Welcome to the Ultimate Day Trading Strategies Crash Course Part 2. if you're new to the channel, my name is Shea AKA Humble Trader Previously I made this one hour long technical analysis crash course on this channel. I'm really happy to receive so many positive feedback from you guys watching. So in today's Crash course I'm gonna be teaching you a frequently used trading strategy which I call the Gap Up or Gap Down Trading Strategy Stocks that Gap up or down overnight has the best potential to give you the range and volume, essentially creating a runway for the stocks to go a lot higher in trading.

You always want to look for stocks that can potentially give you a larger range of profit from than the risk you take. So having a Gap Up Trading Strategy in your trading Arsenal is a must and spoilers in this crash course. I'm teaching you as many as five trading strategies that you can potentially use to trade Gap UPS or Gap Downs You guys know the drill. take a look down in the video description first and prepare the important chapters for you from understanding the psychology behind the setup to practical learning and how to execute the strategy with my live trading examples.

So make sure you smash the like button and save this video, learn at your own pace and share this crash course with someone who might need it. And yes, in this case, I'll be sharing this lesson with my ex-husband Mike Bagholder Our first chapter is on understanding what a Gap, Up or Gap Down mean in a trading Psychology Behind Gap trading Now let's dive into it. So what exactly is a Gap Up or Gap Down Strategy? A quick 101 for my new Traders A Gap Up or Gap Down refers to a situation when the price of a stock opens higher or lower than the previous day's closing price, resulting in a gap in the price chart. These kind of overnight Gap may occur due to significant market news such as earnings reports or economic data.

Let's look at an example here on the stock Google On my trading view chart, you can see the price is closing price for the stock was around 112 over here and overnight it gapped up all the way to 113 and opened all the way up here at 1 15.. So this is like a three dollar per share overnight Gap up. The next example over here is a Gap Down overnight on my favorite stock of all time, Moderna. Anyways, there's negative news on the stock.

you can see that's why the stock you know pride is closed was 157 over here, Gap down overnight and pre-market you know it dropped all the way down to 146.. So this is what we call a Gap Down and this is like a 10 per share huge breakdown day on marginal stock over here and this will be a great short opportunity that we're gonna go over it later on in the strategy video at this point. You Must Be Wondering Shay Why is this Gap Up Strategy so effective on large cap stocks? Well, the reason you want to focus on large cap stocks when trading the strategy is because those kind of stocks have two key traits: Number one is the high trading volume from large cap stocks, and number two is the volatility and range. Large cap stocks are generally considered to be more stable and more predictable than the small cap stocks, and they have a higher trading volume compared to small cap or low float micro cap stocks.

And when these large cap stocks Gap Up or Gap Down, that brings in even more volume and volatility than normal because they are more likely to be effective by significant news such as quarterly earnings reports or guidance. Chapter 2: Gap Down Long Strategy Criteria and live examples: Okay, I Hope I made the concept of Gappers simple enough for you to understand. In our next chapter, we'll get started on the first strategy that you can use. The Gap-up Long strategy will go over the key criteria of the setup, how to execute, and my live examples.

This is a very simple technical strategy that's designed to take advantage and profit of a stocks that opened up higher than a previous day's close basically an overnight Gap up and you can find them very simply using a pre-market scanner. So there are two key criteria to this. Gap Up Long Strategy: The first Criterion is our short-term technical analysis on the daily chart, which we're gonna go over right now. So we're looking at the stock Shopify over here S-h-o-p Now let's go over to just the dating chart over here.

enlarge it on our trading view chart. You can see on this particular day, the stock gapped up overnight from Friday's close of like what 48 dollars and got the overnight open at 54? That's a huge gap up. Now you're not looking for just any Gap Up You want to see a gap up over the key daily resistance. So in this case, if you zoom out on the chart, you can see that there's some key resistance above.

The priority is closed 58 around 50 here, 50 and over here 51 and the most extreme one the peak over here. the little Wicks on the daily chart. that's 54. So that's gonna be the most important level that you're gonna look at the next day during the pre-market planning session.

And if you zoom out and delete the other line for a little bit, you can see we haven't tested that fifty four dollars ever since here, which is April of 2022. That's more than a year ago. So now we have the key level on the daily chart. Looking at a pre-market you can see this stock was already consolidating above that level pre-market fifty four dollars.

Now a lot of times you're gonna have stocks that Gap up to key resistance like This and at the open, it just pops and Fades and breaks down. So while yes, it's important to identify the key level, it doesn't mean you just buy a pre-market most of the time. Despite seeing the stock breaking above key level during the pre-market session, I Still prefer to wait for the open to execute my buys or sales and we're going to go over the exact buy and sell entry points for the strategy in just a little bit. But let's go over our second Criterium for the strategy.

So the second Criterion is based on fundamental analysis. Essentially, you want to know if there is indeed a positive Catalyst that's causing the stock to Gap up so much overnight. And if we go over to my favorite stock news research tool which is Benzinga Pro, you can type in Shopify over here like I did here to select the ticker, click on the calendar tab. Um, you can see um 2023 May 4th which is a day of the Gap up.

They had earnings before the market open and let's scroll over to see the results of this earnings. You can see that the estimated was really bad for the stock. They were expected to lose money, but in actuality they actually beat. they made money instead.

This is the Peps so you can see a surprise Factor over here over 125 percent and same thing for the revenue as well. They had a nice beat also, so that's the reason the stock is gapping up due to positive Catalyst which is earnings beat and most likely also beat on guidance as well. Alright, so now that you know the most important two criteria to look out for, let's take a look at how you should execute on the strategy. So remember the key level is 54 on the daily chart over here daily levels that also matches with the pre-market support area.

