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Welcome
welcome to TRADEnosis RT
- Establish an account with Gar Wood Securities (Garwood serves as an introducing broker for Interactive Brokers).
- Log into OmniVest
- Subscribe to the TRADEnosis RT Strategy
- Connect to Paper or Live Brokerage at IB
- Monitor the trades in OmniVest
If you have any questions or problems, please contact Nirvana Support at 1-800-880-0338 or email support@nirvsys.com.
TRADEnosis Team
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Welcome
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Instructions
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News and Information
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Active Strategies
welcome to the inner circle
To Our Very Special Guest!
On behalf of all of us here, I want to say, “Welcome to the Inner Circle!” We quickly closed out the group and are now preparing for first launch. We really appreciate your coming on board ahead of Launch. I can assure you, it’s going to be quite a ride.
This week, you can expect to receive the following:
- An overview of Collective 2 (“C2”) and How it Works.
- How to set up your C2 account.
- How to connect your broker account to our Trade Streams coming from C2.
As I have more information on the development of the Trade Throttle process, I will share it with you. Today, we ironed out the last few issues connecting to brokerage internally, so that’s looking good. As I mentioned, we have already tested C2, so we are good to go there as well.
Right now, I am specifically working on Filters that can isolate the best-trading symbols, and will be integrating “variable allocation” as soon as our programmer finishes it. With that feature, the Throttle can trade lower-priced stocks, which is important because they are more volatile.
I have also started preparations to engage a second Throttle Operator, who will be trading a different list. I firmly believe that the best way to control risk is to diversify and “watch the money” which is precisely what the Trade Throttle facilitates.
This is the most exciting project I have ever been involved with. The outcome has the potential to benefit almost every other area of what we do. Your Inner Circle membership has given us the most valuable commodity of all – the time to focus on, and execute this plan, and I just want to say “Thank you” for coming along with us on this journey.
Sincerely,
Ed Downs
Welcome
We are excited to have you as a valued member of The Inner Circle! This document will help you quickly establish your account on Collective 2 so you can monitor IC Throttle One in Real Time as it is used to trade the market. When you are ready, you can engage Collective 2’s AutoTrade function to send the trades generated by IC Throttle One to a live brokerage account. The last page lists contacts should you need additional help.
Why Collective 2?
As far as we know, Collective 2 is the only company that allows traders (which they call “Trade Leaders”) to submit trades into a server, so they can be distributed to individual client accounts. C2 has been in business over 20 years and has a very good reputation for accurate delivery of trades to investor accounts. It is the best way to serve our Inner Circle Members, so we can focus on trading, rather than the machinery that makes it happen.
Establishing an Account at Collective 2
1. Create Account: Go to www.collective2.com and click Create Account.
2. Check Your Email: Your account is created and a verification email is sent...
What's This?
Collective 2 is a complex beast if you are a Trade Leader (like us). But it’s not that complex for subscribers. We think you will find the following instructions to be straightforward. Note that if you click “I don’t like free training” on this pop-up, it will tell you how to get help later.
Subscribing to IC Throttle One
Subscribing costs $0 and enables you to track the Strategy’s Performance via email.
3. IC Throttle One Page
Click this link: https://collective2.com/details/138848842
You will be asked to log in, after which you will see the IC Throttle One page.
Normally, Trade Leaders charge $100-$1,000/mo to access their Strategies. Since you are an Inner Circle Member, your cost is $0.
Click Subscribe (no monthly fee).
Can’t Subscribe?
The Strategy is set to “public” from time to time so members can subscribe. If it is currently “private”, contact us and we will make it “public” so you can subscribe.
Angela Duran aduran@nirvsys.com
4. The "Are You Sure" Page
Collective 2 detects that IC Throttle One is a brand new Strategy that has only been on the site for a short period of time. So they promote other Strategies that have been running longer and basically ask “Are you sure you still want to subscribe? ”
The note at the right indicates that you will receive Trades in Real Time through email, as well as P&L Statements and Position Reports
-- > Click Subscribe <--
Immediately after you subscribe, you will be taken to the AutoTrade payment screen. We recommend that Inner Circle Members gain experience with the IC Throttle One Method before turning on Autotrade.
About AutoTrade
With C2 AutoTrade, any Strategy monitored by C2 can be set to target an account at Interactive Brokers and about 15 other brokers.
Important Information about C2 AutoTrade
AutoTrade Cost - After subscribing to Throttle One and will receive trades and performance information at no cost. For Collective 2 to automatically trade your broker account, they charge $49/month or $390 a year – a $200 savings.
Number of Accounts – AutoTrade can only be connected to one account per Inner Circle Member Login. Multiple Logins per user are not allowed.
Account Size – We set the recommended starting balance to $30,000 so anyone in the Inner Circle can start with a smaller amount of capital. C2 allows Investors to trade up to 10x this amount, or $300,000. Members can use leverage to take advantage of this. For example a $30,000 account can trade at least $150,000 at I.B. during the day (using margin). In this case, all trades will be amplified 5x in the user’s account (see 8. AutoTrade configuration Screen).
Dedicated Account – Because of the potential for trade collisions and resulting user frustration (which C2 does not want to deal with), any account traded by C2 must ONLY be traded by C2.
No other positions can be present in the account that you connect C2 up to.
Setting Up AutoTrade
5. The Dashboard: Log into C2. You will be taken to your Dashboard. Or, If you are already logged in, you can click Dashboard on the left from anywhere in C2.
Dashboard (also called Home)
Click the LIVE button to the right of the IC Throttle One entry. You will be taken to the AutoTrade Payment Screen.
6. The AutoTrade Payment Screen
To AutoTrade a single Strategy in a brokerage account, C2 charges $49/month. There is also an Annual Subscription, which is just $390 – a $200 savings.
Select Solo Monthly or Annual payment plan and enter your payment information.
7. Select the Broker
Click the All Available Brokers tab and select your desired broker. If your I.B. account is linked to Garwood Securities, select GarWood. If you use TWS for your trading, select Interactive Brokers.
Select a broker and enter your brokerage account number. Then click Next Step
8. AutoTrade Configuration Screen
We suggest default settings to start. Trade Management enables you to intervene in the trading process. Since IC Throttle One is trading in Real Time, you want to leave this on Default. You can set Stop Losses beyond what the Strategy does and scale the account up to 10x using AutoTrade Scaling. The setting Don’t join trades in progress is right for IC Throttle One, since it is in and out quickly each day. When you are ready, click Turn on AutoTrade
9. Agreements
There are 6 Agreements and Notifications. Read and type I Agree for each.
Once each agreement has been accepted, you will need to send the appropriate signed document to the Broker, with identification, and then wait for broker approval. Instructions on this are provided on the page.
Once approved, you may have to click the LIVE button on the Dashboard (the page that comes up when you log in). Bring LIVE means you are AutoTrading.
C2 Resource Email
When you subscribe to a Strategy, you receive a confirmation email. This email has links to the IC Throttle One Strategy page, the AutoTrade Control Panel, and other links. Save the email you received to refer to if you need it.
Getting Help
For additional assistance, contact:
Collective 2 Support (914-610-3979)
Angela Duran (aduran@nirvsys.com)
Barry Cohen (bcohen@nirvsys.com)
news and information
Inner Circle Update
August 16, 2023
Dear Inner Circle Member,
I mentioned in my video update last week that I was working towards a BETA release of Throttle One supporting SuperTrend today. I actually did trade it into C2, and was up 1% on investment (50% of the account). Below is a picture of today's two opportunities:
The "adder" here is the confirmation provided by SuperTrend. First we have a solid Leading Indicator gaining strength. In this case, SQQQ is being traded so RED in the L.I. is associated with UP in this Symbol. You can see that the strong upward movement is easily confirmed when the price chart rises above the SuperTrend lines. There is a second trade I did not engage, but it was set up exactly the same way.
This market looks really weak. There are a lot of articles about it. I am finding that this indicator, when used in EOD charts is really good at determining the same thing, and am employing it in both Rocket and ETF Consensus. More about these later, but here below is an End of Day chart with the same markings:
I will continue trading into Throttle One in C2 and will keep you informed as I adjust the method.
Sincerely,
Ed Downs
Inner Circle Update
June 16, 2023
Dear Inner Circle Member,
Good day! If you've been tracking progress with Throttle One in C2, you've seen me trading for several weeks now. It's been very enlightening. Sometimes the market telegraphs it is going into what I call "Herd Mode" and at other times it's downright Schizophrenic. I traded a couple of Herd Mode days and easily made 2-3%. But I tended to give it back on the Schizo days. All of this experience has helped me understand how to detect the difference. I'm gaining on it...
Recent success with the Leading Indicator
(Click Image Above to Expand)
I am holding a meeting today for those who have invested in certain projects here at Nirvana. We are embarking on an important mission centered around OmniFunds, but I wanted you to let you know that, as a result of this recent work, I believe I am very close to finally automating "Consensus Trading" with the Trade Throttle. We continue auto-trading our other Strategies, including Dynamic Equities, Option Income, and TRADEnosis under the supervision of staff members.
I remain 100% committed to our work in the Inner Circle. I have been able to run VT on a machine next to me, reacting to it only when the market starts moving (thanks to the Leading Indicator) and can keep doing that, or will assign/train the right person to monitor it for me. The Team will continue to manage our Strategies (at our direction) while my senior staff and I work to fulfill this important mission.
Sincerely,
Ed Downs
Inner Circle Update
May 29, 2023
Dear Inner Circle Member,
I have been monitoring the market, looking for Throttle Trade opportunities. Over the past several weeks, there have been times when a move appeared to be starting, but then did not follow through. Friday was different. I also changed how I am approaching it. Instead of trading the 5 Minute Chart, I have turned to the 1 Minute, with confirmation from the 5 Minute.
(Click Image Above to Expand)
The Leading Indicator was turning up and strong. I entered a position near the blue line in this screen shot, but my allocation was just 10%. So about 20 minutes later I closed it and entered another one at 50% strength. I ended up with 1.5% profit, as shown in the C2 record. But if I had traded it perfectly, it could have been 2.5%, or 5% at full allocation.
I will continue monitoring the market for these moves, and hopefully can get a consistent growth pattern established. I am also working to bring back some of the End of Day Methods I developed over the past few years, including "Rocket." As these are deployed I will let you know so you can evaluate them for consideration.
Sincerely,
Ed Downs
Inner Circle Update
May 16, 2023
Dear Inner Circle Member,
I wanted to put out a quick update today regarding my current work on the Trade Throttle. In the three weeks since my last update on our Consensus Trading Apps, I have been working with VisualTrader's new features to complete a version of The Trade Throttle I can deploy in Collective 2 and on the accounts we have access to.
Current Leading Indicator Setup in VisualTrader
The above screen shot was taken of my current setup, which uses my latest Leading Indicator to determine "Buy and Sell Zones", the result of perhaps 60 hours of testing. As I have said before, the secret to automated Throttle Trading is "holding back" for the Big Moves and avoiding the choppy markets.
If you look closely at this image, you can see the green and red areas line up well with profitable moves in the one minute chart of TQQQ. I am continuing to run tests and simulations, and will host a formal Inner Circle webinar once I conclude this research. But I wanted to keep you in the loop and let you know that progress is being made.
I told my staff this morning that the current market feels a bit like the Twilight Zone. It's been slowly advancing, but not without rather large intraday corrections. I have asked Jeff Drake and Steve Mayo to review performance of the Strategies we have published and see what can be done to improve them. I will provide an update when I host my next Inner Circle webinar.
