Hey hey: what's up my friend, so i remembered in my early years right of stock trading. I was overwhelmed because there were just so many things right. You can pay attention to. You know things like earnings, report, fundamental analysis, dividend yields, price to book ratio.

Technical analysis, chart patterns, support resistance, candlestick patterns. You know how do you know what to focus on, because my attention could be easily diverted to any of one of these things so, along the way right after much trial and error years of you know, testing and research. I realized that there's only five things right, that you must focus on and pay attention to if you want to be a profitable stock trader. So this is why, in today's training, i want to walk you through step by step.

What are these five things? In fact, here's what you learn you will learn number one to know when to stay in the markets and when to stay out, so you can avoid unnecessary losses. Number two you'll learn how to identify the best levels to trade on your chart, so you can find low risk and high reward trading opportunities number three: how to time your entry with precision, so you buy only when the market is about to turn in your favor And not try to catch a falling knife number four: how to cut your losses like a pro, so you don't blow up your entire trading account and number five: how to know when to take profit. So you don't lose everything due to greed and along the way, i'll share with you a ton of charts. Examples illustration, so things will be crystal clear, sounds good.

Then, let's get started first thing. First number one! I want you to pay attention to the stock market index so, for example, if you trade us stocks pay attention to the stock market index, if you trade, philippine stocks pay attention to the philippine stock market index, if you trade, singapore stocks pay attention to the singapore Stock market index, why? Why is that? And the reason is simple - is because in trading in stock markets, there is a saying which i find it to be true. Is that a rising tide lifts all boats, so imagine like you're out and see in the ocean when the tide goes down? Well, all the boats, which are you know floating in the sea or in the ocean? It goes up as well when the tide goes down. All these boats goes down as well, so when you translate that into stock markets, when the overall stock market index is bullish, if, let's say, for example, the russell 3000 right is heading higher, you can be sure that the individual stocks right more often that more often Than not, most of them are trending higher as well, because the overall stock market index is in an uptrend make sense okay.

So the key message i want to bring you across is that you want to buy stocks only when the overall market is bullish when it's in a long-term uptrend, or rather when it's in an in an uptrend stay in cash right when it's bearish, always when it's In a recession, now you might be thinking but rain. How do i know whether you know the stock market is bullish or whether is it bearish or whether should i stay in cash? That's a good question and one simple technique i can share with you is to use a trend filter so, for example, if you trade the u.s stock market, you can you know, benchmark against the russell 3000. This is a index right which tracks right. The largest 3 000 stocks right in the u.s stock market.

So if this index right, the russell 3000 is above the 100 week moving average, then you can say right that the overall stock market, the overall u.s stock market, is in an uptrend and if the russell 3000 is below it, then you can say that it's a Bear market and you don't want to be buying stocks anymore and you rather hole in cash okay. So let me give you an example. So this is the russell 3000 index right, so you can see that this over here simply is uh. It tracks right.

The largest 3 000 companies in the us stock market and it's kind of represented as one individual, a ticker or symbol for trading view it's under ru-8. So if you just overlay with the with 100-week moving average in this case, i'm going to change this to 100-week. Moving average okay, so what you want to do is to make sure or to see whether this index is above or below the 100-week moving average. So you can see at this point in time it's above the 100-week moving average, which is this black line over here.

So this means that the overall stock market, the overall u.s stock market, is still bullish and you want to look for buying opportunities in the u.s stock markets. And if you look at this over here, let's imagine now the u.s stock market at this point in time has collapsed. It has closed below the 100-week moving average. At this point, okay, you can conclude that hey the u.s stock market right now is bearish.

We want to sell our positions and remain in cash, but if you look at this, you know over the long run you will see that more often than not right it will keep you on the right side of the move. More often than not, you know, as whenever, it's above the 100 week moving average right, you can see that it tends to have a nice follow through towards the upside. Of course, there are times where we get caught right on, like a like a correction on a pullback times like this. This and this, and this we might, you know, have to uh cut, shot our profits or even cut our losses, but that's part and parcel right of this business so again look for buying opportunities when the russell 3000 is above the 100-week moving average, and that's assuming You trade, the u.s stock markets, if you trade, singapore stocks - or you know, uh chinese stocks or indian stocks, just benchmark against the stock market index, that your stock belongs to number two stock structure.