You can see a stock spiked to 56 pre-market pulled back to fifty four dollars area and actually reclaim V-wap at the open and break through the new higher day. So there's two simple ways to execute the long side on the strategy. You can either long when the stock pulls down to key level 54 dollars and give it 50 cents risk which this one happened really quick so nobody could have caught that. Maybe somebody did, but I didn't catch that or again the second entry will be if the stock is able to break through the pre-market highs area around 56 dollars that we just talked about.

and essentially you're using these two entry points as your guide to buy the dips along that key levels. So either fifty four dollars or over pre-mark highs, all the little dips around the 56 dollars are potential entries. and once the stock holds, the key level breaks through pre-market highs 56 dollars. You can see it had a really, really strong breakout to almost 60 dollars.

and that's why it's important to plan out your profit targets as well and seeing the potential upside on this strategy. So this is where we want to zoom out on the daily charts like so and look at the range of the stock in a potential upside. So we talked about earlier. over 54 dollars? That's a very important key level, right? So over this area, where can the stock go to if you zoom out? This thing really doesn't have any strong resistance until over here.

Closer to 58 dollars here and sixty dollars range 60 61s. And why is that? Because this is also a 52-week highs breakout, right? So you have multiple things. Yeah, the daily Breakout: Your weekly breakout through the key levels and this is a new 52-week highs. And on top of all those technical breakouts, you have earnings beat and guidance beat.

If you've been following along in my YouTube videos, you know that earnings reports are some of my favorite Catalyst because they essentially tell you short term whether the company is more bullish or bearish, and you when you're trading a stock with technical analysis, fundamental analysis, all the criteria which is talked about, you're essentially writing a trend to the upside following the big money. Anyways, that's the reason I Like this strategy so much on large cap stocks is because when it's a multi-day multi-week even 52-week high breakout, you get a lot of upside. You can see this thing also ran for one to three days so you can play the same setup for multiple days after. So anyways, all these areas 58.60 are your price targets when you are trading this loan on the first day and even more so on the second day and the third day, you can see it went from like the second day went from 57 to 60s and closing in at 62.

next day at sixty four dollars. But of course we cannot just talk about entries and price targets. We also have to talk about risk management and how to get out and manage your risk and keep it very small in case the strategy doesn't work. Have you ever walked in a broke or bridge? This is what an overnight Gap up or gap down would do to you.

The results really depends on whether you use risk management and guess what? I'm gonna choose Rich every single time so make sure to follow along to learn how to place a stop on this strategy. This strategy is actually very, very simple. If you think about it, if a stock is really breaking through 52-week highs, it should keep going and form a strong Trend So essentially you want to stop out when the trend is no longer in your favor. and one of the best way to do so is with V-wap on the five minute chart so you can see the stock is staying above five minutes.

and if we're long above the 56 dollars loaning over to 58 59 almost 60 dollars, there's no reason to get out until the stock is breaking down V-wap So that's gonna be your risk. It's very simple, that's the only indicator I Use once again I Use it for entries as well as for stopping out next. I'm going to show you a live trading example on this: Gap Up Long strategy. You can see well looking at the stock P-a-n-w They also have the exact same Catalyst as Shopify They beat on earnings guidance and the stock gapped up overnight.

Um, if you look at a daily chart, you'll see the same thing you can see on the chart. I've identified a key level of 179 180s area stock is gapping up over to 155s. you can see I got long over the pre-market highs area of 183s. So everything we talked about I got in half of a thousand shares at 184.90s If we flash somewhere a little bit, you can see the stock is already around 187's Mark Now I think I made a deadly mistake here of not selling into a breakout.

If you can see on the daily chart, there's some resistance around that 187c area over here. that little Wick over here. Um, I did not see that. So zooming in you can see the stock is pulling back I'm still in my 1000 shares at 184.90s and you can see the stock is already kind of pulling back.

Fast forward it's testing 187s once again. I really should have sold at least like 50 of it but uh I didn't I'm up. you know, a little bit more than two grand. That's decent for like this is what like the first five minutes of the day.

but I didn't sell? That's also the the issue here. I Think you know when planning out your daily resistance like we did earlier on. Shopify you want to make sure you're selling into each resistance. So in this case, if I have a thousand shares, what I should have done is sell at least 300 shares to scale out on my position.

Fast forward a little bit more. you can see we're pulling back I still haven't gotten out? Really should I Got to know some on the two minute charts Here you can see I am finally starting to manage my position. So I went from being up two thousand dollars to now being up only uh three hundred dollars you can see I just added some around V web because 1 000 shares now my full position but still not unless it's just so some. In hindsight, this is a pretty good ad.

Remember we talked about using V-wap as your entry as end as your risk. We're now back at 187. I'm pretty sure I sold some up here after the ad, but no I didn't. Really really big range on these kind of large cap stocks, but that's why I love trading them well.

I can't believe I held it on for that long 187s with my average of 185 1500 shares really should I at least sold like 300 shares, but I didn't Good practice. I'm holding on to a winner, but at the same time it's a fine balance between holding on to a winner and scaling out into your price targets you can see zooming in. We're having some trouble around that 188 area. the daily Resistance we talked about.

Okay now I'm full size into the stock at 185.50s and I added a little bit on the dips as if you saw earlier on the dips over here. um, added just a couple more. Now my average is all the way up to 185.54 and when I'm full size I want the stock to work almost? You know right away I'm up five grand I'm realized on the stock. So as long as you know this strategy works I'm going to tell you this became like a very, very small winner later because I didn't sell into the resistance levels.

I talked about. but you know I'm happy about my entries and my patience. but I'm a little bit too patient in this case. Okay So Allah has passed.