Sincerely,
Ed Downs
Inner Circle Update
April 21, 2023
Dear Inner Circle Member,
I wanted to put out a quick update today on the Mobile App project I've been working on, and more specifically how it connects to the Trade Throttle.
As I mentioned in my prior update, we are building a Mobile App for lead generation, and that is its primary purpose. However, in the course of using it, I made what could be "The" Discovery that puts my Leading Indicator and Trade Throttle work over the goal. It has to do with what I am calling "Double Consensus".
As you know, the Leading Indicator is based on the concept of Consensus - when nearly every stock in an index is going up, the index will have momentum and usually follow through. I've documented many cases of this and manually traded some of them. What I discovered is, if I look at the next level of Consensus across multiple markets, the probability of an upward move is even higher.
I want to share this very short clip from a commercial I just made for our ETF Consensus Apps project, where I show the "Dashboard" in VisualTrader tracking eight SPDR Industry Group ETFs and their components. Each Leading Indicator display shows consensus within that industry. But when consensus among all the industries is high, that is typically the sign that a "Monster Move" is taking place!
The idea is to look for consensus across all groups (ETFs) to signal a trade on QQQ or SPY. I notice in this profile that QQQ can often signal a false breakout, but if I wait for consensus, it tends to follow through. Today, I have been porting the code over to OmniTrader so I can create and test a Strategy based on this idea. I will share the results as soon as I have them. I feel really good about this.
The Mobile App project is being promoted as a "Trio" composed of ETF Consensus Trader (ECT) for OmniTrader, ECT for VisualTrader, and the Mobile App. Naturally, all Inner Circle Members will get the Mobile App - it's an exciting application that will take advantage of this Consensus phenomenon.
Request: The Team is focused right now on getting the App out the door and we are promoting a "Crowd Funding" event at https://www.nirvanasystems.com/CTA Everyone here is pushing hard to make this happen, and of course, revenue can't start until we put it out there. I greatly appreciate any Inner Circle Members who can participate. Thank you.
Sincerely,
Ed Downs
Inner Circle Update
March 14, 2023
Dear Inner Circle Member,
I wanted to share my work from last week on the Trade Throttle and a few other new items. I ran VT every from March 3-10 and documented each day's observations in the attached PDF. I am once again working on the Rules, which is what the document is about.
As I have said before, waiting for the big moves is important, and the examples I captured clearly demonstrate this. As trader, it's too easy to get into a trade where there is good movement but not that level. It's also all too easy to exit on a small but reasonable pullback to generate a loss that would have turned into a profit. (Guilty.) I have spent a lot of time defining a System that trades these opportunities correctly. But I now have some new "secret weapons."
OmniTrader with the Leading
Indicator on SPXL1 Like reaction.1
(Click Image to Expand)
I have been working closely with Mark Holstius, who is using the Leading Indicator concept to trade the ES futures contract. Mark is one of the most talented system designers I know. He has said repeatedly, "Ed, this is the best thing I have ever seen for trading..." (paraphrased). He agrees with me that the ability to signal a new internal movement is incredibly powerful and is now just as dedicated to it as I am.
As I have worked with Mark, I began looking at the S&P 500 equivalents to the TQQQ and SQQQ ETFs - SPXL and SPXS - which also have 3:1 leverage. The image in this post is of SPXL and a move that happened late today that could have made 2.8%. You can see how the green and red zones predict and demonstrate the movement.
You can also see that the chart is in OmniTrader, which is Secret Weapon #2. We have been running the Leading Indicator in OT, which is now working well enough to start running tests. With OmniTrader, I can generate long back tests to see if the rules hold up over a long period of time. I'm really excited about it, and you can expect more on that in my next update. I may in fact start automatically trading it in a few days. If I do, I will let you know.
I am thrilled to see that TRADEnosis has been performing within the early test parameters over the past few weeks, as it's currently up over 2%. Today we identified a few more ways to improve performance, including changing from Market on Open to Market on Close orders. More about that in my next formal update on TRADEnosis next week. I am also pleased to see that Dynamic Equities is also starting to perform.
Clearly, there's a lot going on here. After my initial successes with the Leading Indicator a few weeks ago, I have continued to study (and trade) the market's ebbs and flows to refine this powerful concept. With Mark and OmniTrader on the Team, I think I have what I need to break through. Once the Signals have been tested on the leveraged ETFs, I can go back to the Throttle, where multiple trades are taken in the direction of the market. I will continue to keep you updated...
Sincerely,
Ed Downs
Trade Throttle Update
February 27, 2023
Dear Inner Circle Member,
I am pleased to provide this brief Inner Circle Video Update today, with news on:
• The Trade Throttle
• Dynamic Equities
• TRADEnosis
I am reworking my primary indicator in the Trade Throttle to provide a clearer "engage" Signal and Exit. In the video, I show what this new indicator does and how I think it can help us identify markets that have the highest "breakout" potential.
Dynamic Equities remains one of our strongest concepts. Jeff Drake has studied all aspects of the approach to create D.E. Version 3. In the Update, I included a video by Jeff in which he goes over the work he did and the resulting improvements.
Finally, today is the first day we deployed the TRADEnosis System in C2 for Inner Circle Members who have subscribed to it. I'm sharing some of the recent work, including historical simulations and what we are focusing on next.
We are continuing forward on these and other projects for our Members. We greatly appreciate your support, which has made it possible for us to focus on this important Trading Agenda.
Sincerely,
Ed Downs
Trade Throttle Update
February 27, 2023
Dear Inner Circle Member,
I have several important announcements to share today. The Team is configuring TRADEnosis in C2; I will send out the update once everything is in place. I also have news on the Trade Throttle and Dynamic Equities. Watch for my update.
Sincerely,
Ed Downs
Trade Throttle Update
February 23, 2023
Dear Inner Circle Member,
Good day! I have two specific updates today. First, I want to talk about the Trade Throttle, what happened the past few days, and what is happening now. The chart below shows yesterday's afternoon market. The red arrows mark the places where the Leading Indicator goes up to a high value, and in this case, the market is going down (so we are trading SQQQ). What happened multiple times was, the ETF would almost immediately begin retreating.
Some of the Throttle Signals and reactions from Wednesday, 2/22.
(Click Image to Expand)
Within 5 minutes, a 1/2% draw down would be experienced, which has been my max tolerance on a losing trade. It didn't take many of these to get to a 1% loss for the session.
So Today... I'm re-evaluating the best way to avoid this level of volatility. In doing so, I am looking at 100 Tick charts - a capture I just made is shown below. You can see that the Leading Indicator tends to trend nicely in the moves. But it's more about the separation. When Red and Green are gradually diverging or coming together, the market is steadily going down or up. This is especially evident in the first and last 2 moves in this chart, which would have made about 2%.
Tick chart demonstrating volatile and non-volatile zones.
(Click Image to Expand)
The nature of the market the past 3 days has been one of uncertain direction - relatively slow trends with internal volatility and, in the case of the past 2 days, strong counter-trend "whip saws" that force an exit.
If you look at the first and last red zones (9:02 and 9:29 CST) and the last green zone at 9:32, you can see the chart smoothly declining and advancing. The middle green zone is trending but volatile. So today I am working on Filters that can detect this, and will update you on my findings tomorrow.
I'm also investigating my trades from 2/7. We all know the essence of good trading is "Cut your losses short and let your profits run." And that went well on this day. The problem the last few days has been having multiple trades pull back hard against the entry. My feel right now is that analyzing those trades in addition to the internal smoothness in the tick chart may enable me to avoid this.
Investigating the trade record from Tuesday, Feb. 7.
(Click Image to Expand)
TRADEnosis is Live!
Monday, we released v 1.0 of TRADEnosis to OmniTrader users who licensed it, and have been monitoring its trades the last 2 days. TRADEnosis was such a large undertaking that we have been careful about deploying it in C2. The good news is, the servers and other technology seem to be working fine. You can see the updated performance and news at www.nirvanasystems.com/tradenosis I will have more news in Friday's Inner Circle video update.
My video update will include news on the Trade Throttle, the TRADEnosis launch, and more. I plan on recording it ahead of Monday's market and will work towards getting it out tomorrow.
Sincerely,
Ed Downs
Trade Throttle Update
February 16, 2023
Dear Inner Circle Member,
My goal in life isn't to become a professional trader - I started Nirvana to automate all this! But I can't tell you how valuable it has been to sit in front of the live market this past week to experience the emotions of trading. Today was similar to yesterday - a ton of volatility most of the day, with only 2 well-defined moves.
In the chart, you can see the strong down move that happened in the last hour of the day. The chart is inverted because it's SQQQ, the 3x inverse ETF on QQQ. Trading less and using tighter stops, I was able to keep the losses down on the early trades, so when the big move came, there was plenty of dry powder to push into the green.
Important observation: If we wait for the Leading Indicator to "peg" the upper boundary, the chart will almost always be in a strong accumulation or distribution and should be trusted. I entered and exited several trades on that last run because I was taking profits. If I had just let it go until the blue line was crossed, the SQQQ would have moved from 34.4 to 35.5 for a 3% gain. Actually, it never crossed the blue line!
Larry Luck, an intuitive member of our mastermind group, suggested I try Heikin Ashe charts. I did, and discovered there is clearly an advantage in doing this. (Thanks, Larry!) The second chart is Heiken Ashe 1-minute. You can see that, in the H.A. chart, the strong moves typically have a sequence of red or green bars that exponentially advance. It only takes 3 of these to confirm the strength of a move.
But perhaps the BEST way to avoid loss risk is to WAIT for the "maxed-out" Leading Indicator we saw at the end of the session. That may not happen on some days (like Wednesday), but there are typically 3 to 6 swing moves that have the potential to make 0.5%+ with small losses, provided stops are tight enough. So I plan to try running 2 Strategies at the same time - one that has very tight stops for the swing moves, and another with loose stops for the "maxed-out" Leading Indicator moves.
Armed with all these ideas, let's see how we do tomorrow...
Sincerely,
Ed Downs
Trade Throttle Update
February 15, 2023
Dear Inner Circle Member,
Today was definitely different. I marked a chart with the AM trades that had the strongest Entry Signals (Leading Indicator peaking), and you can see that in each case, the ETF almost immediately turned against the trade.
Yesterday, the runs were so strong that the best Exit was generally at the next Leading Indicator crossover. Today, waiting for these crossovers incurred losses (see picture).
Also, in several cases my Stops were "run", meaning I did not see the bar touch them, but one "tick" would come in low enough to trigger them. I didn't see that happen yesterday either. There were 2 good runs today (10:20 and 12:10 CST) but they trended up slowly, so the Leading Indicator did not identify them as strong moves.
Perhaps today's market behavior was due to all the news coming out on inflation, and certain important earnings reports. I am studying each situation to see if I can detect this behavior to tighten stops until an initial profit is reached, or stop trading for the day to avoid further losses.
One thing I did notice - in Yesterday's market, the Leading Indicator would max out at 1.0 and stay there for a number of bars (see yesterday's picture). Today, it would peak for just 1 or 2 bars and then retreat. If the trades were to Exit on this condition, there will still be losses, but they will be much smaller. Working on that approach this evening.
Sincerely,
Ed Downs
Trade Throttle Update
February 14, 2023
Dear Inner Circle Member,
I do hope I'm not wearing you out with all these Throttle updates. I know many of you want to see "behind the curtain" as to how I am actually doing this, and I enjoy sharing the progress.
