good morning guys welcome back to the channel i appreciate you guys tuning in with me this morning i gotta say i'm really excited about today's uh morning video uh because something just clicked and i can't believe i hadn't spoken about this earlier or maybe i have but didn't just hit home on it too strong or didn't emphasize it as much but i really think this video is going to help your trading a little bit better and i think it will also help you guys uh in regards to following along with these videos and some of the twitter posts i make and and yeah i think it's going to be a really good video so hope you guys uh stay safe through it all shouldn't be too long so first thing i want to do is pull up twitter here so for those of you that tune in regularly you know i think about last week or so we started talking about markets bouncing with price targets of 400 all right to price targets of 393 to 400 etc so i want to help you guys wrap your head around why i picked the price target of 393 to 400 400 400 but more specifically like when making these twitter posts why did i say 400 right and then kind of change to 393 to 400 and say it's hard to say all right well yeah it's hard to say because it's the stock market but let me help you understand for me in the way that i look at the market why it was hard to say which one it would be 393 to 400 or somewhere in between there okay so so this would be really good i think you guys are really going to enjoy this right so this is kind of you're going to walk us through from the starting point of suggesting 400 and switching to 393 to 400. so what happened from this initial post on june 22nd to maybe a couple minutes later changing to say 393 to 400 okay so let's pull back this page go to the stock go to stock chart okay we're going to go to a daily chart first all right when we go to the daily chart there won't be as many lines you can see it's a little bit cleaner but we're also going to go back to that four hour chart uh in a second too so we're gonna start here with this spy okay now remember this post was done on june 22 all right spy 400 seems about right something blah blah blah 364 bottom all right so starting to build the case on june 22nd where i think the markets can go all right so on june 22nd the market was trading um here so this is june 20 section if i just gotta zoom in a little more to get the day okay that's right so that's first and that would be the second all right so this day you're here is june 22nd market traded at a low of 370 dollars so on the day of june 22nd i say 400 and then we kind of switch to 393 to 400 okay so you will see uh just a couple days ago actually yesterday we topped out at 393.20 so on june 22nd we build the case for the markets going to 400 then we kind of backtrack suggest 393 to 400 so i want to talk to you guys why i suggested the zone of 393 to 400. and now in order to get that zone we're going to have to change the time frame to 180 day four hour chart okay so when we change to 180 day for our chart okay you can see that this zone actually becomes a little bigger and it's actually missing a line here so we're going to use this chart to the right okay so this is kind of the full picture of that zone so when we look at this screen here 184 hour time frame you can see our orange zone is all of these lines so every single one of those lines those orange lines that's a zone every single one of these green lines that's a zone okay so on the day of june 22nd let's go find that day um let me just double check let's go to the daily chart so was this trading day right there i think all right so on june 22nd the market was trading here okay now on that day right on this day june 22nd if we were to look straight up and through the green and go directly to the yellow where does the price kind of start you can see the price starts here at about let's see one second the price starts here at 395.50 okay and it goes to a high of 402.87 okay so on june 22nd when we're down here i at the time was predicting the market would break upwards meaning it would break through this green zone the negative two deviation zone and it would then break out and trend to the negative 1 zone in which case the negative 1 zone on june 22nd existed at 395.83 area i think that was right let me just double check sorry yeah so this zone exists at 395.30 to 403 but on june 22nd i recommend a price of 400 arguably and 393. so anywhere from 393 to 400 400 was the breakout expectation if we were to move through the green zone why is it that on june 22nd when the negative one orange zone is saying 395.30 in 403 am i suggesting 400 to 393 because the market is in a downtrending motion okay and if you look at the deviation system in front of you you can clearly see its stair steps down and that's because the market is trending down so on june 22nd i knew we weren't going to break all the way up from here to here that day it would probably take a couple days and if it took a couple days i knew that it was most likely we would see this system recalibrate downward from the day that i had initially done the analysis so on june 22nd the system says targets of 395.30 to 403 but knowing we weren't going to break up and run 20 2 500 points in a day and it'd probably take a couple days to do it that would allow the system to most likely recalibrate and continue trending down so by the time the market actually does break up and go there the price will not be a target of 395 to 403 okay the system will most likely calibrate lower now i didn't know how much it would calibrate and what exactly would do based on how long it would take for this market to break out yadda yadda yadda so with the prediction i went with the 400 to 393.

