I Fed 1,482 Hours of My Floor Trading to AI — The Pattern It Exposed Stopped Me Cold | MIT LIVE

[00:00:01][music] [music] >> Hey everybody.

[00:00:21]It's Jonathan and welcome to Master the Trading Live.

[00:00:24]How you guys doing?

[00:00:26]Master the Trading Live, I get on here every single day the markets open.

[00:00:29]11:00 a.m. Eastern time, go over the markets, share some thoughts once in a while, we'll share our trade of the day.

[00:00:34]We got something special today.

[00:00:36]What I did today is I've been presenting since 2015. And I have so many videos on YouTube, and then I used to have so many videos on Vimeo as well between 2015 and 2023, I put videos on Vimeo.

[00:00:50]What I was able to do is I took all my content over the last 10 years from YouTube.

[00:00:56]I've took all my content over the last 10 years that was on Vimeo. I put it all into Claude and I said, "You know what, Mr. Claude?

[00:01:04]Today's your show.

[00:01:06]Take over the show. I want you to go through all my material and you could present on anything your little heart desires. So, today is an AI takeover.

[00:01:16]Claude is going to be running the show.

[00:01:18]So, without further ado, I want to go to the slide deck. I don't even know what's in there. I didn't build it. I'm just going to be the one delivering it. So, here we go. I got rained out of golf yesterday. I was so sad. I finally got an opportunity I played Medina a whole bunch of times, but Medina is one of the best courses in Illinois and the US.

[00:01:38]And it started to rain right after my first shot. Very, very sad. All right, guys. Welcome to our first AI takeover.

[00:01:47]So, AI read 1,482 hours of Floor Traders YouTube and today is going to run the show.

[00:01:55]What I found is worth more than any course, and today it's all free.

[00:02:01]All right, first who is this guy?

[00:02:04]Floor 1997, joined CME, the Mercantile Exchange.

[00:02:08]2010, I was a market maker on the floor of the Chicago Board Options Exchange.

[00:02:13]I made $1 And then put out 4,000 videos that the AI has gone through. So, here we go.

[00:02:23]This is going to be interesting. This is actually what the AI went through. In the Vimeo vault, 3,476 videos, 461 GB of content. And then YouTube, it went through over 2,000 transcripts, 12 million words. Very, very, very cool.

[00:02:44]Here's the the big takeaway, which is really cool.

[00:02:48]It's all the same stuff.

[00:02:50]Same lessons going on since 2015.

[00:02:53]We're not chasing the shiny object. The industry sells a new secret every week.

[00:02:58]11 years. Go back in the content. It's all the same. The production's probably gotten a little bit better. I've probably gotten a little bit better at presenting, but the content, going back to 2015, is exactly the same.

[00:03:13]No mention of any Fibonacci, no Gann, no nonsense. We're looking for objective information, not subjective, not feel.

[00:03:26]So, here are the key lessons that uh Mr. AI found.

[00:03:32]Money.

[00:03:33]Money drives markets.

[00:03:35]We're looking for unusual options activity. We're looking for big institutional buys, big hedge fund buys, big endowment buys.

[00:03:44]The tape can't hide.

[00:03:47]The truth is in the market. If you want to be when news comes out, the market, you'll feel it first. You'll feel like tremors in the market. Many times when news comes out, I'll feel it in the market and then I'll go research and be like, "Oh, wow. What just moved the market a little bit?"

[00:04:04]Everything is relative.

[00:04:07]Nothing is ever cheap on its own.

[00:04:09]Nothing is ever expensive. Gold versus silver, Coke versus Pepsi. We don't look at anything in isolation.

[00:04:16]This is a key one, guys.

[00:04:19]Decide what you're comfortable risking before you get into a trade. If you decide once you get into a trade, your emotions are going to take hold of you.

[00:04:28]You're going to end up doing things that are reactionary because it feels good.

[00:04:33]When a position's going against you, it feels good to get out and to take that pain away. Risk, decide what you're risking before you get into a position, and longevity. There's nothing more important than surviving in the market so you can actually learn these important lessons.

[00:04:53]Rare lesson number one. Again, this is all AI. AI created this whole presentation. I didn't mess with it at all. Something we talk about often is a free trade.

[00:05:04]Buy 10 options.

[00:05:07]Once you're up on those options, you could sell a higher strike. Sell five.

[00:05:14]Maybe ride five for free.

[00:05:16]We did a trade like this. We took it off this morning.

[00:05:20]This morning, 9:22 a.m., we have a position CIFR.

[00:05:26]This was in our free portfolio for all of you guys. Let me get a show of hands.

[00:05:31]Who's in CIFR or who had this trade and has already locked in profits? Today, we locked in profits about 265% because CIFR, as I speak, is up 10%. Let me get a show of hands guys. Are you involved with C I F R? Who's involved with C I F R? We shared this trade about a month ago I would say. Not too bad getting in May 4th for $171.

[00:06:09]Then the next day Just Adam, there's got to There we go.

[00:06:14]Let me see who's in this trade. Let me get some yeses.