You can see now: I sold all my original position all the way here at 187 and like below V Web I'm stopping out uh, around like 185s break. Even so I went from being up over unrealized five thousand dollars to now realizing only 300. So you know my mistake here is I didn't sell into those resistance areas which you definitely should be doing and every enter. but no, this is like a little bounce thing that I'm gonna do but again I realized that they green but not as green as I should have been if had I sold into the breakouts.

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If you use my link in the description, if you're in the US you can get up to 16 free stocks as well using my link. Thanks to MooMoo for sponsoring this video. Chapter 3: Gap Down Short Strategy Criteria and live examples. So far, so good.

In our next chapter, we're going to be looking at the exact opposite of the previous setup which I call the Gap Down Short strategy and remember if you're enjoying this kind of Crash Course so far, please comment Gap Trading down below and also give me a gentle tap on the like button I'd Really appreciate it. It really doesn't matter whether stocks are gapping up or down left or right, as long as there's volume and range, there's still strategies that allow you to profit on each side. Now the next Short Selling strategy is available to Traders whose Brokers can let them short a lot of these easy to borrow stocks so that should be Almost everyone besides the users on Think will swim just like a previous strategy. There's a few key criteria to note for you to trade this Gap Down Short Strategy: Okay, now on the screen over here you're looking at the stock.

PayPal You can see this in Gap Down Huge overnight after once again earnings report you can see on this particular day over here with a huge gap down overnight. uh Friday's close was like 76 dollars and this thing gapped down after hours after it. Really bad earnings report and the next day pre-market this thing's trading at like 70 dollars. so pre-market already dropped six dollars per share on a 76 dollar stock and you can see at the open this thing just continue tanking even lower all the way down to like 68 dollars and sixty six dollars.

So the first key Criterion is once again technical analysis. So which is opposite to what you saw with Shopify the Gap up long strategy On this gap down short, you want to see it break down some key support on the daily chart. So in this case you know if we go on the daily chart over here you can see the 52-week lows is around the 66 dollars area right? So this is almost the exact opposite of Shopify Shopify broke through 52-week highs, this one broke down 52-week lows. But also you can see like some small little support here in which you know this thing broke tons of different support areas and over here some small ones.

69 over here. Sixty Seven dollars. Um, you know this thing was just really weak. You can see pre-market this thing broke down to 71's daily support that we drew pre-market already broke down and at the open it didn't even spike it, just like dumped through the 69 and then nature on the 68 dollars.

and that's when it's like started trying to bounce. But no, no bueno, it went even lower to 66 dollars. So that's where you have both of these criteria met. Really, really bearish.

Fundamental analysis with the earnings reports and guidance as well as breakdown on the technicals on the daily chart and this short. Strategy execution is very simple. Remember, this is basically the exact opposite of the previous strategy you wanna shorts using V-wap as your risk Um, every little small bounces to test these key areas so you know I don't think anyone would have caught this. It dropped really quick SSR also triggered so it's impossible to chase the short and then you want to enter on these little bounces towards view app and towards our key daily levels which is 68 dollars with a downside mode to 67 66.

And honestly, once it broke down that 66 dollars the 52-week lows, there's really no bottom in sight for the stock, right? Because you if you want to see more support, you have to go all the way to prior to 2020 for PayPal stock. But essentially, if you've got a short entry on these little pops using V-wap as your risk and these little pops breaking down key support, you're looking to join the trend to the downside until the stock have found the meaningful consolidation, which it really didn't do until like one two, three days on a third day. Okay, now we're gonna dive into a live trading example on this gap down short strategy which is opposite of the loan that we just saw earlier with pen. W In this example, we're going to use my favorite stock ever: Moderna stock.

I've had some love hates relationship with the stock mostly hate, but this is also the stock where I lost the most amount of money on a single trade in one day. It's not fun anyways, so you can see Madrina star also gapped down from Pride days closed due to this really negative Catalyst and you can see over here on the daily chart. I Know it's really small on the left-hand side here. the stock broke down that 147's daily support and you know, and while I didn't catch it at 155, I caught the little bounce at 147 and I only have 500 shares at the time? Looking for a simple easy trade like a scalp to.

The downside, you can see the stock, you know I got in 500 shares around 147s and that little bounce to 147.50s Um, again, and my risk will be V WAP reclaim at this point, which is if you see V-wab over here 148. So my risk is essentially 50 cents to 60 cents depending on the slippage. and now you can see it's already dropping down 144. So I'm in the money.

Three dollars per share. Remember you want the fundamentals the Catalyst to a line that's bearish as well as the day getting child to be breaking down. So fast forward, we're on the chart on top we're holding at 145s I think it has downside to a lot lower to like 140s. Why do I know that? Because I try to launch in a stock before and it just wouldn't bounce.

So I learned from my mistakes, you can see it's really weak. That little bounce you saw earlier to 145 didn't do anything. You can see it's back at the lower day 144. Okay, so fast forward on the chart on my journal here: I was getting really bored on the stock I was trying to focus on a couple other stocks I'm watching and you can see down below.

So I'm trying to cover just a little bit around 200 shares on Madonna around 144 80s. So just in case you know when I'm paying attention to something else, I've already taken some profit just in case so you can see trying to cover some 144. if you look at the daily chart, there's no real support here. You have that small resistance here at 144s, but I really thought it was going to fade lower.

