The 920 strategy is a trend-following trading approach that utilizes the 9 and 20 Exponential Moving Averages (EMAs) on a 2-minute chart to identify entry and exit points within an ABCD price pattern, aiming for trend continuation.
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So, what is the 920 strategy? You've
probably heard it lots in the room. The
920 strategy basically, and I was just
thinking, you know, as I was going
through this uh presentation, I was kind
of uh thinking about um thinking about
it in a sort of a different way, a sort
of a high level way. And it's it's
essentially an AB, you know, you're
hoping for a derivation of an ABCD
pattern. So, everybody kind of knows
what that ABCD pattern looks like.
You've got that push on the on the bull
side. You've got that push up.
Eventually, you get to a point where
buyers get a little exhausted. Ah, crap.
Going to do that. Buyers get a little
exhausted at the B. You get a bit of a
pullback on the C where some people take
profits and then the people that have
missed out on that initial run um start
jumping in and buying and then you get
that next push up to uh D. So, it's
essentially it's an ABCD pattern. Um, so
you're just looking for a uh buy point
to enter on a trending stock that's
going up. I didn't put in the bare case.
Uh looking for a uh a short or a sell
point um to enter on a a stock that
might be trending lower like you've got
on that ABCD pattern on the uh on the
far uh right hand side there. So, the
nice thing about this uh this ABCD
pattern is the in 920 strategy is the 20
EMA defines where um where you're going
to get into that um that trade, whether
it's a long trade or whether it's a
short trade. And so if you're if you're
just looking at an ABCD pattern in uh in
sort of isolation, you're always kind of
guessing a little bit as to where where
that um where those buyers are going to
uh step back in on a on a bullish trade
or where the sellers are going to start
hitting the um the price again um on a
on a bearish trade. [clears throat] Uh
why does it works um so often? Um I can
only imagine that other people are using
this uh 9 this 9 and 20 EMA something
around that and uh that's why it just
seems to be um at least relatively
predictable in my mind. So so
[clears throat] this is essentially the
um the 920 strategy sort of the the
highlevel view.
Um okay so I went the wrong way. Um,
Um,
so what are we going to talk about
today? We're going to ch talk first
about uh charts chart settings. Um, what
the settings I use to be able to pick
out these trades.
We're going to talk about the trade
setup, you know, how it how it sets up. Um,
Um,
well, we'll get to that in a minute,
Frank. Uh, we're going to talk about how
the trade sets up. We're going to talk
about entries and exits. Um, we're going
to talk about uh stopping out when you
know the trade's not going the way you
would hope. And uh then we're going to
get into uh examples and uh as to um uh
some of the some of the example trades
that I've used or seen. And uh and then
we'll talk about uh you know the closing
out of the trade, how you know if you're
if you're in the trade and you're still
uh riding it either higher or lower um
where you might want to think about
closing out. [clears throat]
So, chart settings, uh, the chart
settings, and the reason I really picked
up on this, uh, pattern was because I I
liked in for my short-term trades or for
my short-term chart, I like to use the,
uh, the two-minute chart. And this is
where you see these u these uh, trades
set up on the two-minute chart. The one
minute chart uh, doesn't it just doesn't
appear as um, you know, as a 920 trade.
And uh so I that's why I I you know I
started seeing the pattern time and time
again as I was using the two-minute
chart. And and some people I know
there's people out there you know
there's uh people out there that prefer
using a one minute chart um for their
very shortterm uh maybe entry and exit
um indicators. I like the two-minut just
because it takes a little bit more of
the variability
um out of um out of the uh the price
action. So, [clears throat] you know,
it's a personal thing. You know, some
people like to use the two-minut, some
people like the one minute. Um I prefer
the two-minute chart. And then this is
where I kind of decide, you know,
figured out this uh 920 strategy. kept
seeing these uh bounces off the 20 uh
exponential moving average, which brings
us to the next setting on my chart. I
use the nine and the 20 exponential
moving averages. So, you'll see those on
all my example charts. Um what else do I
have on my charts that you really need
to keep in mind for areas of uh of
support and resistance? Obviously,
previous day high, low, and close.
That's I like to have those on my chart.
obviously the VWAP and uh I have I
usually have pivot points on my charts
the R3 4 and six and the S3 4 and six I
find that uh the ones and the twos and
the fives don't really have that much of
an impact um in terms of seeing where uh
potential reversals u or um you know or
support and resistance will be. So those
I think are the the crucial ones for me
personally. And again, I uh I always
when I start the day before I start um
trading in the open, one of the last
things I'm doing as Peter and Carlos
here are kind of wrapping up here is uh
before they turn the the room over to
myself and Andrew is I like to mark the
pre-market high and the pre-market low
on both the SPY and the Q's because I
find that uh those pre-market levels
seem to be areas where you will also see
um some support and some resistance.
You know, [clears throat] if for no
other reason, at least you can
understand why maybe maybe you're
watching the spy and it goes up to a
certain place and it doesn't it just
seems to be maybe it just seems to be
like a random location where it either
stalls or or reverses. Um, if you mark
the pre-market high and low on, you
might uh get a better understanding of
why um why these areas seem to be uh
important or at least at least it gives
you an indication as to why there's
price action at those levels. So, so
those are the um those are the pretty
much all the uh um the tools that I use
on my chart, the indicators that I use
on my chart. So you can see that's what
I'm using when I'm looking for the 920 trade.
Let's take a look here. So what is the
trade setup? What what what am I
watching for when I'm looking for a 920?
