31/01/2015 How do I go about building my Situational Awareness?

Fellow traders,
I’m often asked what are the best news-feeds to follow and who are the credible market blogs and articles to read.

Lets face it since the dawn of the internet age it’s never been a difficult case of finding information on trading and markets. To be honest it’s quite the opposite; how do we stop ourselves from getting overwhelmed by ever-increasing and insidious forms of media communications?

It may amaze people to find that I don’t spend every waking minute glued to a Bloomberg terminal or plugged into twitter chasing the latest news piece (as those of you who follow my moribund twitter feed will already know).

Many years back I read a great book called “How I made 2 million dollars in the stock market” by Nicolas Darvas. Although the book is a good 50+ years old it still holds some relevant truths today. In that book after a period of trading success, Nicolas decided to move to Wall Street, open an office and get his own ticker machines installed. He thought that by being closer to the action he would be more successful. In fact the opposite was true – he failed miserably. He found that by being too close to the action he was unable to see the wood for the trees. He eventually shut up his office and went back to his old lifestyle and returned to being a successful trader and investor.  That story has always stuck with me. Ten years ago I would read everything, follow everything, try to trade everything. You either blow-up or burn-out…or both. I was the latter.

I’ve often talked about knowing yourself and knowing your personality with regards to your trading style. I’ve talked about such tests as Myers-Briggs or the Van Tharp Trader Test as a means to further examine who your are and adapt your trading accordingly. I know that under Myers-Briggs I am ENTJ – commonly known as ‘The Field Marshal’ or ‘The General’. I know that I have a big picture mentality and aligned with my military background I do take an interest in the worlds geopolitical events and the effect they may have on financial markets. I’ve learnt to play to those strengths in my analysis rather than trying to understand the intricacies of an individual stocks fundamental data. Hence why I like trading big-picture instruments like major Indices, FX & Gold. (Whilst I keep an eye on Oil and its moves, I’m not an active trader of it.)

With that in mind the resources I use are more big picture orientated but I find it helps me to build situational awareness of whats going on (That’s big picture for those who’ve never heard of situational awareness),

So here are a few resources that I use. (For disclosure, I have no commercial arrangements with any of these organisations – I use them because they help me.)

The FT Weekend edition: I read this every weekend. Its one of my favourite things to do in a local coffee shop or pub. And always the print version rather than online. It’s a great read anyway but gives me a great overview of the markets and some good market themes and opportunities.

StratFor Global Intelligence: I first came across these guys during the Kosovo War back in 1999 and have kept in touch with them ever since. yes, they’re US-centric but their analysis and observations of the major geo-political events and the players are pretty sound

Blogs:

Blaine’s Blog – Blaine was a Trading veteran who I met through the London Traders Network. A thoroughly nice guy, a clearly exceptional trader who also gets to live in one of the most beautiful parts of the world Vancouver / Vancouver island. (Dont you just hate some guys!!!!) 😉  Blaine’s writes a weekly blog on the state of the US markets and I have to say its a fascinating insight into those markets from someone who has the skin in the game. Well worth a read.

The Hovis Trader – whilst this gentleman doesn’t post as much as he used to it’s still a blog that’s worth following and exploring. He has some interesting big picture pieces that I enjoy reading.

Peter Brandt – Peter L Brandt is a commodities trader of some repute who’s got nearly 40 years experience of trading markets. He tends to trade simple patterns on larger timescales and blogs about his positions. Always worth a good read.

The Market Oracle – this is a great blog for large-scale macro view on the worlds markets and economies. They generate some great thought-provoking stuff.

Twitter:

Twitter is amass with traders, and is useful for uptodate news and analysis. I’m always amazed at people who can tweet all day whilst trading. Its something I’m not good at. I’ve found that I tend to do best when doing only one thing at a time. (Hence the paucity of my tweets.) There are a couple of people worth following:

@NicTrades

@chigirl

@EdMatts

@JediEconomist

@tradingproverbs

@polemicTMM

There’s probably a whole host more links and twitter people I should mention but it escapes me now. I’ll update as I go on. I hope that gives you some help, insight and a bit of enjoyable weekend reading!

If you have very good resources as well then please feel free to add them to the list. Im always keen to expand my knowledge of quality news outlets.

Enjoy the weekend,

Paul