Where Most Of Your Time Should Be Spent

Selecting the one or two super trades should consume most of your time. There’s a great deal of work and thinking to be done in comparing markets, finding the best Open Interest play and carefully reviewing the premiums. The average tendency is to rush over this section of trading simply because it seems more productive to look at all the technical wiggle-waggles.

In actuality, as I’ve said so many times, unless you are fundamentally right in your initial selection decisions, all the technical tools will do is get you in trouble. Please devote all your concentration and energies to the selection of your commodities before you give the technical data any consideration at all. Technical data is secondary to screening out the potential big winning trades.

The only technical tool to look at during this screening is the ten week moving average trend line. For a bullish situation it should be slanting up; for a bearish market, it should be slanting down.

by Larry Williams, excerpt from his book, How I Made $1,000,000 Trading Commodities Last Year.

Spotting the Best Trades

Let me begin by telling you of my system for isolating trades with odds 10 to 1 in my favor. Those are million dollar odds. Unfortunately, I still haven’t developed a method for calling all the big moves all the time. What I have done is develop a set of criteria that will, when they coincide, tell you the odds are heavily in favor of either an up or down move.

This method seldom speaks, but when it does, you have as close to a sure thing as you’ll ever get. As you will see, this method will not call all the swings, but that’s not its purpose. Its function is to segregate the super trades from trades that are questionable.

Trading in this manner is much easier because it allows you to take a longer term view of the market. I have found there is no need to monitor the market on a trade-by-trade basis, or, at times, even a daily basis. The signals are so strong that you don’t need to concern yourself with a microscopic view.

I use two major tools for selecting “bankable trades”. They are: 1) premium relationships, and 2) open interest. When these two click, the odds are 75% in your favor. To further substantiate the 75% probability, I also check contrary opinion, the market’s reaction to news, trend direction, and a few chart formations.

by Larry Williams, excerpt from his book, How I Made $1,000,000 Trading Commodities Last Year.

So – you want to be a trader?


• In 1973 Larry Williams published a book titled “How I Made One Million Dollars Last Year Trading Commodities” detailing his trading success that year. The next year he lost the million dollars.

• Michael Marcus started with $30,000, borrowed another $20,000 from his mother and then proceeded to lose 84% of their combined capital (imagine trying explain that to your Mom) before becoming a successful trader.

• In 1987 several commodity funds managed by Richard Dennis lost 50% of their capital and were forced to stop trading.

It is the most competitive field out there, not only we have to fight each other (yes – this is what we do), but we have to oppose enormous computing power of heartless machines turning trades in nanoseconds. 

Here is a simple test if you cut to be a trader – if you can stay emotions free when you finish it – try stock betting…just don’t bet your house on it – that was a job of banksters. (Just remember – 99% of you will be better of sticking with just a test and not moving to real trading)

 Step 1. Go to your bank on a windy day.
Step 2. Withdraw a minimum of  Rs10,0000 in cash.
Step 3. Walk outside and with both hands starting throwing your money up into the air.
Step 4. After all of the money has blown away, go home and sit down in your favorite chair and calmly say, “Gosh that was foolish. I wish I hadn’t done that.”
Step 5. Get on with your life.

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