Tsunami Trading Educators

http://www.tsunami-trade.com/

Here comes another system--which costs a whopping $6500--that claims to use no indicators whatsoever, only proprietary charts, to day trade the ES. I swear these sites are multiplying faster than roaches in an old soup can. What is so special about trading on price action? It's been done ever since markets existed but lately has become so new and vogue.

I've taken the free trial a couple of times and I'm not impressed. It obviously is targeting the novice trader who has spent a lot of time and money on other trading tools and still is losing money. Who else but the desperate and/or naive would wire $6500 to someone's bank account who, like most others in this con game business, won't even disclose their name, let alone a phone number. In addition to sending your money in a non-recourse fashion, new members are required to sign an unbelievably one sided disclaimer http://www.tsunami-trade.com/disclaimer.html that doesn't even tell you where this company is located. In addition, a search under "who is" reveals an anonymous front hosting company (Tucows).

In fact, the guy who runs this shop (Blade) is so paranoid and secretive that he doesn't even let other members communicate amongst themselves away from the room. He totally forbids any sharing of emails, IM, or Skype and is lightening quick to erase any such posts. On several occasions I witnessed him bleeping out this type of info AND admonishing the person who posted.

What I found particularly interesting was the use of shills in the room to praise and tout the system to the folks who were in for free trial. This is a variation of the three card monte scam in which the people winning money right and left (in this case alleged "members" who expound the virtues of this system ad nauseum) lure the unsuspecting visitors to get on board. Blade himself is the biggest showman when he makes the right call on a trade, making it seem that the magic secret of interpreting price action through this so-called proprietary system is the answer to your dreams. And indeed, the website has all the bait with pictures of folks living their fantasy lives on some tropical island with a Ferrari in the driveway.

In the two weeks I spent in the room, I calculated a win rate of approximately 59% as defined by a trade making one point before hitting a 1.25 stop. No great shakes. Blade claims the system is "robust" in that it gives many signals during the trading session. (I witnessed 10 calls in one day.) When a trade gets stopped before profit Blade has a litany of excuses that are too long to mention in this thread; suffice it to say as any true conman, he knows how to put a spin on the negatives as if it really wasn't all that bad. For example, the market is "acting violently" and the price action, therefore, can't be properly discerned. Blame it on anything but the system. After a couple of quick stopouts in a row, he takes a break as moderator and the room sits in silence.

Although I'm not privy to his secret system, my observations tell me he uses a short term candlestick chart (10 or 15 minute) calling out buys at obvious support and sells at resistance. Anyone with a rudimentary understanding of technical analysis and chart reading could easily make the same calls. I also believe he uses a modified pivot point for his early morning calls which I did find funny. (f X price is broken, expect to go to Y and if that is broken, the Z and vice versa for the upside).

The free trial is worth the price of admission for entertainment, but not much else.

Thanks for the comprehensive overview of this company.

In my brief study of the web-site, I notice a common theme found in many such offerings. They mystify market behavior, in so doing imply secret knowledge exists that eliminates the uncertainty encountered in trading. Seasoned traders know this is a false claim, made by many so called market guru's though the years. Here is the mystical hook from the companies home page...

"The Tsunami-trade.com system can create order from chaos. We see in the price action what most do not see."

Again, this statement implies their secret method will remove the uncertainty in trading. This creates false hope in the mind of an inexperience trader. No person or method can predict the future, and therefore uncertainty will exist in every trade you enter. Better to face this reality of trading, and learn to properly manage it, rather than to chase the illusion and false hope that with the right system/method/indicator (ie. "Holy Grail") the uncertainty of the future outcome (aka "pain of loss") can be avoided.

The second problem I have with this is the risk:reward profile of the method you described. Although the web-site promotional material talks about risking 1 point (hard stop) to make 4 points a day in the ES market, those "4 points a day" are made 1 - 2 points per trade. Thus, they are using a 1:1 risk:reward ratio. In which case the simple math behind this requires an 80 % win:loss ratio in order to be profitable over time. A 2:1 risk:reward ratio requires a 67% win:loss ratio to be profitable. These are simply unrealistic probabilities for the average trader to achieve consistently over a long period of time. I would be interested in seeing the independently verified 6-month performance of 100 traders using this technique.

quote:

---

Originally posted by ahk

I swear these sites are multiplying faster than roaches in an old soup can.

---

LOL
I have also noticed this. My inbox and spam box seems packed with this stuff at the moment. Maybe it is con season? Christmas money?

BTW: Thanks for the very well written information!!

Many thanks for your report ahk - very well written and excellent information! It's because of diligent people like yourself, and others reporting here that we can try and do our little bit for society and protect newbies from the sharks.

http://www.tsunami-trade.com/contact.asp

Man, news gets out quick. The Website's "contact us" page now has a phone number (I didn't call). The irony of it all is that Blade will no longer allow free trials to anyone who is using a free email service, yet his is [email protected]. Last time I checked gmail was free.