Well, starts out with you're looking for
securities and that can be either stocks
or it can be um or it can be indexes
that are performing well from the open
or performing poorly. So, you know, and
it and I like them better at the open,
although these these trades can happen
pretty much any time during the day. But
what you want, um, you want something
that's u moving steadily in one
direction for an extended period of
time. And when I say extended, I'm
talking maybe 20 or 30 minutes of
[snorts] either either moving up slowly,
you know, not slowly, but steadily or
moving down steadily in uh in dur in one
direction. Um again, ideally the setup
is a slow steady move higher or lower.
doesn't necessarily have to be from the
open, but uh I find these things quite
often a lot of these things show up
right around 10 o'clock, 10:10 from the
open. Again, they can happen pretty much
during the day, but uh it's it's the uh
it's the reaction to either news or
something like um you know, the market
just moving higher or lower from uh from
the get-go. And we've seen that
obviously. And so, like I said, when I'm
when I'm watching them from the open,
I'm looking for for these trades to set
up around 10:00. Um, sometimes even, you
know, if I was going to pick a time,
1010 seems to be almost like you see
that quite often. um you know this uh
this this time period of 10 10 minutes
after 10 seems to be an area that uh you
know if you've got a stock that's
bullish um you um [snorts]
you know you're going to see the thing
open and go and you know go up and again
you don't want something that just
blasts off. You want something that sort
of starts up and then you know
continually the the bids come in. bids
come in and around 10:00 the buyers
start to get exhausted after that first
half half hour of trading and then and
then you start to get some selling come
in and this is when you get that that
ABCD pattern that pullback and that's
when I'm looking for these um these
[clears throat] trades on the pullback.
So again, you want steady consistent
move up in one direction. And the other
thing that happens when you're getting
this nice steady move up in one
direction is the distance between the 9
and the 20 EMA um remains constant but
there's also because the stock is moving
up the nine is is leading above the 20
and uh and I've give a I've given a
presentation in the past about um I
think I was talking about the open where
I where I've been watching you know
stocks that tend to get on a nice run.
They always stay they always seem to
stay above the nine. Um they you know
they'll keep moving up above the nine.
Occasionally they'll sort of consolidate
a little bit and move sideways and
they'll come back to the nine and then
they'll continue they'll run up. And
this is and this is sort of this 10:00
10 is kind of the the point where where
you get some a little bit more serious
uh selling on a bull side or or a little
bit more short covering buying on the on
the downside. >> [snorts]
>> [snorts]
>> Um, so and and the other thing that um
that's sort of notable, the trade works
even better if the 20 EMA is close to
the VWAP. And we'll see a few of that
that on um on these uh examples that
I'll get into in a minute.
So the entries and the exits um again
the entry is at or around the 20 even uh
EMA. Even better if it's close to the
VWAP. Sometimes you have to make a call.
Like for example, if the 20 EMA is is
just above the VWAP.
Sometimes I I kind of hang back and wait
to see if it just goes a little bit
below the the 20 EMA and then and then
I'll take a long even more confidently
off the VWAP. But um doesn't always work
out that way. Or you can add sometimes I
add a little bit at the 20 and then add
more at the VWAP and then tight stop
after that. And so if the VWAP is just
below the 20 EMA, it's like I said, it's
option to add to the trade if it drops
below the the EMA and then gets to the
VWAP. And again, sort of the reverse on
the bearish side if the VWAP's above the
20 EMA. Um you can add add some at the
20 and then add more at the VWAP and
again very tight stop. Um after that,
you don't want to see it turn around.
So, [clears throat]
so what I typically will do is I will
take my first partial when we go back up
to the nine just to lock in a bit of
profit in case the trade fails because
sometimes and I'll show you in some
examples where the trade will fail. um
it'll get back to the nine or just get a
little bit back above the nine and then
it'll just uh roll over um or it'll you
know like it'll uh yeah roll over if
it's if it's a bull trade or or it'll
just start to keep going higher like
it'll actually be a trend reversal
versus a um ABCD pattern which is a
trend continuation.
Um the second case uh second area to
take profits and I strongly recommend
this as an area if you're not going to
take uh partial at the nine. You should
very for sure take profits at when you
get back to the high of day on the bull
case or uh low of day on the bare case.
Um lock in some profits just in case
it's a double top or a double bottom.
The reason I like to take um first first
little bit off at the nine is it just
gives me a little bit of a cushion. So
if we do end up falling back and there's
a bit of slippage um on the trade then
um you know you end up with a flat trade
or you know just tiny little loss um if
you've gotten some slippage when you've
gotten stopped out. But uh locking in a
little bit of profit on nine is uh is
kind of like my assurance that I'm not
going to lose very much on the trade.
And then uh if you if it does in the
bull case if it does you know continue
to move higher you just hold and uh on
the bull case if it just continues to to
head lower trend continuation you just
look for the next levels where um where
there could be support and resistance
and we'll talk about that as we get to
the end of the uh uh presentation here.
Um what do you see better um for
entering the trades and what key do to
well it's um I can answer that. Um
um I don't really I don't look at the
float um necessarily. I um I don't look
at the market cap per se. Think it you
know like I said it works for it works
for stocks, it works for indexes, you
know. I think it's going to it's not
going to maybe work quite as well on
some the really highriced um stocks like
the ones that are 400 like SanDisk and
you know ones that have a big spread. um
I'd be reluctant to um to take trades
with it on um you know I'd be reluctant
to use this strategy on stocks that are
you know tend to be have big spreads and
and uh make it difficult for you to to
get out if the if the you know if it
doesn't work out actually and Atlas yes
um you can use uh yeah Tesla Tesla you
can use it on
Tesla's uh you know because Tesla is
kind of an exception because it's so
liquid. Um you've you've got a fairly
tight um you know tight spread between
the bid and the ask and Nvidia same
thing but uh you know SanDisk I haven't
I really haven't traded SanDisk. I know
other people in the room have, but um
you know it's uh I just find that uh
when you get into these really high
price stocks, the spreads be can be challenging.
challenging. Um
Um
is it going to work with the 8 and 21 as
well? Well, [clears throat] you have to
remember this is, you know, you're not
going to get a perfect entry every time.
I mean, I can point to charts and we'll
look at these examples. I'll point to
charts where you can almost it's almost
like picture perfect where you get this
nice bounce off the uh the
[clears throat] nine or the 20 EMA.
Sometimes it comes close, sometimes it,
you know, undersshoots a little bit, you
know. So
yes, you can use this with options for
sure. Um again, I would caution you to
if you're going to use options on a
trade like this, like I can use this on
the spy or the Q's options. So, if I see
this the Q's doing a 920, I can I can
trade it with options, no problem. And
the and the great thing again about the
the the options with the SPY and the Q's
is the is the spread is um is fairly
small. Um they're very liquid. So, if
you if you're on the wrong if you end up
on the wrong side of the trade, you can
>> Um how do I get this recording? I
believe it'll be um it'll be recorded. [clears throat]
At least I hope it's recorded.
