GM Lark Traders. This is Lark Digest, your virtual trading companion. We’ll accompany you on your journey through the market's highs and lows—except when you full-margin your account (that’s on you).

Today we’ve got:

• How NOT to approach funding challenges ❌ 

• Jerome Powell gets the market excited 😏 

• A new weekend giveaway? 🎁 

• Weekend treats 😍 

HOW NOT TO APPROACH PROP FIRMS 🚫

I recently came across a tweet from a trader who said they’ve failed 31 challenges in a row.

31 challenges 🤯

Now, obviously, however this trader has been approaching these challenges is exactly how not to do it.

But sadly, this is a lot more common than you would think.

The truth is, it’s rare for a trader to get funded on their first try. On average, it takes two to four attempts.

So 31 is… Is insane the right word?

Like the great Charlie Munger, rather than asking ourselves, “How to pass a funding challenge?” we like to use what Charlie made famous: inversion thinking.

See, as humans, we’re way better at avoiding disaster than we are at achieving success. In fact, this is the exact mindset shift I adopted that helped me go on to pass 4, $100,000 FTMO challenges in 2021.

So in 2020 when I made it a goal to get funded, I asked myself the following:

“What would I need to do to ensure that I would never get funded? To ensure that I would never pass a funding challenge?”

Here are some of the answers I came up with:

• Always risk more than 1% on every trade.

• Take every setup I see. Regardless of the quality of it.

• Trade small timeframes, like the 5-minute chart.

• Focus on as many pairs as possible.

• Don’t pay attention to news events.

• If I lose a few trades in a row, look into a new strategy.

Now, pretty much all of these are obvious. Or at least, they should be. But if we understand that simply avoiding all of these and doing their opposite (AKA inverting them) we’re much more likely to be successful.

We’re much more likely to be consistent. And we’re way less likely to purchase 31 challenges without passing one.

We go a bit deeper on this in our recent YouTube video.

PAPA POWELL IS FEELING GOOD ✅

Jerome Powell is kind of the godfather of the market.

He decides what to do with interest rates and is the big boss of monetary policy.

And that means what he says matters. A lot.

But at Lark, we have a gut feeling that you don’t get quite as excited about congressional testimonies as we do. But they matter. Also, a lot.

On Thursday, Powell (AKA Papa Powell) testified in front of Congress and discussed what he sees happening the rest of this year.

Some of his comments, as usual, moved the market. And if you want to understand how and why the market will move the way it will over the next few months, this is stuff you need to know.

But first, Monetary Policy 101:

Remember all those lovely stimmy checks back in 2020? Yeah, they were great, but they sent inflation to the moon. As a result, the Fed had to hike rates the fastest they had ever done in history.

Remember, when rates go up, economic conditions tighten, and the Dollar gets stronger, but stocks typically sell off.

When rates go down, it’s seen as a move to light a spark in the economy’s you-know-where. So the Dollar will weaken and risk assets (like stocks, crypto, etc) will fly.

Okay, back to our regularly scheduled programming.

Here’s what Powell said:

1/ Inflation is not far off. On Thursday, Papa Powell said the current inflation rate is not far from where it needs to be for the Fed to cut rates.

2/ He’s feeling good. Powell echoed the inner monologue of every spring breaker in Miami right now when he said, “I think we’re in the right place.”

3/ Futures traders are predicting June. The market expects the first cut to come in June and three more later this year for a total of 4 cuts. That would bring the Fed Funds Rate down an entire percent (that’s a lot).

Now, by the time you’re reading this, none of what I’m saying might matter.

By the time you receive this, NFP, the most important event of the week, will be out, and the market could be going crazy.

But we think even if your troubled nephew and cousin did go back to work and the unemployment rate is looking good, the above will hold true.

The market holds on to Powell’s words like they’re gospel, so remember where his head is when deciding whether to buy or sell (or go full-margin).

A NEW GIVEAWAY! 🎁

Okay, let’s end the week on a good note.

We’re giving away two $50,000 3-Stage Evaluation accounts!

Here’s how to enter:

1. Subscribe to our Lark Funding YouTube channel.

2. Watch our latest YouTube video.

3. Comment your biggest takeaway from the video.

We’ll share the winners in Monday’s email!

WEEKEND TREATS 😍

Every Friday, I like to share what I’ve been reading, watching, looking at or anything in between.

Usually, non-trading related. Here’s what I’ve got for you this week.

1. We launched a giveaway yesterday where people needed to say how God has recently blessed them. If you’re looking for a quick pick-me-up, scrolling through some of the answers is great.

2. I found this synopsis of the book Bad Therapy to be very interesting. It seems like therapy has turned into the modern gospel but by all available metrics, it’s not helping the younger generations. It’s actually making them worse. Something to think about.

3. This tweet got me thinking about productivity differently.

4. Speaking of productivity, no joke, this thread is changing my life. I’ve implemented this deep focus routine for the last three days and man, it works.

That’s it! Happy Friday!

DIGESTIBLE MEMES 🍪 

ACTIVE GOODIES? 😏