Today was easy, thanks to market reactions to the CPI report. You can see the moves marked with approximate percentages on the ETF. I am still trading too conservatively, because I have been trying to protect against draw downs. It does appear there will be larger gains once my "conservatism" is out of the decision process.
I wanted to run in live fire with the Rules, which I have been refining. I added a Fixed Loss stop, because sometimes the market does what I call a "dipsy doodle" and just completely reverses itself. Even in One Minute, these ETFs can move a percent or more. There are two of these in this chart. What you see in the vertical lines are Entry decisions in green/red and Exits in grey, based on Leading Indicator moves through 0.7 when the red line is above the blue line in the chart (i.e., in trend) with exits on reverse crossovers of the L.I. or the Fixed Loss.
Thanks to the Leading Indicator, I've managed to beat the 1% a day goal these past 3 days. I will admit that, after working on this for so long, part of me doesn't want to let it auto trade! But I'm getting there. Will let you know where I get to tomorrow. Once this is deployed with automation, I will start working on stocks for larger gains, and options for those of us who want to see magic happen.
Sincerely,
Ed Downs
Trade Throttle Update
February 13, 2023
Dear Inner Circle Member,
I was monitoring and trading the Throttle into C2 again today. Most of the trades followed my rules but I did place some experimental trades, including three option trades to compare executions in Collective 2 to what I am getting in VisualTrader. I find that as long as I am willing to let trades pull back above the blue line but not through it, they almost always recover.
But sometimes, like the last 20 minutes of the session, they don't. That's why I am once again considering using options to avoid draw downs on adverse excursions Trading 1 contract, the initial purchases typically cost about $0.05 more but C2 precisely matched my exits on all three trades.
In the picture, the vertical Entry/Exit lines represent my Rules, using the Leading Indicator crossings for Entries with the trend (the blue indicator line), and the L.I. Crossover as a Stop. We had two strong moves today from 9:15 to 10:15 and another from 1:15 to 2:00. If I had traded them perfectly today's gain could have been higher. I am still working on the automation, but will continue trading manually until I have it.
Sincerely,
Ed Downs
Trade Throttle Update
February 10, 2023
Dear Inner Circle Member,
In my last post, I said, "I am going to adjust the Trade Plan to use the 2nd stop level and give it a go again tomorrow. Will let you know how it goes..."
So I did that Thursday to discover that I was getting out too quickly. I did have some winners but they weren't large enough to overcome the losses from early in the day. There is a rule in trading, "Cut your losses short and let your profits run." The problem is, if you don't allow trades to "breathe" sufficiently you end up cutting your profits short, too.
After reviewing all the trades I did yesterday, I jumped in again today mid-morning. There was a really good early trade on SQQQ (the leveraged short ETF) that I missed. I could have entered it within the trend but decided to wait for the next signal, which came around 11:30p in the opposite direction. In the video, I discuss the trading rules while I was in this trade. Ended up with about a 1% gain for the day, - from just that one trade. The video is only about 8 minutes long. Check it out!
Trading with the Throttle this past week has helped me understand which timeframe works the best (1 minute.), how to best use the Leading Indicator for Entries, and how to use Trend Break for trade management. I am using these insights to code a new Strategy that I will test in simulation this weekend. I now have a much clearer idea of what it's going to take to deploy a fully-automated, Throttle-based Strategy that makes steady profits.
Ed Downs
Trade Throttle Update
February 9, 2023
Dear Inner Circle Member,
I decided it might be helpful to document Wednesday's trade action, to accompany the trade history in C2. About 11am, I posted a video of the move I captured, purchasing the QQQ inverse (SQQQ) and holding for about an hour. From that point on, I continued trading to better refine the rules.
While only one of the subsequent trades was profitable, the others had small losses, leaving a net gain of about 1.5% for the day. We didn't get another large trending move, though there were about 6 "Singles" I marked on the chart as "Other Opportunities" that could have cleared 0.25% each if an early, tighter stop had been employed.
Rather than use a 4 (or 5) period Trend Break (the red line), I am shifting to using the 2 period TB until the trade has cleared a 0.5% profit, then shift to the next line. This should leave mostly winning trades, provided they are entered in the direction of the market, which is what the Leading Indicator provides.
This was the result of last Thursday's discovery coupled with today's action in the live market. It's time-consuming, but I realized it's the best way for me to overcome the issues with trade management to get the automation right. I am going to adjust the Trade Plan to use the 2nd stop level and give it a go again tomorrow. Will let you know how it goes...
Sincerely,
Ed Downs
Trade Throttle Update
February 8, 2023
Dear Inner Circle Member,
Greetings! I have been trading with the Trade Throttle in VT this morning, and thought I would make a quick video that shows the approach I am taking. If any of you are trading in real time, you may find it useful.
Basically, I am using the Throttle Indicator to find entries, and managing exits and re-entries with Trend Break Lines. The trade I show just closed out with a +2.5% gain.
My approach is to continue trading manually while I code the rules I am using (per the video). VT has great audio clues that can call my attention to the chart while I work on the automation and my staff on other important agenda items.
TRADEnosis is moving forward well - when you take something into production there are always issues to address, but I am fortunate to have the Nirvana Team working it. Thanks go out to Steve, Cose, Carolina and Gianluca for focusing on our important A.I. agenda.
I will continue to keep you informed as I get us into play on the Throttle. Looking good today!
Sincerely,
Ed Downs
Throttle One Update
February 7, 2023
Dear Inner Circle Member,
I've been watching and working with Throttle One since I announced the release last Wednesday, this short video shows what I discovered Thursday, and changes I have been testing since then.
I have also been doing some manual throttle trading Friday, Monday and today, but the automation can do a better job than I can. I will post here as soon as I re-deploy.
I am placing throttle trades as I see cases in the market that warrant it, but obviously, they won't be as consistent as what the automation can provide. Late this morning while I was working on a Trade Plan I glanced at VT and saw this monstrous bar, 100% RED on the Leading Indicator! I made money but was late to the party. I'll keep going on the automation and let you know.
Sincerely,
Ed Downs
Throttle One Breakthrough!
February 1, 2023
Dear Inner Circle Member,
If you watched my webinar from last Thursday, you know I was able to get a very good simulation over about 4 days using the Trade Throttle. I hit a few problems with my setup when I tried to run longer simulations, but after fixing them yesterday, I got the curve you see here for all of January.
This is EXACTLY what I was hoping to see - good gains in the bullish/bearish zones but small losses or avoiding trading altogether in the sideways markets. This test from 1/3 to 1/31 shows 18% return for the month with less than a 3% draw down.
Bottom line: I think we are finally there! I have asked my Team to reset Throttle One, and plan to start trading it into C2 tomorrow. It's new, so I suggest watching it a little while before engaging it. I'm trading leveraged ETFs (SQQQ and TQQQ) so we will have to see how liquidity holds up. To address that potential issue, I will be testing it trading stocks next.
I see more room for improvement but I am satisfied enough with these results to deploy it. My sincere thanks go to all of you for your patience as I have worked on this over the past year. There may be a Winter Storm raging here in Austin, but I'm a happy man today.
I'd like to add a few notes about the TRADEnosis project... The Team is moving really fast on this prime objective here at Nirvana. I'd even say it's Warp Speed. Steve just implemented something like an Advisor Rating on the A.I. Signals, so the best ones can be allowed to trade. In just a few days, we expect to be testing it in OmniTrader. Steve and our developers are easily running at Warp 9!
We have been providing licenses for early adopters at the TRADEnosis web site to raise funds so we can keep The Team focused on this important Cloud A.I. mission. Any Inner Circle member who takes us up on it will gain access to the TRADEnosis Stream in C2 when it's released, which is currently expected to happen some time in the next 2 weeks (plus an Extra Seat to trade it).
I will keep you informed as we continue to continue to advance these and our other automated trading projects.
Sincerely,
Ed Downs
Inner Circle Webinar Video
January 27, 2023
Dear Inner Circle Member,
I am pleased to publish this recording of Thursday's webinar. This event was not so much a presentation as it was a discussion of where we are going with the Inner Circle and the new TRADEnosis initiative.
In the webinar, I share some special insights into Trade Throttle development and Steve Mayos' expertise in creating TRADEnosis.
The webinar only lasts 35 minutes, but the following Q&A session was a great exchange with members and worth the time to listen to. As I indicate in the webinar, I am ready to publish the Throttle trading live this Monday and will keep you informed as we move forward.
Sincerely,
Ed Downs
DE Market States
January 9, 2023
Dear Inner Circle Member,
Why didn't Dynamic Equities trade last week?
Dynamic Equities now uses a market state based on the Trend Intensity Index. Last week, it was Bearish and inverse ETF trades were in play. We need new Signals in order to engage. It looks like today, the Market State could be changing to the upside, so if it follows through we would expect to see new Equity trades in the Strategy.
Sincerely,
Ed Downs
Special End of Year Webinar
December 30, 2022
Dear Inner Circle Member,
Good Greetings! Today’s Inner Circle Update webinar has two really important pieces of news to cover as we enter the New Year…
First, I show how I simplified Throttle One, configuring it to engage the market on the larger moves. Then, I review the other Strategies we have had deployed in C2, including notes about improvements that are being made to each.
Then, I include a very special presentation on Dynamic Equities by Jeff Drake. The really good news is that Jeff has discovered several ways to make it more robust and risk-tolerant, which is important in current market conditions. I know you will enjoy learning about it.
Finally, I talk about what we are focused on going into 2023, starting with the deployment and monitoring of Dynamic Equities 2, Throttle One, and other important Strategy work. I want to wish all of you the best New Year’s and look forward to working with you in 2023.
Sincerely,
Ed Downs
Trading with Throttle One
December 6, 2022
Dear Inner Circle Member,
I have been focused on Throttle Trading since last Tuesday, and feel like I'm getting "in the groove" as they say. In the brief video I made for this post (starting yesterday), I show what I am looking for and how
I am engaging the market with Throttle One. The good news (aside from the Fed Meeting trade last week) is my Gains have generally been larger than my losses. However, I learned a valuable lesson this morning about trading into Collective 2...
Last night, just after the close, I attempted to execute a Long Throttle Trade on TQQQ. I hadn't done that before, but these ETFs trade after the Close and the movement was there. VisualTrader entered the trade just fine, but when I brought up C2, it wasn't there. I figured it was a "glitch" so I closed the trade in VT and called it a day.
What I didn't know was that C2 had entered a market order to Buy TQQQ that would be executed at the Open. So, when I fired up VT this morning, I saw that I was Long TQQQ in C2, which was down over $700 in the weak market. Of course, I closed it immediately (in C2). I've already recovered some of the loss. But lesson learned. I am now making sure I verify not only the trades, but also whether any orders are live in C2.
As you can tell from the video, I am excited about the results I am seeing using the new indicators. I will keep you updated as progress continues!
Sincerely,
Ed Downs
December 1, 2022
Dear Inner Circle Member,
Yesterday, I used the indicators I mentioned last Thursday to engage the market during the Fed Announcement and wanted to share what I was looking at, and what happened in this brief update.
Since my last post, I have been monitoring the Throttle for a strong move, which of course came Wednesday. In the video I discuss some other observations that I am incorporating. We are getting there! Have a great rest of the week.