Definitely make the uh the presentation available.
available. Um,
Okay. Well, let's see. I'm going to
start recording this. I should have done
it earlier, I guess, but uh we'll start
the recording here just in case nobody
else is on to uh to do that.
Okay. Thanks, Dwayne. I'll just uh then
Why don't they trade spy and QQQ in the morning?
I don't know who they is. I mean I I've
traded spy and QQQ. swimming uh number
of other people had.
Yeah. Um I I tend to trade as you know
if I'm feeling confident I'll trade SPX.
[snorts] If I'm if I'm um if I'm feeling
less confident about uh movement one way
or another and but I still want to take
a trade, I'll I'll use SPY and QQQs. But
when you're trading S&P options, you uh
you can lose a lot of money. uh very
quickly. Yeah. And and I know Andrew
trades uh you know he'll if he sees the
cues of the spy and he likes the price
action on that he will he'll trade he
doesn't trade options but he does trade
usually trades TQQQ
which is uh which is essentially u a
trade on the Q's.
So let's just see here. [snorts]
[snorts] >> [clears throat]
>> [clears throat]
>> So stops, let's talk about important
thing about stops. And again, I think
once if if we get in through some of
these um through through some of my
examples, I think you're you'll kind of
see um more clearly um all the all the
concepts that I've been talking about.
Um, so again, the stop is, you know, if
it doesn't hold the 20 EMA, um, you
know, if if it's a a bull run and it
pulls back to the 20 and it doesn't hold
that 20 EMA, then you you've got to get
out quickly. Um, and then the other
things you have to consider, again, I
talked about how far the 20 is away from
the VWAP. If the VWAP is pretty tight to
the 20 EMA, then maybe you might hold
on. Um, got to watch price action. um
you can refer to um to Atlas to get um
you know to get some indication of
whether there are um you know whether
there's an indication that um that
there's some u there's some bids above
if if you're looking at a bull case or
or bids heavy heavy uh uh book um
positioning below if it's a bare case.
[clears throat] Um
again, if the price goes back to the
high or then to then reverses or goes
through the nine and reverses, that's a
sign of a double top or a double bottom.
So now you're probably might be dealing
with a trend reversal versus a a trend
continuation, which is what you're
playing. So you got to be careful about
that. Um yeah, so um that's um yeah, if
the price breaks higher and then pulls
back to previous higher low again, it
might just be a check back before you go
higher, but uh consider you have to
consider exiting more. So let's get um
ah can you please share
this to the most traded stocks that fits
the 920? Wow. Um well again I kind of
watch um Nvidia, Tesla. I mean it can it
can be any any stock and and again it's
probably um [snorts]
it's probably best if you look for you
want a stock that's trending. So you
want a stock that's maybe gapping, you
know, that's could be trading on on
news. So it could be it could be any
stock, right? could be. Uh I think I I
think I've got one in here on Oracle. Um
I mean the the ones that are most active
are things like Tesla, Nvidia, AMD,
PLTR. Um those are the ones that are
most active, but um you know it could it
can show up on just about any chart. And
uh also watch for them on the Q's and
the SPY. Um,
Um,
so, um, oh, it doesn't allow two-minute
charts. So, maybe 821. Yeah, I I guess I
yeah, I don't I don't know. You'd have
to play around with your settings. I not
Yeah. You know what I mean? This this
initial this initial little partial at
the nine, I mean, you're probably going
to you're probably going to get one R.
Um but again the purpose it's I would
call that a conservative
um a conservative trade versus a um you
know maybe you don't want to be quite as conservative.
conservative.
[snorts] Um because you know you're
you're probably only going to get one
hour on that that first little initial
um pullback [clears throat] or that
first little initial bounce if you want
to call it on a bull trade. But, you
know, you the the point of it is for me
is just to get a little bit of money off
the t off the table to cover any kind of
uh slippage. Um and [clears throat] uh
and then really look for the the larger
R moves as we uh for the continuation move.
move.
Um like I said, 920 uh trades can happen
just about any time a day.
um uh 10:10 like it like [clears throat]
it's this is this I wouldn't start
looking for them much before 10:00
because you need to you need to see a
trend. Um and it's not uh it's not a
strategy you use when the when the stock
price is doing this for the first half
hour. You want a nice steady move up or
a nice steady move down. Not not jerking
all over the place. And so you need, you
know, [clears throat] that kind of price
action can happen during the day. Um,
but if you get a, you know, if you get a
market open where every, you know, where
everything's positive like yesterday and
we start, you know, we just start buying
or, you know, and it just keeps going up
or or something moves up on um on some
news, then then you're going to get uh
you might get a nice steady move that
you're looking for. So [clears throat]
okay.
Yeah, exactly. It's a again this is a
this is a strategy
[snorts] that is it's basically you're
looking it's a trend trade. You're
looking for a trend to continue. Um, but
you at the same time you have to watch
to make sure that it's not a trend
reversal cuz sometimes these trend
reversals can happen and you need to be
prepared to stop out if it becomes a
reversal. So, let's take a look at at
some examples and uh maybe it'll become
a little bit clear. I know just talking
through stuff is um sometimes the
concepts are hard to grasp. Um, so you
Let's try. You can see here,
this is the nine. This is the 20. The
blue line is the VWAP.
But you can see here we've had an you
know we get this uh at the beginning
here we get this um you know the retail
traders they call it the silly
this not the silly hour I can't remember
what the pros call it but this is the
silly session where you know this is
mostly retail traders that are in that
are trading when the market opens the um
the professionals the guys that uh
aren't uh you know have been doing this
forever will sit back and let things
kind of settle out here. So, you can see
here, this is Apple. We kind of had this
crazy little move up. Um, we had a
pullback, bunch of profit taking, and
then and then it settles into a nice
trend higher. You can see this is what
we're looking for here. You can see, as
I mentioned earlier, you can see how we
had this move up, then we came back, we
touched the nine. Um again um a little
bit of selling [clears throat] um profit
taking as we broke out a pull back to
the nine the 9 EMA touched the 9 EMA
again. This is this is always a good uh
setup for a trend. And again, we get
some and more ABCD pattern here. And
then you come back to the nine again.
And then we get to this high here.