[00:06:18]More than two of you, more than three of you I'm sure, but here they come. We bought it for 171, then we take a credit of 101. So we only have 70 cents of risk.

[00:06:33]The most that we can make on this trade is the difference between the spreads, $5 minus the 70 cents. The most that you can make is $4.30.

[00:06:45]Now I'm seeing you guys come in.

[00:06:46]Fantastic. Dale's out for 129%.

[00:06:50]Portfolio we were able to capture a little bit more, but this is a fantastic trade and one where we didn't have to risk very much money in order to make a very very cool return. C I F R right now up 12%. So bravo.

[00:07:10]Wackenhut spiel for us.

[00:07:12]C I F R.

[00:07:15]Another rare lesson that I found.

[00:07:18]We talk about the crack spread, right?

[00:07:20]The crack spread is the profit margin for refiners.

[00:07:27]Energy's truth serum.

[00:07:29]Demand, supply, and fear.

[00:07:32]All in one number. So when we see that the crack spread is strong that's when you want to buy refiners.

[00:07:41]What is the crack spread doing right now?

[00:07:47]Here's the crack spread.

[00:07:49]Try to rally a little bit. Falling a little bit today. But trust me guys, when you see these big moves in the crack spread, you want to get your buns long refiners. Is a great great great trade. I like this.

[00:08:04]Energy's truth serum. I like that. Hey I way to go. Bravo.

[00:08:10]Here's a cool trade, a rare lesson number three.

[00:08:15]Closed-end fund arbitrage.

[00:08:20]I like that AI found my closed-end fund arbitrage trades. Closed-end funds traded at discount to what they already own.

[00:08:29]Go on the uh YouTube channel.

[00:08:32]The NAV of a closed-end fund might be a dollar.

[00:08:37]But the stock very well could be trading at 85 cents, and then it's trading at a 15-cent discount to actually what it owns. This is a phenomenal phenomenal trade and a rare lesson that you can learn on the YouTube channel.

[00:08:55]Here is the edge checklist.

[00:08:58]Nice. 195% on Cypher.

[00:09:03]Bravo. Bravo.

[00:09:04]Every winner in 11 years of footage.

[00:09:08]That's probably aggressive to say. We want liquidity.

[00:09:12]Options, you need liquidity in order to trade.

[00:09:16]We want to look at a relationship. We don't want to just look at, "Hey, let's get long copper." No.

[00:09:23]We want to look for the cheapest names to get long copper as copper is rising high higher.

[00:09:31]We want a catalyst for all of our trades. We want a reason to be in those trades. Is it unusual option activity?

[00:09:37]Is it earnings? Is it a pedufa price for a for a biotech?

[00:09:44]Volume versus open interest.

[00:09:47]Options are transparent.

[00:09:49]Follow options, follow open interest.

[00:09:52]Movement on the price, implied move versus actual move.

[00:09:56]And then risk decided exit written. You want to figure out your risk before you get into the trade.

[00:10:03]The edge checklist. I like this.

[00:10:07]AI takeover.

[00:10:09]We talked about this yesterday.

[00:10:12]S&P versus Russell.

[00:10:14]Russell leading.

[00:10:15]Breath is real, Russell lagging. Trading one against the other.

[00:10:21]If you want to get long, find out what's cheap, find out what's expensive.

[00:10:29]Overall, does it follow the money or does it follow price? Everything that we do, guys, is following the money. We want to follow objective data. We don't want to just do things because the RSI or be or a double bottom or triple top or anything like that. Okay?

[00:10:50]Takeover ends, the archive doesn't. All right. What we always do, guys, is we share a trade of the day. Enough of me yapping. Here's the trade that we're going to talk about today because it's a trade that we've talked about in the past.

[00:11:04]Copper.

[00:11:05]We want to be long copper. Copper continues to rip higher. We want to be long copper.

[00:11:14]So, let's pull up our Val Vis, which is right here. CCJ, we talked about the other day, right at its expected move.

[00:11:25]All of our copper names.

[00:11:27]FCX.

[00:11:29]ERO.

[00:11:32]HBM is another one.

[00:11:35]Okay, we want to be long copper.

[00:11:39]Here are some more copper names. Rio, Vale, Teck, FCX, HBM, Ero.

[00:11:47]I like Teck. Let's look at Teck.

[00:11:51]Teck's another one I really like. I like all of these names, guys. In our all access, in our advanced notice, we are long copper names. My recommendation to you today is get your buns long copper.

[00:12:04]You could do it with Teck. You could do it with FCX. You could do it with Ero. I think that they're all going to be trading much higher by the end of the year. So, that's what I got for you.

[00:12:18]A big shout-out to our AI friend for hosting our first AI takeover. You did a pretty good job. Next week, I'm going to take the reins back. Guys, thank you so much for joining. I hope you were able to take out 200% on your Cypher trade, and we'll see you guys next week.

[00:12:35]Everybody in all access, you guys hang tight. We'll be right back.

[00:12:47]>> [music] [music] [music] [music] >> Hey everybody, what's up?

[00:13:43]I'm back on for all access.