Fast forward you can see I only have 300 shares left at the same uh, 147 average um and cover partial down here earlier 200 shares and trying to see if it's gonna fade even lower. and I just found that a closer and maternal trade around this time at 1 45 over here I'm closing it out over here I Think because I think I bring out a patience I I Just got filled down Here you can see I Realized my Magena trade on the short side 800 Chapter 4 Variations of Gap Trading Strategies You have just learned two trading strategies that you can use to plan your trades When you spot a stock that gapped up or gapped down for a long or it's short. I Would highly recommend beginner traders to practice the first two setups on your paper trading account and familiarize yourself with a Gap trading executions. And for some of you who are looking for a more advanced strategies I have a couple more variations for you to trade these overnight gappers.

These strategies are called The Gap Up Short Selling Strategy the Gap down scalping strategy and pre-market Gap Up Short Strategy Strategy Strategy Strategies it's it's a lot of strategies I know for short-term Traders Like you and I we always want to be very versatile and adaptable to the current market conditions. In the last few years we've experienced a crazy bull market rally in 2020 and 21 and we also got hit with a bearish economy due to inflation and Global conflicts in 22 and 23.. And that's why you need to be able to profit from opportunities on the long side and the short side with these overnight gappers. The fundamental Concept in trading psychology behind the next three strategy variations are very similar.

as a previous Gap Trading strategies you just learned. However, they are different in terms of the execution and entry timing for each of these more advanced strategies. I'll show you the trade planning process, risk management Live Technical analysis and price action. Make sure to ask me any questions you may have down below and I'll do my best to answer you.

Now let's dive into our third Gap Trading Strategy The Gap of Short Selling Setup Chapter 5 Gap Up Short Selling Strategy So the first trade I want to share with you guys is Cvna Carvana Gap Up Short Selling Strategy This is a pretty simple trading setup for day Traders and scalpers who are looking to trade just the opening hours and as you'll see later in a live trading recording that I have I made a little over eleven hundred dollars on this sticker on the short side within about 20-30 minutes after the open. So let's take a look on this particular day on Carvana. Over here this day we're talking about as you can see the stock gapped up huge overnight from Friday is close to about eight dollars all the way to pre-market highs of 1070s and hit like a little Peak lower highs 10 20s pre-market and since then at the open just sold off. so we're looking for that little Gap up to show it into in this particular stock.

And as you probably know already, Carvana is also considered one of the many meme stocks that rang in 2021 and 20 2022. And the thing with meme stock is that every time as you can see on the daily chart these usually these stocks whether it's AMC Bbby it's been long term downtrending. I mean Cvna used to be a 300 stock and since then it's drifted off and sold off all the way to like four dollars. Um and then you can see you know has a lot of failed spikes in the past before and every time it gaps up especially to a key daily resistance.

which it did on this particular they were looking at, it gapped out to like 10 40. You know resistance sold off and over here this rough area 980s. That's also the daily resistance. So whenever we have these meme socks with like a long term bag holder chart that you just saw gapping up to key daily resistance then a lot of times I'm more short buyers on the stock and it'll work really well for a simple scalping strategy.

On the short side so you can see this is pre-market level 980s over here. this little pre-market support That's what I'm going to look for when the stock breaks down and that's my trigger for entry. and if this is the entry on the short side and then I'm risking about here pre-mica highs area 10 30s. So we're talking about 40 50 cents of risk and for the downside you can see on the downside: I have all these lines but downside.

Obviously at the time we don't know where the stock is going to go. but if we're looking at a daily chart. The downside: I Want to look for the next level support down on the dating chart so you have a small support around 9 30s over here 930 950s right here and then you have a little bit more support down here on 860s Range So those will be your price targets. So if that's the entry downside you have here 40 cents.

so that'll be one to one risk award. But if you're looking for even more then you have downside to like 860s or like you know, there's probably a small level around 880s. Mark So here are the three key criteria for this scalping short strategy: Number One: A Need to have a pass price action on the daily chart of a long-term downtrending chart Number two: you need to see a pre-market Gap up and number three: This needs to be a stock that's gapping up on air, basically gapping up on nothing so you can see it's 9 31 am right here. So Market just opened about one minute in um, this Carvana trade.

you can see I'm already in a thousand shares so it happens super fast after they open. You can see the breakdown of this level right here that we talked about pre-market which is a 980s area. It's already broken down so so that's why I Really hurried up and got in a thousand shares. On the short side.

Thankfully, Carvana is an easy to borrow stock so it didn't cost me anything to locate those stocks short. and as you can see immediately after the open, it got halted to the downside. So I'm stuck short with a thousand shares which is a starter for me. The idea is to skip an ad into it after it confirmed the breakdown of 980's pre-market support.

These volatility holds happen whenever a stock increases or decreases by 10 percent within a five minute time period. Okay, I fast forwarded a little bit. it shouldn't hold really quick. You can see I'm quoted.

you can see it hold it down right. It holds it at about 980. it opened at 9 50. so you have about 30 cents air gap so this is usually what happens after the hot you can see on the top over here Gme.

even though I'm not trading it, that's also a lot of main stocks were gapping up in sympathy. You can see this thing is also holding to a downside as well. but I wasn't trading Gme GameStop so you can see Corona usually after down hold. whenever you have a gap down, you're gonna get a pop to retest the viewab area and that's kind of what I'm looking for.

a bounce to short into and a critical mistake that a lot of new Traders make is that they don't look for the little bounce to short and they'll hit the bid at the very bottom at like 940 or 950 down there. So for me I want to start adding slowly into a little bounces you can see I did a little bit. uh, a thousand shares at around 960s so that gave me an average of 9.70 Right now on 2 000 shares, you can see a little test of View app right now. I'm down about three cents.

Uh, no problem. So I'm looking at whether we're gonna reclaim that view app in which in this case the risk is now moved down. So I'm not I'm no longer risking the 10 uh, what do we say? 10 30 like we talked about earlier since I started adding into it I'm moving my risk down I'm moving it to around the Europe area so that would be around 9 80s. So at this point I'm risking about 10 cents.

