Hey hey: what's up my friends, so in today's training i want to share with you a simple breakout trading system that has generated like five thousand and twenty four percent over the last 31 years and once you've learned the system you can spot or get on board Right trading opportunities like this, where the price over here, you can see a breakout and then ride this type of huge massive trend up higher or cover the precise entry, exits risk management and much more and of course, this is clearly right - an exceptional case where you Get to write massive trends, but over the last 31 years, if you apply this trading system, you know uh with discipline. This is the equity curve that you know has resulted in it right. You can see that you know this. Uh system has generated more than 5000 over the last 31 years, so if you're interested to learn more right, then let's get started so first and foremost right.

What is this system about, and why does it work very simple? This is a stock trading system, so based on academic research, based on my own back testing, based on the works of other traders that i've studied strong uptrend stocks right, they are likely to continue in the direction of the trend. It's proven right, so basically, stocks in an uptrend are likely to continue in the direction of the trend, so this system right looks to buy breakout right when the stock makes a breakout, and then we will ride the trend till it ends. Now i want to be honest right that the trading strategy that i'm about to share with you right it isn't mine. Originally, i have actually studied the works of other quantitative traders like andreas cleno, nick ranch, emilio tomasini and that's how i learn right off such trading strategies.

So i just want to give credit where credit is due. So let me give you the exact trading rules, to do this number one. We are going to be trading like stocks in the russell 1000 market, so these are the largest 1 000 stocks in the u.s stock markets. They are liquid.

You can enter and exit these stocks with relative ease. We will use a simple trend filter because we only want to be buying when the overall stock market is in an uptrend. We don't be buying when the market is, you know in a recession or it's in a downtrend, because this won't put the odds in your favor right. It's kind of like you know.

If the market is in downtrend, you buy stocks, chances are that stock is going down as well, so we only want to be trading when the overall market is heading higher, so we use this trend filter where the russell 1000 must be above the 100 week. Moving average next one entry very simple: we will look to buy when the stock price has closed above the 50 week high on a weekly timeframe. So this is a weekly trading system. You can actually trade the system right while having a full-time job, because you don't need to you know, watch the markets all day so once the stock has closed above the 50-week high i'll share some charts with you later.

What you'll do is to enter on the mondays open, so when the market opens on a monday, you enter the trade exit. You will exit the trade when the stock price has closed below the 40 week low and again i'll share with you how to spot that later on and ranking right. So what happens? Is that you're trading the russell 1000 index there is like 1 000 stocks in the index? What happens if you have like 50 or 100 stocks right making a new 50-week high? Which stocks do you choose? Which stocks do you pick? So what we'll do is we will select stocks that have increased the most in price over the last 50 weeks, so this kind of kind of, like filter, help us filter out the strong stocks from the not so strong stocks and for risk management. Pretty simple: we will use all right, uh, five percent of our capital for each stock and have a maximum of 20 position, because five percent of capital multiplied by 20.

All your capital, 100 of it will be totally used up. So there's no leverage in this uh system. So, for example, let's say you have a capital of hundred thousand dollars. What you'll do is you allocate five thousand dollars to each stock? Okay, so let's say: if you're supposed to buy stock, a stock, a is trading at a hundred dollars, so how many shares of stock a can you buy, so you just take five thousand dollars.

You divide by the share price of stock, a which is hundred, and that should give you 50. If my math served me right, so you buy 50 shares of stock, then your 5 000 capital is use up. Okay, so you keep doing this for a maximum of 20 positions, so once you've done that. Okay, let me give you a few charting examples, so you can see how this works.

So you can see this is a chart of splunk. You can see that over here. This blue line is pretty much helping you to highlight the 50-week high, so you can just simply use a tool like the dungeon channel, just plot out the dungeon channel on your chart and just show the the high of the dungeon channel. You can hide the middle line and the bottom line, so you can see over here.

This blue line is the 50 week high and on this candle here you can see on this candle here. The price has closed the highest price point right over the last 50 weeks. How do i know that? Because if you look left right, this is the highest closing price over the last 50 weeks. There's there's no closing price right above this candle.

If you just look left on the chart, so this is the highest close over the last 50 weeks, it has meet our our requirement. What you'll do is you enter on the next week open on a monday which is on this candle over here, which i've highlighted so you'll go long? Okay? What about stop-loss so stop-loss again, very simple: is it the 40-week low when the price closed below the 40 week low? So what you can do again is use a dungeon channel, but this time around you change the settings to 40.. So only show the bottom of the channel, so you can see over here on this candle here, this red candle. It has made the lowest close over the last 40 weeks.

So again we don't exit our trade on a friday right. We wait for the market to close first, so on friday, the market has closed the lowest close over the last 40 weeks. So on monday open we exit, which is which is over here on this candle. We exit this trade, so this is probably a losing trade.

If you ask me so here's another example you can see over here this this market also made a new uh 50-week high. You can see this this candle over here this particular candle right. If you look left, this is actually the highest close over the last 50 weeks, so we enter on the monday open, which is highlighted by this green candle over here, which i've put in the arrow. You enter this candle open on a monday exit.

