How Christian Kwalamagi Turned $5,000 into $100 Million: Momentum Swing Trading Strategy

if you ever wondered how Christian kwalamagi turned five grand into a hundred million dollars and you want to

go deep on understanding his systems and processes for how he did it primarily with a momentum based swing trading

breakout strategy then this is the video that's going to explain it to you there are plenty of kwalamagi videos out there

on YouTube than the like but this is a summary of the systems and processes and thinking about his strategy from five

key Parts how does he identify trades how does he initially control the risk how does he mitigate risk on the trades

how does he optimize the profit and then also have a deep dive into his mindset and also think about things from a

deliberate practice standpoint how on Earth did he get so good at trading and how can you try and repeat the success

that he has had Market Smith are the sponsor of this video you'll see a couple of charts throughout this

presentation certainly as we're talking about the screening and fundamental side of things there is a discounted trial

available in the comments section below if you are interested and with all of that out the way let's start getting

into the systems and processes for how qualamagi turned five grand into 100 million dollars so let's begin with

kwalamagi's returns this was a print screens from one of his twitch streams so you can see in 2011 he actually blew

out trading accounts around about three or four times but you can see from 2020 11 to 2020 including these big down

years that is an average annual return of 268 if you take out the two down years and go from 2013 it is around

about 350 so absolutely phenomenal returns how on Earth did he do it what are the systems and processes that he

used well you're watching The Right video let's get into it so strategy overview we're thinking about long setup

so kwalamagi has a three main setups two of those along one of those are sure the two long setups are continuation based

breakouts so that is basically breakouts from Flags vcps Darvis boxes cup and handles of the like then Auto episodic

pivots one on earth a data are basically Gap up bass breakouts he also has the parabolic short but we're not going to

go into shorting in this video we're going to keep it very much focus on the long side so if I could summarize the

strategy in about two sentences it would be this trade leading momentum stocks from these setups with asymmetric risk

reward potential I.E little risk lots of upside once in the position mitigate risk and keep part of the position to

ride the short slash intermediate term Trend which Crown mangy defines as the 10-day and or 20-day moving average it

gives much more emphasis to the 10-day moving average certainly for the quicker momentum stock so this is just a little

visual here to give you a flavor of the type of things we are going to be looking at so you will see throughout

this presentation that koala Maggie refers to setups that just repeat time and time and time again and he puts a

significant emphasis on deliberate practice if you don't know what deliberate practice is and the xeroxen

wrote a book called Peak which is absolutely fantastic for how we actually learn and how you master a skill trading

is a skill set so by the end of this video you'll have a much better understanding of the knowledge but then

also the steps you need to take to develop the skill sets great to have the knowledge but you need to have the skill

set so what are the repeatable patterns that that just happened time and time and time again and kwara Maggie refers

to it many times about going back studying history and having thousands tens of thousands of stocks in your

chart model database it's in essence it boils down to these these four there's a lot of variations but in essence it's

these four it's Flags triangles Penance vcps it's cup and handles it's flat bases also known as Darvis boxes and its

wedges which is slash a volatility contraction pattern low mid pivot they are basically the four job four trial

patterns you'll see these momentum leaving stocks put in time and time and time again so let's keep going down and

down and down so remember we're starting off high and we're going further and further and further into the weeds so

identify how stocks move so while you're looking at this video I'm just going to read a little bit to you so these are

quotes from Kuala Maggie stocks cryptos and all assets classes they move like stairs so this is the basic premise how

do stocks move how do cryptocurrencies move and I've got lots of examples to go through including quizzes to try and

make it a little bit more engaging for you as we go this is how they move generally they make a move then they go

sideways or pull back make another move go sideways or pull back make another move this is how stocks move study any

stocks that are up hundreds or thousands of percent over many years this is how they move they move instead our job is

to buy here our job is not to buy here not to buy here not to buy over here our job is to buy it here so our job is to

buy at the exact time it starts to build the next step higher so here basically when it's breaking out of those

consolidations so there's continuation base patterns cup and handles vcps Flags wedges pennants whatever you want to

call it so our job is to buy as it's breaking out now I'm not going to be 100 correct my win rate is 25 that probably

threw you off a little bit there didn't it the key is all about small losers bigger winners so small losers Big

Winners we're going to get all into the asymmetric rest award where you place your initial stop loss as we progress

throughout then you get the moving averages the 10 day the 20 day and the 50-day the leading stocks keep surfing

those moving averages this is a continued theme you are going to see throughout so the next two slides are a

little bit tax heavy but they need to be there for you to start understanding the strategy then as we start progressing

we're going to get into lots and lots of slides as you can see and the quizzes so it's the same theme a big move then a

pullback or sideways consolidation and then the stock starts finding support or surfing one of the moving averages it

could be the 10 day the 20 day the 50 day and many times it's a combination of two of them you're going to see that

when we start looking at setups usually the 10 and 20 day then it gets Tighter and it breaks out of that Ridge it's

just the same theme over and over this is how stocks move this is how stocks have moved over the past 100 years go

back and look at charts from the 1920s 50s 80s 90s they do the same thing over and over again you just need to memorize

these patterns remember those patterns I was showing you stocks move like stairs leg higher sideways leg higher sideways

we are trying to identify the areas where the next step higher could be formed tight areas we're looking for

tight areas where we can get a tight stop and a good risk to reward this is how stocks have moved for a hundred

years and there's no reason they shouldn't stop moving like this you need to build a database this is thinking

about the deliberate practice element you need to build a database with thousands of stocks if you don't spend

at least 500 to a thousand hours studying this one single setup it's super simple it's not easy but it's

simple but you still need to study hundreds hundreds of hours thousands of hours over the next few years that's how

you master it and make millions tens of Millions with this one setup you can make tens of millions if you spend 1 000

hours studying these setups you're going to figure out the variations of the setups as well now quality in a tweet on

the 17th of February 2023 I sound like a little bit of a stalker here don't I but he said he now uses the 10-day

exponential extra potential moving average instead of the instead of the simple so slight change a slight change

that I use 10 email as well not that you potentially care I rarely buy stocks below the 50-day moving

average who wants the stronger momentum stocks which invariably when they're building the pivots when they're getting