10 50 cents with slippage in mind So you can see you have a little pop to test that view up area. That's what the yellow line that you see on screen right now you can see the stock is staying pretty heavy. That little pop barely even tried to reclaim that V-wop area. So really, really weak.

You have some decent volume on. uh, Carvana, you're trading 7.4 million so still holding my 2000 shares short. So at any given point I'm usually trading at least two stocks at the same time, but on the top over here you can see two minute chart on Carvana you tested at 9 80s area right? I was saying like if it reclaimed that V-wop I'm gonna have to stop out but looks like you're failing that V-wap at least right now we're back down to 970s. That's my average I'm still holding I Think the idea is I want to add at least a couple more times you can see I'm adding um the confirmation of weakness added about only 200 shares I was trying to add 500 shares but not sure why I canceled it so I only got filled 200 shares at this is what 970s and you can see because I'm adding on I'm adding on the confirmation of a breakdown I'm not adding on strength so that's the difference here.

I'm adding once a stock rejects that uh that 980s level we talked about and rejecting View app and as you can see on the top window here, Kavana is staying week. we're back down to 950s. so I'm up about 20 cents per share. Um, but I think at the minimum I was looking for nine dollars.

Remember at this point I'm risking 15 cents 15 cents around that. Um for downside. if we hold it down all the way down to nine dollars, then I can potentially make about 70 cents. so that's good Risk award.

You can see we're testing the lower day which is 940s. Um, it's a really really small support here from pre-market 940s. so I'm expecting some small bounce, maybe like a dead cap balance. So I think I'm gonna start covering at least like a very very small piece into that and that will give me about no 30 cents per share if I covered it, cover it there so you can see I'm just covering small small 200 shares.

So fast forward a little bit you can see. Oh I actually did not cover I actually added even more 940s? Yeah, because the stock was so weak you can see even on that trying to add I was trying to get filled 500 shares couldn't get filled I only got filled about 100 shares. So I'm adding to a downside on the breakdown of that. um, 940.

Syria Because a stock was extremely weak as shown on the tape so you can see the stock can barely even bounce. I'm trying to not to like Chase the weakness to short into the weakness but waiting for so. I'm trying to wait for the bounce, but sometimes you just gotta accept the stock is so weak that it won't bounce. So that's why I only have about 2300 shares short now with an average about 968..

So back to cover on now you can see now we are dripping lower. The stock is all the way down to 920s. Really, really weak, right? This disparity and the bounce. And I finally covered some I covered about 500 shares I Believe yeah, 500 shares.

So I'm down I'm down to 1800 shares on the short side from 2300. So I cover some lockding about 200. Um, but I want to see how you know how much longer I can hold on to the remainder of 1800 shares short. And keep in mind if you look at the bottom right hand corner the little clock over here Market clock it's only 9 44.

So it's only 15 minutes after markets opened, but all of this planning once again is done pre-market You can see here the stock is extremely weak. You can barely get any uptick. the bids are just getting hammered down. There's no one buying the stock and this is very typical of the meme stocks and any stocks that have a the a long-term barcode chart that you saw earlier.

So this is the reason that having a bad holder chart is one of the most important key criteria for this scalping short strategy. Whether you're actually scoping for the quick move or trying to hold on to like you know, at least 20 30 minutes like I did. Um, doesn't matter. It's important to look at a daily chart so we're back down to 915.

I Think you're gonna see me trying to cover up the rest um of the position even though I should have held down to a lot longer you can see I'm trying to cover some a nice 16 over here. The lows of the day at the time was not I think it printed 909 earlier I covered all of it. Oh wow I covered all of it. So I covered all of it at 9 16.

locking in eleven hundred dollars. So coming back to the trading view charts now we're not looking at two minutes I believe that was the the time frame I was using to execute. you can see I entered here 980s which you saw earlier and I covered pretty much everything around 9 15 here and you can see the stock ended up going a little bit lower. okay, not all the way to 860.

that made me feel a little better but to 8 90 880. So I left about somebody doing math 30 cents on the table which is okay but we're trying to catch capture the meat of the move from the open building that key daily key daily and pre-market support going short, risking the pre-market highs 30 cents Looking for a downside move all the way to 915 or 890s chapter six: Gap Down Long strategy this time around I'm going to demonstrate another live trading example on Tesla your favorite stock. So in contrast to a Corona trade on the short side, we're not looking at a large cap stock that's gapping down during pre-market So as you can see over here on this day, the day before Tesla had a really strong day. We're talking about a move from 197 all the way to 207 so that's a really strong close over here.

The white area is the regular trading hours and the yellow part on trading view. This is the extended hours trading so you can see the next day this thing actually Gap all the way down from 207s down to 202's and then pre-market went to a low of 200. We're talking about a seven point gap down overnight, so we're about to dive into the key criteria for the scalping strategy once again. I Hope you guys have been taking notes and learning from the essence of these live trades before.

We move on to talk about the criteria and the details of the strategy. If you haven't done so already, please remember to drop a like at the bottom of the video and remember to subscribe if you want to see more videos like these in the future. Thank you very much! Now let's move on to the next strategy. So here are the four key criteria on the long scalping strategy on Tesla stock.

So number one: It needs to be a large cap stock. It this strategy does not work for small Caps or microfloads or any of those like Runners Like it just doesn't work. It works best for large cap stocks like Tesla Nvidia Apple AMD Number two, the stock needs to have really strong breakout the previous day. So that's why I pointed out the daily chart for Tesla stock earlier.

