This recently showed in my in box:

Dear Michael,

Hello, this is [name] writing from CNBC. Would you please let me know which company holds the distribution rights to ‘Broke: The New American Dream‘? 

All the best,
[Name]
Senior Talent Producer
CNBC Strategic Programming & Development

What did I do? I obliged and sent a film copy per their followup request. However, I thought to myself, “Not so sure this will be a workable marriage.”

This is a great example of predictive technical analysis. That means language like:

The market just failed a test by breaking down out of the triangle formation, but the technical damage is not serious, and a decline to the 1175 area to clear intermediate-term overbought conditions could be absorbed without major technical damage being done. On the other hand, if the ultra-short-term oversold spikes have produced sufficient internal compression, yesterday’s breakdown could prove to be the final shakeout preceeding a new rally. In any case I view the recent decline as a correction within the rally that began in October.

Trend following is not that. It is reactive technical analysis.

Big difference?

One attempts to predict (impossibly unreliable) price moves and the other reacts to and follows price moves (decades of proof). What will you choose?

More here:

It appears the housing boom/bust in America was nothing unique. It was global. Doesn’t that make every attempt to try to explain, understand and rationalize the U.S. housing debacle pointless? Doesn’t it also reinforce the idea that there is only one proven way [hint: trend following] to prepare for and take advantage of unpredictable bubbles?

Source: Robert Shiller book cover.

From the vampire squid:

“Almost 300,000 individuals applied for full-time positions at Goldman Sachs for 2010 and 2011. We hired fewer than 4% of that population, and, though most had multiple offers, nine out of ten people offered a job with us accepted.”

Better idea? Read the book Linchpin.

Feedback in:

Hey Michael, I was introduced to your work a few years ago by Bernie Drury [featured in The Little Book of Trading] and wanted to say that I’m definitely a fan! I read Trend Following and The Complete TurtleTrader and enjoyed them both a lot. I’m actually a close friend of Bernie’s and worked for him as an intern analyst for 5 summers. He taught me pretty much everything I know about trading, so between Bernie’s guidance and what I’ve read in your books I’ve really gained a lot of insight towards developing my own trading strategy.

Lately I’ve been working on testing a strategy that combines longer-term trend following signals with shorter-term counter-trend signals (hoping that the counter trend positions catch some of the smaller moves over a long trend). I found the appendix on trend following with equities [in "Trend Following" book] to be very useful with regards to this strategy.

Your name showed up on “People You May Know” on Facebook, so I figured I’d send a message. Anyhow, I just wanted to say that I enjoyed the books quite a bit and look forward to reading Trend Commandments. Feel free to shoot me an email anytime at [email]. Keep up the great work!

Best Regards,
[Name]

Nice meeting!

I spoke here (PDF) the other day. An attendee wrote me after:

Michael, I’ve gotten through the first chapters of your book [Trend Commandments or The Little Book of Trading; both were provided] and realizing I need to put it down until I finish with my CFA level one exam in December! But I do find it interesting and we had just been pitched a tactical momentum strategy earlier in the month, which when you strip it down is a trend trade. So very thought provoking for a shop that has been and still is a Bogle-head focused passive indexing strategy!

Sincerely,
[Name]
Deputy Treasurer
State of [One of the 50]

I will take the converts!

Note: The PDF above? “Secrets” was not my word. I actually nailed it in my talk (nicely of course!).

From MarketWatch:

…two technical areas stand out: Major support spanning from 1,220 to 1,230. The S&P bottomed last week at 1,226. Resistance at the 200-day moving average currently 1,271. The S&P has topped at 1,267 on the recent upturn. So very simply, the S&P and the Nasdaq are compressing between major support and the 200-day moving average.

If you were considering the possibility of trend following trading please be aware that the seemingly fundamental analysis of technical analysis in that article is not trend following. Let go of trying to find an explanation for every situation. You don’t need to know that to profit. And you can’t predict tomorrow anyways.

There is this guy who is always touting Warren Buffett to me in email. I would think after years of apparently following my work closely, and writing me regularly, he might have a clue as to what trend following is, but not exactly. Big time blind spot. This in today from him:

Informative but overwhelming. I’ve always wondered what do you do when there are just as many bearish arguments as there are bullish arguments?

http://www.businessinsider.com/naufal-sanaullah-market-overview-2011-11

Can anyone else help this poor chap?

From The Little Book of Trading:

Kevin Bruce is living proof that there is no need to be in New York, London, or Chicago–flaunting a sharp business suit and trading in a sky rise. Bruce is a small-town guy from Georgia with no ancestral connection to Wall Street, who has not only made it on Wall Street but conquered it. Heed his path.

Bruce spends his time far away tucked in quiet spots in Richmond, Virginia. He works out six times a week at his local YMCA, and still drives his 1996 Ford pickup. With a net worth of nearly $100 million, he prefers to live life just as he always did before making that fortune. He is low profile. Most people have no idea of his wealth. He says, “I guess that means I’ve done a pretty good job of just being me.”

More:

While Bruce was crafty in his early trading, almost tripling his initial seed money, he was really crafty in the way he built up his $5,000 nest egg. When he was about 15, he started the practice of packing a lunch and taking it to school. The cafeteria food wasn’t great, but he could buy a lunch for just 35 cents. Bruce would meet other kids in the bathroom daily and auction off his home-style lunch. He would then eat the cafeteria lunch–and would usually net about $2. Nice trade!

Inspirational? Yes, absolutely.

Of course, you could always grab a tent, your best protest vibe and head to lower Manhattan to live at Occupy Wall Street. However, I am willing to bet the next Kevin Bruce is not hanging out there.

From The Little Book of Trading:

The reality? Markets are often in “tail” situations that can produce sizable profits–profits that, over time, will sig­ nificantly outweigh losses that may occur when markets are not operating within tails. When I say tail, think back to that stats class you probably hated. The tail of the bell curve is what I mean: extreme events that are supposed to be very rare, but actually happen quite regularly in the markets.

Meaning, we all know the world is chaotic. We know surprises happen. We know that trying to explain the world with a perfectly symmetrical bell curve, a normal distribution, is not smart…so why not build a trading strategy to take advantage of that?

Simple. Wise.