Jake Bernstein

Introduction Trading Model And Patterns

AUSTRALIAFebruary 2008

© 2008 by Jake Bernstein

The Trading Model S-T-F

Unless you have a trading model you are doomed to failure A trading model provides structure My Model: SETUP-TRIGGER-FOLLOW THROUGH Set up: A high probability pattern (examples) Trigger: Increases the odds of a set-up NO SETUP – NO TRIGGER = NO TRADE You MUST have a reason for EVERY TRADE Follow-through: Risk management/Profit Maximizing Consider the fate of the typical trader

© 2007 by Jake Bernstein

What happens to the typical trader? Consecutive losses Changing the system What most traders can handle 90% of your money on 10% of your trades Small profits and large losses Lack of confidence and lack of discipline Disorganization Too much information Too many opinions Danger of chatrooms

Types of Set-ups

Price patterns – support/ resistance / trend Time patterns - cycles Price relationships – open / high / low/ close Monthly seasonals Weekly seasonals Daily seasonals Key date seasonals Spread seasonals EXAMPLES Set-ups, triggers and follow through Unless you can maximize profits you won’t win

Psychology, Discipline and Confidence

The weakest link in the chain What cases lack of discipline? Why do traders lose with profitable systems? Why do traders make money with losing systems? How confidence creates discipline What creates confidence? How to help create confidence What if it doesn’t work? Finding a professional for help Should you be trading?

Making the commitment

Take the challenge

Don’t paper trade

Why you should use real money

How to do it

© 2007 by Jake Bernstein

Would You like a Broker Who Knows Jake’s Order Styles?

Check Out Boutique Broker I-Deal and ask for your Special Jake Bernstein Student Offer – http://i-deal.com.au

31 days 26 c>o = 83%

20/27 c<o = 74%

Jake Bernstein

Why Traders Lose How Traders Win

AUSTRALIAFebruary 2008

© 2008 by Jake Bernstein

Goals and Why Me To review and explain winning trader behaviors To review and explain how traders win Based on my near 40 years of trading experience Based on my personal mentoring of hundreds of traders Based on my more than 650 seminars all over the world Based on my thousands of trades Based on my education in clinical psychology Based on my own mistakes Based on my own successes Not the “same old stuff” My 1982 book “The Investors Quotient” by Wiley – still a classic

best seller What we will learn today

© 2007 by Jake Bernstein

Jake Bernstein’s Trading Rules

If you can’t test it don’t trade itIf you have to think too long you’re about to loseDon’t analyze – actualizeToo many inputs= too little realityThe smaller the stop loss the worse the resultsFind your time frame and trade within that time frameGet organized or get outDiversify or loseThe big money is made in the big time frameDon’t average in but scale out

© 2007 by Jake Bernstein

Common thinking gets common resultsCommon results means that you WILL lose moneyThe small trader isn’t always wrong The large trader isn’t always rightBy the time you hear the news its old newsLook at enough indicators and you’ll find what you wantMost indicators have never worked and never willNormal market behavior teaches us nothingUnusual market behavior brings unusual opportunitiesHigh accuracy does not always lead to profitsA few good trades will make all the differenceSetup - Trigger and Follow through will make the big difference in your results

© 2007 by Jake Bernstein http://www.trade-futures.com

Time is more important than priceRisk is more important than rewardWhat you do with profits is more important than how you take your lossesIf you can’t take at least six consecutive losses then don’t even think about tradingTraditional moving averages get traditional resultsNever trust the markets to do what you think they should do - trust only yourself to do what you have to doDiversify across markets, systems and time framesAvoid on line market chat rooms - they’re poison!If it seems logical then it’s probably wrongLeave your losing personal habits at homeBigger and faster computers do not necessarily lead to better results

© 2007 by Jake Bernstein http://www.trade-futures.com

Sample Track Record – Optimized MOM/MA

© 2007 by Jake Bernstein http://www.trade-futures.com

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Equity Curve

Running Total of Equity Equity MA

Max Drawdown: -$34,370.00 on 12/01/2006 Longest Flat: 408 days ending 09/01/1983

MOM/MA optimized11 market portfolio“Whizzard” system

Study time is not proportional to profitsMore is not necessarily better either in indicators, information or computer powerMany mechanical trading systems perform much better than the individual trader (example)

© 2007 by Jake Bernstein http://www.trade-futures.com

© 2007 by Jake Bernstein http://www.trade-futures.com

Be Careful what you tell yourself…You may start believing itBe careful what others tell youYou may start believing it…

Market myths perpetuate Common myths… Small stop losses will protect you The more you trade the more you make “I need to make $xxxxxx a month” Options are the best way to trade My broker is there to help me…are you sure? A bigger and faster computer will help you make more money Day trading S&P is the best game in town The FOREX market is the best market for profitable trading The myth of the 200 day moving average Follow what the professional traders are doing and you’ll succeed The REVERSAL and KEY REVERSAL are profitable signals Spread trading is virtually risk free

© 2007 by Jake Bernstein

How A Jake Student has gone

Would You like a Broker Who Knows Jake’s Order Styles?

Check Out Boutique Broker I-Deal and ask for your Special Jake Bernstein Student Offer – http://i-deal.com.au

How Jake’s Recent Trades Have Gone From His Broker

From: Matthew Zimberg Optims Trading Group [matt@optimsfutures.com]Sent: Wednesday, 20 February 2008 11:55 AMTo: JakeAtMBHSubject: Last Trades

                                                                                                                               Hi Jake, You can show the following to your students: Your system has gone long the oil on the 13th of Feb Today the market has jumped around $4.  So far we have about 7K per one future contract.

                                                                                                                            The Coffee, long on the 5th of FebAbout 5k per contract Both trades were taken from Whizzard. Good Job and THANK you for being in our lives. Matt

Adest.com.au

Or call 02 927 4690

Would You Like to Get The Software Jake Uses?

You can and its Called Trade Navigator http://adest.com.au/software/trade-navigator-softwar

e-gold.htm There is a special offer for Jake’s students

Call 02 9527 4690 and ask for it

You can get a Full working 30 day free trial from:

http://www.liontrader.com/free_trading_software.htm

How A Jake Student has gone

How Jake’s Recent Trades Have Gone From His Broker

From: Matthew Z’berg Optis Trading Group Sent: Wednesday, 20 February 2008 11:55 AMTo: JakeAtMBHSubject: Last Trades

                                                                                                                               Hi Jake, You can show the following to your students: Your system has gone long the oil on the 13th of Feb Today the market has jumped around $4.  So far we have about 7K per one future contract.

                                                                                                                            The Coffee, long on the 5th of FebAbout 5k per contract Both trades were taken from Whizzard. Good Job and THANK you for being in our lives. Matt

Would You like a Broker Who Knows Jake’s Order Styles?

Check Out Boutique Broker I-Deal and ask for your Special Jake Bernstein Student Offer – http://i-deal.com.au

Would You Like to Get The Software Jake Uses?

You can and its Called Trade Navigator http://adest.com.au/software/trade-navigator-softwar

e-gold.htm There is a special offer for Jake’s students

Call 02 9527 4690 and ask for it

You can get a 30 day free trial from:

http://www.liontrader.com/free_trading_software.htm

Adest.com.au

Or call 02 927 4690

Jake Will Be Back in Sydney in June 2008 for 3 Days of Real Time Trading