Sincerely,
Ed Downs
November 22, 2022
Dear Inner Circle Member,
Good News - the recording from today's live webinar is now ready! Three topics were covered in the webinar - A quick review of what we are doing in the Inner Circle Strategy assets, Ed's breakthrough discovery on identifying solid Throttle trades, and a Special Announcement for Inner Circle Members ahead of Black Friday.
The webinar itself is only 30 minutes long, and the Q&A afterwards was really great, as many Members were present in the meeting. Additional news will be made available to IC Members as the Throttle is deployed in live trading. Thanks for watching, and have a great and restful Thanksgiving!
Sincerely,
Ed Downs
November 16, 2022
Dear Inner Circle Member,
I wanted to send you this brief set of instructions for activating futures trading in Collective 2. If you've already been trading futures, you know about this.
I was unaware it was required, until I discovered that my account missed the NQ trade that was made in the big rally last Thursday. I mentioned this in my video, but I now know it was a C2 setting I had to change, not an IB issue. Hopefully helpful...
Sincerely,
Ed Downs
November 15, 2022
Dear Inner Circle Member,
I just made a video update for the Inner Circle blog that includes a review of our current Strategies, plus some notes on work we are currently doing to improve them.
Most of the update is about Dynamic Equities - our newest Strategy and the one we are most focused on right now. I've been trading it in my IRA, which I show in the update. I also provide some insights into my Trade Throttle work. In the course of developing this proprietary approach to day trading, I created a new Indicator that does a superb job of signaling that a breakout move on an individual stock has begun. I am testing it now with the goal of providing a Report/Update by Monday, and ideally, deploying it in C2.
Sincerely,
Ed Downs
October 14, 2022
Dear Inner Circle Member,
I have some special news to share today, related to my last blog post. As you may recall, we had run experiments on a hedge approach that we were calling The Dynamic Hedge.
With the market pushed even further down the past few weeks, we were in need of a product to promote to our customer base. So we took this concept and improved it to create "Dynamic Equities" - a Trade Stream that incorporates all the best ideas we have for investing in equities, and especially in retirement accounts. This is the next Strategy we are deploying for our The Inner Circle members, with Monday as the target release date.
I embedded my "commercial" for Dynamic Equities in the blog video so you can see what it does and what sets it apart. In case you want to share it with friends and acquaintances, I am including a link to the YouTube commercial video below. But just to be clear - Dynamic Equities is going into the Inner Circle (like all such products we create) so you will have access to it as part of your Inner Circle Membership. As you can tell from the video, I'm really excited about it!
In the update video, I also discuss what we are doing with Futures, and my recent work on the Trade Throttle. Yes, it's very much in play! I am targeting the end of this next week for an update on it; watch the video for details. I just want to end today's post by saying Thanks again for all your support. Have a great weekend!
Sincerely,
Ed Downs
September 30, 2022
Inner Circle Members...
For this week's update I have some very exciting news! As you know, virtually all of our work so far has been in Real Time. The primary reason for this has been to avoid overnight risk. Jeff and I recently talked about
implementing an investing Strategy, which would have the benefits of fewer transaction costs and larger moves on each symbol. But that overnight risk held us back.
Then, Jeff began testing the concept of a Dynamic Hedge, which uses NQ Futures to hedge risk - any time - day or night. This concept is simply beautiful, folks. In tonight's video, I explore how Jeff built it, and what the initial performance looks like. Prepare for an upside surprise!
I also talk about how this work is positively impacting the Throttle One project. So enjoy, and have a great weekend - we will let you know when the NEW Dynamic Stocks Strategy has been deployed, early next week!
Sincerely,
Ed Downs
Important Inner Circle Update
September 15, 2022
Inner Circle Members...
I have two great pieces of news to share today. There is a 15-Minute video attached to the post in which I visually cover both.
Here is a summary:
Trade Throttle Breakthrough
My first news is about the Throttle work I have been doing since my last update. The “breakthrough” has to do with finding an indicator combination that appears to accurately identify the big moves, which is what we want to trade. You will see a simulation I ran over Tuesday’s market, where I share how I am translating this to create and test the Trade Throttle Automation.
New Strategy: IC RT Nasdaq
After recruiting Jeff about a month ago to help with Throttle Development, he decided to apply some of the principles to develop a Real Time Equities Strategy in OmniTrader. The result is IC RT Nasdaq, a new Strategy we have now deployed in The Inner Circle. The first day was up! I will make sure Angela sends out the link to it early tomorrow.
My next update will be on my progress deploying the Trade Throttle in The Inner Circle. The Strategy is ready to go on the page; my next task is to apply the indicators I developed to create the Throttle Automation. Expect me to cover that in my next update. Clearly, my goal is to deploy Throttle One!
Ed Downs
Recent Trade Throttle Advances
August 30, 2022
Inner Circle Members...
I mentioned in my last update that I have some important Throttle News to share. A lot has been happening on the Trade Throttle project.
Recent Simulation on Throttle One by Jeff Drake
One of the big challenges in trading "market consensus" is the potential for a losing Throttle trade to give back a good portion of equity if the market turns sharply against us. To counter this, I asked our developer to create an "Equity Curve Indicator", so I could close all trades from the Throttle under program control when this occurs. Other changes made at the same time invoked a fairly involved Q.A. cycle, but the good news is it's all working properly now, and I am seeing improved results.
Perhaps the biggest issue I have encountered developing Throttle One is that automated runs are very time consuming, with each Simulation taking about 30 minutes. In order to accelerate our progress, I recruited Jeff Drake to apply his knowledge of Strategies and Trade Plans to the Throttle application. That was a good move - in about a week, he was able to get the Simulation shown here.
Another feature that was just added is the ability to run Simulations in the past, which is important because the market is always changing. Up to now, we have only been able to run on the most recent 2,000 bars (about a month in 5 minutes). With this improvement, we can Simulate any month in the past, and aggregate the performance.
I appreciate the great work Jeff has done to create the Futures, Equities, and Options Strategies that have been deployed in the Inner Circle. At this point, completing and deploying Throttle One is the highest priority project in the Company. When I announce its release, I will host a webinar to review the many discoveries that have gone into this one-of-kind technology. While the project has taken much longer than I expected, I know it's going to be worth the effort.
Sincerely,
Ed Downs
August 22, 2022
Inner Circle Members...
IC RTY Breakouts is now live for Inner Circle Members. Last week, Collective 2 restricted the number of Crude Oil Micro contracts that can be traded. We are working with them to determine how to configure it, and may have to switch to a Strategy that trades a single contract. We will have more news on this tomorrow. I will also have an update on Throttle One.
Sincerely,
Ed Downs
IC RTY Breakouts is now Live on C2.
August 15, 2022
Inner Circle Members...
In my last update, I mentioned that we had added detailed Strategy descriptions to the Active Strategies tab. I also mentioned there were two Strategies under development for the Russell 2000 and S&P 500 futures contracts (RTY and ES). These Strategies are now documented in the Pending Strategies section, at the bottom of the Active Strategies tab.
ES Trend Trades is a new Index Futures Strategy that trades
5 contracts. It is expected to go live over the next few days.
Both IC RTY Breakouts and IC ES Trend Trades have been trading live since last week, and some important adjustments have been made resulting in less capital required to trade them. Requirements had to be increased on other futures Strategies (like CL) because we are now "scaling out" which requires the use of multiple contracts. But Jeff worked out a way to trade these new Index Futures Strategies with fewer contracts.
I also did considerable work last week and over the weekend on Throttle One. I am testing a new Trade Plan concept that uses the new Equity Curve Indicator that our developer, Cose, added for me. Looking good. I hope to have more definitive news in my next update this week.
The new ES and RTY Strategies are expected to be deployed tomorrow or Wednesday.
Sincerely,
Ed Downs
August 5, 2022
Inner Circle Members...
As I indicated in my post last week, the Nirvana Team added several new Strategies and updated our existing ones to take advantage of the Trade Plan discoveries Jeff Drake had made in prior weeks - reducing draw downs and improving profitability.
With so many Strategies and all the changes, we have received requests for notes or information explaining what the Strategies do and how they should be traded, including recommended capital, number of contracts, and so on.
We have now updated the Active Strategies tab to contain this information. In addition to Throttle One, we have a few pending Strategies based on the Russell (RTY), S&P 500 eMini (ES) and Equity Breakouts (formerly "FAANG"). We will keep you updated here but that tab will now have more detailed information on all our currently Active Strategies.
Sincerely,
Ed Downs
July 26, 2022 -
IC Update #2
Inner Circle Members...
I hope you had the chance to watch my short video this morning in which I traded options on the QQQ to capture the downside movement. I have additional news on the Throttle that I am including in today’s second update that I think you will be interested to hear about.
In addition, I have some breaking news on the new Strategies that Jeff has been working on using his new Trade Plan approach. It’s truly ingenious and in the update I explain exactly how it is able to improve profits and reduce draw downs. I also include some curves based on the new index Futures Strategies that Jeff developed using this approach. And that is actually the most exciting part of the update because the return to draw down ratios are so high. As I indicated in the update, I will let you know when they have been deployed to Collective 2. Thanks again and my next update will come out soon!
Sincerely,
Ed Downs
July 26, 2022 -
IC Update #1
Inner Circle Members...
I am preparing a BIG update for later today on the work Jeff has been doing on futures - very exciting stuff. This morning I was working with the Throttle and testing an approach for retirement accounts that I have discussed before -
using Puts on QQQ to trade the Short Side of the market. The news is: I have a new Leading Indicator that is very good at predicting continuous directional movement, which is enabling me to catch longer moves. The video shows a live QQQ Put trade from start to finish. This will become a Strategy that trades down markets this way, based on the Leading Indicator and other chart clues I talk about. My 2nd video on Jeff's work will be out later today.
Sincerely,
Ed Downs
July 15, 2022 -
IC Update #2
Inner Circle Members...
At the end of yesterday's video, I showed MarketScans running on the VisualTrader Throttle and said I would run them in the live market today.
I just made a 4-Minute video that I am attaching to this post on the web site. I was excited to see the MS+VT combination generate over 1/2% in fully-automatic trading on a flat market. This first test was Long Only. I need to run additional tests that incorporate market direction into the trading decisions and then potentially add options.
I think this has HUGE potential. I will continue working on Throttle One, but this approach has a larger universe to trade, and thus may be more productive. It looks like MarketScans feeding the Throttle has the potential to make steady, daily gains. I will continue running these tests a few more days, with the goal of then adding this new trade stream to C2 for our Inner Circle Members. I'll also continue to keep you updated on all our trading initiatives.
Sincerely,
Ed Downs
July 15, 2022 -
IC Update #1
Dear Inner Circle Member,
Before I provide my update for this past week, I want to again say "Thank you" for being a part of The Inner Circle. This exciting endeavor continues to move forward with better Strategies and concepts that, without your help, we
would not be able to develop and deploy. It's a vigorous process for us because it has to be. In addition to fulfilling our promise to Members, we are ourselves dependent on the trading profits we can generate. These updates are designed to share what is happening and how we are advancing the ball in Futures, Equities and Option trading.
Again, welcome aboard.
I would say our most intense focus, aside from the Trade Throttle, has been on futures and CL in particular. Crude oil quickly made 30% after launch but over the last month has not advanced. Rather than just continue to watch it trade, we decided to look at what's happening in order to move to the next level. In this update, I share recent CL Strategy advances Jeff has made that are truly exciting. The new version, showing an incredibly smooth equity curve, is expected to be deployed next week.
