System Virtue

by Matt Romantech on December 2, 2017

Monday. I am feeling good today. The trading is pushing but it’s not pushing me far enough to break my stride and break this good vibe I’m getting on.

I am managing the situation. Kurb, I am managing the situation.

Pigs, Trading, Kurb.

I am managing.

I’m not doing my running but I am getting organised in my business.

Most important is turning the trading around so we can get confident again. We have to believe, we have to know we are coming to get that $200 per week because it means we can have a nice trip,

The money from kurb will supplement the money from weed and pigs so that I can be sure I make my $3k, I’ll have $350 to spend each week, I won’t be living like shit, I can afford to impress the girls, but even then, I don’t care – my shit is becoming more real.

My trading, my pigs, kurb, weed, my whole game, I run it. I’m putting the situation under control so I don’t have to be messed up. Even on saturday I was too messed up, the trading was gripping me I couldn’t focus.

My situation is sorted out because I take action to deal with it. I talk to darya and say good things because I have chased out the dark vibes haunting my trading for months – since I met her – and I am a confident man with very good plans to advance at a suitable pace, as well as big dreams that lie beyond that from when I was more naive about what trading would be and do for me.

When I’m out with a girl, I know my trading is under control.

Any big move where I lose a few grand would be massive and allow me to cut out so much of that range – it’s not a good thing, but it’s managed and manageable, again, my aspirations for the next 18 months is to earn less than a grand I can pull down.

$200 in 6 months, in may, when I’ve been gone a month, $500 in a year, a grand when I leave again.

It’s only while I’m away that I should require to draw down my full cash out, so getting the $200 per week is the big goal, and so it should be that now I have the next 6 months to prove not that I can add heaps of capital value, but that I can increase my equity by a tiny regular amount.

If I’m earning from kurb, I can put the money toward my europe expenses. I’m pretty sure I can make $1500 from weed, $1k from kurb, and realise $500 worth of value from the pigs, that’s like 4 pigs.

It feels like the situation is under control, that even if I don’t quite make it, I’ll struggle through.

Without all these problems and dilemmas following me around, plaguing my thoughts, I can freely wade into the waters of my music and art.

I know it’s time to get down to business, kurb is showing signs of life right when I need it again, it will make the money for my next trip, I can see that now.

I got up, I decided I would work on making some progress, and I have set up to mix test override protocol.

I have not messaged darya. But then it’s the next thing. The videos for the next two tunes, and then for noob eats – the next big hump.

But that is where we’re breaking out into a freedom, No more old tunes. The CD/DVD vids come next, they are not really urgent.

We’ve been over this before, we’ll do it again. After that comes the list.

Finish the kurb archive, then it’s tour vids, and the websites, starting with the 27 pages for my site.

It’s just not urgent because without money or big action, why feel it has to be done?

Because we must grind on – we’ve never really been on top of it, I wonder what it feels like. The next road block is the cd/dvd vid animations will cost money. I think if we can keep it under $200 then maybe we can do it. Especially to get another big job out of the way.

RCTV comes back into focus, but it’s a distant dream. It’s the tour vids, and the websites. The tour vids, we have to settle in for more archiving and delving back, you need to be braced. The websites, again, there’s no money.

We can start getting focused there though, that some kind of engagement must be cultivated.

How are we engaging online with what we want to do?

This is where it gets mad because what do we do after that? We write music, we chase girls, we do what we do, but what’s the big task other than making good music and vids that go with them and putting it online? Doing some writing.

I will think of how we can do RCTV, but it kind of doesn’t matter. You do your songs, your vids, your site, you write, it’s the same thing, your aesthetic.

I keep trading, I keep doing my travel, those things don’t change, I mean, my content will always be about that. My farm, my trading, travel.

What’s the big achievement?

I just have my website, on it, I just have my songs with the videos, I saw my old footage of the girls, and it suddenly hit me, I’ll always have that footage to use again and again and again, it’s not just some girls, it’s the girls I shot, it’s my thing.

I write my blog, I do my thing, you don’t have to like it. I might play somewhere weird some time, I don’t really care.

