There was a total of 1,600 people signed up for the MrTopStep “Unplugged” webinar with Marty “The PitBull” Schwartz and 750 attendees on Saturday morning (MrTopStep “Unplugged” recast). Like the trip to Amherst College (See video here) we created a video to capture the essence of a man that has done what few men have ever done: made millions trading his own account. While many of his peers are now retired and not trading, the PitBull defies time and continues to be one of the most profitable traders in the world.

My name is Danny Riley. I helped build one of the largest S&P floor desks on the CME. I did not know what a broker group was before I moved from the CBOT’s bond pit, but within minutes of walking up to my new desk I got the flavor of how things worked at 30 South Wacker. I know some traders and order fillers do not like it when I talk about it, but it was not an even playing field for the customers who called the trading floor to buy and sell futures and options.

I want to make one thing perfectly clear: I am not talking about everyone. There were lots of honest people, but standing right next to them were people who constantly did whatever they could do to harm the customer and profit off them. Some people still dread the closure of the futures pits this July, but even the traders in those pits knew that the futures pits were “long in the tooth.”

Most of the grain pits have 2 or 3 people standing in them and the wheat pit has some overweight guy sitting on a chair waiting for corn option orders to come in. You cannot stop the evolution of the trading floor or the markets; it’s never going back to where it was. If the CME’s Globex platform ever went down, there’s no way any of the futures pits could provide the liquidity that it would take to keep up with the thousands of customer orders. There is simply no way.

I was pushed around, threatened and attacked by one of the heads of the largest broker groups on the floor. I was told to look the other way while traders front-ran our orders. I fought for the customers like no one had ever seen. I was an outsider, an Irish guy from the Board of Trade, and it took me a long time to get the message across that I was never going to play their game. That said, I loved the S&P from the second I hit my new desk. I knew I had found my calling.

When I look back at the turmoil and the fights I got into back then, I shudder. I was young and believed that I was right, but when you’re one man against the status quo and it happens every day, the fighting will wear you out. Sometimes it became so obvious that the clerk reporting the fill couldn’t even explain the fill the customer got on his order.

I think that’s how our desk got all the business we got. People heard about the desk that was fighting the pit for better fills and that’s why the PitBull stuck with us. He knew he had a desk that was going to safeguard his orders and actually get in a fistfight for it. In the end, I think that’s why the desk survived. They knew that a 6-foot, 210-pound Irish guy was ready to do battle and if you wanted to get in that desk you had to go through him first.

In the end I have no regrets. I did what I had to do to protect the customers and my desk. My moto when it came to the pit was simple. It didn’t matter if it was a 1-lot or a 100-lot, it was someone’s money, and as long as I was standing there that type of conduct just didn’t fly.

In Asia 6 of 11 markets closed modestly higher and Europe is mixed this morning with 6 of 12 markets trading modestly lower . Today’s economic calendar starts with Motor Vehicle Sales, Gallup US ECI, Redbook, and Janet Yellen speaks on bank regulation in New York.

Back and Fill Until She Spills

Our view: Regardless of the trading tools you use, you need some level of street smarts. If not, you’ll get beat by the algos every day. It’s like being short the S&P, knowing you’re wrong and getting out early rather than waiting for your stop to get executed. The basic patterns still apply in the final three days and the first three days of the month, when the mutual funds sell their losers and mark up their winners. Yesterday’s trade was a classic example of just that. The S&P rallied early, sold off a little and then started going back up. Exactly like it has done for the last month.

Yesterday the S&P 500 futures came within three points of their all-time contract highs. The low-volume selloff that we saw last week turned into some back and fill yesterday. Our view is unchanged because the overall uptrend is unchanged: sell the early rally and buy weakness.

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As always, please use protective buy and sell stops when trading futures and options.

• In Asia 6 out of 11 markets quoted closed higher: Shanghai Comp -2.20%, Hang Seng -0.74% Nikkei -0.06%
• Europe is mixed, 6 of 12 markets are trading lower: DAX -0.07%, FTSE -0.19%, MICEX +1.86%, Athens GD.AT +0.89%
• Fair value: S&P -1.88, Nasdaq -0.51, Dow -18.80
• Total volume: 1mil ESH and 4.3k SPH traded
• Economic schedule: Motor vehicle sales, Gallup US ECI, Redbook , and Janet Yellen speaks on bank regulation in New York.

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