Tighter and Tighter and Tighter are actually above their 50 day quite commonly you will see them around the 10

and 20 moving averages for this method you don't need to scale in you buy everything at once one but you need to

scale out so sell one third or half of your position after three to five days and then use the 10-day moving average

as your trailing stop then when the stock closes below the 10 day you sell the rest now I know there's a lot of

information coming at you very early on in this video as we progress throughout and you make it towards the end of this

video it's all going to start clicking it's all going to start making sense obviously you can't determine early in

the day whether it being the stock is going to have higher volume especially if you're trading liquid Min large cap

stocks they always have volume so you don't need to worry about it so high volume around the pivot you need clean

setup something that keeps surfing that isn't all over the place choppy around moving averages so some socks have

really nice clean moves as you're going to see others just chop around chop around chop around and you want to avoid

the choppy stocks as you get into the trade management you're just going to get chopped around you'll see some

examples just because it's a good setup doesn't mean it's going to work it's quite a mindset his win rate is around

about 20 25 or so so let's start higher and then work down so thinking about the market environment

now the key moving averages to be paying attention to on this chart here are going to be the black line which on my

charts is the Tenny made the blue line which is the 21 EMA which you can kind of think of as a 20-day moving average

on color monkey charts and then the purple line is the 50 SMA so black blue and purple are going to be the key

moving averages for you to be paying attention to here so just study this chart and I've color coded it to

basically show when these moving averages and the market is turning up and then turning down and then think

about this as trading environments because not every strategy is going to work fantastically well across every

single Market environment sometimes the market goes up sometimes Market goes down sometimes Market goes sideways

right any type of breaking breakout or momentum strategy is going to work best when the market is in momentum mode what

is momentum mode we'll get on to it sometimes you have to be in cash for weeks and months on M when the market is

not good think about those red areas you don't need to trade all the time it's it's fine to sit on cash for months on

end it's easier said than done then NASDAQ Composite is the relevant Index this is IX IC if you're wondering

you don't need to look at anything other than the NASDAQ 90 of the stocks I trade are in the NASDAQ generally you want to

see what what you want to see is the 10-day sloping higher and the 20 day is sloping higher and the 10 day needs to

be above the 20 day so you see here I have the black line above the blue line also trending nicely above the purple

line as well it's fine if it undercuts it a little bit for a while but that's the general that's the general rule so

if it's undercutting it a little bit that's okay but generally speaking you want to see it trending up here's kind

of a good example for where the trend is up but it does kind of undercut it briefly a couple of times but moving

averages sloping up 10 above the 20 20 above the 50 would be an ideal environment if you get breakouts when

the 10 and 20 day moving averages are sloping down in the NASDAQ comp and the 10 days below the 20 day there's a high

failure rate you probably shouldn't swing trade on the long side so kind of indicated that with the red zones every

year there's usually a three to six month period That's challenging you'll make little or no money and that's fine

when you get these runs that last for three to six months where you can but then you get these runs where that last

for three to six months where you can double and triple your account you just have to wait for those periods you have

to wait it out so what he's saying there is wait for the market to be good for your strategy know where your strategy

performs better performs worse when it's in a period it may be a little bit of a kind of a a trade trade holic like me

potentially but just be trading smaller during those type of periods understand it's going to be it's going to be um

it's going to be tougher period so let's go into the next slide now this is where we're going to start breaking it down a

little bit more we're going to look at breakouts I'm going to give you quizzes I've cut off the chart at the actual

kind of like trigger point bar so we're quite like you would then be looking to enter the trade and taking trades that

he discussed and spoke about five star seven star kind of setups and then we'll be doing quizzes for them so we're

really going to try and help you with your pattern recognition again we're just starting here with a bit of an

overview and then working our way down so what are you looking for and we're looking at continuation pattern

breakouts so that's going to be your flags your pennant your Darvis boxes your vcps your cup and handles so on and

so forth so on here obviously the white line is priced the green line is going to be a trend line and then for the

purpose of this the yellow is the 10 day the blue is the 20 day and then the purple is the 50 day so number one a big

move high in the past one to three months anywhere from 30 to 100 plush and usually the rally lasts a few days to

weeks orderly pull back in consolidation with higher lows so higher lows are like this so if you look at what price is

doing here see from here so this is the high here it pulls down bounces makes a lower high but then it puts in a higher

low so this High here or this low is higher than this low so it's making higher lows very important concept

orderly pull back in consolidation with higher lows and tightening range in the consolidation phase it's very similar if

you've read minivini's book The volatility contraction pattern volatility contracts from left to right

preferably volume drying up as well a breakout of the consolidation the consolidation phase is usually two weeks

to two months so somewhere between two weeks and eightish eight-ish weeks maybe 10-ish weeks as well during the

consolidation phase the stock surfs the rising 10 and or 20-day moving average and sometimes the 50. so this is an

important point and we'll get on to it I'll explain it on the on the next slide so as the stock is going up here and

you'll see this on the examples ideally you want to see the share price staying above the 10 day and the 21 Day it may

come down and kind of test and reverse quickly that's good behavior as the base is starting to build you would like to

see the stock respecting either the 10 days it's doing here see how it pulls down bounces pulls around bounces off

bounces off and then tightens around the 10-day so you ideally you'd like to see stocks that respect the moving averages

that you are going to be using from a trade management standpoint you don't want to have the stocks they're just

chopping around like this all over the place they're going to be an absolute nightmare so number one

how to trade it enter on opening range highs and you might be like what on Earth what on Earth is opening range

Heights don't worry got slides on it we're going to be explaining everything this video is extremely thorough

enter on opening range highs so orh for the first one five or 60 Minute Candlestick the first 60 Minute

Candlestick caveat is actually a 30 minute candle set because the six and a half trading hours in the session you

can use whatever time frame or combination you don't have to use intraday charts enter when the stock is

starting to break out so basically you're trying to identify these pivot Points and enter pretty much as soon as

you can when the stock is starting to break out the stop is always lows of the day so lows of the breakout day and

should not be wider than the ATR which is the average two range or ADR which is the average daily range so one is a

number one is a percentage we're going to talk about that a little bit later do not worry of the stock to keep the risk

versus Ward variable and you might already be going like what is going on don't worry so we're going to make sense

again this is detailed stuff it's in the ways you don't go from five grand to 100 million and it's all kind of broad brush

vague fluffy Duffy stuff okay then so one third or one half of the position after three to five days so once you're

in the trade after three to five days so one third or one half of the position this comes into the mitigation Parts

remember we're looking at identify control mitigate and optimize we're going to go deep on all of them the rest

of the position should be trailed with the 10 or 20 day moving average depends how fast the stock is if a beginner

stick to the 10-day wait for the first close so not intraday if price is going underneath wait for the first close

below the 10-day oftentimes you can see kind of shake out demand tails undercutting the level so

what I've got here and we've got well I don't know maybe at least 10 examples like this if not more and then we're

actually going to look at Bitcoin we're going to look at eth as well and I've tried to make this section here

interactive for you I appreciate you'll probably just sat there looking looking at your laptop board you're probably

surfing Netflix and other things like that so in this section here I've really tried to involve you and try and help

you train your pattern recognition skills so these are then quotes from kwalamagi and he's specifically talking

about the setup that I am showing you so this is coming from the horses map so prts this is a seven star setup on a

five-star scale big big move go sideways build a tight range look how tight it gets breaks out and boom memorize this

so I'll just break down the first couple for you so you start getting it a little bit more but I've tried to make some