As you can see on daily chart right this day, this is the previous day you had a huge breakout, right? So that's why the second day the gap down. it gives you a good opportunity to bounce the stock. We're not looking for a big move. Once again, we're looking for a simple uh balm strategy that you can trade for 15 30 minutes and be done and go to work or do whatever else you want.

The third criteria is that you need a pre-market Gap them, which is pretty obvious. Once again, you had a gap down Mall from 207 priorities close to 200 pre-market So that's what we call a gap down. And last but not least, the stock needs to be gapping down on really, really high volume on this particular day. Um, I don't have my scanner up.

but Tesla whenever it gaps up or gaps down, it trades really high volume over a million shares pre-market So that's what you want to see if the stock was gapping down on like 20 000 shares. Not good enough. Remember you're not here to be Warren Buffett and invest in the stock. Okay, we're talking about trading here.

Oh, we're looking for is the profits from a short term price action. Hit it and leave it. Quote me in the comment section if you agree. Now let's plan for our entries and alongside the profit Target as well as the risk.

Now so on. Tesla Stock You always want to start from the daily chart. Um, because it's a stock that has a big range. So that's why I have 200 here.

You can see on the daily chart that's a key level right here. The stock previously tested once twice over here and three times that held up a support on this area in February So that's why 200 is gonna be key. but remember the stock is not. You should not just use one and single entry point.

It needs to be a zone right? So that's why you look at the previous breakout day the day before. If you look at it before it hit 200 it Consolidated right here broke out to highs 199s you know Consolidated dipped a little bit to that 199 tens area and then that's when it like dipped, trapped and then broke out in your highs. So that's the reason this is going to be an important level that also lines up on the daily chart. this Zone Here we're just gonna call gonna call it 199.

the Zone on a daily chart is going to be the key level you're looking for entries. Um, bouncing the stock on this overnight gap down. So this is my entry area 199 200 right? I Know this is a big range, but again Tesla Big Range stock you need to have Give it at least a dollar room. So if you're planning to Long 200, you need to be able to risk risk 199 and Below right? And if you're a long one in 99, then you probably can have your wrist be a little bit tighter at 50 cents, 198 30s uh sorry, 70s or 198 50s.

Now for the upside: I will say I was a little bit more aggressive. You're gonna see in a live trading recording in nature that I had originally in for 204s on the bounce. so I was looking for Four Points bounce on the upside. that's very possible with a stock like Tesla However, um, you can see you have another small level here.

around two or threes, 203s, 202's two or fours. Those are the price targets that I'm aiming for. Remember we're talking about a quick scope. so the best you're gonna get is one to two risk award.

and if it really does go to you know, 204s then that's probably if you do the math. that's one, two, three, one two four risk award on this particular day on the gap down to 200 I got in a starter at I think about 200 shares. Starter at this is like 199 80s and I added after reclaim of 200 because we talked about this 200. that's gonna be a key level and this is only a minute after the market opened So it happened really really quick, right? Remember if you are trading this for a scalp for a dollar two dollars, you're gonna be in and out.

Hit it and leave it. So that's why things happen really fast. If you don't have a fast broker platform like this one which is, um, that's Trader Pro you, you might not be able to execute this. Okay, so at the open you can see I got in 200.

So 200. Um, entry to 200 just like what 230s maybe? So I had in a thousand shares averaging. uh, 200.30 you can see the stock is already bouncing. We bounced about one point.

Now testing the UAP Now if I was more aggressive, you can sit down here 230. that's my average. Now if I was more aggressive I actually add over this bounce which but I don't think I was a aggressive as I should be because I want to be patient. Looking for the big move towards the 204 Syria which is your pre-market highs on the day you can see.

we tested our VY projected a little bit similar to Carvana earlier, but I'm still holding. Do not panic at a decent average about 200 30 cents at this point I would be risking just below below 200 so that'll be 40 cents risk. So I can potentially lose 400 on this trade. Let's see, we're testing that 201s you can see I'm getting ready to add trying to add into Tesla I want to add slowly 300 shares 300 shares.

Uh, because after all it's a really volatile stock but we actually remain strong. You can see we're testing over 201s once again and testing that V-wap and usually same same idea is on the short side. um on a short I want to show it once a stock is below view app if the stock is over vyp I want to add into a long side you can see I wasn't sure certain so I sold a little bit too fast I sold 300 shares at 201 ish so I locked in about a little bit over 200. Not a lot but I want to see if what the stock stays strong they'll add back into it or to sell into the pop towards that 202 204's area.

I Definitely was playing a little bit safe on this particular day though because I think I believe at the time Market was kind of choppy so I wasn't quite sure if I should stick with it or you know, just get out you can see I went red for a little bit and when it went back down to my average but nothing to become too concerned about right now. I'm trading on the five minute chart for a stock like Tesla This is very different than Carvana because Tesla is a big cap Big Range you can see that popped way too quick over 201 88. so I'm up about oh decent. So I'm trying to sell just a little bit to lock it in 201 80s.

but once again, I am aiming for a 204s. If we don't get it, that's fine. But I want to make sure I'm locking in profit along the way and that's a little bit over a dollar move. So risking 30 cents to make a dollar, that's decent Risk Award: I Know it didn't go according to plan where I sold everything at 204s, but you just gotta be cautious.

Remember, hit it and leave it. There were a couple things I'm concerned about looking at the market and now I'm switching on a two-minute time frame just to look at the price action a little bit closer to determine whether this is just a just a little pullback or are we actually in like a huge downtrend retest and now we're failing that and I believe I'm gonna get out of the position really quick two or twos now I think I just exited everything at 202. the remainder 500 shares. I'm locking in about fourteen hundred dollars and you can see back on the trading view charts.

