E-mini Futures Lessons From Legends

Great lessons in trading can come from lots of places.

Sometimes we get trading insights while playing golf or watching the ocean waves. But more traditionally (and reliably), I find that I learn best from other traders folks who have been there and done that.

So it should come as no surprise that my business partner is a Wall Street veteran who has traded and worked with top traders for many decades.

Christopher Castroviejo is one of those rare individuals who can look at a issue from many angles. He can take in competing points of view simultaneously and cull through scads of data to reach a meaningful conclusion. While this is helpful in many areas of life, its easy to see how useful this skill set is in the trading world.

As Ive said in this space before, Christopher is a market maven in the every sense of the word. Heres a short re-introduction for those of you who havent been introduced to my good friend:

Christopher has spent 35+ years in and around the markets, and his resume and track record on Wall Street became something of legend: stints with Smith Barney, J.P. Morgan, a partnership at Bear Stearns, financial consultant for The Vatican Bank to name a few. Christopher was hot and getting hotter. Highlights including turning $10,000 into $178,000 in four weeks, 8 straight years of 43% compounded profits as a top hedge fund manager, a sleek Manhattan brownstone and a spacious summer getaway in the tony Hamptons. Christopher even struck up a friendship with his money making idol, billionaire George Soros.

Along with multi-million dollar wins, there were a few huge losses; in just six short weeks, $10,000 became a cool million, and quickly nothing but air. And, in one monumental transaction gone wrong, Christopher lost $15 million dollars in just a few months$1.5 million of it his own money. But, unlike the Vegas poker player who cant leave the table, Christopher learned from the missteps as well as the wins. You have to reinvent your performance all the time. I used to see the business as just about orchestrating wins, but the rational way of thinking about it is really about controlling your losses.

Today, Christopher is active intraday and swing trader and continues to manage money for a select list of Wall Street insiders.



Christopher is a master at several aspects of intraday trading and is particularly skilled in the application of key level support / resistance and Market Profile. We will be covering these topics in depth at the upcoming Professional E-Mini Futures Tactics workshop, so I thought Id ask him to share some insights with you as put the finishing touches on that workshop. Heres an interview I did Christopher just this morning!

D. R.: Christopher, you basically grew up on Wall Street with a grandfather who was a famous depression-era trader. Youve had a chance to trade, advise, manage money for and learn from some very household names. Folks like Paul Tudor Jones, Ed Seykota, George Soros and Julian Robertson, to name just a few. What key lessons have you taken away from your interactions with the legends?

Christopher: Youre right in that Ive been fortunate to deal with some amazing folks. What has set these guys apart is their mental approach to the markets. All were absolutely dedicated to what they were doing. And, perhaps because of that, they all mastered adversity. Every one of them had to live through draw downs and fallow periods. But persistence paid off and we all know how they came out the other side of tough periods with massive successes.

Another key I see with these guys is that they show multiple ways to make money. Its clear that they all traded in very different ways, yet found significant edges in different instruments, strategies and time frames. Each one of them found an edge that was consistent with who they are as traders. I think this carries over, to what were doing in the e-minis. Even in day trading, there are different styles and time frames. Trend following and counter-trend. Shorter holds and longer holds. Traders that stick around found the edges that are consistent with who they are.

D. R.: Youre the most knowledgeable person Ive ever met when it comes to Market Profile. So I didnt hesitate for a second when you suggested that we spend time one-on-one with Market Profile creator Peter Steidlmayer. Those were two of the most intense days Ive had in a while! Youve known Pete for a while what were your main take aways from our time with him?

Christopher: Yes, Pete is certainly a guy whos always thinking on another level! I thought his most interesting concept was how the market has undergone a structural change due to the high volume, short time frame trading associated with the hedge fund boom. This has, interestingly, made Market Profile more important, not less. And the way that these big funds leave behind signs in the Market Profile like elephants leaving footprints. I thought that session was particularly intriguing. I look forward to sharing these insights in Raleigh.

D. R.: In the current market environment, what tools and strategies have struck you as particularly useful, especially in the e-mini futures?

Christopher: You and I were just looking at some amazing double top formations that played out beautifully. Combined with the divergence pivots that we use, those have been particularly notable. In addition, gap plays are still working very well, but only in the right structure. And the key numbers continue to be a great guide for market behavior. And I had to pick one, it would be those double top patterns.

D. R.: Im really looking forward to teaching with you again in Las Vegas for the e-mini futures course.

Christopher: Thanks. Same to you!