2-JohnODonnell.pdf

Market Timing Preview For

Short Term Income and Long Term Wealth Preservation

Moderator: Online Trading Academy John O’Donnell, CKO

3 Key Elements To Success The Three Key Elements in any investment strategy are: Core Strategy

• Probability • Risk • Leverage

Futures Forex Options Most novice traders have this list in reverse order! Online Trading Academy 2013©

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What Is Inflation? What is Deflation?

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New York Grad Testimonial My name is Damen D, I came to the Online Trading Academy after suffering a tremendous loss due to hurricane and to make matters worse during the recovery effort I suffered a major back injury. Im a professional race car/ fabricator technician specializing in high end super cars. My business was destroyed and more damaging was that I would no longer be able to earn the nice living I had been accustomed to because of my injury. My father one day was in the mall and just so happen to sign up for a market timing class knowing that I have always liked the market and when I was 18 started to study for my series 7 test but drifted away and went onto pro racing. At that time I was home basically nursing a injury and at the same time depressed that I had lost everything I had known and loved for so long. My father called me and "said I'm taking you to a class I have a plus one and think you should attend". I attended market timing and instantly knew this school was the real deal. At that time I did not have the money to purchase a package so my father put it on a credit card in good faith that I would comprehend the course material and be able to pay him back. Long story short I started with pro trader then went onto futures classes. I have all asset classes since I bought the total solution but my main focus is the futures at this time. My teachers have been phenomenal starting with my coach Gabi Golan, Jeff Sacks and Eric Benson along with my pro trader teacher being Chris Manson. My future teachers have been Bob Dunn, Craig Wehls and Jossip Causic. These guy have changed my life along with watching videos of Sam Seiden. I have gone through loosing money and having no confidence in my ability to invest in the markets to having 3 losing days in 4 weeks. That's a incredible transformation! I have now since in the last 8 months gone from no direction in life to learning a amazing technique and co re strategy that has changed my life and my families lifes. I am almost completely debt free including 30k in tuition alone. I recommend this program to anyone that has a interest in the markets and is willing to put the time in to learn there strategy and curriculum. I owe a lot to these guys in the OTA and my father for being able to change my lifes direction and be a consistently profitable trader day in day out. Thank you Online Trading Academy…June, 2014

Intense scrutiny on market structure turns to payment for order flow (PFOF). Yesterday, Charles Schwab spoke out vehemently against high frequency trading (HFT), sustaining the intensity of the debate on HFT and market structure overall. And it appears with the spotlight on rebates/maker-taker model, the market's focus turned to payment for order flow (PFOF) of the eBrokers. The two eBrokerage stocks that we suspect have the highest exposure, AMTD and ETFC, were down 5.3% and 6.5%, respectively. SCHW, which we suspect has the lowest as a percentage of PFOF to total revenues, was only down 1.9%. eBroker PFOF Summary ($ in mm) Source: company documents and Sandler O'Neill (A) ETFC actual FY13 Order Flow Revenue (1) Sandler O'Neill estimate of Payment for Order Flow Revenue for SCHW (2) Sandler O'Neill estimate of Payment for Order Flow Revenue for AMTD is a range of 15%-17.5% of total net revenues But stocks appear to be pricing in PFOF is going away, which may or may not be true. eBrokers state that PFOF helps them to offer low commission rates and superior execution to their retail customers. AMTD reports that its clients received price improvement on ~90% of all marketable and limit order trades (100-1,900 shares) in 2013. SCHW reported similar if not higher percentages of price improved trades. Therefore, while we suspect PFOF will be part of the comprehensive, holistic review of market structure the SEC is committed to doing, there are no guarantees a complete overhaul or even a partial overhaul of the PFOF system will be mandated. Therefore, given the decline in the eBrokerage stocks yesterday, we believe they have reasonably priced in their probability weighted exposure to PFOF regulation. Even with Chuck's letter, SCHW does not intend to forego PFOF. In discussions with SCHW, they believe HFTs more or less interact with all the flow out there, so it may not be possible to avoid them. Their primary concern with order routing is to provide the best execution for their clients. SCHW makes a distinction between market making/wholesaling and HFT, which they believe is more a proprietary trading strategy

The Japan Debt Bomb Is Coming

HFTers Rule Messaging

Keynes Model Spend in Red, Actual in Blue

Do They Ring A Bell At The Tops of Markets?