That was a good call to sell everything around 202s you can see I sold I entered here 200 right even after the ad my average about 230 points and I sold everything around 202. I didn't get the top of 20270s but you know I got out around this area as you saw earlier even though my ultimate price Target was 204s. but it ends up being a good sell because after that this thing just rejected and then stayed. Below V-wap on the five minute chart over here and really just sold off all the way down to 192.

So I'm really glad I didn't hold on for that. You know, two more dollars and that's why I Keep on repeating. Hit it and leave it. Do Not outstay your welcome if you're looking to do these kind of scalping strategy.

whether it's on the long side like Tesla or shorts like Carvana. Chapter 7: Pre-markets Gap Up Short Strategy: Congrats on making it to the final chapter of this: Gap Trading Crash Course I'm sharing a bonus trading strategy for those of you who are looking for more setups in your bag I Call it the Pre-market Gap Up Short Strategy I Get a lot of questions from you guys asking if I trade pre-market I'm gonna answer that in just a little bit, but let me know. I'm kind of curious to see how many people watching this are trying to trade pre-market or want to learn pre-market trading strategies. Do you trade during pre-market hours? The answer to this question is yes, sometimes very very selective times I will enter a trade if I see a pre-market mover, but it must fulfill my setup criteria and that goes to the next strategy we're going to talk about I Must give you a disclaimer: the next strategy is why? Considered really risky, but at the same time time, you can make a lot of money.

So in this particular trade, I made almost ten thousand dollars. So the stock we're looking at is fcn CA I know long ticker First Citizens Bank Now they're known for the bank who bought up Silicon Valley Bank's debt and that's the reason the stock gapped up from like 600 like below 600. priorities close all the way to 900. So we're talking about a 300 Gap up overnight.

and that's a reason once again. I Gotta just gotta disclaim this: This is a very risky strategy and if you're watching this, make sure you have risk management intact. So this particular strategy is pretty similar to what you saw for Carvana earlier. so if you pay the tension earlier, you remember the key criteria.

First of all, you want to see a downtrending daily chart. In this case, you can see down trending daily chart. I Mean this thing was part of the banking crisis that started with Silicon Valley Bank You can see the stock sold out from 800 all the way down to five hundred dollars and you can see a huge pre-market Gap up as usual. Now, most importantly, you want to note that ideally to trade this particular setup like we talked about for Carvana, you don't want any meaningful news for the stock.

However, on this particular day, yes you have the huge gap up. Yes, you have a down training daily chart. but guess what, you have extremely positive news and you know huge news headline they're gonna buy Silicon Valley Banks debt and that's what I mean by. It's a very risky strategy because whenever you're shorting these stocks I have news you need to know when that's it.

like you, you cannot hold on to the fade all the way down to 700. No. I'd be dreaming. You gotta be able to just you know, get out at a consolidation before this reversal.

Okay so I'm gonna show you how I did that later on. So here's a recording you can see pre-market I already had a short scalp from 9 15 down to is like what? uh, 880 and I only had 100 shares Like I mean do the math. I only had 100 shares. So this is the kind of range you get.

We're talking about like a 20 range so you don't want to like oversized for these things. You know there's a couple of important lessons here besides what we just talked about that the stock has catalyst so you want to be able to just get in and get out and like do not out say you're welcome The second thing is that if you were trading pre-market which I was you know my now the Market's open but I was from the shorts 9 15 down to 880. we're talking about like a 30 point drop. Actually, the volume is going to be very very low on the stock so you don't want to oversize like using a thousand shares at one time.

won't work unless your building is slowly. 200 shares here, 200 300 you have to slowly Build It Up This Market It's already open and it's only trading 800 8 sorry 280 000 shares. So that's what I mean by this. Extremely risky.

Okay, just because because you're watching this doesn't mean this is the right trade for you. Okay I'm telling you this just so you don't burn yourself. You know, if you do decide to trade the strategy size down and make sure you maybe start with like you know, paper trading first. So that was the pre-market trade.

a very simple holiday short 915 risking knife 40s. We're talking about a 20 30 dollar risk risk per share and then downside to cover it into the open I just didn't want to hold it into the open. so that's why I just covered everything here at 880s and now once the Market's open, I'm stocking for my next short. um, entries here.

but if all you do is trade pre-market this strategy will work quite well. maybe on some different stocks that have more volume and less spreads and doesn't have no such a positive news. So at the open you can see this is just sold off from um opening of like 870 went all the way down to 850. so that's another 20 points from where it covered.

Volume is staying low but you can say I'm trying to get Phil 500 shares short at 8 48 so I got some like only 200 shares. Gotta be careful. once again, volume is really low. We're only trading 280 000 shares.

um but whenever I get partial fills I I you know depends. Oh I got fulfilled at 8 48. otherwise I would cancel it. Okay but you can see this thing is spread.

We're talking about three dollar spread so that's another reason you want to size down. Okay but for me 500 shares on this it's manageable. So I'm I'm realized red 3 000 but like if you look at the spread and my average is 848 I'm in between the spread the bid is 846 and ask is 850. so that's why you know these like higher spread stocks you you gotta be able to have the heart for it.

Okay but for me this was okay and I don't really have any plans on adding into anymore I think 500 shares on this stock with such a big range we're talking about twenty thirty dollars. That's that's why that's all I wanted. Okay so I'm looking for the first line which is that 8 30s area I believe that's gonna be my first price Target because that's the daily level here on the dating chart. so that's what I'm looking for.

You can see the stock is trying to hold up at 8 30s area. so I'm watching this to see if we we you know keep on getting a lot of bids around this area. I think I'm gonna cover everything for either a small win or a loss. A small loss.