annotations so if you look at the trend here the stock goes from a couple of dollars up to a high here of about 9.50

do you see how not once it closes below it's 10-day moving average and on my chart here it's actually

and my jot is actually the 10 the 10U do you see how it just Trends perfectly along the whole the whole time this is

really really really good to see it holds here it holds here a little shake out demand tail here and then it starts

going into this tightening range holds above the 21 EMA here then it goes tight tight tight tight tight and the volume

dries up so this here memorize this seven star setup on a five-star scale there's somewhere qualamagi refers to it

as a six star setup or a five and a half star setup but this is the only one I could find where he says seven star

setup on a five star scale this is this is my interpretation and from my own kind of experience as well this is

pretty much as good as it gets for a high type flight but note the cleanness of the move so this is what you want to

see now what I've done is then showed you the aftermath as um as well the aftermath that's the wrong word isn't it

what happened afterwards basically so here you go there's the breakout coming through here tight tight tight tight see

how it just surfs the 10 day and then little bounce off near the 21 EMA the blue lines are 20 I want to email my job

I like the 21 EMA rather than the 20 day that's from my own evidence experience and things like that but see how tight

it gets in it but for the purpose of this it's pretty much a 20-day moving average okay and then tight and then

breaks out let's do another one so AMD this is a stick six star setup on a five-star scale you've got to memorize

this you don't get many of these look how tight it is bounces perfectly off the 20 day here and then gets really

tight here look how tight it gets but do you see here this is a real subtle point but a really important Point look how

smooth the trend is before the stock even starts basing so the prior uptrend you want to see the stock saying above

all the key moving averages it's okay if it comes down a couple of times like this see how it holds the 10 hits see

how it holds the 10 hit there's actually a gap down reversal bar underneath the 21 then it's tight tight tight look how

the volume dries up six star setup on a five star scale there it is see how tight it gets and then the trend

thereafter really really really good setup exceptional setup apps this is a five and a half star so we've

gone seven star six star five and a half star okay this is a five and a half star setup on a five star step on a five star

step memorize this startup stock makes a big move see how it holds the ten holds the ten and the ten and the 21 in here

and in here as well go sideways surf's the 20 day which in essence is this blue line here okay see how it holds it it

builds higher lows then a tight range in here see how tight the stock gets and then a high volume breakout let's say

the next one there it is there's the setup and then see how well it Trends there afterwards so the the trending

point before the base I'm just going to emphasize this the best and this is my own anecdotal experience the best

indication for how stock is going to act in the future is how did it act in the past so if you get a really nice

trending stock pre-base it's more likely that it's going to be a really nice trending stock post base you don't get

another five star setup in here look how tight it gets really really good another one here this is Celsius

so it makes a big move here you go makes a big move surfs on the 10 and 20 day moving averages starts building high

lows off the 20-day takes out this tight range this is a nice 5 star high tide flag so you see here nice uptrend big

move holds in here then it's tight tight tight starts building high lows in here nice flag nice bit of ECP action look

how the volume dries up okay here it is here's the setup in here see how it comes out of this base starts trending

high lows tight bar in there and then off it goes next one Kodak this is a six star setup on a five star scale makes a

big move it gets Tighter and Tighter builds higher lows goes from surfing the 10-day to surfing the 20-day has a range

that gets Tighter and Tighter has a really narrow range day before the breakout and then it breaks out on a

higher volume that's the perfect setup does it sound like I'm repeating myself in these slides that is the whole point

of it okay it's a repeatable process these stocks do the same things the same patterns the same behavior

characteristics in terms of the price action in terms of volume in terms the relative strength where the stock is

setting up into in relation to key moving averages what it does it's specifically before the breakout I.E it

gets Tighter and Tighter and Tighter Bill Tyler is round the key moving averages the volume

same thing keeps on happening study them learn breaks out here doing it will go at 588 in five sessions absolutely not

but you're trying to position yourself in front of stocks that can go up 588 in five sessions and you're trying to study

deliberately what did a stock do before it went up 588 in five sessions what did it do are there other stocks that did

similar things can I profit from that can I be um can I basically profit from that that's

uh I can't say anything but I'm not to be honest you this one very good setup x e e x p i so see how the stock makes a

big move here pulls into the 10 to the uh 2021 in here and then it bounces again it has a nice checkout demand out

underneath the 10 reclaims volume drives up it's a really good setup there it is that you could also look at it as maybe

a cup and handle with a high handle or a fly type Banner but see the trend unfold afterwards and then you want to try and

ride the intermediate downtrend fastly five star setup right here so see how the stock is trending see how it holds

the 10 in here then it holds the 10 in here see how it gets really tight there's this inside bar here look how

the volume dries up same things are happening no the relative strength line as well look at the reaction to the

earnings big volume on the earnings positive reaction then the trend thereafter you'll see those are quite a

little bit later that an EP so an episodic pivot which is basically a gap up bass breakout that can often be the

start of the trend so what you can have a stock that's been basing for kind of six months a year a couple of

years then suddenly this earnings report comes out and it catches a lot of the large operators off guard so suddenly

they then start piling into it so then you get this really nice post earnings uptrend which you'd like to see do what

trend above the key moving averages and bounce off of them the 10 and the 20 right and then go and build a high-type

flag at vcp Carbon handle whatever it may be so here's fastly there's the setup there's the trend there afterwards

that was another very good setup there um in my view perfect setup here this is a six star setup on a five-star scale

this is a ridiculously good setup okay this one here so see how the stock makes a big move oh look notice notice the

reaction to the earnings and the volume coming through in the 52 economic if you want to use that it's free tool search

my name on trading View and the indicators you will you will find it and then you just pin it to the bottom of

your chart like this where you could have it on your chart whatever you want to do so the stock Powers up here holds

the 10 then it pulls back down to the to the uh 2021 in here and then see how you actually get those of you who've read