What do I care about? Me and my nice darya, here on my farm, my trading works out so even though I’m old as rats, I can do the one where I’m like this guy who makes beats and I fly around and bang young girls in these places. I can do the one where I’m eco left guy on my farm, here’s my russian wife and our family.

Here we are setting up another kiwi-russian couple in a house I relocated, now instead of doing my ideas, they do them for me – my pigs, my hampers, etc.

There is a mini version of the dreams I had, and when you cut out all but the best ideas, it gets pretty streamlined.

Just do your songs, make them good, if it goes anywhere, cool. If you get some money from trading, just push your brand in weird innovative ways and build your own thing through basswave and coming from the farm, just open to whatever.

I feel that I will do other media, podcast that is more around trading and lifestyle, but also a blog which I guess the two are connected, because it’s more about travel and philosophies and such, themes running behind my creativity.

Mainly I’m just expressing my own shit, but also it’s the chance to connect with people around concepts.

The concept of my little empire I laboured away will always serve as a guide to what could be possible and under what perspective.

Give people what they need. But first, let’s make sure they deserve it.

***

Up $700 on the day, it’s been a long time since that’s been the case. Weeks, but it’s seemed to be a hellish couple of weeks, where it’s all been within my reach but the trading punishes me hellishly.

It’s not a real $700 yet, but my new system is taking over, and soon it will be – not that earning a whole $700 in one day will be as likely when the new system kicks in at top gear.

I feel great that I have got some faith coming back, my faith in trading was totally shrivelled for a few weeks there.

My dreams in bangkok and europe are not far away, it was when I got real about the fact I just needed to make a few hundred bucks, and put that before my greedy and maniacal fantasies, that I saw I could make it work, because I have made it work before.

I also realised I would make some kurb money while I was away. Maybe only a grand, but look at it, weed and kurb and pigs will definitely make that $3k up.

It’s going to be fine.

Today is still strong, I just can’t pick up another gear.

I woke up to much better news in trading – the first morning in a long time I woke up without this fearful dread of what was happening next with the market, and my trading has continued to pick up nearly another whole grand since yesterday.

My carry costs are now down to $45. I’m going to start easing up and letting the process take control now.

I have certainly not had my new system proven yet, but good news continues the vibe that I feel so much more confident we will reach our goal of $200 per week by next april,

The vibe is good, but the focus isn’t there yet. I know I am picking up the opportunity to outlast these challenges and wait it out. When the trading is no longer robbing all my focus, I’ll begin working through more shit I have to be on top of.

Darya, and music. Music and girls. The most important thing for girls is getting my money right for europe. Now that I feel like I am getting my money right, I can begin to focus more deeply.

But I can’t. I’m obsessed with trading, if I am beginning to believe my new system really will work, I want to know how it can scale.

You only scale it by increasing the hedge gap, and there’s absolutely no guarantee you won’t lose as much as you make.

But by the time the hedge gap opened that wide, you’d have made a bit of money anyway, and I’m very much about seeing a short term and pulling out and hedging, waiting to let the next move build.

What this would mean is being generally more intensive – a strong move would be escalated quickly and then rapidly cut short and the first resistance.

From a hedged position the next move builds.

What we know is that the topside is limited.

When an obvious range appear we may want to play the normal trading game – $50k trade, $100 profit, but it doesn’t feel like me.

What I say, is knowing the topside is limited, don’t be afraid to cut out. There’s a trend where you let the line out, a top, where you fall back into a small tight hedge, and then you wait to see if it’s a reversal where you start cutting away the positions on the top side.

Then that side will trend, and the reversal is where you ramp quickly to a $50k gap because you know it will run 1-2% quickly and then reverse again for the retest.

You build on a reversal quickly, but if it’s false, you build out on it, waiting to see if it becomes range bound. You’re waiting for the breakthrough to signal which side should be cut, you accept you will take some losses rather than guess which way it will then go.

Of course if the break out reverses, it’s a pain in the ass, but it means you cycle around to more deleveraging, and repositioning for ranges – less working the hedge and more old system trading, playing slightly bigger positions back and forth, until a break out signals one side will need to be cleared out – once again, the losses have to be built in, that’s why when you would be making $1500 now under the old system, it’s going to be $700, because the losses are all built in.