So here's the thing just because the index is in an uptrend doesn't mean a stock is in an uptrend, because the stock can be in one of these three market structure in a range in a downtrend in an uptrend. Now let me ask you which of this three stock truck structure: do we want to be trading in? Is it a range market, a downtrend or an uptrend? So first, let me tell you which market conditions you don't want to be trading in downtrend is out. Why is that simple right? If you know the overall stock market is in an uptrend, and now i'll be honest with you i'll share a few facts with you, or rather this fact is that stock markets are in the long run. They are in an uptrend.

If you look through any price chart of the u.s stock market smp 500 nasdaq russell 3000 whatsoever, you can see that they are in a long-term uptrend and that's because the stock market is a reflection of the economy. So you know that the u.s economy, right where it is today relative to where it was 30 or 40 years ago. Things have improved so much, and this is why the improvement in the quality of life technological advancement is reflected in the stock markets. And that's why the stock market is in a long-term uptrend.

So if you know that the stock market is in a long-term uptrend, then why do you want to be buying stocks in a downtrend doesn't quite make sense right, because that stock right clearly is even weaker than the overall stock market right. So why do you want to fight against the natural phenomenon of the market? So i strongly advise against buying stocks in the downtrend if you're investing that's another story altogether, but for trading next one? What about range markets again for me range markets? I would choose to avoid them as well. Why is that nothing wrong? Nothing particularly wrong with range markets, but the reason is because there are thousands of u.s stocks out there. Why do you want to buy stocks which are in a range or in a downtrend where you can select the best ones which are stocks in there? Uptrend make sense you want to be buying stocks which are in an uptrend when the overall market stock market index is also in an uptrend.

This really would put the odds in your favor okay. So let me just share with you a few examples of what stock. In an uptrend looks like so, if you look at this, these are a bunch of stocks that i've, just you know, kind of listed out over here. Look at doku, docusign right daily time frame.

You can see that this stock is in an uptrend pins stock. In an uptrend summer stock in an uptrend tesla stock in an uptrend sq square stock in an uptrend trillium therapeutics stock enough in an uptrend. So you get my point right. You want to be focusing right on stocks which are already in and up trend and avoid you know, stocks which are in the range market or avoid you know, stocks which are you know, declining lower, so, for example, stocks that are declining lower right now is possibly I would say the airline stocks uh, or maybe just uh - how about some wells fargo or something like that.

This is a bank stock. You can see that this stock is more in the downtrend downtrend right range market downtrend. So this is the type of stock that you want to avoid. So this is a bank stock, not an inline stock because uh, i can't think of any u.s airline symbol at this point in time.

But you get my point. I want you to focus on stocks which are trending higher peloton. Nvidia. Okay, get my point next one, the third thing area of value.

So here's the thing just because a stock is in an uptrend doesn't mean you buy immediately right. It's like you know, meeting a girl for the first time and marrying her on a spot just because you know you saw for the first time she's. So pretty! Oh, you know. Oh, i love you two bits.

No, it doesn't work that way, because what, if she's a psychopath? What is if it's a transgender? What, if you know, personality mismatch? So this is why you want to seek confirmation right - or rather you want to meet her a few more times to get more clues to get more idea about her to see whether it's a good match so same for trading right, you don't want to buy a Stock, just because is it an uptrend? What if it's really near the end of the uptrend cycle, where it's going to make a reversal or pull back? You have to wait for confirmation right. A few more. You know uh factors right, that is in a line right to improve your odds. So the next thing that you want to look at is what i call the area of value, so this simply means right, an area on your chart where potential buying pressure could come in.

One fine example is an area of support, so, for example, okay. This could be, as you know, we want to buy stocks in an uptrend, so stocks in an uptrend, and then it comes back into this area of support okay. So this is an area of support area of value. So that's one! So let me share with you a few examples.

