How I Stopped Gambling and Started Trading
I stopped blowing up and started compounding returns the right way
When I first started trading, I thought the fastest way to make money was to go all in. I’d size every trade aggressively—sometimes 100%, 200%, even 500% of my portfolio. If I was right, the returns were massive. But when I was wrong—and I often was—I’d blow up the entire account.
It wasn’t trading. It was gambling.
That cycle—big bet, big gain, bigger loss—repeated until I finally admitted that I didn’t have a process. I had impulses. What I lacked was structure, and I found it in Victor Sperandeo’s Trader Vic: Methods of a Wall Street Master.
In the book, Sperandeo lays out a clear three-part framework:
Preserve capital
Achieve consistent profitability
Pursue superior returns
Most traders try to start at step three. I know I did. But Sperandeo flips the script. He explains that you only increase risk after you’ve built a cushion of profits:
“If, and only if, a level of profits exists to justify aggressive risk, then I will take on a higher risk to produce greater percentage returns on capital.”
Over a decade ago, that idea changed how I trade.
Now, I start the year with small position sizes. I wait for my strategy to prove itself. If it works. I add to my positions. I never press when I’m down. I never try to force a comeback. I scale only when the market gives me permission—when the trends are working, and my equity curve is rising.
Sperandeo gives a great example. In July 1974, after booking a solid gain, he used part of those profits to take an aggressive short position. Nixon resigned weeks later, the market broke down, and he doubled his account in a month. But he didn’t take that shot out of desperation. He took it from a position of strength—after earning the right to take risk.
That’s the difference between traders who survive and those who burn out.
It’s not about having the best idea. It’s about having the discipline to size it properly. Most blow-ups happen not because the thesis is wrong, but because the size is reckless.
After more than a decade of applying this approach, I can say this with confidence: consistent returns come from controlling risk. Exceptional returns come from scaling into strength.
You don’t start with size. You earn it.
One of my first interviews on the channel was with Trader Vic. If you haven’t seen it, make time—it’s worth it.
The Signals Beneath the Surface: What These 7 Charts Are Telling Us About the Cycle
📈 Chart 1: Lumber Futures ($LB_F)
Lumber is a classic proxy for growth. It’s tied to housing, construction, and industrial activity. When it breaks out, it often signals that the real economy is heating up. Right now, lumber is pushing out of a multi year base.
This is something you don’t ignore.
🏭 Chart 2: CRB Index & Yield Curve
This is one of the most important macro pairings to track. The CRB index is coiling near a major resistance zone, while the yield curve is steepening out of inversion. Every prior cycle like this (2002, 2009, 2020) led to strong commodity rallies.
It’s a signal that inflation pressures could return—and commodities are listening.
💵 Chart 3: 30-Year Treasury Yield
The 40-year downtrend is broken. And now the path of least resistance is higher. This isn’t about the Fed anymore—this is about long-term capital demanding higher returns. Rising yields change everything: equity leadership, risk premiums, and asset allocation.
This chart tells you the secular regime has shifted.
☁️ Chart 4: Cotton Futures ($CT_F)
Cotton just closed above its 40-week moving average for the first time in over a year. That’s a trend signal. But it’s not just technical—it ties into the bigger China story. Cotton demand is tightly linked to textile production and emerging market consumption.
If China is coming back online, this breakout could be the early tell.
🟡 Chart 5: Junior Gold Miners vs. Gold Miners
Junior miners are finally showing relative strength—and that’s when you pay attention. Outperformance from juniors often confirms a more aggressive phase in the gold cycle.
The ratio just cleared a multi-year base. If this holds, it supports the idea that silver’s next leg higher is real—and being led by the highest beta names.
🧠 Chart 6: NYSE Breadth
Breadth doesn’t lie. The advance-decline line is making new highs alongside the S&P 500. The percentage of stocks above their 50- and 200-day moving averages is rising. This isn’t a narrow rally—it’s broad. That’s healthy.
When internals lead or confirm price, it’s a green light for the bulls.
🔋 Chart 7: Energy On Deck: Watching XLE
This is one of the most important charts in the market right now.
XLE has been knocking on the same ceiling for nearly two years. This level has capped energy rallies for over a decade. You can see it—2008, 2014, 2022—it’s the zone where trends have died.
But this time might be different.
The longer a base, the bigger the breakout. And we’ve been coiling under resistance for over 18 months. If energy is going to move—and if oil is about to make its next leg—this is where we’ll see the signal.
You want to know when oil is ready? Watch XLE.
If we break out above this zone, that’s not a trade. That’s a new trend. And it would confirm what other macro charts are hinting at: rising yields, reflation, global rotation, and a potential surge in demand for hard assets.
Nothing’s confirmed yet. But this chart is loaded. Stay tuned.
We don’t just talk signals. We act on them.
Here’s a quick look at some of our standout performers from recent setups:
✅ MAG Silver (MAG): +59%
✅ Junior Gold Miners (GDXJ): +57%
✅ Poland ETF (EPOL): +55%
✅ Wheaton Precious Metals (WPM): +49%
✅ Sibanye Stillwater (SBSW): +43%
✅ PPLT (Platinum ETF): +39%
✅ PALL (Palladium ETF): +23%
✅ Chile ETF (ECH): +21%
✅ India ETF (INDA): +55%
✅ Silver, Gold, Bitcoin, Lumber, and Uranium—trending.
These weren’t hindsight trades. These were signal-based entries, backed by process, not prediction.
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