Our Option Income 2 Strategy has been surprisingly effective. Its only drawback is it can't be traded in a retirement account. But a Margin account would be up 10% since it was released less than a month ago. And in terms of retirement account support, that is a primary focus I have in my Trade Throttle work.
I continue to work on the Trade Throttle problem and have made great progress trading the moves, while avoiding the sideways markets. In the update, I show a recent equity curve that shows this kind of trading. It's been a difficult problem to solve, but every new experiment gets us closer.
At the end of the video, I show a related project we just embarked on that has the ability to trade breakouts across the entire market using the power of MarketScans. It just makes sense to find and trade the stocks that are moving - when they move in Real Time. I think you'll be excited about it.
I will continue to keep you informed. Thanks again for being a valuable part of the journey.
Sincerely,
Ed Downs
July 8, 2022
Greetings! I am working on a video update, but wanted to make sure I got some news out to you at the end of this week. Since my last post, we have been very busy here working on several projects for the Inner Circle. Let's start with the Trade Throttle.
In this post, you can see my current "test bed" for Trade Throttle runs. It has plots for the Leading Indicator (red, green), a Separation indicator, and DMI. I am finding this combination is very reliable for directional Throttle Trades. By looking at longer term Separation, it is able to maintain trend direction in small whipsaws, which means less trading. I will share the results after running a few more tests.
You may recall that several weeks ago we changed the Crude Oil Strategy per the video I made with Jeff - taking quicker profits and holding stops tighter. This was done to reduce draw downs. And, it did that, but it also reduced profits. During this time, we noticed a phenomenon that we call "whale trades".
For example, near Tuesday's stock market open, Crude Oil dropped below $100 - which made headlines. Our Strategy shorted it and took quick profits, only to watch CL go much, much lower. So we are working on multiple Strategies that run in parallel, each designed to trade a specific setup. There is so much to be made in this market that this is taking a large part of our focus right now.
We also have another test running on Anchored VWAP in a private channel. It's done well in its first week, but it is 100% discretionary. We plan to release it to the Inner Circle if it continues to perform. More about that later. As I say, over the next several days, I plan to publish a video update on my Throttle work and any additional advancements we make during this time. Thank you.
Sincerely,
Ed Downs
June 29, 2022
Today's Inner Circle video covers the Strategies that have been deployed as well as an important addition to the Trade Throttle that is making it easier to capture gains from a Market Move. As you know, we have had a very strong focus on Futures in the Inner Circle due to the leverage and movement potential of these contracts. This week, Jeff deployed two new Strategies - one on Cotton and the other on Natural Gas. One of them shows a 200% gain in just two months. We are using this week to "burn them in" but if all goes well they should be available to members next week.
I also explain the new feature that was just implemented for the Trade Throttle, though it's actually a VisualTrader improvement. With the new Account Equity Indicator, I am able to "see" (in code) when a throttle move is starting to wane, so profits can be preserved at that point. As explained in the video, this is enabling me to have looser stops on the Strategies for the individual stock trades, but be able to react when the account as a whole is giving back gains. I have just started working with this but I think it could be the last "missing link."
Finally, I also discuss Option Income 2 - the new option selling Strategy that is currently showing a 53% annual rate of return. It's only been trading since June 1, but the behavior and shape of the curve are very encouraging. I talk about the history of this project, and why this new Strategy is ideal for capturing income from selling options on reversals in the direction of the market. I think it's a huge advancement. As always, I will continue to keep you updated on the development of these important trading assets.
Sincerely,
Ed Downs
June 24, 2022
Greetings, Inner Circle Members..
Last week I explained the work my Development Team was doing on Throttle One to get the Simulation and Live Trading to match more closely. They will never be precisely the same because of the processing delay after a new bar forms, but they are much closer.
New NG Strategy tripled the simulation
account in less than two months.
I have some additional, exciting news on the Throttle. Since it places many trades at once, it needs to maximize and retain the gains it makes on each "wave." A special new feature I just got from the Dev Team is enabling me to do precisely that. I am running tests now and expect to publish a video demonstrating it in the next few days. The goal, of course, is to re-deploy Throttle One on the live C2 account.
Jeff and the Team have been working every day to test and deploy additional Strategies to C2. The curve to the right is from Jeff's latest work on Natural Gas or NG. The energy markets are enormously volatile right now, and this Strategy clearly takes advantage of that. The Calmar Ratio above 150 is quite impressive. Today, they are hooking it up to C2 for testing early next week, after which it will be made available to Members. Jeff is also testing a new Strategy on Cotton. I will share more details in my video update.
Sincerely,
Ed Downs
June 13, 2022
This week we made some important gains in our quest for the best possible automated Strategies for our Inner Circle Members. The most significant is Jeff Drake's advances on the Crude Oil Strategy. In today's video, I asked Jeff to come on and explain his research and the changes that have gone into Strategy.
Click the Video Above to Play
Impressive. I also discuss our work on Throttle One, which at this point mostly has to do with synchronizing Live Trading with our Simulations.
My Team made good progress there. Finally, we have deployed both the FAANG Strategy trading equities and the Option Income 2 Strategy, which sells both Puts and Calls under Market State Control. I will continue to update you this week as we have new information on the Strategies we are deploying to Collective 2.
Sincerely,
Ed Downs
June 6, 2022
Dear Member,
Over the weekend, I traded the Crypto market (Open 7-days, 24 Hours) using Crypto Trader to run tests and work with our developers on the differences I experienced Thursday. We think we found the issue - VisualTrader can change the sort order of the list as new "ticks" come in, which means different trades will be taken.
Crypto Currency Test on the Throttle in
VisualTrader over the weekend.
They are addressing this today so hopefully we can resume tomorrow (Tuesday), The screen shot in this post, is of VisualTrader running on Bitcoin using data from CoinBase. BTW, there is a lot of potential in Crypto Currencies! For another day. I'll continue to keep you informed.
Sincerely,
Ed Downs
June 2, 2022
I hope you had the chance to watch the 5 Minute video I made just before the Open today. I now have a throttle algorithm that seems robust - it's time to test it in live fire and make sure it behaves in the real market as well as, or better than, the Simulation. The Trade Throttle ran on the NASDAQ stocks all day, and ended with some impressive results.
The C2 record was up 1.3%, which is great. But the discovery I made is even more significant. In this short video, I explain what happened and also talk about next steps. We are getting there!
Sincerely,
Ed Downs
June 2, 2022
Members...
I made this quick 5-minute video this morning to explain my current live tests with Throttle One for the Inner Circle. Pretty exciting stuff.
As explained in the video, I'm running a live experiment today, after which I will make another video comparing live vs. simulation. See you later today!
"Results! Why, man, I have gotten a lot of results. I know several
thousand things that won't work." - Thomas A. Edison
Sincerely,
Ed Downs
May 27, 2022
Inner Circle Update for May 27, 2022: Trade Throttle Review
Greetings! In my video Wednesday, I showed my recent success with Throttle Simulations and said I planned to activate Throttle One in C2 this week.
I actually did that today,
but a problem in VisualTrader prevented the trades from reaching C2. I recorded the outcome of the Throttle Trade (in paper broker) and also took the opportunity to explain how I have been testing Throttle entry points. I hope you find it interesting. The bug I encountered was fixed this afternoon so we should be all set for Tuesday's market. Have a great Memorial Day Weekend and we'll pick it up next week!
Sincerely,
Ed Downs
May 25, 2022
IC Update for May 25, 2022:
Throttle One plus 2 exciting new Strategies!
Greetings Inner Circle Members...
I have a lot of great news to share this evening, as presented in today's video. Here's a summary:
I am ready to start trading Throttle One live on the site. On the video I talk about the challenges of Throttle One, but also how important this approach is to making steady profits. I also show a simulation I ran over the past 2 weeks, hitting that 1% a day goal.
We are deploying two new Strategies - one that trades both Puts and Calls to generate income in Up and Down Markets using ATM Market States, and another that trades the most liquid stocks on the NASDAQ to replace NQ Overnight. I want to applaud Jeff Drake for his hard work on these Strategies. They are really good.
Finally, I talk about what Don Frazeur is doing to test his unique Strategy, called HVKCH (you'll have to watch the video to find out what that means!) This is very exciting work and I want to applaud Don for taking the time to engage this. It could be huge.
So, that's a rough summary. I hope you enjoy the video, which is under 20 minutes long. Thanks for being part of The Inner Circle...
Sincerely,
Ed Downs
May 23, 2022
I.C. Update for 5-23-22:
Update on recent events in the Inner Circle
It's been a little over a week since my last update. I had planned to make a video today but I hit a bug in VisualTrader that's taken all day to isolate. Hopefully they will get a new build over to me tomorrow. I have some great throttle news but want to test over more data to verify it. Expect to get a video update from me tomorrow or Wednesday.
I had mentioned in the last update that I embarked on a new "Mach" series with my member friend Don Frazeur. Don is trading his Strategy into a private area of C2 in order to validate it; As you know, we had some really wild swings in the market last week! Since his Strategy trades 100% options, the swings penalized it. We need more time in live trading before opening it to the group. I have stopped trading Mach One pending the outcome of these tests.
The CL Strategy continues to do well. We are revising Option Income and NQ Overnight. For the Option Income Strategy, we added liquidity filters (like max bid-ask spread). As a result, in live trading (not back testing) a very large number of trades are being filtered out. We are looking at switch to a liquid list like the S&P 100 and will reset. NQ Overnight is on hold for the moment.
I showed a very exciting Options Strategy in my prior post, which Buys/Sells Put & Call options on the FAANG stocks, primarily at the Open to catch breakouts. When we started testing it live last Wednesday, it made 10% in just one day due to the large drop in the NASDAQ. Since this is the first time we have traded options in real time, we need to compare executions to Simulation for at least as week before opening it on the site.
I will provide more details in my coming video update.
Sincerely,
Ed Downs
May 13, 2022
IC Update for May 13, 2022:
Great Throttle Progress & More
Greetings, IC Members! It's Friday the 13th! Actually, we had a great week. I made really good progress on the Throttle, having it wait to trade the stronger moves. Today's 5-day simulation ended up almost 5%,
(1% a day) even though
most of the week was slowly down. When we have weeks
New Real Time Options Strategy Simulation.
with a lot of volatility, that should increase. I think I can improve its performance, but you will start seeing Throttle Trades coming through Monday. Thanks for your patience. Automating the Throttle has been one of the most challenging things I have ever done!
I also started trading the new Mach One Strategy that I talked about last Friday. I must admit my performance wasn't that hot (and C2 didn't close 2 of my trades due to an error on my part). But there is hope! I have been working with member Don Frazeur on this for a few weeks, and HIS trades have been spectacular. My Good News today is that Don has agreed to help me get Mach One into shape - you'll be hearing more about that in coming weeks. If you ever meet Don, and I hope you do, you are going to find the nicest, most easy going person in the world. I am really enjoying working with him. Just want to say, "Thanks, Don for all your help!"
Futures trading continues to move ahead. One member wrote that the IC CL Strategy has already paid for his Inner Circle membership, which I was happy to hear. But more is in play. We now have the Micro CL Strategy running AND there is a new Options Strategy that is shown in this post. The back test results are so good, we decided to test it internally for a few days before activating it on the site. The Strategy made 2% today in our test. So, you can look forward to hearing more about that!
Next update soon. Thanks again for being part of the Inner Circle.