[snorts] And uh and now we're now we're
at uh 10 about 1020 10:25
and we're you know the the buyers are
kind of exhausted here.
um you know they've they've had this
really nice ABCD pattern a couple times.
Now we're getting exhausted. Now some
more serious selling comes in and we
pull back and we hit the 20. And this is
where the 920 trade comes in. You've got
a pretty significant pullback, a more
significant pullback and you enter here.
uh if you're feeling very conservative
and you and you you know you're worried
that there this might be a a change in
trend uh reversal you could take a
little profit here. So so in case you
drop back down to this low you can stop
out and uh and if it continues to go
lower at least you're you know you're
either flat or you're very very small
loss on the trade. But then you get uh
you get this nice continuation here and
then you take this is this is an area I
would definitely take some profits off
right when we break to this uh new high
and then you just hold the rest.
So this is really um this is an example.
Um well and we we'll talk about the
final exit but this is when you have to
if you're if you're breaking higher
right here this is where you really have
to say okay you have to look at your
bigger charts. So, you have to look at
maybe the where R six is or in this case
R six would be resistance six. Look back
on your 60-minute chart and just say,
okay, where where am I going to see some
more significant resistance and where
should I be taking uh some profits? But
if you didn't have in, you know, in I
would say in if you didn't do that or or
you could look at Atlas. The other thing
is you look at Atlas. Is there are there
orders at 146?
Is there a big order sitting at 146?
Maybe you might think it might go there
next. Take some more profits there. And
uh but if you didn't have any of that, I
mean, I would think that, you know, this
this pullback and then this higher low,
I mean, you'd definitely take profits uh
take your profits there because uh
you've now made a lower high and uh and
that's always an indication of a reversal.
reversal.
Um where do you put your, you know, it's
a little bit of a soft science, I would
call it. Um again I would on this case I
would take something a little bit below
this uh this low this candle because it
just dipped a little bit below um the
20. Not very much just a tiny bit. So I
mean if we if we came up here hit the
nine started rolling over you take maybe
take a little bit off maybe not. Started
rolling over again and came back down to
the nine. That's kind of where I would
probably think seriously about stopping
out. again looking at Atlas and all the
rest of that. Um, but that would be the
conservative approach. And again, the
whole idea is, you know, when you're
getting in here, you're getting in right
at this level. You know where your stop
is. It's not, you know, it's not down.
It's not down at the VWAP in this case.
I mean, the VWAP was here. Maybe you'd
uh you you'd set your um stop at the
VWAP, but uh with the VWAP down here, I
wouldn't hold on to it because it could
All right. So, let's uh let's look at
another example.
Here's uh DKS again. You know, Apple DK
I mean Dick Sporting Goods. This is uh
this is one where if you know if you'd
have traded this and I think this was
one I traded quite a while ago. I used
this as an example for uh um for a um
Phoenix trade as well. But here's
another example of a 920 trade. You get
a nice uh sort of nice move up. We get
to about 10:00, it pulls back, comes
back down to the uh this 20 EMA, dips a
little below it. You know, nothing's
perfect or very few things are perfect,
but you get a nice uh move back up, take
a little bit off as you break through
the nine. um take definitely take some
more off as we get back up to this uh
prior high just in case it's a double
top and then uh you let the rest run and
you know you I would have I think I
would have taken tra you know definitely
taken profits here at PDC because that's
your my PDC line um
um I would say somewhere between two you
know ideally you could get um six or
seven are I You just don't know if if
you're going to get a trend like this or
if you're going to get a bounce back
here, back from the to the nine. I mean,
ideally, I mean, at at worst, that's
would be my my hope would be at the very
least you'd get back to the high and
that would be a double top. Um, and
sometimes they just continue going
higher and sometimes you get a double
top. So, sometimes it's just 2 hour,
three hour. Sometimes uh you know you
can get six R seven R like this trade
here would have been uh amazing trade
even as it went through uh yesterday the
Yeah, I would say I I do watch I do
watch the price a little bit as it comes
back to the 20. Um I do watch for some
some support. I mean, it's a it's a
little bit of a
uh it's a little bit of of feel in it,
too. You just kind of watch it and you
just kind of see um sort of the the the
candle sort of changing going a little
bit more getting a little more upticks
And so, here's a you know, here's
another stock AI. Um I'll try to get to
some of these questions. I want to get
through some of these examples because I
I think that some of these questions
will be answered if I can uh get through
some of these questions. So, here's
here's um a move on AI
again. We get this move up. It's not
this isn't great. This is not a great
setup. You know, we get a pull back to
the 20 and it it goes back up again. Um,
again we test the 20, goes back up again
and uh again it didn't really test the
20 here. Just kind of failed and then
started chopping. It's not a not a super
great example of a 920 but it's uh again
it's it's kind of a trend.
Um let's take a look at the some of the
failures on 920s because I because to be
clear the this doesn't always work.
There's no there's no pattern. There's
no um indicator that's perfect um that
you're going to um you're going to take
and and guarantee 100% uh trade. So,
let's look at let's look at RCL the um
Royal Caribbean. So, you can see here I
this might have been an earnings. You
know, we had a we had a pop up at the
open. This was previous day close. So,
we had a pop up, then we had a nice move
up, but it was pretty This isn't what I
like to see for a 920. This is This is
really a couple of really kind of this
really big candle, this fairly big
candle, and you know, not not that big a
candle, but you know, pretty significant
move in a very short period of time. So,
that was 6 minutes. We jumped up quite a
bit and then we did a lot of consolidation.
consolidation.
And uh to me this this is kind of
telling me that you know it keeps it
keeps stopping out here. They seem to be
sellers right here, right here, right
here. I don't I don't know why this
level is important. You might have to
have to look back in the 60-minute
charts, but you can see here finally we
we do end up losing this 9 EMA. It comes
down to the 20 and really just does not
bounce at all. This is and this is where
you know if you took an entry here you
could see it kind of tried to bounce and
then immediately started to fail. So,
um, you know, he could have held on to
the see if it bounced off the VWAP cuz
it kind of paused here, but you know, it
just it just too much consolidation, too
many tries to get above this level. And,
uh, this is not a setup I would have
taken for a 920 even though we, you
know, it did go up. It did hold the
nine. too much consolidation
um prior to to losing the nine and then
um yeah, it just uh if you had taken it,
you'd have to stop out quickly because
it was just didn't work.