So if you look at this one over here, your cube sign right. This stock is in an uptrend, and you can see that this is the area of value right area of support over here where potential buying pressure could come in support is an area where potential buying pressure could come in another example right: tril, trillium, therapeutics. So again, this stock is in an uptrend, and this is an area of support where potential buying pressure could come in how about this zoom right. So if you look at zoom right, okay, so this one later on right, there's one way area of support.

Next one moving average moving average can also be used right to help you define uh, an area of value where potential buying pressure could come in, and this brings me to this example over here on zoom video. So if you look at zoom, okay and if you overlay the 50ma, you realize that you know historically, this stock right tends to respect the 50ma test at once. Twice tries four times right, there's a slight false break here, then you relate higher and then over here, a fifth time, slight bounce and then collapse. Okay.

So the moving average can also be used right to define an area of value and of course, that's not all, because you also have another uh example over here this one. Here you can see a c r, w d right. This is crowd strike holdings, uh tested once twice three times like a false break over here, but generally you can see that the 50ma, it's a an area of value that you can reference against. So one thing to point out is that i say area of value, not line of value, so when you use moving average when you use area of support right, it's an area.

So this is why you shouldn't expect the price to test the area of value to the to the tick right. So you can see that in this case it had like a mini false breakdown before you rally higher over here as well. A little bit of chopping price action through this area before it rallies higher. So expect this to be an area of value, not a line of failure.

Okay, so that's the third thing to look for the area of value, moving on number four entry trigger so now you know you want to be. You want to stock market index to be in an uptrend. You want to stock to be trending higher. You want to be looking for an area of value, and the fourth thing that you want to look for is an entry trigger.

So this simply right tells you, or rather it's a signal right that gets you into a trade when the other market conditions are made. So let me repeat once again right so don't make the mistake of just simply looking for entry triggers on the chart. It's not how it works right. An entry trigger is simply a signal that gets you into a trade when all the other conditions are met.

If the other conditions are not met, entry trigger is useless. Make sense you want to have the other conditions to be met. First, before you utilize, the entry trigger as a signal to get into a trade make sense good. So here are a few examples of entry trigger number one.

It can be a bullish reversal. Candlestick patterns like the hammer, so for those of you who are not familiar with the hammer, let me just briefly explain so a hammer is a bullish reversal, candlestick pattern, because at this point is the opening price. This is the open and when the market opened, what happened is that the sellers already took control and pushed the price down lower all the way down right to this lows over here. This is the lows of the day right and this extreme selling pressure with the sellers are in control right.

Suddenly, the buyers, you know say enough is enough right and they start pushing the price up higher. All the way up higher the buyers came in push the price all the way up higher exit. The opening price goes up to the high of this days and finally, closing near the highs of the day. So it opens at this price point and it closes at this price point.

So if you think about this right, market is open here. This is the low of the day. This is the closing price, and this is the high of the day. What is the story behind this candlestick pattern? Well, it tells you that at one point in time right when the price opened sellers were winning right, then the buyers right suddenly went crazy.

They went nuts, they took a lot of steroids, they pushed the price up higher to the highs of the day and closed higher, so you can see that, in other words, the sellers are overwhelmed by the buyers. They lost control. Okay. So this is what we call a hammer which is a bullish reversal, candlestick pattern which tells you right that the buyers are momentarily in control.

They're flexing their muscles right at this point in time and of course, hammer isn't the only bullish reversal, candlestick pattern. We also have another one called the bullish engulfing pattern. So let me just you know quickly: uh walk you through this uh this pattern. So again, the previous day, you can see that here the sellers are in control.

They closed near the lows of this candle. The next day the market opened okay here and then the sellers were still in control, for you know, for a few hours of the day came down lower lower. This is the low of the day and then suddenly the same thing right buyers just went crazy. They went nuts right, maybe you know they, they had an overdose of some.

You know uh, whatever supplements that you can think of right and then the buyers push the price up all the way up higher near this highs, all right and then finally closing near the highs of the day. So you can see over here. This is the opening price. This is the closing price.

This is the lows of the day. This is the highs of the days. What is the story behind this bullish engulfing pattern very simple: yesterday the sellers were in control right, they were victorious. They closed near the lows of the day.