Darvis book darvis's box um Darvis is what he's gonna his Darvis book book will be familiar with the Darvis box

which is basically a rectangle it's quite common to actually see a little Darvis box play out in three sessions

five sessions before so see how it just tightens up here along the 20 for me the blue lines of 21 email just

use 21 EMA but the the 20 day is pretty much where the 21 em is there's not much between them for these for these ones

here so see how it just tightens up in here look at this ridiculously tight bar so I'll just go into a little bit of

waxing lyrical about supply and demand why is this really tight bar on low relative volume important what does it

actually tell you from supply and demand it tells you there isn't much Supply that's coming to the market that's

really good for you to know if you're targeting a breakout second fold it also indicates that you could go in with a

very tight stop loss as well interesting we'll come to that later so here it is here's the breakout here's the trend and

qualamagi saying on this docket this is why I advocate trailing some of your shares on the 10 day because sometimes

you can catch something like this so he's talking about this move here where it goes up 226 percent

something like this these things are really going to add to the bottom line of your accounts you catch a few of

these now and then oh man these are the ones that are going to grow your account exponentially

next one Overstock this is a five star setup so see the run the stock has here pulls down bounce off the 21 holds

around the 10 21 in here holds in here and then look it's these tight candlesticks coming up again tight tight

tight look how the volume dries up tight tight see how the stocks building higher lows within the base they look like the

same thing keeps happening it's because it is right tight tight tight there's the breakout goes up 319 before it

closes below the 10 and 21 day EMA's I'm telling you if you catch some of me these these

moves then he's specifically talking about Overstock this is up 300 from this trigger breakout you catch these kinds

of Trades now and then these are the ones that are gonna grow your account so quality monkey as you'll see as we get

into the kind of optimizing profits phase of this presentation really focuses on getting the big ones right

getting the Home Run trades right there is no point if a stock is going to go up 300 for a closest blow the the 10-day

say and you sold it out at 20 and you think oh that's really good all right two percent I sold it at 20 that's 10

times my initial risk yeah but if it goes up 300 you completely miss the point basically next slide codex oh I

jump forward too far so code access one here look at this thing it's all it always finds support on the 50 day so

the purple line in here in here in here in here keep surfing the 50 day these are the only technical indicators you

need the 10 day the 20 day and the 50-day moving averages you don't need to look at intraday charts this is all you

need to make millions literally so see how it's building higher lows it's finding sport of action around the

50 day and then there's the result there powerful breakout up up it goes but then what do you notice here see how it U

turns it so I didn't just want to show you ones that go up 500 or whatever I want to show you ones that actually the

stock makes a big move but then look how it used turns this is why as I've noted here the cell rules really really really

matter there's the First clothes below the tender in there Etsy this is a five-star setup take a screenshot of

this memorize this pattern so the stock makes a big move and then it pulls down Fine support around the 21. see how it

pulls down higher lows there's that little Darvis box building again look how it's a tight bar nearly an inside

bar sitting on the 10 and 21. look how the volume dries up look at the 52-week eyes and it goes right and you could

look at that as a those are your study mini Vinnies were a bit of a vcp right one contraction two contraction three

contraction tight tight tight tight tight really good next one Fiverr I can immediately see a five star setup and in

a couple of slides time I'm going to be giving you a quiz where I put a blank chart and asking you can you see the

setups so again trying to really help you dial in training pattern recognition here five out I can immediately see a

five star setup look how the stock makes a really good move and look how it's stays above

it's 10 EMA the whole time a little kind of shake out in here and then it recovers then it pulls back down holds

on its 21 for my chart here and then puts in this high low Darvis box in there and then see how the

volume dries up interesting and then there you go there's the breakout there's the track

so I will come on to a little bit later on talking about the 10 day and the 21 um and showing you some stats that I

that I ran my um myself so here we go can you identify the three five star setups and these are five star

setups as Carla Maggie defines them as you are going to see on the next side so here

you go can you find the three five star setups on this chart as I said I want it to be engaging I'm going to try and um

one try and involve you in this so those three can you find the three I'll show you three two one there they are

number one here is it this is koala monkeys quite here is a five star setup number two this was an even better setup

look how tight it got so see how it's building high lows one contraction two contraction three contraction full

contraction high lows high lows high lows just tightening up on the 10-day look how the volume dries up look how

tight it got the tightness is really really key number three here another five star setup boom look at this see

how tight it got before it gaps up and breaks out there look at the relative shrimp line as well

let's do another one can you identify the two five star setups and two other good setups so we're looking for two

five star setups and then we're looking for two good setups two five star two good setups three two one there we go

this was a really good setup these are koala Maggie's quotes as he was looking at the track this was a really good

setup not a five star because the previous days Canada was kind of loose so you see how it wasn't so he's talking

about the breakout here the pry bar it was kind of loose it's pretty good bar but it's kind of loose it's not as tight

as some of the other ones and it had been building higher lows this one in here this is a five star setup see how

tight it got high lows see how it's tightening little Darby's box action again another one here this is a five

star setup but it would have stopped you out because three bars later so this bar later see how it breaks out here and

then here it took out the loads of the day so koala Maggie will buy the breakout opening range highs and then

stop loss level today so this bar here stopped him out and then the blue arrows I've just highlighted another two I

think they're very good setups I think this is a five star setup for me and I think this also is a five star setup

this is a really good chart to study let's do another one can you see the five star setup and the

3.5 star setup so there's a five star setup on this chart somewhere and there is a 3.5 star setup as per quality

monkeys criteria three two one there you go has a big big move look how it keeps surfing the 20-day this bit in here this

five star one then it keeps getting Tighter and Tighter look how tight it gets as it surfs the 20 day then it has

a high volume breakout this thing needs to be in your watch list when it starts getting tight so see how it starts

getting tight here around the 10 and the 20 watt as soon as it starts breaking out that's when you buy it don't worry

we're gonna go on to how you actually buy them a little bit later on then he's talking about this one in here if you

were able to find it Well done this is maybe 3.5 star another good setup keep surfing the 20-day build high lows and

puts in a tight range maybe because you kind of have this bearish day in here it's not as clean as setup

um whereas here it's just highlights high lows high lows and what chart patterns you see oh it's a nice big

cabin handle isn't it interesting look at all the 52e cars and well we'll talk about relative strength a little bit

later on another one can you identify the setup on the 10 day so I use the EMA so 10-day

EMA my designing is quite a Maggie Newton now uses the 10 EMA instead of the 10 day simple moving average so can

you find the setup on the 10-day EMA plus a bonus setup three two one there you go so builds a base and starts

breaking out makes a move surfs the 10 day and then you get the two really tight candles in here tight tight with

higher lows and then breaks out there's your breakout that's a good setup and I also think this one here for me that's

the five star setup see good reaction to the earnings a little bit of a common theme here isn't it good reaction to the

earnings then it goes and builds a post earnings earnings um base builds the high loads look at this

kind of Darvis box action so I was just basically going sideways building highlights on the base as well but then

it gets really really tight you get this extremely tight inside bar look how the volume dries up and then see how the

stock just Trends it's also why like the 21 EMA we'll talk about that a little bit later on let's do another one can

you identify the four good setups so on this chart here there's four really good setups four really good setups three two

one there they are one in here see how it just gets really tight 10 21 stock is in

an uptrend look at the 52e cars on the RS line look how the volume dries up this one pointing to the day before the

breakout look how the volume is drying up below this black line here this is the 30-day average for the volume that's

what I use on the volume 30 day average see how the volume is drying up on I just call them trigger bars because for

me they're the last piece of the proverbial jigsaw puzzle right so see how you get this really tight bar these

trigger bars coming through really tight here really tight in here just ridiculously good setups worth studying

but then look how it then Trends note what moving average is it then transfer yes you want to study the