What Motivated You To Come Today? 1. Supplement Income 2. Primary Income 3. Wealth Preservation/ Growth 4. Broker Incompetence 5. Loss Recovery 6. Job Security

7. Financial Freedom

OTA Market Timing For Short Term Income and Long Term Wealth Preservation 4 – Days Market Timing Classes

Market Timing Rule Based Strategy - This is how you make money. • Introduction to Stocks, Futures, Forex, Options - Which market/s are right for you? • Market Timing in Any and All Markets and Time Frames • One On One trading plan sessions in the class with your Education Counselor • Interactive Course Workbook for Maximum Retention • Ability to Bring a Spouse/Family Member •

America the Beautiful S&P 500 1975-2000

Could you buy and hold in this market? Did you need to be educated in this market? Did you need to actively manage this market?

USA Stock vs Global Commodities

Mutual Fund Founder Exposes Funds

John Bogle: Vanguard Founder Exposes fund returns.

John Bogle, founder of Vanguard, exposes managed funds. Assuming a historic 10% annual market return, let’s look at how the investor would make out. With an initial investment of $10,000 for 50 years at a 10% annual return, the investor would grow his account to $1,170,000. However if you take out fund fees of 2% a year it leaves the investor with only $470,000. what a difference paying someone 2% can make!

John Bogle: Vanguard Founder Invest $10,000 for 50 years @ 10% per year. Investor return = $1,170,000.00 Take out 2% per year for fees. Investor return = only $470,000 Investor supplies 100% of Capital. Fund Industry keeps $700,000 Investor keeps only $470,000

Knowing this now, would you make this investment today. 7/14/2014

Not so wise investments Interview with John C. Bogle Conducted on February 7, 2006.

So if I do your average, what percentage of my net growth is going to fees in a 401(k) plan? Now, the financial system -- the mutual fund system in this “Well, case it's--awesome. will take about Let me two give and you a half a little percentage longer-term points example. outThe of that example return, I use so you in my will book have is aangross individual return of who 8 percent, is 20 years a net oldreturn todayof starting 5.5 percent, to accumulate and yourfor $1,000 will retirement. grow to That approximately person has$30,000. about 45One years hundred to go before ten thousand retirementdollars -- 20 to goes 65 -toand the then, financial if you system believe andthe $30,000 to actuarial you, thetables, investor. another Think20 about years that. to go That before means death the financial mercifullysystem bringsput his or upher zerolife percent to a close. of the Socapital that's 65 and took yearszero of investing. percent of If the you risk invest and $1,000 got almost at the80 beginning percent of the thatreturn, time and andearn you,8the percent, investor that in $1,000 this longwill time grow period, in an that investment 65-year period lifetime, to around put up 100 $140,000.” percent of the capital, took 100 percent of the risk, and got only a little bit over 20 percent of the return.

@85 $148,780 @85 $32,465 After Fees @65 $31,920

@65 $11,127

New Normal Markets?

S&P 500 2000-2013

• • • •

Our Grads knew a crash was likely

ARE YOU READY?

Who believes buy & hold will work in this market? How are mutual funds working in this market? Who knew that they can make money as the market falls? How many expect your losses to rebound by doing the same thing?

Worse than 2008 AND Europe? Yahoo Finance July 18, 2012

Stimulus programs can delay this day of reckoning but only for so long and only at the expense of making the eventual meltdown much worse.

We’ve got a much bigger collapse coming and not just of the market but of the economy…

The easiest way to put it is that everything you don’t think could possibly happen in America will come to be. …

The Illusion of News…..

The banks & institutions are playing a game to which the novices don't even know the rules; and most don't even know the game exists.

Whose Money is Really Made & Lost in the Markets?

The financial markets consist of buying and selling among and between two groups… Institutions/Banks (very profitable) & Retail Traders/Investors (Struggle for Profits or Lose) Learn To Think and Act Like an Institution

Institutional 10K Filing Goldman Sachs own 10K filing for 2011, released in May of 2012

2011 Results

237 Profitable days 15 Losing days

54 days (21%) of the time they made over 100 Million Dollars

Goldman's Trading Losses only reached close to their limit one day in 2011 without breaking the limit…

Institutional Trading Profits Bloomberg May 10, 2012

Goldman Sachs generated 57% of revenue from trading in the first quarter and had only one day of loss in that quarter, down from 17 during the preceding 3 months. Morgan Stanley said its traders lost money 4 days in the period. Bank of America reported that it had trading profits every day of the period Goldman's Trading Losses never exceeded its value at risk limit…

How Institutions Handle Risk 2011 VaR (Value at Risk)

S&P 500

Institutions take on more risk in a down market. Retail trader panic and take less risk

Our Students Learn to think like an institution

Who Really Makes The Money? Conventional Thinking OR REAL Profitable Thinking Supply (retail)

Sold Bought Demand (wholesale) Head and Shoulders Top Double Bottom Earnings Report Trend Lines Support and Resistance News Indicators Cup and Handle

RSI Pivot Points Stochastics Broker Upgrade MACD Bollinger Bands Dow Theory Fibonacci

Profit: $5,918.42 This is how you make money buying and selling anything. 32

OTA Student Success

I quit my job

I make more money trading than I make at work!