The next day when the market opened, okay, the buyers right took charge all the way and closed right, the price near the highest of the day. So this can tell you is a quick reversal right of sentiment and market. One day is bearish next day: it's exceedingly bullish where buyers are in control. So this is what we mean by the bullish engulfing pattern and again right when i talk about bullish, engulfing pattern by right, the traditional textbook requires right, the candle to engulf the entire range right of the previous day candle.

But for me personally, i just defined it as as a candle right that covers the body of the previous day candle. So in this case, as long as the bullish engulfing pattern, it covers the body of the previous day candle. I would define it as a bullish. Engulfing pattern, so in a way you can see that my definition is kind of more relaxed compared to the traditional definition of bullish, engulfing pattern and, of course, that isn't the only way to uh define your entry trigger there's another one, which is what i call the Trend line break, so let me give you an example or before we talk about trend line, break break.

Let's have a look at a few uh hem candlestick patterns right to see how it looks like on the chart. So you can see over here. One thing that i want to point out is that examples from a textbook right is going to be vastly different from the real world of trading, because you have different variations, different nuances right. It's like you know, you are looking on the tinder app or you know, coffee meat, bigger.

You look at the the girl right or the guy, quite handsome when you meet in real life. Ah, why is it so different? Why isn't you know what the textbook says he's only what the app says you get shocked so same thing for trading right. I can show you textbook examples, but when it comes to live trading, you have to be prepared that it's not going to be exactly like what the textbook shows. Yes, you might have.

You know a few taxable examples every now and then, but at the back of your mind, you must be prepared right there when it comes to the real world of trading. The candlestick patterns might look quite different from what you've learned. Okay, so let me walk you through a few examples. So if you look at this one over here, this is a kirk lens this right uh earlier we talked about hammer.

This is kind of similar to the hammer right. Some people call this like a uh dragonfly doji, it's like kind of like a dragonfly doji, combined with a hammer. You would see that this body over here is kind of oops the body of this candlestick. This hammer is smaller right than the body that what i've just shared with you, but if you think about the the uh psychology of the market behind it, the the concept is the same is pretty much telling you that the buyers are in control.

At one point, uh, or rather at the start of the day, sellers were in control, push the price near the lows and then buyers took charge, pushed the price and closed near the highest of the day. Again, the concept is the same, but the pattern looks slightly different. Another one right how about this one over here? This is a this is what we call a a piercing pattern. It's similar to a bullish, engulfing pattern.

The only difference is a bullish engulfing pattern. It covers like the entire range or the entire body of the previous candle. In this case, you can see that this candle didn't cover the entire body of the previous candle it covered about. You know three quarter, eighty percent of it, but again the message behind it is pretty much the same yesterday, which is this candle here? Okay, let me just you know, walk you through.

Imagine this right. What happens is that, let's see if you're looking at this chart today yesterday right sellers were in control, they pushed and closed near the lows of the day, but today buyers stepped in right. Suddenly right. They took too much.

You know uh beef, chicken and steroids and they pushed the high the price right near the highs of the day right, almost even matching right, the opening price of the previous day. So this tells you that hey, you know there are buyers stepping in right to you know to buy at this uh this current price. Okay! So have a look at another example. So this one here: okay, it's what we call a bullish engulfing pattern, this one pretty much engulfs right, the body of the previous candle.

But as i've said right, you don't just we don't just trade entry triggers in isolation right. We have to wait for the other conditions to be met and i'll share with you. You know what are the conditions, but for now you have a good idea of you know: bullish, reversal, candlestick patterns and we can move on into another. One is, which is what i call the trend line break, so the trend line break is a very useful entry trigger when the market is trending higher when it's in a healthy trend respecting the 50 period moving average.

So something like this right market is in an uptrend. You know in an uptrend, you have pullbacks along the way, so the trend line break right simply buys right when the pullback has ended over here, and this pullback over here has ended right and you buy near the break when the pullback just ended. Now you might be wondering hey rain, how do you know when the pullback has ended right? So let me just share with you a chart right to explain. You know how this works, so this one here you can see the price breaks out of this resistance and then it makes a pullback.