setups how stocks set up but then how do they move afterwards this is all the deliberate practice nature of it this

one here so now we're actually going into how would you trade opening range highs so how do you actually trade them

so I've got some at the time of filming this which is um which is in May I've picked out picked out some recent stocks

um to talk about opening opening range highs so how does Crackle Maggie actually enter them so we're going to be

looking at on here okay stop makes a big move okay pulls back in find supportive action around its 10 stays above its 21

gets really tight in here inside bar look how the volume draws a really good reaction to the earnings huge sales I'm

going to show you a market Smith chart of this stock later on huge earnings huge sales huge estimates powerful

powerful stock pretty new in terms of its IPO so on the next bars or the next slides I should say we're going to be

looking at the one minute chart the five minute chart and the hourly chart so the 16 minute chart as well so I'm going to

explain how would you trade how do you trade opening range Highs but remember it's in the context of we're looking

here and then we're looking at this bar here okay and then I also want you to be aware of that average daily range

percentage which is 4.79 which I will explain on the next slide because it all feeds into the risk management so

let's start talking about remember that price level of 30 9 that was the high of this bar here so

remember I called them trigger bars for me I'm very very visual how I learn I have ADHD I have dyslexia so for me I

have to get things out of my head and just make them very visual I can't really keep things in my head I got to

get it gotta get it out in front of me so concepts for me to kind of then understand things and then try and help

me internalize things are really helpful so trigger bars that's how I think about them those really tight bars where the

volume dries up so I'm just going to refer to them as trigger bars kalamagi does not call them drug bars but for me

for the purpose of this video to try and teach you the best way I possibly can I'm going to call them trigger boss so

the high of this trigger bar inside bar tight in the basic now on the ten thirty zero nine as we go to the next side so

this blue level here okay 309 was the pivot breakout so the high of the final Candlestick so where are on

the one minute chart so this is the first one minute Candlestick and you see how it breaks out above yesterday's high

of 30 zero nine okay see how it breaks out so opening range highs you're looking for the breakout through the

pivot wherever you determine the pivot to be so for this example here we're just going to think about the pivot the

pivot being the buy point of the prior days high which was that really tight candle so that I refer to as a trigger

bar so you get the first one minute Candlestick it breaks out Fantastic look at the volume coming through I call this

bullish synchronicity where you basically get why what you get high relative volume and you get a widespread

Candlestick okay volume is basically confirming the positive price action polishing nasty makes sense right and

then you get this Hammer type Candlestick then you get this inside Hammer type

Candlestick and then you get the breakout so the opening range highs depends on what time frame you are using

so we're going to look at it on the one minute chart the five minute chart and the 60 Minute chart and I've got plenty

of examples and we're going to look at these opening range highs through continuation base breakouts so IE stocks

that are coming out of pivots from vcp's Flags pennants Darvis boxes cupping handles we're also then going to look at

them for episodic pivots so where the stock basically gaps up on the earnings and is taking out the highs of the base

and preferably above all the key moving averages this is probably going to be quite hard to understand I'll do my best

at it put some wraps and stats on the next slide will hopefully start to drill the point out so in essence you are

looking for the stock to break out show that there is there are a lot of buyers there there is demand there we

can visually see that in terms of the price action and the volume right and then you are looking for the highs if

you are using the one minute chart the highs of the first one minute Candlestick assuming it's taken out the

pivot as this stock here has done you are then entering as price breaks out through the highs of the first one

minute Candlestick so the high of this first one minute Candlestick is 30.56 so the entry is then through here at thirty

dollars fifty six this is the entry now that's the opening range Highs but now we've got to start thinking about the

controlling risk so I'm jumping ahead a little bit and bringing in the controlling risk here as well okay so I

was to kind of explain I can't just teach you the identified part without the control part we're bringing in the

control part while we're talking about the identified part but there is a specific section with quotes on

controlling risks and thinking about risk but we're jumping ahead a little bit here but we'll catch ourselves up a

little bit later so then you have to be thinking okay here is the opening range highs on the

one minute chart it's through here so the entry there's probably going to be some slippage no doubt 30 56. so then

your stop loss is going to be the low of the breakout day which is where it's the low of this bar

here which is 29.98 what is that percentage assuming perfect execution perfect fillage which

is unlikely okay but here 1.89 now I use the average daily range rather than the ATR but koala Maggie he uses the ATR but

he also says you can use the average daily range in essence try and understand the point that I'm trying to

get across it so the average daily range minus set to 20 days this is the average daily percentage move the stock has made

over the last 20 days you can use a TR as well which will give you a numerical a numerical figure so it will give you

dollars or cents or dollars and cents depending on how depending on how much the stock moves so what this is saying

is the average daily percentage move of the stock over the last 20 days on the daily chart is 4.75 now to keep the risk

versus reward in check and not getting out of whack which is quite a monkey's own words you'll see that in the

controlling risk section as we progress a little bit later on ideally you want the initial stop loss to be less than

the ATR or the ADR percentage make sense so for me I I use the ADR so I'm going to teach you with the ADR but it's

pretty much the same thing but if this here so let's just say I'll give you the ATR

example right let's say your stop is going to be from it's just over 1.50 right imagine that your stock was going

to be 30 and your entry was 30.56 so that would be a dollar a dollar fifty okay a dollar and a half would be your

stop so then you could look at the ATR and you might see that the ATR the average true range of the stock over the

last 20 days is two dollars so therefore your one 1.50 stop loss is less than the ATR which we're saying is two dollars

you can do it that way or if you prefer percentages I personally prefer percentages it just works better for me

but if you prefer using actual numerical levels in terms of dollars and thinking in dollars and cents use that if you

work better with the ADR percentage use that it's pretty much of a muchness you're just trying to get stops that in

relative proportion to how much the stop moves how quick the stock is looking at the ATR or the ADR percentage okay you

want it to be less than that so here we have that's the last I'm going to kind of touch on ATR I'm just going to refer

to it as ADR percentage if I keep jumping between them I'm going to confuse myself I'm going to confuse you

as well so the average daily range percentage for on o n o n is a ticker over the last 20 days is about 4.75 it's

a little bit different because it wasn't specifically here because I then took this screenshot about two weeks later

but either way let's imagine it's 4.75 so if your initial stop is 1.89 is it less than the average daily percentage

move for the stock over the last 20 days yes so we're staying in check that is good to see so the entry is here the

stop is here you're in track you're you're in you're in kind of chat now Carla Maggie will actually like to get

his initial stop loss either a third or a half the ADR percentage or the ATR okay pretty much

pretty much the same thing when you actually kind of work it out and think it through okay so ideally you want to

be a third to half that that there can actually indicate you've got a really good wrist versus all trade on your um

on your hand and remember what he said earlier it's all about small losses big small losses big one so this is a way

that you can see and kind of visually gauge are you are you in check you have a nice metric here so let's do another