Your Brain Is Playing Tricks!! Trading Market

How you make money buying and selling anything in life is EXACTLY how you make money trading!

Samsung 55’’ LED TV

Demand

Would You Buy Here?

Would You Buy Here?

• No, price is crashing

• Yes, the TV is on sale

• No, this is a downtrend

• Yes, quickly before price goes up

• No, the news is bad • No, buying is too high risk

• No, I am scared, nervous!

Bought

• Yes, I would buy a few of them at these prices!

Market Timing with XLT Two Most Important Components To Trading Supply and Demand

Human Emotion

1) Where do market prices turn?

Demand (support): A price level in a market where willing demand exceeds willing supply. Supply (resistance): A price level in a market where willing supply exceeds willing demand. 2) Who is on the other side of your trade, a Pro or Novice trader? Human Emotion: The emotions of fear and greed are clearly seen on a price chart, if you know what your looking for.

Supply & Demand Zones Chart Where and why do market prices change direction? The Logic:

Supply

Why did price have to decline? Why did price have to rise? Demand

The origin of motion / change in price is an equation where one of two competing forces (buyers and sellers) becomes zero at a specific price.

The origin of a move in price is where supply and demand are “out of balance”. This is where we find low risk / high reward / high probability entry points into markets.

Supply & Demand Zones Chart Who is on the other side of your trade? Supply (retail)

Who is buying here?

Who is selling here? Demand (wholesale) The Logic: The amateur/novice trader buys at retail prices and sells at wholesale prices. The professional trader simply trades with amateurs

Think Like A Pro!

Supply & Demand Zones Chart Supply

Sell at Retail prices

Low Risk Profit: 978.98

Demand

Buy at Wholesale prices

OTA Market Timing For

Short Term Income

Investor Uncertainty USA Today

June 13, 2012

61% of investors realize they need to improve their understanding of income investing. Just a 3% inflation rate over 25 years can reduce their purchasing power by half… 46% of investors are considering a later retirement, up 30% from a year ago…

Live XLT Trading Session – Nov. 5, 2012

XLT Supply Zone

12 Point Decline

Market Timing – Nov. 5, 2012 $600.00 Profit in Minutes

Trade Like An Institution/Bank

Live Trading With Grads XLT Trading July 16, 2012

The Setup The Result

XLT Buying

OTA Demand (Institutions Buying)

Live Trading With Grads Supply & Demand Levels May 31, 2012

Low Risk Day Trading Profit

$937.50

MC Demand Zone (Institution Buy Orders)

Low Risk Entry

Pro Picks – May 7, 2012 The Setup

XLT Trader Profit: $1,662.00 The Result

Pro Pick Profit: $638.00

The Profit

Supply & Demand on a Chart Supply (Retail) Amateur buyers (my short entry)

XLT Odds Enhancers 1) How did price leave the level? 2) How much time did price spend at the level? Price charts contain all the information you need, if you know what your looking for.

Low Risk Profit: $2,313.20

Live Trading With Grads MSFT Buying Opportunity Pre Planning Trades Live in XLT

The Setup

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XLT Stock: January 11th, 2012 The Result MSFT Rallies over $0.40 over the next hour.

Novice Traders Sell

OTA Traders Learn to Buy

Those who know what they are doing, get paid from those who don’t. 48

XLT Stock Trading

Pre Planning Trades

Rule Based Trading 49

XLT Futures: January 24th, 2012 The Setup

Students are instructed to BUY

XLT Demand

Rule Based Trading Live in XLT 50

XLT Futures: January 24th, 2012 Live XLT Session: January 24th, 2012

The Result

XLT Students (and institutions) BUY Novice Retail Sellers SELL

Rule Based Trading Live in XLT 51

XLT Forex – May 5, 2012 XLT Student Success

XLT Student Profit: $1,200 In Minutes

Watch Instructor Trade Live

XLT Demand Zone

Students Buy

Trading With Banks The Setup July 2nd 2012

The Result

XLT Supply XLT Demand

Good news causes novice retail traders to BUY, this is a trap when that buying is at a price where banks are selling (Supply)

Euro Gap up on good news (Retail traders buy) (XLT Traders Sell)

Target Reached

OTA Market Timing Institution Bank Supply

Sold Short To Novice Buyer

Day Trade Profit: $955.00

Not Supply

Trading is simply a transfer of accounts from those who don’t know what they're doing, into the accounts of those who do…

The “Bear Trap” The Setup NASDAQ Futures – 7/16/12

The Result

Trap

XLT Demand

Globex Low XLT Entry (Buy)

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Student Success – 4/10/12 April 10, 2012 Create Your Own Income and Future

Earns at least $4,000 per week

OTA Market Timing For

Long Term Wealth

Family Net Worth Falls 40% The Wall Street Journal June 11, 2012

Families net worth fell almost 40% between 2007 and 2010, down to levels last seen in 1992, the Fed said.