So at this point, how do you know this? You know pullback is going to end, so what you can do is to when the market makes a pullback. You got to be patient over here right, so one tip that i have for you to be patient is overlay with the 50ma right. You want the price right to come close towards the 50 period, moving average first okay. So when it's closed, when it's close enough right, then you have some kind of like this one here and this one here.

You can see that we have this downward trend line over here against the trend, so what we are looking for is for the break of this downward trend line, or rather the break of. We call this the trend line break when the price breaks and close above it we get long. So in this case you can see the price on this candle it breaks and close above the downward trend line. So this is what we call a trendline break and this is an entry trigger for you to get on board right, the the trade okay.

So this is another technique that you can consider, but sometimes i know many traders they might prematurely jump the gun. So, for example, if you look at here, if i some traders, they might draw it in this manner over here like this and then you might say, hey you know, there's a valid trendline break over here right. This candle. There is a valid trendline break.

Yes, i agree: there's a trend line break right this this can this candle here is close above the double trend line, but remember i said that you want to be applying this technique right only when the price is near the 50 period, moving average when it's too Far away chances are, you know the retracement right? Has you know a little bit more room to go down lower? So if you want to look for higher probability, trading setup right make sure the trend line, break right is uh occurring near or rather occurs right, where the prices, you know almost retest the 50 period, moving average okay. So that's uh. One thing to share the trend line: break moving on exits right, so we've talked about you know a trending market structure, aerial value entry trigger what about exits. You know.

So when it comes to exits right, there are two things to bear in mind: number one: where do you exit if you're wrong, you know i can share with you the best trading setup, the best strategy, all the stars to align, but the truth is they will Still be losing trades, okay, so so be prepared for losses. And how do you actually set a proper stop-loss right such that you know it's not too tight and you don't get stopped out. You know on a slight pullback or slight retracement and at the same time right, you know your stop-loss has enough buffer right to to withstand any potential volatility spike in the market. Okay, so a quick tip that i have for you is that you want to set your stop loss right at a level which invalidates your trading setup.

So, for example, let's say we are again: we trade it markets in an uptrend and, let's say price, comes into this area of value, this area of support, so, needless to say, our stop-loss right has to be at a level which invalidates this area of value. This area of support, okay, so where do you want to put it just below this lows? Not quite because remember we say that support is an area of value; it's not a line right. So what could happen is that this area that i've highlighted it might be. You know uh deeper or larger than what we expect.

Maybe the area of value could be like this, where the price comes in a little deeper before it retrace up and reverse higher. So we want to give our stop-loss or enough breathing roof room right and not get stopped up on such you know, sudden spike down lower okay. So the way we want to do it is to give our stop-loss right a buffer right to set it a distance away from the area of value. So how do we do it? So we want to you know our stop-loss ideally want to be somewhere about here.

You can see that it's a distance from here to here right. This is a buffer that we are willing to give this market right in case you know, we can't define the area properly. In case the market pulls back a little deeper right. We still have some buffer to play with and don't get stopped out of our trade prematurely.

Now the question is: how do we know how much buffer to give? Because some stock could be trading? You know hundreds of dollars - some could be 40 50 and if there is no, like you know, like a five dollar fixed, stop loss that we can use all the time because volatility of the stock market changed from stock to stock. So one technique i'm going to use to share with you is what i call the atr technique. So let me share with you over here. Okay, so let me explain how this works, so what you want to do, let's look at tri l.

So again, all right! If you look at this, for example, let's say market has come into this area of value. This area of support somewhere here, okay - and let's say at this point right market is showing signs of reversal. Now you want to go along right. Where do you put your stop loss? Do you put it below this low? Remember.

Rayner says that you know this is an support. Is an area of your on your chart right? You don't want to set your stop loss too near where the price is because it could just suddenly spike down, lower and reverse higher, so give it some breathing room. So what you can do is just pull out the indicator. The atr indicator.

I have it over here. Just go to you know, you know, go indicators, you look for atr average true range, and this one will pop up over here. My settings is 20 period, sma, okay. So what you're gon na do is to find out what is the current atr value? Okay, so you can see over here it's about 83 over here.