Sincerely,
Ed Downs
May 9, 2022
Inner Circle Webinar Recording
for 5-6-22: Ed and Jeff talk about recent news, including the addition of new Trade Streams into I.C.
We had a great Inner Circle session Friday. Jeff and I both disclosed new Inner Circle assets during the webinar, as well as our plans for adding additional value to the group. We also fielded some great questions from attendees.
Click video above to play.
In the webinar, Jeff talked about the new CL Micro Strategy and additional Trade Streams he is working on, including the new FAANG Strategy that trades the most active stocks in Real Time. I did a Throttle Demo and unveiled a new Swing Trading Strategy called IC Mach One. Click here for the C2 page for this new Strategy. There is also the new Crude Oil Micro Strategy. Click here for the link to IC CL Micro.
Our Strategies be going "Private" today, so please subscribe to any you want to follow by clicking the Subscribe button on the page (free for Inner Circle Members.) Our web department will be adding links to the I.C. site for easy access, but you need to subscribe before they are marked Private. As we add new Strategies in the future, we will open them in a "window" and notify Members so they can subscribe.
My Team and I remain dedicated to getting the best possible Trade Streams into C2 for our Inner Circle Members. I will continue to update you on Inner Circle News, and as additional trading assets come online...
Sincerely,
Ed Downs
May 2, 2022
I.C. Update for May 2, 2022
Live Webinar for Inner Circle Members This Friday
Greetings! Since my last update, I have continued to work in the faster timeframes with the Trade Throttle, including the use of Momentum as shown on the chart in this post. I am continuing to run these experiments and expect to have news by Friday.
Our CL Strategy continues to perform well. Jeff has been evaluating additional futures contracts and Strategies to deploy in the Inner Circle, which is very exciting work. I have been working on a new
Trade Stream for equities, which I will deploy this week. Due to the recent changes in behavior of the NASDAQ, we have decided to stop trading the NQ contract. A replacement will be available soon. Jeff and I have decided to host a live webinar to discuss what we are doing to further enhance the Inner Circle deliverables and results. The webinar will be held Friday, May 6, at 4p CDT. In the webinar we will explain our current work and plans, as well as answer any questions you may have.
Click here to register for the webinar.
Sincerely,
Ed Downs
IC Update
April 27, 2022
Today, I used 1 Minute bars with the Trade Throttle to get a faster Signal. I also tried 100 Ticks but didn't see much advantage over 1 Minute, so I stayed with that. At the Open, the market was screaming up, so I immediately bought the first 5 stocks on the top of the list "Above" List. They
were moving incredibly fast, and Market momentum carried them up. I had gained $200 at one point, where I started taking profits. After a pull-back I entered a new Throttle trade which did not follow through.
The advantage of the short timeframe is that the picture of strength and weakness across all symbols changes very rapidly. In fact, you can see it change twice in today's 8-minute video from Solid Green to Solid Red and back. I wanted to see if I could enter these trades more quickly (and I could) and also get a quicker indication of a turn to signal an Exit. I discovered that the Exit Signals tended to come too quickly.
The other thing I wanted to test is option trading in lieu of a basket of stocks. I did about six QQQ option trades, using the bullishness (or bearishness) of the List to tell me when to enter and exit. While these trades stopped out for small losses, the exercise enabled me to test the concept. My conclusions at the end were that short timeframes are great for the earliest possible entry, but I need to use indicators for exits, so the trades can run. I plan to continue live testing tomorrow.
Sincerely,
Ed Downs
IC Update - 4-26-22
Breakout Throttle Trades
I made another short video today (10 minutes) where I used the breakaway method. Only two throttle trades were done - both profitable. However, you can see in the video that the market can move up a substantial amount - even when 90% of the stocks are in the "red zone". This
provided some great additional insight that I will incorporate. Running Throttle in the live market has provided information about how to get through 'sideways' market behavior and hold the trade long enough to lock in a profit. I will continue to work towards Throttle Automation and share my findings as I go.
Sincerely,
Ed Downs
IC Update for April 25, 2022
Throttle Work: Live Market
Over the weekend I ran tests on a new Measurement that uses Momentum, and decided to trade live with it today. This morning, I recorded the first hour and a half, and picked it up again near the Close. I would say the video, which is 22 minutes long, provides good insights into what can happen on a day when the market is non-directional.
As I mentioned in my last post, this work is experimental, and I suggest Inner Circle members wait on following these trades until I can get the automation worked out. But I think it is better for me to engage the market live in addition to the Simulation work because of the insight it provides. Hopefully tomorrow will be a true "Break Out" day. Stay tuned...
We are now focused on trading the main session in the Futures Strategies. The CL Strategy made some good gains today. I am working on another trade stream for equities that I hope to announce soon. But improving the Throttle so that it waits for, and trades, the biggest breakouts is my primary focus, as I discuss in today's video.
Sincerely,
Ed Downs
I.C. Update 4/22/22
Today's Throttle Work - Live
As I indicated a few days ago, I have re-engaged Throttle One and activated it in Collective 2. I am working on a process that I am sharing in the video posted with this post. I'm very enthused about it. Essentially, it has to do with short term throttle trades versus longer
term trades. I have developed a new indicator that 'points the way' to a strong move that I am using as the impetus to find and place high-probability throttle trades. Longer term trades have the advantage that profits can build up to much higher levels, which helps overcome transaction costs. As shown in the video, I just finished a good trade on the short side. I am trading into the Throttle One Strategy in C2, but this is still somewhat experimental. I will continue to post progress as I continue to do this important work.
Sincerely,
Ed Downs
I.C. Update
NQ Strategy
At yesterday's close, the NASDAQ 100 dropped a full 140 points due to the NetFlix Earnings Report. Immediately after the Closing Bell, the NQ Futures Contract dropped 40 points in less than a second. Our Stops were hit and executed but with countless similar trades processing, it exited past the Stop Level. The chart published with
this post, shows the event. While anything can happen in the market, events
like this are rare. If you had a max stop loss set at C2, it should have been honored.
We have made two significant changes to this Strategy. First, we are only running it during the regular session, because the NASDAQ 100 has not been moving enough after hours to make a profit. Second, we have changed the Strategy to trade reversals rather than breakouts. The equity curve from testing is solid with low draw downs. It will be deployed live when trading on the NQ opens at 9am CDT.
IC Throttle One is back on-line and trading will resume tomorrow.
Sincerely,
Ed Downs
Click Here to See Older Blog Entries
I.C. Update
NQ Strategy
At yesterday's close, the NASDAQ 100 dropped a full 140 points due to the NetFlix Earnings Report. Immediately after the Closing Bell, the NQ Futures Contract dropped 40 points in less than a second. Our Stops were hit and executed but with countless similar trades processing, it exited past the Stop Level. The chart published with this post, shows the event. While anything can happen in the market, events like this are rare. If you had a max stop loss set at C2, it should have been honored.
We have made two significant changes to this Strategy. First, we are only running it during the regular session, because the NASDAQ 100 has not been moving enough after hours to make a profit. Second, we have changed the Strategy to trade reversals rather than breakouts. The equity curve from testing is solid with low draw downs. It will be deployed live when trading on the NQ opens at 9am CDT.
IC Throttle One is back on-line and trading will resume tomorrow.
Sincerely,
Ed Downs
I.C. Update
Ed announces new assets and Live Trading with The Throttle
Greetings! It's been about two weeks since my last update, so I wanted to fill you in on what's going on. The CL Strategy has been performing really well, and I see quite a few members have been harnessing it, which is great. NQ not so much, as it has slowly gone sideways to down.
Why? The Nasdaq just hasn't been moving much, especially overnight. The Strategy looks for the strong breakouts we saw a month a go, which will probably return at some point. But Jeff has revamped it to trade Reversals, and deployed it live for testing today, after which it posted a really awesome trade. So we will be augmenting the existing Strategy with this concept. I'd let it burn in a week or so before trading it.
Now, regarding Throttle One... You can read and watch my many experiments from the start of this page. My goal was (and is) to fully automate this thing so I can just let it run on the account, and then replicate it for other markets. Not giving up on that. But I have decided that with the new knowledge I have, I should be able to trade profitably with it manually. So, we will start with that while I continue to perfect the automation sequence. I may start tomorrow, but Thursday at the latest. I will keep you informed on progress. My goal is still to automate it, but I feel it is important to go back in the market in live fire. It's going to be interesting!
Sincerely,
Ed Downs
Tuesday 4/5/2022:
New Trade Stream on CL Takes Off
I wanted to provide a quick update today on our Inner Circle Strategies. The big news is the Crude Oil Strategy that started trading last Monday. In 5 days, the Strategy gained over 15% on margin. The News on this is that we are working on trading the "Micro" Crude Oil contract, which is 1/10 the size and can be traded on just $5k. We are targeting Friday to have this running and trading into C2.
I.C. CL - All Sessions was launched last Monday in C2.
We know NQ Overnight has been going sideways/down for a few weeks. This Strategy looks to trade volatility breakouts. The NASDAQ's volatility dried up at the bottom around March 12 so that is affecting it. Of course, that is impossible to predict. This is why we are adding more futures contracts into the I.C. collection. Diversification is going to be key to making steady, consistent gains.
I am trying a new approach on the Trade Throttle which is looking good. I want the Throttle approach to be profitable at least 4 out of 5 days and think I have an approach based on variable allocation that will achieve that. I expect to have news by the coming weekend.
Sincerely,
Ed Downs
Monday 3/28/2022:
I.C. Progress & News
"I wanted to provide a summary today of events from the past week. I've been on the Throttle every day up to and including the weekend. I finally figured out why my longer runs have been hampered. When the Leading Indicator goes "solid green", we never know what's going to happen next. Sometimes, profits will build (which is great). Other times, the market will immediately turn around and gains can turn to loss.
Recent run trading when L.I. is above 70% and below -70%
So over the weekend, I tried going Long when the L.I. crosses 70% up and Short crossing -70% down. But Exit all Trades outside these ranges. The picture to the right shows a two week run using this concept. It finds the one strong Throttle move and limits losses, but gives up a lot of profit potential. It's good enough to deploy (1% per day) but has too few gain days and too many trades, since it gets out so quickly. I feel like I'm really close, folks! I appreciate your patience as I continue to work through this.
IC NQ Overnight had a draw down Friday but recovered some of that today. The new IC CL All Sessions has run a few days but logistical problems caused trades to not make it to C2. I see they got it running today, and the account has a gain. IC RTY All Sessions is still in development since it was trading too often in recent tests.
Thanks for being part of the Inner Circle. I will continue to keep you informed.
Sincerely,
Ed Downs
Monday 3/21/2022:
Inner Circle Update - New Trade Streams
Inner Circle Members;
I have some really good news from the past week that I want to share with our Inner Circle Members. Our latest addition NQ Overnight has been working well, as has all the machinery we have set up to trade into C2 and monitor both systems.
I worked on a specific area of Throttle One last week that I share in the update, and am making a special announcement about two new Trade Streams that are testing out well - one on Russell Futures and another on Crude Oil. My team and I will be working today to get them configured on servers and deployed on C2.
Sincerely,
Ed Downs
Friday 3/18/2022:
Inner Circle Update 3-18-22
Inner Circle Members;
I am pleased to see that IC NQ Overnight has been doing fairly well since it was released last Wednesday, and IC Option Income has made gains with the upturn in the market. I wanted to let you know that we have been working on some great new assets for I.C. that I plan to disclose in an update this weekend. I am also concluding some ground-breaking work in IC Throttle One, which I will cover in the update. My goal is to send it Saturday …Sunday at the latest.