Let's try and catch up on some questions
here. Um ever flipped my position on 920 times?
times?
You know, it's hard sometimes it's hard
to get mentally it's hard to flip your position.
position. Um
um the win rate on this strategy is
probably I mean it depends what you what
you want to refer to as win rate. I I
would refer to the win rate as getting
back to getting back at least getting
back to high of day cuz you because that
first uh that first sort of um
um
that first little exit if you want to
take it at the nine that's that's um you
know that's usually usually you're going
to get a bounce and get back to the
nine. But that's not that's not the
trade that's going to make you money.
the the trade that's going to um be a
winning trade, one that's going to get
you to R or better is one that's the
very least is going to get you back to
the high of day. And I would say it's at
least uh it's at least sort of 50%, and
I'd say it's much higher. Um I don't
know exactly. I'm just guessing it's at
least 50%, it's going to get close to
back to the high. Um, and I would say almost
almost
almost 70% that you're going to at least
Um,
I I haven't actually ever sort of
kept uh kept track of it. So, here's
[clears throat] a here's a trade that um
that I did. This happened actually [snorts and gasps]
[snorts and gasps]
probably last week. I think this was a
last week trade mid. Um probably I'd
called it out in the room here. So
you've got this is the cues obviously.
So we had this um you know the open we
were gapping up here. There's your
previous day close right there. Gapping
up and then we just struggled to go
higher here. Um
this was probably maybe an R3
uh level right here. So had trouble
going through R3. Eventually we started
rolling over, got through the VWAP. We
tried to come back, recapture the VWAP,
continued lower, lower. So you get this
nice steady downtrend. Not too not too
radical. Um and uh finally we get to
this level and uh and then we bounce and
we come back up and we go through the
nine and then we hit the 20. And this is
I did a short here. I took this short.
Um, not sure if I took a little bit off
here. Might have taken a little bit off
here. And I probably used options with
this. Um, took a little bit off at the
uh at the nine. Um, and then took a fair
amount more off right down here at the
uh at the low of the day and uh and then
uh then it bounced. Um, so was this a
successful trade? In my mind, yes, it
was because it was green. probably got
close to 2 R. So, because I would have
stopped out I did stop out back when we
got started moving back above the nine
here. This is where you would stop out
when the trend when you're seeing a
trend reversal, not a trend continuation.
continuation.
And uh I'm not sure if I flipped long on
this or not, but this uh but you know,
seeing a double bottom like this is
always a good uh I probably thought
about it after and thought, you know, I
should have taken a double bottom there,
but I didn't. >> [snorts]
>> [snorts] [clears throat]
First partial at the 20. No, first
So,
short at the 20, first partial. If you
really wanted to be conservative, take a
little off here. I'd say like 10%.
And then, and then let the rest ride. I
would take up to, you know, even even
get to like a 50% position once I got to
uh back to this um this prior low and
then uh you know hope for a continuation
move down. Of course, we didn't get
that. And then you'd have to stop out
here. You're still even when you're
stopping out, you're still a little bit
green. Um but um again, you're looking
for a trend um continuation and uh
stopping out when there's a trend reversal.
Yeah. Well, like I said, Yeah. Yeah. You
>> Uh you can, but you really want to get
you can take multiple 920s on the same
stock, but really you you know, you're
looking for this setup. You're looking
for this long sort of steady move either
down or up. And I'm doing some bearish
ones now. And I will mention this again
at the end of the video, but I find
these um 920s work better on on bullish
trades. And why is that? It's because we
have this buy the dip mentality. So, how
often are you going to see double
bottoms versus double tops? I mean, this
is uh you know, this is the market we're
trading. um it's tends it's it's
definitely been um bullish and so you're
probably when you're looking for a trend
continuation, [clears throat]
you're more likely going to see a trend
continuation on bullish stocks and
you're you're more likely to see more of
a reversal on bearish stocks. Um unless
unless the bad, you know, it's really
rolled out some bad news. Um, again,
here's uh here's another failed move on
the Q's. Again, this is this is the
setup. Now, this is this is a a trade
that's uh actually, you know, people ask
about, you know, what time of day you
can see these any time of day. I like to
look at them for the open, but you know,
[clears throat] this is this is at 11:25
and we start to see uh believe this was
this week. um you know we start to see
this uh slow steady breakdown. We get a
one big candle here. We got a bunch of
little candles here, a bunch of you know
testing sort of the 9 EMA here, testing
the 9 EMA here and then and then we
start we get back to PDC. And this is
why it's important to have all these
levels on your chart because you you
know you you know that some of these
levels are going to be uh respected. So
you get this bounce back up to the nine
and then it and then it pushes through
and goes to the 20 and then you get this
rejection right at the 20 EMA. So you
can take a long here, take a bit of a
partial here. Um no follow through on
the bounce. You can kind of see here we
we double bottom. We um you know the
other thing that I've got setting on my
chart is I've got when the uh when the
moving averages are red or they mean
they're trending down and they go green
when they're trending up. So, you could
see here we're kind of consolidating.
Um, probably at this point I' i'd decide
this is not going to uh continue lower
and I'd stop out. And again, wouldn't be
it if I stopped out somewhere around
here, wouldn't be a wouldn't be a um a
red trade, but it wouldn't be a terribly
green trade either.
I always use um I rarely well I
shouldn't say I always use mental stops
to u to manage this area here. Now if I
get a if I get a nice uh continuation
move lower and we do break this low of
day and it's getting you know it's
getting to 8:00 and I'm wanting to have
some breakfast. I can always if we start
to break down below there, I would
probably be more inclined to uh use a
trailing stop or use uh just a stop, you
know, back up, maybe back up at PDC. Um
uh so for the most part on these trades
I'm using um I'm using mental stops, but
physical stops can be good if you're if
like a trade like this one. You could uh
you know you could set it and forget it.
use a trailing stop or use um you know
just use a hard stop, you know, just uh
you know, if you want it and and
sometime I know Thor does this a lot um
and it takes the temptation out of
taking profits because he looks for big
moves um like we all do, but if you're
if you're sort of micromanaging the the
stock, you know, you might be tempted to
take, oh, you're definitely going to
take some profits here because that's
PDC, you'd almost have expected a
rejection there, which you didn't get.