So what you you're going to do is to take this swing low over here. At this point right and minus 83 cents, so i'm just going to walk you through this quick exercise, so you know how to set a proper stop loss. So what is the value of the swing loss? So if you look at this, this candle, the low, is about 11.93. So what i'm going to do is take 11.93, which is actually the low of this candle here and minus one atr.

What's the value of 180r, it is 83 cents, as shown over here. Okay, so 1193 minus 83 cents. That gives you 11.10. I know some of you have really good math and you're faster than me and i'm a loser with this calculator but yeah, i'm an old school guy, so your stop-loss site will be placed at 11.10.

So what i'm going to do is let me just duplicate this line. Okay - and i put this line now at 11 - 10 cents - and i don't want to confuse you with the colors this one - just change this to black okay, so you know this one is showing the area of support, even though it's a line and this pink color Line over here is your stop loss right and why? What is the significance of this pink line? Very simple from this low over here you minus one atr, which is this value here. You get this value over here, eleven dollar ten cent and the low over here. As mentioned earlier, it was about eleven dollar and ninety three cents, so eleven, ninety three minus eighty three cents gives you eleven dollar ten cent, and that is your stop-loss.

That's how you do it! That's how we do it. Okay, next one second part of your exit: where do you exit if you are right, so here's the thing right, you won't always have losers in trading. You might have winners from time to time, and another question is: where do you exit if you're right? What if the market moves in my favor? How do i know where to exit my trade objectively? So there are a couple of techniques to this number one. You can.

You know trail your stop-loss and write trends in the stock market, but for the other technique, which is swing trading, which is what i'm going to cover, is uh i'll share more with you right on how to exit if you're right - and this is from a swing Trading perspective, so for those of you who are unaware right swing trading right, all you're trying to do is to capture one swing in the market. So, for example, if the market is in range, you want to buy low, sell high right. So we capture this portion here, one swing if the market is trending higher, what you want to do is buy on a pullback and sell on that uh on this uh up move higher. So again you capture this.

This one swing up higher. So this is what we mean by swing trading. So how do you set proper targets? Are such that you capture, you know, swings in the market. So the key thing here.

The key phrase here is that you want to set your target right at a level right before opposing pressure steps in so what do i mean by that simple? So, let's say: if you buy it support, can you buy it support right now? Let me ask you, as the price hits up higher, where my selling pressure coming. I'm sure you say that hey right now, i think that the selling pressure would come in. You know just in front of resistance over here and you're right, you're. Absolutely right right! If you buy and support and as the price you know approaches resistance, you can be sure that there are traders are willing to sell a resistance shot at resistance that will traders who might want to take profit at resistance.

So if you want to capture a swing right, you want to exit your trade before resistance right. You don't want to. You know, set your target over here or over here, because you have no idea whether the price you don't break out of resistance. It reaches.

You know this higher level, so you want to be conservative down here. Remember: support resistance. They are an area of your chart, so you want to set your target right at the early part of resistance right. You know book the profits right and let the greedy traders, you know, have a higher expectations and eventually you know the price doesn't reach their target.

What happens is that you reverse back and stop denmark for a loss, but because you're conservative, you set your target just before resistance. You manage to book a profit and capture a swing in the market, nice and by the way, if you're, enjoying this video smash the thumbs up button subscribe to the channel right. This way, you'll always be updated. Whenever i publish a content like this, now that you have, you know, understand the exits right.

Let's have a look, a quick one at this example again so over here. Let me ask you, let's say market, you know it's at this area of support. Where might potential selling pressure come in right? Let's say if the market now starts moving in your favor, where do you want to set your target profit? Well, we say that you want to set your target before opposing pressure sets in. So where am i opposing pressure? Come in this looks like an area of resistance.

You know, i think i better, you know, look to sell my position somewhere around 16 and if that's your mindset, congratulations uh, you probably would have booked a profit and then market now comes back to the area of support. But you'll, probably you know, make some money. Uh, if you followed what i just shared on hindsight, of course, because this chart is cherry picked so anyway, let's do a quick recap right before we look at some examples. Number one index right: you want to pay attention to the stock market index because a rising tide lifts all boats.

