All right welcome back everyone. Today, we're gon na be talking about that number one afternoon: pattern that I've been talking about for years and years and years. And the biggest reason I wan na talk about it is we had a incredible example on VERU two days ago And the great thing about it is: it happened during a day when the quote unquote world was ending okay. Market's down again today, but two days ago it was death..

Well, I hate to use the term death, but I mean it was bad. Very, very, very ugly. Day., But what's great about VERU and I'm gon na be going back to would be Tuesday 5/17. So you can bring that up on your chart if you want.

And we're gon na kinda break that down, and why it's amazing how well these setups work or the ABCD setup works, especially when everyone's like ``, Oh, the world's ending. ``, There's no plays.''. Oh, it drives me nuts.. I know I have if you followed the channel for a while.

Yes, I have rage issues.. Yes, I fly off the handle quite frequently., But I fly off the handle. When I see pointless complaining or whining et cetera., I mean I think that I'm such a firm believer that, what's great about the market is the market is truly a meritocracy in my opinion. Or that might not be the proper term..

But it's really you get out what you put in., I mean: listen, I'm an average guy average height average intelligence., And so many of successful traders are., You think about my buddy Tim Sykes. Maybe you watch his channel too., Just an average guy, nothing special., Again: Jack Kellogg. Arguably the greatest penny stock trader over the last couple years., Just an average guy was parking cars a couple years ago.. But what I rage about is people are like ``.

Oh, the market's down. ``, There's no opportunity. ``. Oh there's no trades.

``. Oh! What do I do? ?'' Whine whine whine, whine, whine whine., But if you're willing to put in the effort and the work it's open to anybody, race, color, creed, sex age., I mean the market doesn't care.. The market doesn't care if you're 101 years old and you have purple skin. And it doesn't care any of that.

If you put in work and effort and time and diligence and discipline you'll be rewarded. Anyway. That being said, rant over, let's talk about VERU., So why was this on the radar Number one? This thing started spiking over a month ago, now. So day, one on this stock was April 11th.

And I'm gon na be talking about, May 17th. Over roughly six weeks later okay.. This is a trash penny. Stock..

Look at this long term. Chart. Stock was at 3 4 bucks when it spiked on day one on some COVID news.. So I bring that up number one.

It was an amazing trade for those first couple weeks.. Then it pulled back hard in the beginning of May, but what's significant is even when it pulled back hard, I mean this thing slammed all the way back from 15 to 7. This is where people I think slip up, and they just let things fall off their radar.. I mean yes, major, pull back there..

The high was 18 pulls all the way back to 17., But this is a point. You'll hear me talk about a lot on StocksToTrade Advisory click, the link below live every morning, 8:30 Eastern., It's still up 100 %, And this is where people I think let these things fall off the radar.. It's like, yes, pulls back hard., It's still up 100 %. The stock ain't dead.

Now that's going back to the 12th. Again I wan na just talk .... Then we had the big gap up and the big run more news., But anyway, let's zoom in on the ABCD day. Or actually I'm zoom in on three days..

So these three days right here, you've got that secondary day on the 13th, which would've been last Friday., They dropped more news. Huge run stock closes basically at around. The high of the day then goes into what we call that day. Two rest pattern., If you're a meathead like me, you know about rest days.

A lot of these stocks like to have those rest days where it just kind of digest, and we see where we're going after that. Over in the archive. We got a day three surge pattern.. Ultimately, this kind of was a day, three surge as well..

So now you had plenty of time for this thing to be on your radar.. It spiked six weeks, ago. It ran on Friday. It held on Monday..

You got ta be looking at this thing, come Tuesday, the 17th and be like ``, Hmm man, this stock again still in play.''. This is what we look. For. Ooh look at that technical breakdown there..

So this is what we look for going into the afternoon.. So now this is that day, three. The 17th again.. So you get that big gap up in the morning from 13 to 14 and then the stock, I'm just gon na draw a VWAP on this., I'm gon na estimate on VWAP.

Understand. This is probably not perfect. Okay., But you can see that that stock then starts to consolidate at VWAP all day.. So you now have your A from here in the mornin'.

