Pod Insights Michael Covel's Trend Following Ep. 1320: Happy New Year with Michael Covel on Trend Following Radio About this episode Please enjoy my monologue Happy New Year with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive. --- I’m MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I’m proud to have delivered 10+ million podcast listens since 2012. Investments, economics, psychology, politics, decision-making, human behavior, entrepreneurship and trend following are all passionately explored and debated on my show. To start? I’d like to give you a great piece of advice you can use in your life and trading journey… cut your losses! You will find much more about that philosophy here: https://www.trendfollowing.com/trend/ You can watch a free video here: https://www.trendfollowing.com/video/ Can’t get enough of this episode? You can choose from my thousand plus episodes here: https://www.trendfollowing.com/podcast My social media platforms: Twitter: @covel Facebook: @trendfollowing LinkedIn: @covel Instagram: @mikecovel Hope you enjoy my never-ending podcast conversation!
Transcript 0:00 Speaker 00 I just finished a more than one month trip to America. Always interesting to be back to make observations.
0:10 Speaker 00 I grew up in the Washington DC area. About 15 miles from Washington DC. I visited that area again. And I gotta tell you, it's absolutely amazing. What unfettered. Government spending. Government welfare. Can do to an area. If a government has an unlimited checkbook. And spends and spends and spends. People who live in that area. Will think they are rich. And perhaps they end up having a lot more money. Than they otherwise would have had. That's a fact. But it's disgusting.
0:56 Speaker 00 Because at the end of the day, all of us are driven. Whether we admit it or not. In the one life that we have so far. We are driven to create. We are driven to make. We are not only driven to take. If you live a life of only taking. Man, I sound really heated already to start the new year. What the hell? I am heated. But if you are driven to only take.
1:24 Speaker 00 What are you?
1:26 Speaker 00 You're not the type of person that wants to listen to me. I look up to the achievers. My mentors have all been achievers. Novel approaches to the markets. Novel approaches to business. Work hard, often alone, inspired. To make something great happen. Now, there's no guarantee you will be the next Elon Musk, obviously.
1:55 Speaker 00 But you still strive. You still push. When you go back to the Washington DC area, you can feel it. Millions of people. On the dole. Whether those people consider themselves rich. Or poor. They are all on the dole. They are all taking. They are all pretending.
2:21 Speaker 00 It makes me sick. Now, I don't let it stay with me too long. I can't control it. This is what America is. And sure, there's other countries that have crazy government spending and people bleed the system dry. America's not the only place.
2:44 Speaker 00 But I am American and I observe this. I wish I saw something respectful, honest, that you can look up to. But I don't see that.
2:57 Speaker 00 Sure, you can listen to me and you can put your horse blinders on and you can pretend things I'm saying are not true. And you can try to find some bullshit excuse to make yourself feel good because you just don't want to look at the truth. I get it. It's not dissimilar to the markets. It's not dissimilar to trend following.
3:16 Speaker 00 Because I do want to pivot away from talking about the Washington DC area. I do want to pivot away from talking about
3:23 Speaker 00 disgusting government overreach. But it doesn't make a difference what aspect of life you go into. There are scammers everywhere. There are people who want to take your money and give you nothing. Or maybe they'll give you hope. Maybe they'll give you a dream, a fantasy, something that you can hold on to. I'll never understand why people fall for this stuff.
3:53 Speaker 00 But I can see it in my world quite clearly. For those of you that don't know about my world, it's the trend following world. It's a particular style of trading. A style of trading that doesn't use the fundamentals, doesn't make predictions,
4:11 Speaker 00 doesn't know what's going to happen tomorrow. And I think this best represents in a post that I put on X late December 2024. My post was quite simple. But it's not so simple if you ponder it.
4:31 Speaker 00 It says, "Unknown, unpredictable, unstable, unclear, uncertain, unfamiliar, unforeseen, unreliable, unsettled, uncharted, unverified."
4:49 Speaker 00 My last line? Just the expression "trend following."
4:54 Speaker 00 What do I mean? All of those terms are the truth. That's where we are. That's life. That's normal. Regardless of how many people whisper sweet nothings into your ear on a daily basis, 24/7,
5:12 Speaker 00 to tell you they've got it figured out. And they can help you. They can't.
5:19 Speaker 00 That's what's so beautiful about the strategy of trend following. It handles all of those "uns," those uncertainties, the uncharted, the unsettled.
5:32 Speaker 00 Trend following navigates it. Trend following is the colonial explorer on a wooden boat in the middle of the Pacific Ocean, not sure what's gonna happen. Unsure if you will survive.
5:49 Speaker 00 In many ways, that is trend following.
5:52 Speaker 00 Now with a mathematical approach like trend following,
5:56 Speaker 00 you actually do worry about survival more than you worry about making money.
6:01 Speaker 00 The act of surviving is what it's all about.
6:07 Speaker 00 So unlike those great explorers that got on a wooden boat and sailed into the Pacific, many of whom never returned, trend following's different.
6:18 Speaker 00 Trend following prepares you to return, so to speak. It prepares you to survive. And it puts you in a position, when the unexpected happens, the unexpected good, you're on the right side of the unexpected good.