Right again, we use the dungeon channel the 40 week low to highlight for us, where is the 40 week low? So at this point in time you can see that the 40 week low is here so this trade right now oops, i mean the 40-week low. Is here 40-week low is here so we are still holding on to this straight until the price breaks and close below the 40-week low. Only then do we exit this trade, so you can see that the trading setup is extremely simple. Okay, so using those rules which i've shared with you right, let me share with you the results of this trading system.

You can see that we have a net profit of about 5, 000 and 24 over the last 31 years. Winning rate is about 48 slightly below 50, so you lose slightly more than you win right, losing rate is 51.25, average profit is about 62 and your average loss is about 11 on each trade. So you can see that, yes, you lose more than half the time, but the reason why this system is profitable is because, when you win right you, your gains are much larger than your loser. So you can see that your average gains over here is about 62 and your average loss is about 11, and this is how you know uh this trading system, you know, gives you an age in the market.

Okay, now let me share with you: the full breakdown of this trading system results, because some of you might be thinking. Ah, you know just simply pluck all this number out from thin air, so uh, i do uh, you know get that. So let me just share with you this excel spreadsheet, so how it works is that i actually backtest this trading system on army broker, that's the backtesting platform and then i export the data to excel. So it's easier for you to digest and read the the data over here so just to walk you through quickly.

You can see that this is not something that i made up over here. This table. It's actually uh the year and year month-on-month performance of this trading system like, for example, in 1990 uh, zero percent, probably because the trend filter kick in right market is a bear market. So this is why we didn't take on any position in 2020 up 9.1 percent 2019 up 11 percent 2018 down one percent, so you can see all these numbers over here and of course you have some crazy.

Just like you know this one here 53. I think this one here it's in uh was it 2010. Yep seems like it's 2010., then walking true right. How many trades did this system take over the last 31 years about 600 trades there you can see the winning rate over here 48.75 losing rate about 51.

Your average loss is about 11 average profit about 62 average annual returns about 13, whereas the s p 500. I think it's like eight or nine percent. Maximum drawdown is 37, whereas the s p 500 is probably more than 50. So you can see that this system right pretty much beats the market and if you want to look at it at the equity curve right since 1990, you can see that it's pretty much sloping up higher the equity curve.

So this tells you that you know this system still works right even till today, so now moving on. Let me share with you a few lessons right that you can learn from this trading system, even though you know uh, you might not be a systems trader. You could be a discretionary trader, so here are some lessons right for you to take away number one: what's high can go higher, so if you trade, the stock market and the stock looks really bullish. Maybe it looks something like this.

Okay stock is an uptrend about to break out, looks so high. Oh rainer man, the stock is so high, so expensive. I can't buy right now it's about to reverse about to make a pullback well based on the data i just shared with you right. What's high can go higher right? What's high, especially strong, trending stocks, it's likely to go higher, so you should you need to kind of, like you know, overcome that you know biases in your head right.

You know. Oh, it's so high. I can't buy so expensive right now, but chances are right that stock could possibly continue even higher, of course, not always because there are pullbacks. There are recession along the way, but more often than not, the stock is likely to continue moving up higher.

So, what's high can go higher, so if you're a discretionary trader a price action trader, you can look to employ a breakout trading strategies right in strong trending markets in or rather in nice uptrend stocks. Next, one trading doesn't have to be complicated because, as you've said, the trading strategy that i just shared with you right pretty much boils down to buying high and selling higher we're buying, breakouts and then trailing our stop loss and exit when our trailing stop losses. So trading doesn't have to be complicated, especially when you have, or rather when you have, when you're trading based on sound, proven principles right the strategy itself can be relatively simple, so trading doesn't have to be complicated. Okay, what's difficult i would say, is you know, uh sticking to the rules right come high or low right, you know, draw down, you still follow your rules.

Uh market is good. Market is bad. You follow your rules, that's what it's difficult sticking to it. For the long haul, so if you've enjoyed today's training so far, then i would like to invite to you right: invite you to a live trading, webinar that i'll be hosting so this over here right.

The next one is in november november, but again right, you might be seeing this video in december or january february or whatsoever. So my plan is to actually host this live webinar once one to two time a month. So, even if you missed the november session, i would still have other upcoming future dates on this page, so just go down to trading with renault.com sts during this live. Webinar sts stands for stock trading secrets during this webinar you'll learn, for example, how to grow your account right to seven figures and beyond.

Even if you have a small starting capital, how to steal hedge funds winning strategies right. So you can save your time, money and effort on you know and avoid wasting time on things that don't work, how to generate an extra 10 20 or even 40 a year. Even if you know, uh can't read the chart for nuts or you hate, analyzing financial reports right i'll share with you, how you can still achieve that, how to generate consistent profits from the market even during a recession or a financial crisis and i'll share with you. A very simple trading system to profit from the stock market, even if you've tried everything else in field.

Okay, so just come down to this uh this page over here click on this orange button. You will be brought to a zoom page where you can register for this live webinar. It's free and i'll, see you there. So with that said, i wish you good luck.

Good trading, if you enjoyed this training, smash the thumbs up button. If not, then hit subscribe and, finally don't forget to sign up for this live webinar. The link is at trading with rayner.com sts over here click, this orange button and then you'll be brought to a zoom webinar page just sign up and i'll see you. There talk to you soon,.