basically trying to predict where this downtrending market system would be on the day of june 22nd all right so fast forward a little bit or go from we're talking about 393 on june 22nd okay so then this would be june 23rd june 24th we break out and on june i think that was the i i think that was anyways but regardless we break out and we run up okay and so you will see by the time the market gets to here look at what the system does it recalibrates down and down to the point where when we were trading let me i'm gonna change the time frame to 20 day one hour okay all right so look it um on monday when the markets open back up so this is the weekend and the markets open back up monday you can see this system instead of having targets of three whatever that is 395.80 to whatever 403 the system recalibrates and drops downwards right a little bit going into monday all right so let me put it like this if this system did not recalibrate down going into monday and it stayed completely flat then that would mean on monday morning opening up this yellow line would have been where the red line is giving the market room to run maybe more upwards but anyways the concept is is on june 22nd we made the prediction of 400 to 393. based on the idea we would break through the negative two deviation structure run to the negative one structure and since the market is in a downtrending motion it didn't make sense to have this be the target specifically like in this zone when we're training down here because it would not break straight up that day and go there it would most likely most likely take a couple days to do so in which case this system would stair step down creating a lower deviation price zone as prior to june 22nd okay um where else am i going with this okay so that is really to help you guys understand how the system works a little better while at the same time helping you guys understand how i go about thinking about a price target when i'm using this system um and so on and so forth okay so with that being said we're now going to change pace a little bit change charts up we're going to come into this chart here we're going to go full screen for those of you that are new to the channel which probably isn't many since we're shadow band this is an open high low closed chart no pre-market no after hours data this is a 10 day well this may not be on this i might have changed the time frame but you can use a 10 day 30 minute chart okay and it would look the exact same as this and this is a 10 and 50. 10 and 50 sma okay so that's a 10 that's a 50. it's an open high low closed chart 10 day 30 minute okay basic premise of this is when the blue is over the red you're in an uptrending momentum market and when the red is below the blue you're in a bearish downtrending market okay when the red is above the blue you're bullish doesn't mean you can't see drops okay when the blue is below the red you're bearish doesn't mean you can't see pops all right happy you know that now so that being said yesterday's action and actually mind you remember what day june 22nd was it was either this day or this dog is this day because i put the green arrow there right so remember june 22nd we're talking about markets going to 393 to 400.

the prior day we had a gap up and we got the cross so june 22nd we're watching long three ninety three four hundred that's three ninety three four hundred was right there we hit 393 on the nose sold off okay now today after yesterday's sell-off well we got across yesterday from the sell-off but going into today are we going to be bullish are we going to be bearish well we just got a bearish cross so in this case you would either be sitting in cash not long the spy if you're a short-term trader or you'd be flipping bias back to bearish until we get a bullish cross etcetera so since we have a bearish cross here you ideally are going back into cash or bearish okay mind you seriously i'm thinking 393 to 400 as the price target june 22nd we hit 393 sell off and now we have a bearish cross okay so we're not going to be long biased currently we're going to start watching things more bearish okay before we continue i want to put your eyes back to here when the market crossed here okay did it instantly run that day well it gapped up then we crossed traded sideways following day we gap down directly to the 50 sma find support bounce trend sideways a little bit then breakout okay the reason i explained all that is because i want you to pay attention to the location of the 10 sma today and the 50 sma the reason i say that is because this was a bullish cross up and break up that pullback was a retest of the 50 sma the strong buying was a good dip then you run if this is going to roll bearish you can very well see a relief bounce pop to retest the 9 or the 50 sma location before rolling down and that would be a re-test of the breakdown one breakdown specifically the moving average one so just because we got this bearish cross doesn't mean the market instantly just rolls over keeps selling off doesn't even mean it sells off entirely we could go through a consolidation phase right the concept being is we got a bearish cross and if it doesn't sell off right