So fast forward a little bit. Here you can see the stock is still consolidating around that view up area. I'm gonna stock like this I definitely use a five minute chart and once again, I'm looking for that breakdown to 830s. That's all I'm looking for I'm up.

uh, about six dollars per share. but once again it's deceiving because of the spreads. I'm looking for a drop and I'll draw on the cover and get out. but I believe I ended up breaking some rules here in like outstate for way too long.

but I really wish I covered some into this 835s that's gonna be the lower day and testing that pre-market support area. We really wish I covered into this, but you're gonna see I made some mistake here. like even right now it's printing through 8 34, 834, 831. That's the bids and you know I'm up a decent amount but I still didn't cover I really wish I had because you're gonna see I get trapped later on.

So I really should have just covered everything I really wish I did, but I didn't if I just cover everything into a 30 twos that will only be like a 10 grand day and I'll be done. but no I I definitely I'll say you can see I'm trying to cover 200 shares at 8 30 but I'm not gonna get it because it's holding that 8 30 support really really well. and the spreads on this is just nasty. So that's the reason I said man and mentioned earlier.

This is a risky trade because of the volume and the spreads and the fact that it has positive news. Nope, we can see right away we pop back up. This is what happens when you're trading low volt in the stocks even now. I don't even have that many share sizes 500 shares.

That's enough of a fluctuation between we use already a five grand and now negative 500 dollars. You can see on this little pullback here: I finally covered some so I covered 200 shares at um 841 I think or 840. I'm glad I covered some I was like nervous not gonna lie. so at this given point you know the worst that can happen is Break Even if we skip up through V-wap and I'll get stopped out and I'll probably give back everything.

but at least I wouldn't lose a lot of money. So this is what it's called. like adjusting your risk as the trade goes on and of course according to price action as well. So fast forward here almost 10 o'clock You know the volume really dropped a lot so you can see that type.

No. I'm trying to cover it now. so the stock was already low volume to begin with, but whenever you see on two minute or five minute chart the same, the volume you can see down here drops below. 10K That's when you definitely want to consider just getting out.

So that's what I'm trying to do trying to get out in small pieces. 100 shares say 100 shares shares there I Want to get out before the huge squeeze? Nothing all the low volume traded stocks will squeeze I'm not saying that, but then it becomes a 50 50 event at this point. and I don't want to sit through low volume consolidation. if the consolidation was higher volume, I would be okay sitting through that because you can read into the price action a lot better when there's no volume and the price just kind of.

Teeters around the support area that looks like it's gonna break down but it just won't and there's always like an underlying bid around 8 30s a31s you. you want to be cautious, especially if you're short. so that's why you know I want to get out so you can see I finally got out at 8 32 area I covered another 100 shares now I have the remainder 200 shares. Even like re-watching this recording is like making me nervous I'm like just get out.

please just get out. Yeah cause the dropping a little bit more. 8 26 I See I think a 26.50 Wow. Risky once again.

risky trade. You know, don't do it if you're a beginner, just paper trade this. Okay on small size. see if you can actually sit through the consolidation on small sizes even just 10 shares.

this will be like a difference of a couple hundred dollars on each. Skip right? Oh I got filled and not 100 shares so locked in eight thousand dollars at 8 27. No I just have the remainder in 100 shares I Want to see where it goes I guess oh no I'm trying to get out yeah I Think it was a good idea to just try to get out. A27 was the lowest point that I got on this.

you can see it's starting to like bounce a little bit back to like 830s. back to that previous um support area you can see on the five minute charts on the five minute. That's why I keep on switching between two minutes and five minutes on the five minute. You know modem is starting to come in.

That's a bigger picture right? and then you know you're back at 8 35s and I want to get out the Fielding a lot of shares down there. At 8 35 834 earlier the print um 827 the volume was so low. So at this point I think I just want to get out on the five minute chart it looks like it's Consolidated Okay I got out everything at 8 36 I believe So locked in 9 400 dollars. So this is really a one-to-one risk award so it's not the best trade so that's why it is also risky.

but you can see if you are cautious like I was talking to the through the consolidation stage. Why I covered everything instead of waiting for another drop to 800 then you know if you're able to hit it and leave it like we just kept. Keep on saying throughout this video you can still make some decent profit. Um and I close all the trades by 10 o'clock.

So I got out here 10 o'clock so this is a 30 minute trade to make. We talked about 9 9 400. So here are the key takeaways from this strategy in this lesson: A very, very risky trade once again, pretty much a short and also an overnight Gap up Scalping On the short side on the strategy: Number one, you must be very cautious if you are short in pre-market on a very low volume stock such as this one. you must size down.

You know, look for the spread, see if you can either handle that, if not, size down one tenth of your regular share sizes. Number two: be cautious if there is actually positive news for the stock. I mean we're talking about a 300 overnight Gap Up there was news. so if you're shorting this, be cautious.

If you're long right then that's probably a good time to look for reversal on this now saying to low longer, huge gap but you want to wait for the reversal midday. And last but not least once again as we keep on repeating throughout the video. Hit it and leave it okay. don't outstay your welcome.

You need to watch when the price action changes, especially during the low volume consolidation time you saw and just cover everything up. You know you are not gonna make you know the most money you could, but you know you need to be able to get out and protect your profits or break even stop on the name. Congratulations on completing our second technical analysis Crash Course I Hope you have learned at least one or two trading setups that can start using tomorrow. You can save this video If You find the strategies helpful and remember to share it with your trading partners.

If you want to see more trading crash course videos for free, then check out this playlist over here, especially the one on Price Action trading. Thank you guys for watching As always I'm the humble Trader and I'll see you guys next time.