Sincerely,
Ed Downs
Thursday 3/10/2022:
IC Update
Inner Circle Members;
I had planned to get this out earlier in the week, but with the deployment of IC NQ Overnight on Tuesday, I decided to wait a few days so I could say more about it. I have also been doing intensive Throttle Tests, which I go into in the video. I think you will enjoy today's update. We are taking ground really quickly now in The Inner Circle!
The last section of the video talks about establishing a Stop Loss in C2. If you have activated IC NQ Overnight or IC Option Income in your account, you will definitely want to do that. This is where you set a wide Stop Loss to cover all possible contingencies, such as internet failures. Remember, this is futures trading! We have made tremendous gains so far, but a runaway loss is also possible if something goes wrong. So make sure you set that up in C2.
As you can tell in the video, I remain hugely enthused about Throttle. The returns are simply unbelievable! I just need to get it consistent enough to hold onto gains through choppy markets. We are getting there, and I will continue to update you on progress.
In the video I mention a Collective 2 page where you can learn about setting a Stop Loss. Click here to access the article on C2. Thanks...
Ed Downs
Friday 3/4/2022:
IC Update & Breaking News
Inner Circle Members;
I wanted to provide a quick update and some 'Breaking News' about an important new development. For Throttle One, I believe I have found a way to avoid large draw downs during weeks like the one we just saw, with the market trending sideways to
down. Per my prior video, the fact that we can short stock in C2 is very helpful. However, this week one of our members wrote me, asking about trading an IRA (which doesn't allow the short sale of stocks). To address that, I will provide a separate version that buys QQQ Puts in down markets as I had planned. I appreciate the email and request.
Tuesday 3/1/2022:
Execution Price Comparison
Inner Circle Members;
It looks like the market has transitioned to a 'wait and see' posture with everything going on in the world and the uncertainty surrounding it. As a result, I decided to spend the past few days working on ways to handle sideways markets in the Throttle.
I expect to finish this work quickly. But another very important item on my list has been to make sure the prices we are seeing in Collective 2 are reasonably close to execution prices received from I.B. - for short trades.
I was going to buy Puts on QQQ but it's better to short stocks when the market is falling because individual stocks can fall faster. So just before the Close, I did a Throttle Trade on 8 stocks, holding the positions about 20 minutes before closing them. I then compared execution prices between C2 and IB. As I show in the video, the two were very close on these trades, which is good. I also discuss what I have been working on, as well as my plan to deploy Throttle One in C2.
Ed Downs
Friday 2/25/2022:
Bingo!
Inner Circle Members;
Pursuant to my prior video a few days ago, I applied the same principles in the Throttle and was able to get to the Fully Automated result you see in this post. Quite good actually, generating 1.35% per trade and an enormous calculated APR of 3,400%. I am using I.B. Commissions but there is no way to program in the bid-ask spread, so we will have to run this live in C2 to see the effects of that on performance.
I'm going to work on Throttle One a bit more over the weekend, and start trading live in C2 Monday. Then I can compare simulated results with actual and we will know where we are on the playing field. But I can see ways to improve it and am very excited about it! The important thing right now is to deploy, see where we are, and then move to the next level. Thanks again for your patience; We will start Monday and continue improving as we go!
Thanks!
Ed Downs
Wednesday 2/23/2022 Update:
Inner Circle Members;
The past several days I have been poring over these VisualTrader Throttle simulations to find the key to capturing consistent moves. We have good Strategies now, so I need to automate the Throttle Levers to take early positions, let them run, capture profits, and repeat. It sounds easy but it wasn't until I started trying to do it manually in the simulator that I began to see what actions need to be taken.
In the 10-minute video attached to this post, I share the experiment I ran this afternoon. The equity curve that you will see shows what is possible if all Throttle Actions are managed like a symphony - one movement after another, allowing trades to breathe but not letting them give up too much of their gains. I need to convert the Short trades into Options on QQQ (due to the problem with shorting on C2) but that is not too difficult.
I will update you again as soon as I have finished translating this manipulation of the Throttle into the Automation scripts.
Thanks!
Ed Downs
Monday 2/21/2022 Update:
Inner Circle Members;
I wanted to provide an update today after working on these projects over the weekend. First, I wanted to note that our Option Income Strategy stopped out of its first positions as the market continued down last week. A few new positions were added Friday. Once we get into a more normal market, the mixture of Option Sales from different dates should smooth out the draw downs.
Regarding Throttle One, the Simulation shown here generated a profit of 1% a day even with the 3% draw down in the middle of the test. We want to continue pressing forward on this until we see a little less draw down, but we are getting close. The other project that is underway is a pivot-based system that I will explain in my next video update.
Thanks!
Ed Downs
Thursday 2/17/2022 Update:
Inner Circle Members;
A lot has happened this week in the Inner Circle. We launched Options Income with first trades yesterday. The market dropped today, which affected the trades but not that much. The good news is all the machinery is working and we can now run this in C2. As I suggested, I'd wait a few days before attaching it to brokerage so we have some additional 'burn in' time.
RE: Throttle One: Jeff has helped me tremendously on this (Thanks, Jeff.) I have been working on Leading Indicator timing with specialized code that evaluates the "launch points", which the image in this post shows. Each vertical line represents a throttle "go" point; and you can see that immediately after each one, the QQQ made a good move (along with the stocks comprising it). I will be testing this tomorrow morning with our new Strategies. My hope is that I will be able to deploy Throttle One on Monday.
We have some other Strategies in development, including one that trades NQ (Nasdaq) futures, which is looking great. And there's also my Super Pivot work, and I have some results to share on that. I provide another video update this weekend.
Thanks!
Ed Downs
Tuesday 2/15/2022 Update:
Inner Circle Members;
"I have great news - we have deployed the IC Option Income Strategy to Collective 2! Click here for the details page. We did one small "test" trade yesterday (-$20). This Strategy is based on a $10k account (the Model Account).
Margin Rules allow Options to be written on up to $50k of stock on an account of this size. Starting at $10k, the 2021 equity curve shows gains of 107% with a 7% draw down, for a Calmar of 12. We will be running it at 3:30p EST daily to avoid opening market volatility.*
In other news... I have recruited Jeff Drake to help with the Strategy that is used in Throttle One, as the automated exits are where we need to focus. We are seeing fabulous throttle runs - we just need to reduce draw downs so the ongoing performance is more consistent. We are getting there, and I greatly appreciate your patience. PLUS, we have several exciting new Trade Streams nearing completion, and I expect to announce at least one of them this week!
Thanks!
Ed Downs
* Starting Wednesday, Feb 16, 2022
Sunday 2/13/2022 Update:
Inner Circle Members;
Greetings Inner Circle Members. I wanted to provide an update ahead of Monday on what was accomplished last week and also to disclose our plans for the coming week.
I continue to make good progress on Throttle One, and discuss that in the update. We expect to deploy Option Income early in the week - some major improvements were made this week that I think you will be interested in.
And finally, there is my new work on Super Pivots, which I think are a game changer. We look forward to deploying these Strategies and continuing our work of creating the best possible Trade Streams for our Inner Circle Members.
Sincerely,
Ed Downs
Thursday 2/10/2022 Update:
Inner Circle Members;
Going from my last post, I spent Tuesday through today working on ways to identify strong whipsaw markets so Throttle Settings can be adjusted accordingly.
The plot in this post shows an indicator that seems to work fairly well; I have been running simulations, which take time, but I am making good progress. We have established a cloud machine and C2 page for the Options Income Strategy, which is showing greatly improved results thanks to a new Dynamic Scan.
will provide a video update tomorrow.
Sincerely,
Ed Downs
Tuesday, 2/8/2022 Update:
Inner Circle Members;
Yesterday I ran a Trading Simulation from 1/10 to 2/4 trading Put & Call options, which the curve in this post is reflective of.
Note that option spreads are not available to the simulator, which would reduce results somewhat. While the ending equity was high, the 47% draw down is concerning me.
The red zone is where the market was highly volatile over about 5 days. Yesterday's market was similar. Today, I am working on a countermeasure (like lower allocation when high volatility is detected) to guard against this.
I will update our IC Members after running these tests and prior to deploying it on Collective 2.
Sincerely,
Ed Downs
Sunday, 2/6/2022 Update:
Inner Circle Members;
Today's update covers a lot of ground in just 30 minutes! First, I review some of the lessons learned since we started the project on Jan 10, including changes I made to create the revised Throttle One Strategy.
In the video, I run simulations that show the potential for making steady gains, followed by another run trading Puts and Calls (you won't want to miss that!) Finally, I discuss our plans for next week, including deploying Throttle One, testing Options in the live market, AND releasing a new Trade Stream in C2 that generates steady income from Selling Puts.
It's going to be an exciting week; stay tuned for the next update!
Sincerely,
Ed Downs
Tuesday, 2/4/2022 Update:
Inner Circle Members;
The past 3 days, I have been working in the Simulator and creating new assets to improve results. We have a new Pivot Algorithm and Trend Indicator, which both Jeff and I are using to create assets for the Inner Circle.
Here is a simulation run from today, trading both Long and Short on the Nasdaq 100 stocks. I am working on a video update that will be published this weekend, containing news and our plan for next week.
I also have a very special announcement for our Inner Circle Group.
Stay tuned!
Sincerely,
Ed Downs
Tuesday, 2/1/2022 Update:
Inner Circle Members;
After running a long simulation Friday, I realized I need to create new assets to help VT stay in the Trend-Following Trades longer.
We are seeing good numbers using this new approach, but I was unable to run a long simulation today due to a problem with the latest VisualTrader build that our development staff is currently addressing. I expect to be able to resume tomorrow.
BTW, Jeff is working on an exciting New Trade Stream to deploy in C2 - more about that later this week.
Sincerely,
Ed Downs
Click image above to enlarge.
Friday, 1/28/2022 Update:
Inner Circle Members;
Today I continued with the work I described yesterday, using market direction to automatically drive the Trade Throttle. I mentioned in yesterday's video how Shorts may be disadvantaged in C2.
The picture featured in today's post is from a simulation that only buys the strongest stocks when the market is in a bullish mode. Doing this, it was able to avoid drawdowns in the middle of the day to resume its profitable climb to the close.
It basically doubled today's market gain without using leverage. Longer simulations need to be run but this is looking really good! Not possible without automation.
Sincerely,
Ed Downs
Click image above to enlarge.
Thursday , 1/27/2022 Update:
Inner Circle Members;
I have completed the Inner Circle Update I mentioned earlier today. In the update I talk about yesterday's trading adventure during the FOMC meeting, followed by a look at the prices recorded in C2 for trades made into the Strategy.
Very interesting. Could we actually be up 10%? Watch the video to find out! I also explained a new Leading Indicator feature that is enabling me to automate Throttle One. And I can tell you, I am VERY excited about that.
The video is just 16 Minutes long. I expect to make another post tomorrow afternoon with a special announcement.
Thanks and take care..
Sincerely,
Ed Downs
Wednesday , 1/26/2022 Update:
Inner Circle Members;
The market is quiet this morning, so I thought I would get a quick update out, since I did not post one yesterday. In the video, I talk about a Transform experiment I ran yesterday, and what I am focused on today.
After working with and observing the market the past few weeks I have made several discoveries that I am incorporating into the Transform and the Strategy. The most valuable lesson I have learned is 'Wait for it...' We only need 2-3 good Throttle trades a day.
