Let me show you the framework

A 🧵 We start viewing the market from the top down, for us that's determining the market regime we are in

It's like using a calendar/seasons to identify how the weather will be

If we can identify the direction and volatility we can identify how a market will trade

How to determine if the day is a trend day or mean reversion day, before it’s too late

If you have a problem taking profits too early or letting a winner turn in to a loser

This ones for you

here we go 🧵 Before we begin let's be clear, trading is a game of trading on unknown future outcomes, nothing will work every time

We use statistical edges and risk management to make more when the trade works, and lose less when the trade doesn't work out

I wonder what systematic situation might happen at $VIX above 20 oh hey

When you first start trading a new system, any system, the biggest issue is trusting the system enough to stick with it

In order to trust a system you need to trust yourself

Like anything, you need to put in the reps to get confident

A 🧵 How do you get confident, confidence comes from consistency

But what is consistency?

Take every-single-trade that show’s up, no matter what

Take every-single-stop… that show’s up, no matter what

Take every-single-stop… when hit, no matter what

A great trader asked me

"How do I avoid catching a falling knife when trading a mean reversion strategy?"

Your 1st response might be, "don't"

Catching falling knives are mean reversion strategies (which have higher win rates than trending strategies)

Here we go 🧵 Catching a falling knife means, stepping in to buy when an asset is dropping fast

Why would anyone do this you ask?

The win rate is very high

Markets mean revert 70-80% of the time, so there's a high likelihood that any sharp move will revert back to where it started

This is for everyone who has been doing the various prop trading challenges, and failing

• It's 50% about risk management
• It's 40% about how good you are trading your system
• It's 10% about how great your system is

Before you lose another $ on a prop tryout, read this

🧵 First of all, getting past the first step in prop is hard

SMBCapital says 95% of applicants don't even get an interview

When I passed the CTI tryout, they said only 4% who tryout pass (it might have been harder then?)

Because

Earn2trade states that 18.58% pass the tryout

Everyone wants to be Paul Tudor Jones but

Most traders don’t want to do what Paul Tudor Jones does...

A 🧵about the GOAT... Known as one of the original Market Wizards, PTJ (Paul Tudor Jones) was also the star of a PBS documentary called “Trader” where the crew follow PTJ and crew around during the 1986-1987 markets