When we recruit editors here at Agora Financial, there’s one characteristic we look for above all others. We’re looking for people who are obsessed with their subject.
Obsession trumps everything else because an editor who’s obsessed with their subject will always find a way to do great work. They’ll learn what they need to learn, improve where they need to improve. And they’ll know a hell of a lot about their subject too.
Two months ago, we found a new editor. David Belle is his name. David is a top class technical trader. He’s been trading, working in and studying the markets full-time since he was just 17 years old — that’s what we mean by obsession.
Now David is launching a new service for Agora Financial readers. It’s called the Trading Point Pro. Earlier this week I called him, to let him explain it in his own words.
Sean: Why have you set up this service? What gap in the market are you trying to fill?
David: Trading Point Pro is for people who want a daily holding hand in the markets. It shows them how to interpret daily market signals, and it’s a way to develop their knowledge over a long period of time.
But the purpose of the email isn’t just to give trade ideas. It goes further than that. I give the knowledge on how to build a strategy. Whereas, if I’m giving market context — my ideas on technicals for example, or why the market moves in the way it does — then maybe eventually you’ll have the capability to go and trade something by yourself.
Sean: What’s distinctive about your trading style?
David: I simply focus on two things: price action and volume. And I try to limit myself purely to those two, because price and volume are the only two primary indicators you can have.
You can have all these funny leading lines and oscillators and things like that, but they’re just purely based on price or volume at the end of the day. So you can get conflicting messages. Where if you just stick to the primary things the market is telling you, and indicating, you’ll come away with a lot less confusion.
It’s just price charts, and trying to go with the fundamentals at the same time. Technicals and fundamentals work together: fundamentals are the key drivers; and the technicals allow you to execute.
Sean: How do price and volume interact?
David: They interact because people are very habit-based. So when you’re looking at a price chart, you look at support and resistance — at where price has moved before.
Support and resistance is basically just supply and demand. So people are buying and selling at areas of previous interest. Because this is what happened before.
But where these areas break, they can lead to increases in volume, because something new has happened. It’s a different market structure. I like to trade off these areas because, you know, at the end of the day technicals are down to what everyone else is doing, what orders everyone else is fulling. And they’re all pushing the market at the same time.
And I’m talking about institutional people here — not just the everyday retail client, because they don’t have that much effect in the market.
Sean: How do institutional investors differ from private investors?
David: They have an advantage because of asymmetric information. If you work at an institution like a bank or hedge fund, you can see the whole market, especially in forex because you’re dealing with the interbank market not just small orders. You can actually see things like client orders coming though, what other clients are doing. It’s the same in equities really. You can see what’s going on throughout the exchange. You can have an understanding of what’s going on at other desks.
Where if you’re a retail trader, you’re just going to be at home in front of your computer. And you’re only going to have news sources and price, as the only things to guide you. So there is a big gulf in information. But I think that’s one of the reasons why retail traders need to look at and understand price from an institutional perspective, because these are they guys who are really doing the big business.
Sean: So if you can get in the head of institutional traders, you can profit by trading like them?
David: Yeah exactly. I would say that 90% of what retail traders believe is gonna happen institutionally: where banks are splitting orders, where business are buying and selling currencies, but there are certain points on a chart where you can find what they’re doing and try to capitalise.
Sean: What mistake do you see ordinary retail investors make the most?
David: They don’t understand risk. They don’t have a big enough account. They don’t understand what’s occurring at a specific point. they think the market is going to go one way, when it’s really going the other. Because that’s how the market works. It wants to shake people out, and get weak hands in and get them out quickly, so they can fuel a move to go the other way.
The job of my newsletter, Trading Point Pro, is to help fight those biases week in week out by not alone explaining how they work but using real life examples and trade ideas to help people do it the right way.
Ed Note– David’s put together a free book to tie in with the launch of Trading Point Pro. It’s called Retire Rich: How to Trade Your Way to £1,000 a Week.
David knows a lot about trading… and it’s all in this book. As the title suggests, it shows you in realistic steps how to build a big income from financial trading.