6:34 Speaker 00 Does that mean you have had a good strategy to trade Bitcoin? Of course. The best strategy to trade something like Bitcoin. Also, the best strategy to trade something like gold, or cocoa, or damn it, any market. Because what trend following does so cleverly, it reduces all markets to a number.
6:59 Speaker 00 And that's the only data you analyze.
7:03 Speaker 00 So if you come to me and you say, Mike, I want to learn something from you. I'm going to teach you trend following. I'm not going to give you my opinion for that day. I'm not going to say something inane like Elon Musk said this today. So therefore, why did the market not move the direction of what he said? Look, Elon is a fantastic entrepreneur. But you can't look at the individual words of one person on any given day. And make investing decisions or trading decisions and call yourself an investor or a trader.
7:43 Speaker 00 Because if you are looking at the words of any one person, their prediction, their insights for that particular day. And you think that's investing, you think that's trading, come on, you're fooling yourself, you're fucking fooling yourself.
7:57 Speaker 00 That's gambling.
7:59 Speaker 00 You're the old blue hair at the North Vegas ancient hotel playing slots. You're not a serious person. Michael Saylor, the Bitcoin guru.
8:13 Speaker 00 He's made a bloody fortune. Up and down, up and down. I don't understand exactly what he is doing. I don't understand what his plan is.
8:26 Speaker 00 But do I have to understand his plan? Or can I just trade Bitcoin as a trend following trader? Can I just trade his company MicroStrategy as a trend following trader? Yes.
8:41 Speaker 00 So instead of trying to tell yourself, I believe Michael Saylor, or I don't believe Michael Saylor. Why not just follow the price? Now, look, I'm not oblivious to the fact that if you make an early bet
8:58 Speaker 00 and you go all in and it turns out your way, you can make a bloody fortune. But is that investing or trading, or is that the lottery? What do you want? You only live one time. Right now, on this planet, there is one Elon. Right now, on this planet, there is one Michael Saylor. That's it. Two guys making stuff happen. Now Elon, he clearly has a more stable approach. Car business, space business, telecom business. Michael Saylor is all in on Bitcoin.
9:40 Speaker 00 And he could end up being 100% right. We have no idea. He could end up being 100% wrong. We have no idea.
9:49 Speaker 00 But we can only judge both of these men and their businesses via the price of the markets they represent each day. We can trade that price.
10:02 Speaker 00 So if you can't be sure of the fundamentals
10:06 Speaker 00 of these men or any other company, or any other market, trend following gives you a way to not have to trust the fundamentals.
10:18 Speaker 00 Trend following gives you a way to believe in the right now. What is happening right now? What can you do right now? And with a stop. Meaning, back to the survival aspect of this, to not being a colonial explorer in the middle of the Pacific with no way to phone home.
10:39 Speaker 00 Trend following gives you a way to phone home. Phone home, meaning take a loss, have a stop, protect yourself. Be around to play another day. If you can't play another day, you're out. You're on the sideline. You're taking fentanyl. You're a meth head. You're up on that crazy street in Philadelphia where you're bent over backwards and shit's drooling out of your ears. No fun. But look, this is the world we live in right now. A world of non-stop information. Non-stop voices. I mean, in your ear, you've got your local brokers.
11:24 Speaker 00 You've got your hedge funds.
11:27 Speaker 00 And you have people like me.
11:30 Speaker 00 My goal is to share information. My goal is to share insights. On a particular style of trading. And a particular lifestyle. Take it or leave it. Now, the cool thing with my take it or leave it approach.
11:48 Speaker 00 Is you can verify it.
11:51 Speaker 00 Now, if you call up your local broker. And you want to know his given opinion on Nvidia for any given day. He will tell you. He will have an opinion. That much I guarantee you.
12:05 Speaker 00 What is his opinion for that given day rooted in? Absolutely nothing. Will he tell you that? Of course not.
12:15 Speaker 00 I hate that kind of style. I would never want to be in that world. It's especially strange for me when. I see people that I care about. In the middle of that world. Meaning they take advice, they get insights from people. Who they think.
12:38 Speaker 00 Have an expertise. To guide them with their money.
12:43 Speaker 00 Now, how the hell can anyone have an expertise when no one knows what the hell's going to happen tomorrow?
12:49 Speaker 00 So the expertise is back to trend following. The expertise is to have a strategy. That puts you in a position. That when markets move. And they move in a big way, you can be on board to ride those markets. And when markets crap out. And go the opposite way that you want. You're protected. And you lose a limited amount of money. So you can come back to play another day. I mean, if you lose 2, 5, 10%, whatever of your money. And that's it. You've still got 90%. You can still play. You can still make up your losses, so to speak. Now, that's not the goal. That's not how you approach it with trend following. But in actuality, that's what does happen.
13:35 Speaker 00 You take the small losses and you wait for the unexpected big moves to pay for the losses and to give you your profit.