Um, but you know, you'd take some
profits there, but I mean, if you know,
you could have made a huge move if you'd
have just left uh a little bit on on on
that trade.
So, sometimes it's good just to use
those um those um stops and just walk
away from the trade and don't uh don't
look at it. That way, you don't
So again, here's here's another um
failed um trade on Oracle. Again, we get
this uh we get the open, we get a little
bit of crazy price action, and then we
get settled into a range after about 10
minutes, and then we get this nice
steady move down. Um tested the 9 EMA
once here. Um actually tested it twice,
a continuation down. Then we start to
get some bottoming action, put in a
double bottom here. Um, again, we come
back up. We test the uh we test the uh
20 EMA, but again, this is this is not a
great setup because we've had, you know,
an area of consolidation here. If this
had come back up and kind of tested the
TW the 20 there and then you could have
it would have been a much better setup
than kind of getting consolidation in
this range. We talked about talked about
that with one of the other uh trades,
RCL, how it how it came up and really
fast and then it kind of consolidated
for a long period of time. Um pulled
back to the 20 and just never really
bounced. And this is what happened with
this one. So, you have to be cautious
that, you know, if you get into this
consolidation before you get this test,
it's not always your best setup for a
920 trade because you get this nice
bottoming price action or topping price
All right, here's a I'm going to do I'm
going to do this uh
I'm going to do this little test here
and I'm just going to see what you guys think.
think.
again here. This is a this is later in
the day trade. You can see we've been
chopping along here for the morning.
Come to about 11:30. We start to lose.
You know, you can kind of see here
there's a a definite range we've been
trading in. All of a sudden, this candle
takes us below that range. We come back
up. We retest where we broke down from.
And we don't the buyers the buyers
basically can't push the stock back up
into that range. And what happens? The
sellers all of a sudden anybody who's
sort of bought in this range is already
is now going yikes. We got to get out.
And the and the people that are watching
this for a short are going yeah baby.
Here we go. So you can see here big drop
and then we get this nice, you know,
steady move down. Then we get into this
period of consolidation
and uh even looks like we broke to a a
bit of a low here and came back up. So
where do you think do you think this
Very good everybody. Yes, you're getting
the That's right. It's not a great setup
because first off, we're getting this
consolidation. We've come, you know,
we've kind of come up. We did this um we
did test the 20 and we rejected from it.
So, you would take a little bit of a
profit here, but what would concern me
the most is this uh this false breakdown.
breakdown.
And uh let's see. Let's see how it all
turned out.
So, one of the one of the things that
you can really watch for as a good
indicator is when you get a false
breakdown like uh you've got this all
these lows here, testing these lows, and
then you get one that goes lower, but
then snaps back. To me, that tells me
that uh that the market makers were
playing games. They knew there were some
stops right around here. they dropped
the price um so that they could um you
know force some uh some some stops to be
triggered and then the and then the
price snapped right back up here. And
that's that's a really good uh
indication. If you were quick, you could
have caught that and uh and seen that it
was uh you know was destined to sort of
do a reversal as opposed to a
continuation move lower. So one bad
thing too much consolidation in this
area false breakdown and uh yeah that
would have been a good long trade um
right at the end of the day day there. So
okay so getting to this question um how
do you know when uh to do a final exit?
Well again we talked about uh you could
use trailing stops. You could just set a
set a trailing stop and just walk away.
Let the let the price action take you
wherever. Maybe you're going to get
stopped out. Maybe you'll look at it an
hour or two later and you'll be up seven
or eight hour. You just uh can do that.
As far as you can read price action to
see if there's where the buyers or
sellers are. You can look at level two.
You can see uh you know Thor's
presentation on uh pivot levels, reading
level two and uh and using Atlas as an
as a way to decide whether you want to
take your your final exit. Look for
areas of support and resistance. You
look at Megan's uh multiple time frame
approach, like look at the 60 minutes,
see where you might see some um
resistance. And if you're sort of
monitoring the trade, you just look for
patterns that might indicate a top or a
bottom like uh higher a lower, you know,
higher lows like we saw on that one
chart or lower highs if you're short and
double bottoms, double tops, that kind
of stuff if you're monitoring the trade.
So that's um that's kind of if you're if
you're if you've caught a a trend um a
continuation move, that's uh that's what
you want to do is look for look for your
ne next exit. Maybe it's like at like
Dicks, maybe it's at uh um at previous
day close. So,
So,
the final thoughts I just want you to
keep in mind before we get to questions
here, um the [clears throat] 920
strategy works, it works better on
bullish moves versus bearish moves. I
talked about that already. It's just the
nature of the market. um this market is
is in bull mode and uh it just uh you
know you tend to get this is a this is a
continuation strategy. So if you know
you're going to get more likely to get
continuations on bull moves and more
likely to get uh you know trend
reversals on bearish moves. So it
definitely works better on the bull case
but you know it's still it'll still work
on a bare case. Um the stock market is
like I said still firmly in the buy of
the dip camp. So that's why it's working
better a little bit better on the uh on
the bull side. Um so that's uh was kind
of my final thought on that
and uh let's get into some questions
here. I've got uh maybe five or 10
Yeah, you can use I find the uh I find
if you go longer longer on the on the charts,
charts,
longer time frames sometimes these
double bottoms and double tops will look
like, you know, if you go to a five
minute or a 15 minute, they'll look like
V reversals.
Um that's again why I like the
two-minute charts. They kind of you can
kind of see these uh double bottoms and
double tops. Um whereas if you go for a
5m minute sometimes it'll be so tight
Um they're they're based on um they're
based on the um I think I think they're
based on just the they're the nine and
the 20 EMAs. So, they're the they're the twominut
twominut
um they're the two-minut uh candles. So,
Um, I would say I I'm I might I would
say to do to say I do this strategy
every day might be a little bit of a
push, but I would say it's uh it's
something that um you know, you if you
watch hard enough, you can see, you
know, if you watch closely enough, you
can see them see them happen during the
day. And you know, people will sometimes
point them out uh to me in the in the
room or point as moderators point them
out in the room. um [snorts]
it's it is something you can actively
look for, but again, if you're trading
at the open, um you probably don't want
to start uh looking for them till, you
know, roughly about 10:00
uh 10 in the morning. So you want to you
want at least a half hour of um nice
sort of you know you're going to get a
little girration right at the open but
after those first uh 5 minutes 6 minutes
are you know the silly the silly time
frame is kind of done then you can look
for um look for sort of a trending stock
either down or up or an index.