away there's a good chance you're coming back up to retest the pricing location of that 10 and that 50 sma all right so now what we're going to do is we're going to go kind of overlap this 1050 sma location onto the other chart and just see how that lines up with our deviation system all right so i'm going to delete them right now i'm doing it on another screen but i'm going to add them you can see where they were right there so i'm going to re-add them and then we'll go from there so adding the 50 sma location now did you notice how it lines up perfectly with our deviation system all right so again that 50 sma level adding it now you can see it's right pretty much overlapped on our statistical probability trend six month there here's an eight or here's a 10 sma level right there not really lined up with uh with a deviation system but so that being said okay we had a bearish cross happen yesterday the location of a 50 sma retest of that bearish cross would be 3 84 69 which is currently the same price as our six month trend but you can see the six month trend usually updates a little bit every day so wouldn't be surprised if today we update and we're slightly lower than that okay so right now it looks like this zone is going to be anywhere from here to here let's just say pretty much like this 383 to 3d 469 is a high probability like retest location on a pop squeeze move so if you see the mark kind of squeeze out today and push up to start that's most likely the location it's going for to then probably try to be sold into um and you will only see a bigger long move if the market sustains over the six month trend wherever that cal recalibrates you like right now it looks like every day it's calibrating from let's see what that i can figure it out let's see it's usually recalibrating like uh looks like a dollar seventeen so if we go from here a dollar seventeen or so about a dollar all right yeah right there so that's where we can expect the six-month trend will probably be so good chance you could see the markets pop up kind of re-test 383's area and maybe up to that 8465 price in that zone and then that's where i expect you'd probably see some selling pressure um on the day um yeah i mean and secondly too i mean if you think about it um yeah i mean that's i mean i guess that's pretty much it uh in that regard so yeah um could very well see a long pop-up retest of this zone then sell back down um i'm gonna go back to the daily chart here really quickly on the spy all right so looking at the daily chart um you can see markets were trading one deviation we sold down to two deviations bounced the negative three it broke through the negative twos back to the negative ones pull back so the way that this sits is pretty much each one of these green lines here here here and here are targets on the downside so for every day that we're bearish and we sell down that would be the target that would be the target that would be the target etc at the same time each one of these green levels tends to be an algorithm level where people do buy so you can either see short squeeze bounces or dip buys off that so going into uh today um pretty much your bearish targets for the spy would be like 378 37 or whatever this recalibrates to going into the open which looks like it's recalibrating by like about a dollar so maybe 377 vice versa your long pop targets would be what we already discussed um um looking at the nasdaq here kind of same thing it has some deviation levels you know basically same levels as the spy um yeah but like even here right i mean your targets down would be like back to 277.98 if the markets can't kind of sustain their bounces um but i've been going on for a long time here so i don't want to hold you guys up too long uh but like i said before going back to the spy really quickly we just got the bearish cross if the markets are going to stay bearish cool that's fine um but anyways if you're looking to be bearish which i would look to be bearish today since we got the cross but only probably on a retest of prices up in that 383 384 and 384 69s prices is kind of my guess there uh and then in terms of where the market would go it would just be targeting back down to the green lines unless the market started to get acceptance above the yellows right and that and that's basically how it works right just like here right acceptance above you see how the market broke above pulls back holds above that's acceptance above holds above holds above holds above so the market is getting acceptance above this green line right and then we trend to the next screen line so until we break over this right so then we break over and then we hold above and then we get acceptance except and then we squeeze out to the next line and then we get acceptance above and then we squeeze up to the next line and we push and then we start to get weakness and then we can't hold above and then we can't hold above and then we try to hold above we push up and then we fail and then what we trend down to the next line down down et cetera et cetera and that's kind of how the game goes so that being said i will see you guys in the next video i hope that helps hope you learned something new.