13:47 Speaker 00 Now, I know what I say to the uninitiated probably sounds damn good. It probably sounds, "Man, I needed that reminder," or "Wow, I've never heard about that." That being trend following. Here's where it gets interesting for me, and I am a broken record when it comes to this, which is the proof: Trust but verify.
14:15 Speaker 00 So, do you want to know if a particular trading strategy works?
14:20 Speaker 00 Where's the proof? Who has been doing it long before I appeared? Long before the mentors that I have had appeared?
14:31 Speaker 00 Where's the proof? Trend following is a trading strategy has unlimited proof.
14:38 Speaker 00 Traders, over the decades, not affiliated with each other, making money in the same markets with similar returns. The deviation in the returns often related to the leverage they choose. But bottom line, there is proof. And if you don't know, meaning you don't have a strategy, proof is the first place you start. Once you see the proof from the people that came before you,
15:13 Speaker 00 and this is what I do in my life as I share this proof, once you see the proof, you know that everything else is a scam. Why is everything else a scam? Because unless we're looking at the Warren Buffetts of the world, the Elons of the world, where you can see their track records, you can see their stock prices,
15:37 Speaker 00 the other people out there saying, "I have this strategy," or "I have that strategy." That could be fundamental analysis, it could be some form of technical analysis, some form of chart reading. The moment you ask for, where is the proof for your strategy that came long before you? Like, where are the other practitioners that do what you say is so great?
16:04 Speaker 00 It's not even about the person that claims to have the strategy. It's the other people that should have been using this strategy all along. If it was so great, going back decades. Let me give you a hint. They never exist. It's always the one dude on X or Facebook with the one strategy, with the loud voice telling you how wonderful something is, without a shred of freaking proof. Zero, none.
16:42 Speaker 00 Now, they might have some documented bullshit in the moment. But where are all the other people? If this strategy was so great that they promote, where are all the other people who used it? Where are all the other people who believe in it? Where are all the other people who practice it? Now, I know you can come back to me and you can say, Mike, what about trend following? Where's all the proof in trend following? Ladies and gentlemen, eight books I've written. There's 1,200 plus podcast episodes. If you can't find the proof, you don't want to find the proof. You don't want to know about proof. You don't care about proof. You're a degenerate gambler if you don't want to know.
17:27 Speaker 00 And that's cool, man. We might have a great time having dinner out one night. We might laugh about this and laugh about that.
17:35 Speaker 00 Now, I probably don't want anything to do with you when it comes to business or philosophy or working on a project.
17:44 Speaker 00 But you might be a fun individual if I don't have to know anything about your life. But what kind of life is that? Who the hell wants to have friends, family, business associates, who secretly are morons?
17:59 Speaker 00 I do sound harsh today.
18:02 Speaker 00 Maybe it's my 35 day trip to America. It leaves me in that mood of just seeing everything.
18:12 Speaker 00 Where are there places in the world where you cannot be pushed in front of a train on the subway? Where are there places in the world where you cannot be shot up? At a New Year's Eve celebration in New Orleans? Where are there places in the world where Tesla trucks don't blow up in front of Trump hotels? Those are good questions, aren't they? And if you actually sit down and write out the answer? If you've got the balls to write out the answer? And you don't lie to yourself, then you are on to something. You know what that something is? Oh, it's called the truth. So if you can figure out where it's impossible in this world? To not be pushed in front of a subway train?
18:59 Speaker 00 If you can figure out where that's impossible to happen?
19:03 Speaker 00 Then you've learned something. Then you're going down the rabbit hole. Then you're pulling on the string. Then you're really figuring out how the world works. Tangent over. The new year is upon us. I want everyone to have trend following success. Where would I recommend you start for the new year? Four places. My fifth edition of my book, Trend Following. My second edition of my book, Turtle Trader. My second podcast interview for free, online with Ed Sikota.
19:43 Speaker 00 Again, my second episode with Ed is my favorite one. And lastly, a video that I prepared? That I will share with anyone. If you want access to that video? Drop me an email. I'm easy to find, [email protected] . And if for some reason or another, you find it impossible, or you can't figure out how to reach me?
20:09 Speaker 00 Retire, stop, put down the technology. Something's gone wrong. You're not cut out for it. Simple filter. Ladies and gentlemen, I wish everybody a very happy new year. I wish everybody health and success and a little wealth over the course of this year. And as you prepare for the unexpected, as you prepare for the unknown, the uncertain. Are you ready? Are you really ready? Do you really have a strategy? Because if you don't, I can help. See you again next week.
20:53 Speaker 00 I see a time when those awake will understand how to make money in up, down, and surprise markets. Whether a new trader or experienced, college student or financial advisor, protecting against a crash or just trying to make a lot of money, trend following offers everyone an answer in uncertain times. To get started immediately, send me an email, [email protected] . I will send you the right trend following steps to take along with my free video. But if you want to buy and hold, trust the government and trust Wall Street. This is absolutely not for you.
Previous Ep. 1319: Richard Weissman Interview with Michael Covel on Trend Following Radio Next Ep. 1321: Sharpen Your Analytical Thinking with Michael Covel on Trend Following Radio Page updated November 7, 2026 · transcript and summary are machine-generated