If the overall stock market is in an uptrend, you can expect individual stocks to be trending higher as well. Number two stock structure stock can be in a range, can be a downtrend can be in and up trend. You want to focus on stocks in an uptrend, because this is the path of least resistance. If, let's say you know, you want to go from point a to point b, do you want to walk? You can take a bus or you want to drive a car? Of course you want to drive a car because there's less obstacles in your way.

The journey is going to be much smoother, so take a car whenever you can right. So whenever you trade stocks as much as possible, buy stocks which are in an uptrend third thing area of value. Just because a stock is trending, higher doesn't mean you buy immediately because it could be getting ready to make a pullback a reversal just because you meet the girl for a first time doesn't mean you marry her immediately same thing over here. Fourth thing: entry trigger: what is the signal that gets you into a trade? We spoke about reversal, candlestick patterns and the trend line, break and then finally exits right exit if you're, right, otherwise known as your target profit and exit if you're wrong, otherwise known as your stop loss, and if you think about this right, this formula is what i Call the i say formula, i say: okay, so let's have a look at a few cherry pick chart examples there and to share with you this i say concept.

So let's get started right. A few examples right. I know you love charts, let's get started so first, one to look at is peloton. Where are you here? Okay, so for this one over here you can see it again.

Let's assume that, right now the stock market index is is uh in an overall trend right. So you saw earlier the russell, the russell uh 3000, the weekly time frame, it's above the 100-week moving average. So we have, you know, permission to look for buying opportunities now moving on individual stock right, so peloton right now you can see that this market on the daily time frame all right first thing: is this stock in an uptrend? Well, if you look at this right, just zoom out a little bit, you can agree that, yes, right now, it's in an uptrend right series of higher highs, higher lows, great so number one we have the uh the index is in an uptrend. Okay, that's met.

Number two stock is in an uptrend great third thing right. We are looking for an area of value, so in this case all right - let's look closer to here. Do we have an area of value? So this one is quite interesting because number one we have this uh stock right, which retains this previous resistance, which could become support. That's the first area of value second area of value is this 50ma, which have this confluence of this 50 period moving average? So you can see that we have actually multiple factors coming together.

This area of value is at this previous resistance, which could become support with right this 50 period, moving average area of value nice next thing, we're looking for is an entry trigger to get long. Is there a valid entry trigger and for those of you who look at this bullish, candlestick pattern you're right? This is a bullish hammer, okay, so you can enter on the next candle open. So now the question is a rainer: where do you set your stop loss? So again, we want to set our stop loss right, a distance away from the price structure. So if you know that this is an area of support right find out what is the swing load, this is a swing low, minus one atr, and that is your stop.

Loss, so i'm just going to walk you through this example one more time, so you understand how to set your stop loss so in this case, pull out your atr indicator again. So you see that right now the atr value is 9.439.43. So you can see that the atr value change right from stock to stock, because different stock have different price point and different volatility. So this is why we don't use a fixed dollar amount for stop loss so 9.43.

So what is the low of this uh? This candle over here, the low of this candle, is about 92 and three cents, so we take 92 dollar, three cents, 92 and three cents, minus 9.43 cents, which is one atr. So this over here is the 180r value, and this is here. This is the swing low, uh figure right. This is this swing.

Low over here is 92.3 cents 943. Is this 180r value and what you're gon na get is eight dollars and 26 cents? So once you have this eight dollar 26 cents. What do you do? Well? That is your initial stop loss. So if you just take a line over here, we can just put it here.

Change this to uh, paying uh coordinates eight dollar. Sorry, 82.60. Okay, then, over here this is your stop-loss. So if you want to enter on the next day open, this is where your stop loss will be, which is one htr below this low okay, so next day, market open here great you buy, hit the buy button.

Okay, and by the way, all this is just for educational purposes, right, whether you make money from the stock market or whether you lose money. Clearly, i'm not responsible, you're grown up now take charge right and you know don't send lawyers my way, don't send lawyers. My way so yeah this is the opening price. This is your stop loss.

Next question is: where do you set your target right where my opposing pressure come in? So yes, i agree. This market is in an uptrend, but there will be selling pressures still looking around and if you ask me, i would say this swing high. This area of resistance is one possibility right. So if you want to be conservative, i would say anywhere between 130 to be 440.

