Tweet compilation: Strategy & Mindset

Jul 15, 2021

This blog post is a collection all of my tweets related to my strategy and mindset. It’s quick snippets of info that serve as good reminders for me. I expect to add to this post in the future.

Basics:

Brian G @alphacharts

Trend following: - Don't need to know what'll happen in the future - Doesn't take much time to implement - Reduces risk, increases return - Minimizes emotions, stress

Brian G @alphacharts

Price & patience is all you need: 1. Identify leaders (price) 2. Wait for bases to build (patience) 3. Buy the breakout (price) 4. Ride the trend (patience) 5. Exit on breakdown (price) 6. Repeat

Brian G @alphacharts

Horizontal lines on charts minimize biases Weekly/monthly candles minimize noise Aligning with trend gives risk management Aligning with momentum gives alpha

Right mindset:

Brian G @alphacharts

what you want the market to do ❌ what the market is telling you to do ✔️

Brian G @alphacharts

A sign of a mature trader: letting go of things no longer working, moving on to things that are.

Brian G @alphacharts

Thank goodness I'm not wasting energy bottom fishing messy sectors (gold, crypto, etc). Thoughts & prayers for those that are.

Brian G @alphacharts

Lots of people seem to think doubling your money every year in stocks is doable. If so, you would turn $10K into $11 trillion in 30yrs.

Brian G @alphacharts

Imagine being one of those people citing ‘high valuations’ and redrawing a new, steeper resistance trendline each week.

Brian G @alphacharts

What that famous hedge fund manager or twitter guru is saying or doing means absolutely nothing. Learn to think for yourself, and keep it simple.

Brian G @alphacharts

Fundamentalists look for quality businesses, technicians look for quality setups. The market is an endless opportunity stream. Never a need to force low quality trades.

Brian G @alphacharts

3 trading lessons 1) Simplicity. Follow leaders (don't fight the trend) and draw horizontal lines on their weekly charts.

Brian G @alphacharts

2) Patience. You only need 1-3 trades to have a great year. These are setups that leap off the page at you. Rest of time, OK to be in a regular boring portfolio waiting.

Brian G @alphacharts

3) Framing. Great question to ask: "What things would I be doing to deliberately lose money trading? How many of those mistakes am I currently doing?"

Brian G @alphacharts

I have no idea which trade/asset will be my biggest winner. All I know is - Follow the leaders (momentum) - Above line good (trend)

Brian G @alphacharts

Strong uptrends + tight consolidations = strong fundamentals & institutional ownership Erratic trends with large drawdowns = opposite.

Brian G @alphacharts

Over long periods, commodities have chopped sideways while quality businesses trend higher. The latter is a bet on society, while the former is a bet against it.

Brian G @alphacharts

What makes a market? Differences in opinion, strategy, time horizon, discipline.

Brian G @alphacharts

Wrong approach: "It's manipulated" "My model predicts that..." "Heard on CNBC..." "But what if the Fed..." Right approach: Follow the leaders "Above line good, below line bad"

Keep it simple:

Brian G @alphacharts

Be "dumb." Follow trends.

Brian G @alphacharts

Never understood why ppl deliberately make their lives more difficult by - Focusing on ultra short-term - Following news, seeking opinions - Doing complex analysis - Trading trendless markets when clean, strong uptrends exist

Brian G @alphacharts

Sentiment, seasonality, breadth, valuations can all take a backseat to price action. A stock is undervalued and underowned if it’s in an uptrend.

Brian G @alphacharts

Who cares if it's a head & shoulders, cup & handle, or flying squirrel? Above line = good; below line = bad. Relative strength = good; weakness = bad. No need to make things esoteric.

Brian G @alphacharts

In markets, you don't want to be too... - dumb (chasing penny cryptos after a large move) - smart (complex econometric models) A lot of my friends - with no interest in markets - have done well simply holding stocks, real estate.

You can also read a 2-part summary of my trading approach here:

Part 1 of 2: Leaders (link)
Part 2 of 2: Breakout Trading (link)

Important Disclaimer: This blog is for educational purposes only. I am not a financial advisor and nothing I post is investment advice. The securities I discuss are considered highly risky so do your own due diligence.

AlphaCharts Blog

Tweet compilation: Strategy & Mindset

Ready for more?