It's very tempting to act on minor signals during the session, which can lead to many small losses. We need the Leading Indicator to be as directional as possible, so the software can wait for these moves, and then automatically take them.
Sincerely,
Ed Downs
Monday, 1/24/2022 Update:
Inner Circle Members;
With the current situation, the U.S. Stock Market is turning down hard into correction territory. Throttle trading was difficult this morning because the moves were not impulse moves, but rather continuation moves. As a result, throttle trades were turning up and stopping out too frequently.
In an impulse move, the leading stocks can make 0.5% profit before the move ends and we get out. In a continuation move they just slowly move down and then briefly revert to get stopped out. And the Leading Indicators just stay red, as you can see in this picture.
Why not just go short and hang on? The Throttle approach is about making quick profits and then waiting for the next impulse move to form. So I decided I can get us further ahead by focusing on throttle automation today. I will re-engage as soon as the market stabilizes.
Sincerely,
Ed Downs
Click image to enlarge.
Friday, 1/21/2022 Update:
Inner Circle Members;
Obviously, the NASDAQ was not happy yesterday - or today for that matter!
I decided to combine my posts for Thursday and Friday, as most of the trades happened today. In the video, I go through various concepts in live trading that I have been testing this week, including the use of the "Choke" to capture profits when the market turns against the current throttle trade.
The account was up some today; (definitely beating the market!) Most of my work has been experimental so far. I'm working to automate what I have developed so the throttle can trade all day. I will continue to keep you informed. Thanks, and have a great weekend!
Sincerely,
Ed Downs
Wednesday, 1/19/2022 Update:
Inner Circle Members;
Today was a good day. Profits in the account weren't stellar, but I was able to wait for the Throttle to Signal a move, rather than sit in front of the screen looking for trades to do. Tuesday's market threw me off because it wasn't solidly directional, except right before the Close. And some days will be like that. But we don't have to trade every day - only when "the salmon are running."
The 8-minute video on this post shows a solid Throttle Trade trade I captured live today. There can be 2-4 of these on a good market day - more than enough to hit our profit goals. I didn't place any option trades today because I was focused on the Throttle. I'm still refining the method, but looking forward to tomorrow.
Sincerely,
Ed Downs
Inner Circle Members;
I guess you could say today was Experiment Day. Per my video last night, I spent most of the day trading the reversion points to enter option trades on the Qs. But I experienced quick reversals, costing about $30 each time. This was much different than last week, when Leading Indicators would fire at the start of a run. It was challenging.
Since my stops were tight, losses were small - the C2 record ended down about 0.8% (a little better than the index). I did see individual stocks that trended nicely and am looking at ways to identify that behavior sooner. I am also running today's index chart in the Simulator so I can more quickly correct for days like this.
Sincerely,
Ed Downs
Monday, 1/17/2022 Update:
Inner Circle Members;
The markets were closed today, providing some good time to work with the method and refine it. I just produced a quick update on lessons learned last week, and where I am focused this week. I am excited about trading these confirmed reversion points with QQQ options. I will keep you informed as we continue to refine the Method.
Sincerely,
Ed Downs
Thursday, 1/13/2022 Update:
Inner Circle Members;
The Nasdaq turned down hard today. I was trading long and hedging with index puts on the pullbacks. I spent time today experimenting with a few new throttle concepts which I will explain later. With hedging, the account held its own today. Working on adding Short Throttle Trades, which are more challenging (as I described in yesterday's video.) But making great progress...
Sincerely,
Ed Downs
Wednesday, 1/12/2022 Update:
Inner Circle Members;
Today afforded the perfect opportunity to execute an option hedge to recover a throttle trade after a market downturn, which actually ended up with nearly a 1% profit. See the Jan 11 video for an overview of the approach to index option hedging that is being integrated into IC Throttle One.
Sincerely,
Ed Downs
Tuesday, 1/11/2022 Update:
Inner Circle Members;
In this video I talk about today's results in C2 and included an introduction to hedging with Index Puts. I have been developing this technique to enable Throttle Trades to remain open on minor market pull-backs while countering the adverse movement of the index.
Sincerely,
Ed Downs
In this 30-Minute webinar I discuss the use of Collective 2 and some of the lessons learned the first day trading Throttle One. I also talk briefly about where we are headed with the project.
Sincerely,
Ed Downs
Live video from Day 1 - I captured about 30 minutes of the day so I could explain the process in the live market. In addition to showing how the Leading Indicator assists, I discuss automating the process and some other observations. This is a work in progress; I am learning and adjusting my approach every day as I trade the live market with the Trade Throttle & VisualTrader.
Sincerely,
Ed Downs
Saturday, 1/8/2022 Update:
Dear Inner Circle Member,
To the right is a link to the PDF for instructions on how to Subscribe to our first Inner Circle Strategy, IC Throttle One. More information will be provided as we launch IC Throttle One on Monday, January 10.
Sincerely,
Ed Downs
Friday, 1/7/2022 Update:
Testing Throttle One...
This morning at Market Open I traded with the Throttle for a 2% gain in 20 minutes. As I did this, I narrated the process so you can see how it works. More information is coming tomorrow (Saturday).
Sincerely,
Ed Downs
Tuesday, 1/4/2022 Update:
Inner Circle Members;
I was working with the Leading Indicator today as part of my preparation for Throttle One, and made this quick (12 minute) video on how effective it is on determining true direction of an index. Just sharing the progress.
Sincerely,
Ed Downs
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Dynamic Equities
Dynamic Equities trades stocks from the Russell 1000, inverse
ETF's and the MNQ Futures contract. This strategy leverages inverse ETF's
so it can be used in retirement accounts. MNQ is used as a hedge to protect
against adverse moves. Tight stops are applied to preserve profits.
Simulated Equity Curve
Specifications
Suggested Minimum Capital: $30,000
Security Type: Stocks, ETF's & MNQ (Fut)
Symbol List: Russell 1000 and Select ETF's
Trading Timeframe: Daily & 5M MNQ
Trade Type: Long and Short
Positions Held Overnight: Yes
Starting Position Size: 20% of Equity
Starting Position Size ETF: 5% of Equity
Starting Position Size Futures:
2 Mini Contracts
Contract Margin: ~$2,600
Maximum Safety Stop per Trade: TBD
Dynamic Equities - https://collective2.com/my/67M6CBTQI
IC RT Nasdaq
IC RT Nasdaq is an OmniTrader Strategy that trades about 20 stocks in the Nasdaq 100 that are the most highly correlated to it, using a System based on RSI, ADX, and other filters. It only trades during the session, and does not go overnight, thus avoiding overnight risk.
Simulated Equity Curve
Specifications
Suggested Minimum Capital: $35,000
Security Type: Stocks
Symbol List: Nasdaq Stocks
Trading Timeframe: Real Time
Trade Type: Long and Short
Positions Held Overnight: No
Starting Position Size: 33%/Equity
Maximum Safety Stop per Trade: $2,600
IC NT Nasdaq - https://collective2.com/my/A1YQ5CTHG
IC Option Income
IC Option Income sells puts and calls on stocks in order to capture
gains on strong moves while monitoring the loss side with tight stops.
Simulated Equity Curve
Simulation Dates: August 23rd, 2012 to August 1st, 2022
Commissions and Fees Included
Specifications
Suggested Minimum Capital: $35,000
Security Type: Options on Stocks
Symbol List: S&P 100
Trading Timeframe: End of Day
Trade Type: Long and Short
Positions Held Overnight: Yes
Starting Position Size: 10% of Equity
IC Option Income - https://collective2.com/my/4TWR3UFQK
IC CL All Sessions
IC CL All Sessions trades Crude Oil Futures E-Mini Contracts. It is designed to trade breakout moves. It will take partial profits on 5 contacts, hold 1 contract, and then attempt to trail the trade on a continuation move by adding another contract.
Simulated Equity Curve
Simulation Dates: March 1st, 2022 to August 4th, 2022
Commissions and Fees Included
Specifications
Suggested Minimum Capital: $200,000
Security Type: Futures
Symbol List: CL (Crude Oil)
Trading Timeframe: Real Time
Trade Type: Long and Short
Positions Held Overnight: No
Starting Position Size: 6 Full Contracts
Contract Margin: ~ $27,000
Maximum Safety Stop per Trade: 4,400
IC CL All Sessions - https://collective2.com/my/Y1NPM4H71
IC CL Micro
IC CL Micro uses the same strategy as IC CL All Sessions but it trades the Crude Oil
Emini Micro Contract. The Micro CL contract is 1/10th of the size of the full contract.
Simulated Equity Curve
Simulation Dates: March 1st, 2022 to August 4th, 2022
Commissions and Fees Included
Specifications
Suggested Minimum Capital: $25,000
Security Type: Futures
Symbol List: MCL (Micro CL)
Trading Timeframe: Real Time
Trade Type: Long and Short
Positions Held Overnight: No
Starting Position Size: 6 Micro Contracts
Contract Margin: ~ $2,700
Maximum Safety Stop per Trade: 1,200
IC CL Micro - https://collective2.com/my/2PRSNBWEB
IC NG Futures
IC NG Futures trades the full Natural Gas Futures Contract. It will look for
strong breakout intraday and takes partial profits while allowing 1 contract
to run in order to take advantage of extended breakout moves.
Simulated Equity Curve
Simulation Dates: March 1st, 2022 to August 4th, 2022
Commissions and Fees Included
Specifications
Suggested Minimum Capital: $100,000
Security Type: Futures
Symbol List: NG (Natural Gas)
Trading Timeframe: Real Time
Trade Type: Long and Short
Positions Held Overnight: No
Starting Position Size: 3 Full Contracts
Contract Margin: ~ $28,000
Maximum Safety Stop per Trade: 5,000
IC NG Futures - https://collective2.com/my/CVXZCADDB
IC Throttle One
Ed has documented his work on Throttle One in the News and Information tab. Currently trading Long TQQQ (3x ETF representing the NASDAQ 100) and Long SQQQ for Short Positions to accommodate Retirement Accounts. The equity curve below is from a recent test. This has been challenging because of the changing nature of the market and the time required to run Simulations.
2/2/2023
Throttle One is now in live trading/test mode. It's still experimental, so we suggest monitoring it for a week prior to assigning to an account.
Specifications
Suggested Minimum Capital: $30,000
Security Type: Stocks, Index
Options, and Leveraged ETFs
Symbol List: Nasdaq 100
Trading Timeframe: 5 Minutes
Trade Type: Long TQQQ and SQQQ
(as of 2/2/23) Experimenting with Long Stocks/ Index Calls and Long Index Puts.
Positions Held Overnight: No
Starting Position Size:
25% of Equity, increasing to 100%.
IC Throttle One - https://collective2.com/my/DZV84E7YR
PENDING STRATEGIES:
IC ES Trend Trades
IC ES Trend Trades trades the S&P 500 E-Mini Futures Contract (ES).
It looks for pullbacks against the trend. It will take profits on 4 contracts
and then trail the trade with the remaining contract.
Simulated Equity Curve
*Simulation Dates: May 1st, 2022 to August 4th, 2022
Commissions and Fees Included
Specifications
Suggested Minimum Capital: $100,000
Security Type: Futures
Symbol List: ES (S&P E-Mini)
Trading Timeframe: Real Time
Trade Type: Long and Short
Positions Held Overnight: No
Starting Position Size: 5 Contracts
Contract Margin: ~ $13,000