That's a good uh area somewhere about here. Let me just highlight to you this area around this area. Right would be a good area to look to take profits right on this uh, this district, so in this case our price slowly inching higher anyway. That's one example.

Moving on right, let's look at another example: docusign right, so, okay, so looking at this one over here, you can see that in this market again i'm just going to assume that the overall stock market index is in an uptrend because it is right. So so, let's talk about the stock structure. Number one stock structure is this in an uptrend? Yes, it is number two. Is this at an area of value? Well, this looks like it's at this area of support over here great.

This is an area of value number. Three, do you have a valid entry trigger? Well, this looks like a hammer, but it's red in color right. So, if you look at this candlestick pattern, it looks like a hammer, but this hammer instead of green, is red. So what this means is that for the day, the price actually closed lower for the day, but for the traditional hammer, as you know, it usually closes higher for the day.

So is this a valid hammer or not rainer? So again, this is, where kind of you know discretion subjectivity coming to me, i would say i would still consider this a hammer, because if you look at this uh the context of this candlestick pattern, you still have a very nice long, lower weight, which you know Signals rejection of lower prices. This tells you that a try, the sellers, try to push the price lower but will overwhelm over and the buyers overcome them, and you know close near the highs of the day. So to me this is still a valid bullish. Uh reversal candlestick pattern, even though it looks bearish, okay, uh next thing: where do you set your stop loss? Remember uh one atr below the swing low.

So in this case i will take this as the swing low, one atr below it probably somewhere. Here i can look to enter on the next day open what about targets right where my potential selling pressure come in. If you look at this chart right, i wouldn't be too aggressive and aim for this highs over here, because this market would have to face or overcome this obstacle over here. This uh this swing low over here.

So if you want to be more conservative, i would say you know you can consider taking profits right before this swing low over here. Of course, you know if you want to go with uh advanced trade management. Note take half a position off here and the other half over here i'll leave it to you right. It's not the scope of this video, but you know for a more conservative level.

This is good for you to consider taking profits. What's the outcome of this trade, it's not important right, because the process is what matters so move on to the next trade sq square. Okay, for this one over here right same thing: right: what is the overall trend in this market? Well, this stock is in an uptrend great number. Two: do we have an area of value? So if you look at this right, i want to point out to you somewhere about here, an area of value.

Do we have a stock trading at this area of value? Yep looks like it right: we have this uh previous resistance that could become support right, i'm not even sure if the 50ma supports just let me overlay yep somewhere but they're nice. So you can see that again similar to the earlier example. We have a previous resistance which could become support along with the 50ma, which could also act as an area of value. Next one, do we have a valid entry trigger over here, so we've just this time around.

We don't really have a candlestick pattern. We have this. One over here right, a potential bullish, engulfing pattern this candle here, but i probably won't trade it because, due to the small size nature of it right, but what we can do instead is to look for a potential trend line, break technique right, so trend line, break Right just connect the lows all the way down here. You can see that at this point, this candle over here did break and close above the trend line.

So there's a valid entry trigger to go long. So now what about stop loss again? The concept is the same, identify the nearest swing low, minus 1 atr and your stop loss is probably somewhere here. I'm going to guess: okay enter next day open this candle open you could enter or over here on the next day, open, stop loss, probably 180 below this lows, uh possible target right. I would say before this swing high over here.

If you want to capture a swing so for this trade right, if you look at it from a risk to reward basis right, this is your potential profits, and this would be your size of your stop loss right. You can see it from from a risk to reward standpoint. It may you know, may not even be a one to one. So whether you want to take the trade or not, i leave it to you, okay, so one more final example: zoom zoom, zoom, zoom, zoom.

Okay, so for this one over here same thing right: what is the stock structure stock structure is in an uptrend great? Is it at an area of value from the looks of things right? We have the stock at this previous resistance, which could become support around here and the 50ma as well over. Here we have a nice bullish, close up higher okay, you can see a nice bullish close over here so yep. It could be a valid entry trigger to go long right, stop loss again, one atr below this lowest possible target. I would say before this swing high over here in this case uh, the trade didn't move much in our favor before it reverse, and you know stop us out for a loss.

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