Um it's usually just stocks I'm
I usually I just use Atlas. Um I guess I
got used to using bookmap and then when
when we developed Atlas um Atlas is just
Yes, they are based there the camera
pivots. So, if you look up camera pivots
on uh if you just do some Google on it
or whatever, um you'll find that uh
you'll find how they're calculated.
They're just based on previous levels um
from from the previous day. [gasps]
[gasps]
Uh you can find them almost every day.
Sometimes I just miss them. I mean, um
you know, if I'm not watching, I'll you
know, look over and I'll I'll realize
that, you know, Tesla just did a 920 or
whatever. So you I mean you can I mean I
think there wouldn't be a day go by you
Um not really sure what you mean by the
Um I would say two to three hour and
like I said some you know you're going
to get stopped outs. Um, so you might,
you know, you might be lucky to get one
R, but then, you know, if you can get
one that's really running, you could get
six or seven Rs. So, it's uh it's one of
those strategies that h you have to be
prepared to stop out if the thing isn't
uh isn't, you know, if if if it's the
trade's not working that, you really
have to be uh disciplined.
Um, Atlas is on um on the trading
terminal. It's on the on the left hand
side. You'll see Atlas.
Uh, whatever Atlas costs a
[clears throat] month. I can't remember.
Maybe one of the other somebody else in
the room knows how much. Um, I think
Uh, I do all my trading on one computer
and I do all my social media sort of
stuff on the other.
So, I have a laptop that I've been
traveling with that I I set up and on my
desk and I do the social media on it and
uh an Atlas and then I run all my trades
on on a different computer.
um trading terminal. I think $99 per month.
month.
So the $99 a lot of that goes into um
Thanks Dwayne. Dwayne's posted the
trading terminal website. Um a lot of
that money goes to the stock exchanges
because the uh the cost of the data that
we um we we use to to um provide Atlas
I don't have hot keys. I use uh when I'm
trading, I I either use options
um and I just uh select the number of
options that I want um or I um or I have
Yeah, Trading Terminal is part of um is
part of Atlas or Atlas is part of
You get quite a bit of stuff. Thank you,
Dwayne. Yeah, you get uh you get a
simulator. You get scanner in the
morning for gap higher and lower and and
all during the trading day. You get
benzinga squawk which we pay for of
course um data economic calendar.
There's all sorts of stuff on uh on
trading terminal that's uh that's quite
valuable that I I use on a on a daily basis.
basis.
Okay. So you know MD I mean this is this
is a strategy I've developed and and you
know the the thing that we um
you know the thing that we emphasize is
that you know you can you can listen to
all these webinars um and you you it's
really up to you to make this this
strategy or any strategy make it your
own. So, you know, if it works for a fi
on a five-minute chart, then, you know,
build a trade book around that
five-minute chart. Um, know when you're
going to enter, know when you're going
to stop out, um, know when you're going
to take uh take profits. It's that's all
about uh it's all about building your
own trade book. you know, I mean, you
can you can copy and you can make it,
you know, make this one your own or make
tweaks to it, but um it's important to
go through that process and and uh
decide if it's the right trading
strategy for you number one and you know
and and try to use it. See how it how it
works for you. Maybe maybe use um you
Um
yes, I know that um I I know that we're
working on on getting futures in there
as well.
Uh heat map is not on Atlas. Heat map
heat map is generally um just a big box
with a whole bunch of little boxes in it
that have different that represent
stocks. So um on any particular day
you'll have the heat map will show will be divided into sectors like how big a
be divided into sectors like how big a sector is like technology is a big
sector is like technology is a big sector so you'll have uh inside the
sector so you'll have uh inside the technology box you'll have Nvidia AMD
technology box you'll have Nvidia AMD and it'll all be all those the little
and it'll all be all those the little boxes inside the big technology box will
boxes inside the big technology box will all be sort of sized according to their
all be sort of sized according to their market cap and then the box itself that
market cap and then the box itself that represents Nvidia for example If Nvidia
represents Nvidia for example If Nvidia is having a green day, um, Nvidia will
is having a green day, um, Nvidia will be green. Um, if it's having a red day,
be green. Um, if it's having a red day, obviously it'll be red and the and the
obviously it'll be red and the and the sort of the intensity changes depending
sort of the intensity changes depending on how much how red it is or how green
on how much how red it is or how green it is. So,
it is. So, um, you can see heat maps on, you know,
um, you can see heat maps on, you know, on other stuff
on other stuff on other, uh, websites if you're really
on other, uh, websites if you're really looking for to see what it looks like.
Okay, thanks Ben. I don't know if you can use Atlas on
I don't know if you can use Atlas on your cell phone.
Yeah, I mean again using a two-minute chart, one minute chart. I mean, some
chart, one minute chart. I mean, some people prefer one minute. Andrew's
people prefer one minute. Andrew's Andrew trades pretty much off of one
Andrew trades pretty much off of one minute. I'm not sure what uh what Carlos
minute. I'm not sure what uh what Carlos uses, but again, it's a you know, again,
uses, but again, it's a you know, again, it gets back to what what do you feel
it gets back to what what do you feel comfortable trading um with in terms of
comfortable trading um with in terms of the tools that you're using? Um you
the tools that you're using? Um you know, what is what is it what's best for
know, what is what is it what's best for you? Um, I just like the 2-minut just
you? Um, I just like the 2-minut just because I feel like it takes a little
because I feel like it takes a little bit of the um, you know, the jumpiness
bit of the um, you know, the jumpiness out of um, out of the price action, but
out of um, out of the price action, but still allows me to see um, you know,
still allows me to see um, you know, double tops and double bottoms like we
double tops and double bottoms like we talked about, whereas a five minute is
talked about, whereas a five minute is just a little, you know, sometimes you
just a little, you know, sometimes you just don't catch those um, those double
just don't catch those um, those double tops or double bottoms. They look like
tops or double bottoms. They look like uh, V reversals.