Then you've got your B consolidation area. And then you've got your C breakout area which it broke at roughly 3:15 PM.. So you got that A high a day B. Consolidation C is your breakout.

And then, ideally, you sell into that D area, risking 3-to-1 risk to reward. In this instance. If you would've been say you took that 15 break and then you stopped out down in that 14.50 area, which is basically roughly VWAP. That means you're risking 50 cents, a share., Then your goal would be 1.50 of upside, that 3-to-1 risk to reward methodology..

In theory, you'd be selling up here in the 16.50s. Just after hours, roughly 4:00 PM or 4:30 PM. Excuse me maybe 4:45 even., But you can see how this plays out. And, what's great about this pattern, what I love about it, it's telegraphed in advance.

Again when they hang around hang around squeezes on a Friday.. Remember this on the 13th was a Friday squeeze. Has the news consolidates, on Monday gaps on ... Consolidates on Tuesday sorry gaps on Wednesday, consolidates above VWAP and then runs on big volume into the afternoon.? We look at that 2:00 PM window, which is a window..

Remember, that's basically kind of like 1:30-ish into the close.. So it does that right into the close., And you could have been prepared for this thing literally all day., And I think it is the highest risk or reward set up out there, particularly for part-time traders.. What's great about this setup - and this is one that I traded for years and years and years when I was part-time because what it allowed me to do - and I know I made this point twice this thing's already on my radar. - It's not a day-oner.

As much As I love day-oners and we talk about'em every day on StocksToTrade Advisory, they're tough for that part-time trader.'Cause, you got ta, be there all through pre-market. You got ta be sitting there, seeing what the news is seeing. What's running. VERU, I didn't need anything on Wednesday morning..

I could have been following this on my phone saying: ``, Hey: what's this thing doing ``? Oh, Hey it's here, it is consolidating midday.''. I don't need to be sitting there. And what I did - and this is what I talk about with part-time trading. I've got that ebook out now., Try and block out an hour at the beginning of the day, an hour at the end of the day..

Maybe you can do that with your boss.. Maybe you can't., I own the business, but you know it's still very business. Busy., But I was always able to kind of block out that beginning hour and that second hour, and maybe you work from home. - I mean I always joke.

I won't tell your boss if you're trading mornings and afternoons. I mean this - is the best time if you're part-time., But anyway, I don't need to sit there. This stock was on my radar from Friday.. I knew it was consolidated on Monday..

I could have been prepared for this move in advance, set an alert bing on my phone, buy at 15, stop at 14.50, sell it 16.50., And even if this trade didn't work what's great about it is you've got that clearly defined risk to reward.. At the end of the day, the clearer the risk-to-reward is the easier it is for you to stop. And listen you're, probably watching these videos'cause, you struggle with discipline. You struggle with taking a stop., Try and make your stops as obvious as possible.

And again, I know You're, probably new., That's why you're here I understand that., But I mean listen. If you look at this thing, if it did breakdown late day, I mean breaks all the way through. That area fails VWAP and you don't stop out.. You got ta, be asking yourself.

What am I doing, What am I doing right now And especially for newbies? That's a good thing.. It's one thing to get chopped out., It's one thing to get confused., But you want the more obvious, the style .... If you trade, a red to green that then spikes and then goes back red on the day. Very obvious stop., I mean listen.

If you're holding a penny stock red on the day-, It ain't gon na end well., So focus on those obvious stops and that ABCD gives you that by breaking down that pattern, and it outlines a three to one risk to reward. All right - everyone, if you wan Na learn more about these patterns really get in depth. Also check out the steady trade team. We'll have a link to that below..

That's the advanced mentorship program. Stockstotrade Advisory. Is that kinda rapid fire morning program where we go over the biggest runners of the day. StocksToTrade Advisory over 3000 webinars..

I'm live 10 to 12 times a week., Yes, 10 to 12 times. Average webinar length of 45 minutes. 3,500-ish webinars archived.. It's really the way to master this.

Check out that and we'll see you next time.