one on the five minute chart so this is the same same stock same breakout so here you can see 309 so it's taking out

the highs of that kind of trigger bar but this is the five minute chart so it's now opening range highs on the five

minute okay so we're not on the one minute chart we're now on the five minute chart does this look like a good

first five minute Candlestick for a breakout yes why that bullish synchronicity point you have a

widespread candle so you're volume confirming the move okay good you don't necessarily need volume but it's good

it's preferable to see see the volume there however the five minute Candlestick now closes at 30.87 so

remember on the last chart the high of the bar or the higher the five minute Candlestick is higher than the high of

the one minute bar which was 30 56 so on the one minute chart the opening range highs entry point entry point was 30 56

whereas on the five minute chart it's higher so if it's 30 87 so you can start to see here you're paying

a little bit more of a premium aren't you maybe you're getting a little bit more kind of confirmation that buyers

are stepping up and they are really stepping in supporting this stock and it's powering out and it's a good

breakout potentially that you are um you're catching on to here but you're paying a premium in terms of you're

having to pay more for the shares which also means if you're going to stop loss lower the day so lower the breakout day

Therefore your stop loss is wider so you pay a premium for this okay so you have to think about the one minute the five

minute maybe using the combination um of them maybe you get stopped out on the one minute and you buy it back on

the five minute we'll talk about that a little bit later on but here because we're buying it at a higher price

and our stop loss is going to be at the same level low of the breakout day 29.98 our stop loss now is not

1.89 it's 2.88 and if we think about that relative to the ADR which is 4.79 it's still in check make sense still

good it's still less than the ADR percentage it's around about half the ADR percentage okay that's good good it

is a little bit over half but hopefully you understanding the point that let's do another one

let's get forward to her now this one here this is using it on the 60 Minute chart and the first half an hour oh

sorry well it is a half an hour Candlestick but the first on when when you're on the 60 Minute

chart there are six and a half trading there are there are six and a half hours in the session so therefore you have the

first one hour Candlestick is actually going to be a 30 minute bar just the way that's kind of played out but what you

see here is you see a breakout coming through and the high of this bar is 30 to 18. so if you're using the opening

range highs you're looking for a break through the high of that bar and would you notice there is no break for the

higher bar so there's no entry make sense and also when you then think about it well 3218 and if our stop loss is

going loads of the day that means 6.86 percent is this a good risk reward trade look at

the ADR percentage probably not right interesting we'll do more and more and more hopefully we'll start syncing

through so now we're going to look at Oracle and I'm going to be quicker on this one so

Oracle very so slock we're going to be talking about that as well so Oracle see how it Trends up here pulls back down

find support on the key moving averages tight tight really tight bar volume drives up 52 econ relative strength line

while the Stock's still within the base that is a massive massive sign strap so now we're going to be looking here and

the high of that trigger bar is 95 12. ready so here's the Blue Line 9512 was the was the pivot was the entry price

Okay one minute chart so Oracle actually takes it out pulls back down closes here so then you're looking for the opening

Range High so you're looking for the breakout through the higher the first one minute candle set because it is

triggered through this level there it is there at 95.33 now stop loss low of the day is

going to be wet it's going to be underneath the low this one minute bar which is 94.83 how much is that in terms

of percentages it's 0.52 so just over half a percent what's the ADR of the stock 1.33 is an

extremely slow stock and we're going to be talking about slow stocks later on you want be more so focused on the

quicker moving stock stocks with adrs of three percent four percent five percent six percent and above ideally but this

here is it a good resources wall trade yeah it is why because well the initial stop is half the ADR percentage and it's

very low anyway five minute chart so remember here's the breakout on the five minute chart so then you're looking

for a break through the high of the first five minute Candlestick which is 95.73 so the entry would actually be

coming through in here now your stop loss on the lows of the day is going to be wider because price is up so you're

playing a little bit of a premium hit so 0.94 is going to be your stop loss that is about what's that two-thirds of the

of the ADR okay still still kind of in check that it's okay let's undo another one so now we're looking at Oracle and

this is on the 60 Minute chart here's the first 60 Minute Candlestick you can see the tightness of the proverbial

trigger bar yesterday right the prior day see how tight it is in here there's the breakout volume coming through but

now you're looking for a break through the high of this bar which is what 96.64 stop loss of those of the day

94.83 is what in percentages 1.87 what's the ADR of the stock 1.33 so now the initial stop is greater than the ADR is

that a good reversible trade probably not right interesting so let's do a couple of others so we're actually

going to do Bitcoin we're going to do Bitcoin and eth for a little bit because it's quite fascinating and you're going

to see some of the probably best setups you are probably ever going to see actually in terms of in terms of flags

so this is and these are quite a Maggie's own words okay this is back in 2012. back here it was

very very illiquid that should say an unknown pretty much no one knew about Bitcoin back here okay so look at these

setups coming through here this is in 2012 so even when hardly anybody knew about it and it wasn't very liquid it's

still forming the same setups it is absolutely Timeless and what's interesting is you could go back and

look at charts of stocks from 100 years ago you will see the exact same chart pattern setting up on the exact same key

moving averages it's fascinating and this is Bitcoin fascinating absolutely fascinating so

look at this setup makes a move go sideways find support on the rising 10 and 20 day moving averages get started

has a breakout does this look slightly similar or very very very similar to some of the stock setups we were looking

at earlier it does doesn't it look how tight it's getting and then over here look how tight it is then you get

another one another stair step look at this higher lows go sideways gets Tighter and Tighter surface of 10 day

and another breakout so see this black line here see how it's surfing it okay you get these little ShakeOut demand

tails that means intraday prices going below and then pushing up and closing above going below pushing up closing

above look how the volume dries up look at the high lows it's the same things over and over again

here again start surfing the 10 21 and 50 day in an uptrend gets tight and breakout I'll show you the breakout on

the next slide again trying to help you train your pattern recognition look at this see how it's just surfing the

moving averages you get these ShakeOut demand Tails they're good to see why because it's indicating there is

absorption of Supply there is accumulation going on prices going down bars are stepping up prices going down

bars are stepping up good to see see how it just holds the 50 in here and then look at that that is again for me I'm

very very visual so if the trigger bar concept helps you fantastic if it doesn't ignore it but for me trigger bar

inside bar sitting there look how the volume dries up it's the proverbial final piece of the jigsaw puzzle for me

next slide there's the breakout and it goes up sixteen hundred percent we're then going to look at this High type

flag here so the strongest stocks and all cryptos find support on the 10 day the strong ones the 20 day and the

slower ones on the 50 day generally same principle applied here for Bitcoin how this was basing there's also the law of

kind of cause and effects so the bigger the cause bigger the base the bigger the bigger the effect to the upside as um as

well but there's the breakout and before it closes well how'd you have just stayed in this for the 10 day look at