AUDEUR is in this edge hedge stage. It sits on the edge, waiting to decide what it’s going to do, as it cycles around it is actually deleveraging, but the small positions are accumulating on the topside and the big positions are accumulating on the down side.

This means if it keeps trending higher, both positions will stay small and tightly hedged unless momentum breaks out again, but if it reverses, I will instantly build out the hedge gap so that’s it’s $50k going down against $25k – whenever it reverses you must respond.

You respond because it quickly goes into the green which means bigger positions until it’s not green any more, and once again you then snatch all profits and reduce to hedge status again.

Green is like pacman, it means you can start adding big, knowing that when the green stage is over, all money gets snatched, and soon all those positions will be reconsolidated into the right amount to hedge.

What’s the limitation? You open the hedge up nice and wide to $60k and it moves 1% against you and you lose $600+ pretty fast.

Look at CADEUR, it is taking place, EUR has gone green with only a $8k hedge. I’ll be ramping it until the moment that green falls off then I cash out all the profit and take off the loss on the other side so it’s hedge up again, like where the AUDEUR is.

This is not a means to make big cash, it’s simply redesigned the system so that I can negotiate the edges that have given me so much trouble. I will lose money on some turns, but not the $40k+ I’ve lost in the last few months.

At the moment when your biggest hedge is $23k, they all just shuffle along.

Leveraging them up to the sky doesn’t give you any advantage.

You likely won’t be spending much more on carry costs when you hit say, $60k, and double out what you’re doing now. $20-40k average hedge gaps, going out to a maximum of $80k where there is either an absolute trend or an absolute reversal.

Having more money in your account means you can sustain more damage, but this system would never allow me to take a 10% loss on a $50k hedge gap, from the first move it went against me, the hedge gap would slam shut, and the trend that would have to form, would then express on the otherside the moment it turned green.

What if they’re both green? Well one will have to reverse enough to trim both hedges appropriately, and now, once again, you’re squared up, play again, or let it ride.

The fact that we can to some extent turn it off now also means we can risk a little more knowing our losses will be hundreds or grands possibly – not tens of grands, not everything.

***

My trading is holding strong, I have smashed that carry trade down to $33 now. I’m saving $700 a week right there now. It tells me that this is what had to be done, I just refused to believe I had lost all that money, even when I had already begun to accept I didn’t have $250k, I had $30k and some, and it was disappearing fast.

It started with that mistake I made on closing the whole EURAUD trade . . . then the realisation about the turkish, and now this. I am getting closer to solid confidence that my system works even though I can’t quite work out how it works, only that it is an improvement on the last system.

The last system relied on deep pockets when those edges got hit

I saw the journey the EUR must take from 1.20 to 1.30, and wondered how I was going to survive that knowing it would likely happen over a month or two and I would get smashed.

My system works if you stay within a 10% range for 2 years, which is high probability, but not high enough. Start leveraging up and the whole thing gets out of control.

My new system is obviously better.

I knew that parts of my old system worked, the way I could follow a trend when it was breaking to the downside.

But others didn’t, the snowballing debt and the crushing carry costs. You need to be able to get out.

That’s what I couldn’t grasp – how would you ever know when you were making money if you were just jumping in and out all the time?

The old system worshipped the mighty range.

The new system is steered principally by trend, and I am able to make a considered allowance for the range when I place trades. The trend tells you when to get out, because we know one of the things that worked in the old system, was following the price action.

The old system was flawed because it never taught us how and when to get out.

We only accepted this because only now were we ready to accept that the system won’t earn us very much. Making $5k+ a week is certainly years away, it doesn’t carry that capacity to ramp, and that is one of the clues that reveals to me how it works.

When we were prepared to consider that only $200 was all we needed for europe, we were able to look at the numbers again and see.

We saw how much money we lost, how far we fell from a good position, the hedge game we tried to play, we couldn’t sustain it, but you have to know, if I’d never ramped, I would never have got crushed like I have, and I would never have worked out a better way.

I can’t say if if if, it’s like the last time. I got crushed. Except this time I stopped the bus before it went over the cliff, and this time I’ve built a system that doesn’t rely on masses of leverage just totally hanging over me at all times.

My trading is to all become quick and neat. I don’t have to trade just to make the hideous carry costs.

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