uh, V reversals. Um, do I recommend it for beginners? Um
yeah, I mean it's it's a fairly clean it's a fairly clean setup and if you
it's a fairly clean setup and if you have you know if you have access to
have you know if you have access to trading terminal you can do all these um
trading terminal you can do all these um you know the there's this replay uh
you know the there's this replay uh section where you can replay um
section where you can replay um you can replay uh trades and you can try
you can replay uh trades and you can try it out or and then during the day you
it out or and then during the day you can um you know you can do paper trades
can um you know you can do paper trades um just to see if it if it's working for
um just to see if it if it's working for you. Um, but that, you know, that's what
you. Um, but that, you know, that's what uh what I would suggest. If you're if
uh what I would suggest. If you're if you're just going to try this this
you're just going to try this this strategy out, um, don't don't just jump
strategy out, um, don't don't just jump in and uh and uh just, you know, go all
in and uh and uh just, you know, go all in, you know, two feet with the uh
in, you know, two feet with the uh full-blown uh position. Just uh just try
full-blown uh position. Just uh just try [clears throat] paper trading a few of
[clears throat] paper trading a few of them, see how it goes. Um, if you like
them, see how it goes. Um, if you like the strategy, maybe again, we always
the strategy, maybe again, we always recommend if you're going to try trading
recommend if you're going to try trading it, just you know, try something new.
it, just you know, try something new. Always always start small. Don't don't
Always always start small. Don't don't uh, you know, don't go in full full guns
uh, you know, don't go in full full guns ablazing. Um, and then just see how it
ablazing. Um, and then just see how it works out. If if they if it continues to
works out. If if they if it continues to work, then yeah, then you can sort of
work, then yeah, then you can sort of ramp up your size.
ramp up your size. Well, you can't um you can't see order
Well, you can't um you can't see order flow in in in the heat map.
All you can see with a heat map is a snapshot of what the day currently looks
snapshot of what the day currently looks like in terms of um you know what's
like in terms of um you know what's what's moving and what's not.
So I mean I could uh let me just see people seem to be asking about heat map.
people seem to be asking about heat map. I can uh
[snorts] Yeah. So I can show you what heat map looks like here.
heat map looks like here. Okay. I just have to um
Okay. So, there's uh there's heat map. I think you can see that. Maybe you can
think you can see that. Maybe you can see that now. Or
see that now. Or maybe not. That didn't work. Let me try
maybe not. That didn't work. Let me try this different something different here.
this different something different here. Didn't work.
There we go. Yeah, I see you posted the heat map above. So, here's here's what
heat map above. So, here's here's what Trading Terminal looks like um for
Trading Terminal looks like um for people that have been asking about
people that have been asking about Trading Terminal. So, this is what uh
Trading Terminal. So, this is what uh what you get. There's your um live news
what you get. There's your um live news feed on Benzinga. You can turn that on
feed on Benzinga. You can turn that on or off if you want to listen to that.
or off if you want to listen to that. Andrew listens to it in the morning. Um
Andrew listens to it in the morning. Um and uh this is your heat map over here.
and uh this is your heat map over here. So you can see here uh AVGO Broadcom was
So you can see here uh AVGO Broadcom was down today. This is this is the
down today. This is this is the technology section right here. So you
technology section right here. So you can see what we're watching. Nvidia of
can see what we're watching. Nvidia of its largest cap. It's it was up 0.55%
its largest cap. It's it was up 0.55% today. And this will change during the
today. And this will change during the day depending on what's uh what's going
day depending on what's uh what's going on. You can see Oracle here up 2.8%.
on. You can see Oracle here up 2.8%. And then you get into the consumer
And then you get into the consumer cyclicals. These are all the different
cyclicals. These are all the different sectors. Communication, Google, Meta, uh
sectors. Communication, Google, Meta, uh Netflix, all under that communication
Netflix, all under that communication side. You can see here the you can even
side. You can see here the you can even kind of get a sense of what the waiting
kind of get a sense of what the waiting is um on each of these uh sectors um in
is um on each of these uh sectors um in terms of how they impact the um the
terms of how they impact the um the overall index. So you can see technology
overall index. So you can see technology about a third of the um of the influence
about a third of the um of the influence on the index. Um you can see some of the
on the index. Um you can see some of the smaller ones. You can see how energy is
smaller ones. You can see how energy is uh a very small component of the index.
uh a very small component of the index. Utilities small component. um healthcare
Utilities small component. um healthcare sort of mediumsiz
sort of mediumsiz real estate very small.
So you're not going to see all you're going to see here really is is what's
going to see here really is is what's going on during the day. Oh I see that
going on during the day. Oh I see that you know technology is kind of mixed.
you know technology is kind of mixed. You got a bunch of little red boxes but
You got a bunch of little red boxes but the big ones Microsoft, Apple and Nvidia
the big ones Microsoft, Apple and Nvidia are all good you know. So overall the
are all good you know. So overall the day is sort of bullish bit scatters of
day is sort of bullish bit scatters of of red in here and and uh you know
of red in here and and uh you know Walmart down 1%.
Walmart down 1%. Um
Um and uh what else do you get here? Well,
and uh what else do you get here? Well, here's uh here's all the indexes on the
here's uh here's all the indexes on the day. You can see what's happening. You
day. You can see what's happening. You can see here got the uh calendar. So
can see here got the uh calendar. So this is all the stuff that's that went
this is all the stuff that's that went on today. Um January 22nd, all the
on today. Um January 22nd, all the announcements that were going to come
announcements that were going to come out. You got your um earnings release
out. You got your um earnings release and then uh I can turn on atlas here and
and then uh I can turn on atlas here and this is your market atlas. See nothing
this is your market atlas. See nothing going on of course right now.
going on of course right now. So
So all right uh it's 10 after 5. I am going
all right uh it's 10 after 5. I am going to wrap things up here. Uh I hope
to wrap things up here. Uh I hope everyone got uh got something out of
everyone got uh got something out of that. If you uh have a specific
that. If you uh have a specific question, you can uh send me an email
question, you can uh send me an email and uh I will attempt to answer it. But
and uh I will attempt to answer it. But uh yeah, everybody have a good rest of
uh yeah, everybody have a good rest of the weekend. We'll see you all in uh in
the weekend. We'll see you all in uh in the training room in the morning.
the training room in the morning. Cheers, everyone.
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