this see how you get these undercuts here and this is why you'll see there's actually one that there's three

significant ones right I call the shake out demand Tails why because again very visual they're designed to shake you out

shake out demand tail so price goes down goes below the 10-day then recovered see here it comes down to the 21 recovers

down to 21 recovers down to 21 recovers so this is why qualamagi when he talks about the 10 day wait for a close below

the 10 day because you'll see this time and time again the shake out demands intraday they come down try and shake

out weekends and then they reverse hard by by the close don't happen like that every time obviously you can get kind of

change characters and then they turn around but wait for the close because had you have waited here you'd still be

in this stock up sixteen hundred percent I'm not selling saying you're gonna top ticket but see how well hell it kept you

in for the move that's the point stay in for the move then we're going to look at this high tide flag

this one here so we're now looking at that high type flag in the context of that move and this is a quote about this

setup this is a very good setup it went sideways for a while it's a high tight flag it being the price surface the 10

and 20-day moving averages gets really really tight this is a five star setups it's like a perfect one from this setup

it goes up being priced four five hundred percent in a month to Montel see our price is surfing the

moving averages and then look tight tight tight tight look out there's no volume remember what does the tightness

and the low relative volume tell you what's it telling you there's hardly any Supply around that's really good

that's the minovini vcp point you want the tightness you want the low volume because it tells you very much Supply

around the stock is getting ready for the next leg higher The Next Step higher okay think about the stairs up sideways

up sideways up sideways right this one hit Bitcoin March 2013 high tide flag example I'm just gonna whiz through this

one it's got loads of examples here oh this is one I was just showing you here

there's the before there's the after absolutely textbook as I punched a mic next one here Bitcoin November 2013 High

tight flag all you have to think about are the 10 20 and 50 day moving averages again here perfect breakout look at this

here it bing price serves a 10-day moving average goes sideways boom break up look how powerful this is triple good

drupals in a few months these setups can be traded on any asset class look how perfect this is hopefully you you take

print screen to this I'm probably pull in some awkward faces at times of them um but look at look at this this is what

you want to dial in and train your pattern recognition to ethereum nothing different here is a good setup it just

keeps surfing the 20 day so see this blue line here and it's 21 EML my job pretty much every much just check out

demand out check out the manto check out the manto check out The Monto and then see how you get this kind of

quote-unquote trigger bar look at the volume Drive look how it's just sitting there that's your breakout coming

through here this is a five star setup now let's go into a little bit of a quiz so

ethereum let's see if you are learning something in this video I hope you are as it took a lot of time to put this

together so if you are enjoying it please do subscribe to channel if you're new please do press the like button for

me it really helps me grow the channel so can you identify the three high quality setups

can you see them they're all five star I'll give you three seconds three two one

there they are your job is to identify these these setups have been appearing for the past couple hundred years and

they're probably gonna appear for the next couple hundred years this is how stocks and cryptos move they move in

stairs you can clearly see one step another step so you see here how it's just going one step and then it goes

sideways another step sideways another step sideways that's how they move your job is to identify the next step when

it's about to break out okay what does it tend to do we've been talking about it before it breaks out tightness in

price tightness in price tightness in price where is the share price where is the Candlestick in relation to the key

moving averages before it do before it does it what are you seeing time and time and time again there's a very

repeatable kind of nature to it so hopefully you're stunning it hopefully you're getting

you're not going to have 100 win rate you're going to be wrong most of the time but once you catch a move like this

you're going to make 50 losers in one straight and that's how you make money so quality monkey really focuses on

keeping losses really really small relative to where he is targeting and achieving his average gain he's trying

to get these home run trades these huge trades imagine buying youth here it goes from what's that 40 48 something like

that 40 46 47 in here and then look it goes all the way up to 320-ish 310 before it starts closing below it's 21

EMA so I actually like the Tanny men 21 you may even hear from this breakout so it goes all the way up here before it

closes below the tender so the Stockland goes or The Ether goes well even from here it goes from that all the way up

there to over 300 from four from forty fifty dollars foreclosed blood test that's the point get the big ones right

so that was continuation type pattern breakouts okay that is your vcp's your

flags your Penance your cabin handles your Darvis boxes so and so forth so forth we're now going to go into EPS

what on Earth is an EP an episodic pivot which I also I didn't really understand the name I don't to me the dictionary

definition of episodic does not really Define this uh nor do I really think about it as a pivot so if you don't like

the name like I don't know the name I think of it as a gap up bass breakout invariably it happens on earnings as

well so EP Gap up base Breakout playing kind of things right whatever works for you to describe it do that pretty much

so what are you looking for in essence you are looking for a stock that is building a base and then it breaks out

of the base and invariably it's going to be on earnings clearing all the key moving averages and preferably all the

overhead resistance okay as we do more examples it's going to be a little bit more clear I've got some examples as

well so EPS are not always but many times I'll wear a new trend starts good earnings big beat and big volume that's

the secret source so if you re-watch this video later on and then remember at the start of the

video I was showing you the before and after of those stocks note how many of them the beginning of the uptrend

pre-bass was on earnings interesting so they're basically then post earnings bases for them the

continuations so what you could have here is a breakout and then a high type flag form over the next couple of months

or so something like that a couple of weeks who knows so sometimes if you have a good looking

setup and it gaps on the earnings or news even if it gaps 5 10 15 it could work out really nicely so let's go

through some examples so EP guidelines you want a gap up of greater than 10 you want big volume near the open best

and the best of the best often trade their average volume in the first 15 to 30 minutes so that average daily volume

you'll actually see that level of volume come in in the first 15 30 minutes you can use like I use I use tc2000 as well

they have a volt buzz on there so you can kind of see how much volume is is coming in you can just kind of eyeball

it use a little bit of maps if you want if earnings Gap preferably High double digit and or triple digit earnings

Revenue figures plus significant beat of expectations best of the stock is coming out of a base and not overextended so I

the Stock's not been rallying for two three four months and it's kind of at the top of a rally rather it's actually

built in this instance here a big cup and handle type base and then it's gapping out and the size of this base

could be a couple of months could be a year something like that and then suddenly it's coming out and it's

beating the uh the analyst expectations maybe they were expecting kind of a dollar to

come in in terms of the EPS but actually the company reports two dollars or three dollars or four dollars that's a huge

surprise um oftentimes you could get it as well if a company comes out in the earnings

and there's uh there's a material change of some form in terms of the news are you they announce we have just signed a