Also the alleged Testimonials page isn't loading. Maybe some of the chickens are coming home to roost!

Although gmail is free they impose some measures to make it difficult to easily set up spam accounts with them. You need to use your cell phone number or a referral to get an account. This makes it easier for them to shut off spam sources and so makes a gmail account a little bit better than a hotmail or yahoo email account.

Allow gmail and not allowing hotmail and yahoo is not a bad idea if you are plagued with spam or spam applications.

In order for Blade to obtain an ounce of credibility he needs to say who he is and give the world his bio. We need to know who he is and how he came to be an authority on trading. You can't appear out of fresh air with a first name and a telephone number and expect people to believe that you are this incredible trading or trading system developer.

Don't be shy Blade! Tell us who you are...

http://www.tsunami-trade.com/testimonials.html

Here is a prime example of using so-called testimonials to bait the unknowing. Does this seems honest and real? Frankly, it insults anyone with working brain. Ludicrous beyond comprehension. To wit:

<<<Unsolicited Testimonial on 8.17.06

I get excited when I talk about The Tsunami Wave Trading System! It is the most awesome system I’ve ever seen. It is totally unbelievable how amazingly accurate it calls both long and short trades in the markets. I have traded the markets for years, read all of the books written by “experts”, and have wasted many thousands of dollars and hundreds of hours on useless so-called trading “systems”. Like most serious traders, I have always been looking for that proverbial “Holy Grail” to help me locate and get in on turns in the markets at the earliest possible time. I’ve tried every type of system you can think of and have used every type of indicator imaginable, as well as Gann, Fibonacci, Elliot, Andrews, support/resistance, cycles of the moon, wind direction – you name it. Nothing was able to accurately pinpoint the market the way the Tsunami Wave Trading System does…oftentimes to the TICK… no kidding! I really didn’t think it was possible to trade on price action alone with only a 1 point hard stop, but they proved me wrong.

If you’re truly serious about making money as a trader, then the Tsunami Wave Trading System is the absolute BEST system you will ever find. It’s as close to having a Crystal Ball as you’ll ever get. It’s simple to learn and apply, and you’ll see your trading account begin to grow – correction… I would say “skyrocket” – in a matter of days.

Once I learned “The System” I told my fiancé that we had “just been handed the keys to the mint” and all the money we want is out there for the taking. I now trade with confidence and am making highly profitable trades. I’ll never make another trade without it. This thing is invaluable… worth hundreds of times more than you’re charging for it!!
John Gilliam>>>

John, do you really think its "worth hundreds of times more" than Blade is charging. Is it worth $650,000 or $1,300,000?

Interestingly, shortly after becoming a "member" John G. was the room moderator for the afternoon sessions (while Blade calls the banks to check the incoming wire transfers). Remarkably,Blade actually referred to him as "a good friend" when introducing him in the room. Let's see....new member, testimonial writer, room moderator and good friend all in a matter of weeks.

These guys could teach Redford and Newman a thing or two.

You are correct - you can't (or ethically shouldn't) publish testimonials from good friends, co-moderators, co-owners, or other people with a vested interest in giving unbiased testimonials.

Of course we would never expect him to publish negative testimonials on his site just like you would not expect negative testimonials printed on the back cover of a novel.

I did a quick Google search of John Gilliam and found this photo:

I think that he's the one on the left but not sure if it's the same guy.

There is also an NFL football player with the same name.

Generally trading systems do not and cannot give you the type of edge that is being described in this hype and I completely agree with you ahk. If a system is doing as well as they have described it then they would be multi-zillionaires and not wasting time with that web site.

The only systems that do make money that are for sale are those that give you an edge and turning you into the "house" when using the casino analogy.

You need to turn your trading into a casino business with you having the unfair advantage and then repeat trade after trade and push volume with your edge.

Very hard to take that guy in the photograph serious.

"We just completed a fantastic trial week signing up several new members."

This is the first line of an e-mail I recived from Tsunami. I really think this says it all. The emphasis is on the success of the promoter's ability to rapidly sign up new members, not on the success of the performance of the system for its members.

If Blade had any integrity at all, he would at hte very least, have a performance section on the site showing the trades the system called out every day. Wonder why he doesn't do that?

It's a fine line between an education service and a trading advisory service, that is, making actual trade recommendations (requiring a CTA license). Since tsunami is carefully presented as an education service, they are not required to provide a track record of their performance / recommendations.

If they cross that line however, and it's subjective, they will fall under the scrutiny of the CFTC / NFA regulators.

Is blade's name John by the way? From what i ve seen, his latest scam is TsuBot, which he claims has an extremely high win rate in all markets. Watching it trade live, it's obvious that reality is much different. Interesting that he only takes into account the first profit target which is no more than eg 3 ES ticks or 5 GBP/USD pips (which is really 2 after spread which he totally ignores, but that should be expected as he has never placed a real trade himself). The corresponding stop loss is several times larger, a sure recipe for disaster. Avoid them at ALL costs no matter how tempted you feel to waste 6-7k