Between 2007 and 2010, incomes also dropped sharply… Families also grew less confident about how much income they could expect in the future…

March 2009 Performance S&P Monthly Chart – The Bottom 2009 Market Bottom Call Live in XLT

• • • •

Foreclosures at all time highs 651,000 jobs lost in Feb 2009 Annual job losses worst since 1945 AIG disaster

S&P Monthly Chart – The Rally

S&P Rallies over 600 points. Rule Based Market Timing

Student Success 10/1/2012 Account Size: $721,521.50. Gain: 24% in one month

Sep. 2012 Realized Gain: $173,000

Sep. 2012 Unrealized Gain: $125,000

Putting OTA Tools To Work

OTA Market Timing + OTA Options Consistent Short Term Income and Long Term Wealth

Barron’s/Wall Street Journal, Tues. March 15 Barron’s/Wall Street Journal Interview With Sam Seiden

S&P Daily Chart

Demand Zones

Stock market was down hundreds during interview. News out of Japan was very bad, our strategy said buy.

Barron’s/Wall Street Journal, Tues. March 15 Barron’s/Wall Street Journal Interview With Sam Seiden

S&P Daily Chart

Demand Zone

The Dow then rallied over 800 points from that news driven sell off.

2011 Performance 2011 Market Top Call Live in XLT S&P Weekly Chart – The Top

S&P Daily Chart – The Decline

S&P Falls 290 points in about 2 weeks. We Saw it coming, did you? Very Strong Q2 Earnings

Rule Based Market Timing Market Top Called April 3, 2012

2012 Market Top April 3, 2012

Rest of Industry calls calls bear market May 18, 2012

NASDAQ

Falls Over 300 Points From Our Supply Level

Late! After the market falls!

Student Success

“I have covered the entire cost of my OTA program 6+ fold in 5 months of trading just options.”

Who is Online Trading Academy? 16 Years and 37,500 Graduates Where We Started………………Where We Are

26 U.S. and 7 International Locations

Partnered with Industry Leaders

They Did The Research For You… NASDAQ PRESS RELEASE "Online Trading Academy is the premier independent educational resource for the active trading community. They are really more than just an online content provider, they are a strategic ally.“ Bill O'Brien, Senior Vice President of Market Data Distribution, NASDAQ.

NYSE PRESS RELEASE Online Trading Academy and NYSE Liffe US to Present “Gold from a Traders Perspective” and “How to Trade Gold and Silver in Uncertain Economic Times” at LA Traders Expo.”

CME PRESS RELEASE Online Trading Academy Announces New Futures Trading Resource Center with Content from CME Group “Online Trading Academy will work cooperatively with CME Group to deliver futures trading education via All Star trader events in cities including New York, Chicago and Los Angeles and via outreach to their global community of traders and investors.”

Who is Online Trading Academy?

Bloomberg - Asia

CBS

Fox Business

We Are The Worlds Most Trusted Name In Trading and Investing Education…. Bloomberg

CNBC - Asia

CNBC

OTA Market Timing For Short Term Income and Long Term Wealth Preservation 4 – Days Market Timing Classes Market Timing Rule Based Strategy - This is how you make money. • Introduction to Stocks, Futures, Forex, Options - Which market/s are right for you? • Market Timing in Any and All Markets and Time Frames • 1 On 1 trading plan sessions in the class with your Education Counselor • Interactive Course Workbook for Maximum Retention • Ability to Bring a Spouse/Family Member •

Market Timing Class For Short Term Income and Long Term Wealth

May 20-23rd

1pm EST – 4:00PM EST

OTA Market Timing For Short Term Income and Long Term Wealth 4 – Days Market Timing Class • Market Timing Rule Based Strategy - This is how you make money. • Introduction to Stocks, Futures, Forex, Options - Which market/s are right for you? • Market Timing in Any and All Markets and Time Frames • One On One trading plan sessions in the class with your Education Counselor • Interactive Course Workbook for Maximum Retention • Ability to Bring a Spouse/Family Member

$299

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Market Timing - Florida Short Term Income and Long Term Wealth

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