10-year a tenure agreement with the government for our products and services and it's going to be worth X to us and X

could be a significant increase on what the analysts were expecting so there can oftentimes be on these kind of eps a

material change in kind of news and outlook for the company but potentially the earning side as well a big a big

beat coming in basically on the earnings and the revenue side of things so these are the type of eps you're

looking for many times the stocks that are already in existing uptrends over the past six months

a year or two years preferably they have been building high lows for many months and then they break out of a big trading

range so you'd like to see the stock in a longer term uptrend so here above say the 200 above the 100 but then it's

building this big size base and it breaks out of the base takes out the overhead resistance and is above all the

key moving averages next slide so how do you trade an EP identify the setup before the Market opens enter

opening range highs so orh for the first one five or Sixty Minute Candlestick with a stop load of the day so remember

like we were doing the opening range highs looking at the one minute the five minute and the 60 minute we're going to

do that again with EPS Trail your stop with the 10 or 20 day once they surpass the initial stop usually you want to get

in as early as possible when you have a five-star setup so like this EP hit you want EPS to Gap a gap above the moving

averages a strong EP should Gap above resistance levels so thinking about that from a structural tech technical

perspective so are you resistance levels of a base and then also thinking above the key moving average is I you don't

want to see an EP that's gapping up into the 200 SMA which is then sloping down like this you don't see that always

gapping up into the 50 SMA and the 200 SMA volume was on the table before the opening range height so as I said on the

previous slide okay oftentimes in the first 15 30 minutes an EP can actually be trading

its daily average volume so I if a stock trades a couple million shares a day it can be trading those couple million

shares within the first 15 minutes half an hour so let's go through some examples probably the best way that

you're going to learn this so here we have mphase NG we have two EPS on the chart we have one here we have one here

which is the better one which one do you think is the better one given everything that I was just

teaching you well the first one here what does it do the Stock's building a decent sized base starts building higher

lows in the base albeit a bit choppy does start to tighten up here the relative strength is good and then it

eps on good volume 52-week eyes coming through clears the base highs so that's

the overhead resistance and it's above all the key moving averages interesting that's a very good EP then over here

qualamagi actually bought this EP and he bought the CP as well this one here why is this one not as good as this one

because it's not clearing all the overhead resistance think about all the Trap bars up here okay think about all

the Trap visors decent volume there as well there's a lot of trap bars here so again imagine the psychology point a lot

of trading is you want to have awareness of both you and your own actions but also other Market participants so if

you're thinking about this here there could be a lot of people that are trapped up here and they've ridden this

stock down this decline was about 25 30 something something like that so they've ridden this stock down here and

they have a loss in their portfolio of 20 25 say then the stock gaps on earnings and suddenly their loss of 20

25 suddenly they're now break even and what do they do I'm gonna sell why because they want to remove the pain

that they are currently experiencing of having the loss so they now have an opportunity to remove the paint so they

do so a lot of Supply then comes in here so then that kind of makes sense that Stockland has to kind of back and fill

back and feel back and feel like this and then there's a breakout attempt here and then kind of rolls over a pretty

darn sharply but if you think here okay there's going to be some trap people within the base here but suddenly the

stock gaps on EP now they're going from Fear to greed because now they go well hang on a minute I had a loss in my

portfolio I was down 10 on this stock I was down 15 on this stock but now it's just gapped on earnings I'm at five

percent ten percent well I'm holding on to this one interesting right very different in terms of the psychology so

the best DPS you'll often find will Gap above the base highs that they've been building and above all key moving

averages they won't Gap in gap up into declining moving averages and or a lot of overhead resistance a lot of trap

bars hopefully that makes sense we'll do some examples it'll make sense so sometimes stocks Gap up over the

entry point but you can still have a tight stop on it if you do opening range highs when you have a powerful chart

so look at this setup here is it oh I don't flag it's not far off a high type flag see this really nice tight trigger

bar coming through in there that was a really good setup by the way when you have a powerful chart a gap up is okay

this was a pretty decent setup he's talking about plug here so this is your episodic pivot your EP Gap up base

breaker but see how it is basically gapping above all the highs of the base and it's above all the key moving

averages so don't worry we'll go into opening range highs for how to trade these EPS a little bit later on

melee this one here so do you see how it's gapping up it's above all the key moving averages stocks building a decent

base pretty much gaps up to the highs of the base here so it then kind of makes sense because there are going to be trap

bars up here it's at the top of the base you'd expect there to be kind of resistance there from actual trap bars a

bit of psychology as well it's bass highest resistance things like that it takes a couple of days but didn't take

out the lows and then goes on a really nice Trend and that's the first close up here below the um

Kuala manga actually use a 20-day melee I bought on earnings here then I use the 20 days my trailing stop it reported

great earnings I mean just incredible earnings and I'm filming this currently in May of 2023 go and take a look at

melee ridiculous earnings are still coming through on this uh on this stock and estimates as well crazy

uh Shopify so now we're actually going going to go into these are pretty recent you can see this is actually um May

which as I said I'm currently filming this in May 2012. so Shopify we're going to look at

this stock here and we're going to look at it on the one minute chart the five minute chart and the 60 Minute chart for

opening range highs on the EPS but here you can just see visually on the daily chart what do you see is a stock that's

building a big range it's eping above all the key moving averages to pretty much the highs of the base trying to EP

over the highs of the base that day is a better setup remember here mphase engine gapping above pretty much the highs of

the base above all key moving averages it's not really gapping into a lot of overhead overhead resistance so Shopify

let's now start looking at this and be cognizant of the ADR percentage of 4.29 here we go

so gaps up as you'd expect right it's an EP on the earnings so here is the first one minute Candlestick okay candle set

good volume coming through really good volume coming through check out The Mantel decent close and then it goes

tight tight tight and then here it takes out the opening range highs of the first one minute bar which is

55.94 so your stop is then lows of the day which is here underneath this bar which is 53.88 now what percentage risk

is that that is 3.68 what is the ADR percentage of the stock 4.29 is that acceptable wrist versus wood it's pretty

darn good isn't it it's round two thirds or so the ADR which is kind of acceptable and look at the volume coming

for it it's pretty darn good it's pretty good candle six volume price action going on next one five minute chart so

this is still Shopify but now we're looking at opening range highs on the five minute chart so here's the first

five minute bar decent first five minute but the higher that bar is 56 so as it takes out that high that's where you're

looking to get in initial stops underneath the lower the bar 5. 53.88 so that is going to be 3.5

3.79 which is pretty just under around about it's just over two thirds isn't it versus the ADR percentage of the stock

okay it's still kind of acceptable acceptable risk now the next one here this is the 60 Minute chart but remember

this first bar here is actually a 30 minute candle so so really good first 60 Minute bar coming through why gaps up

opens near the low little shake out demand tail pushes a really good volume coming through so the higher that bar is

59.31 stop low of the day 53.88 would be 9.16 now is that a good resources will trade

look at the ADR probably not why because it's about two times the ADR which you could think about that is ATR if you

want to use average 2 range instead again the wrist reverse reward is now out of whack so on this one here the one

minute chart it's in check five minute chart it's in check one hour chart and a check make sense let's do a few more

examples this is another relatively recent one this is smci the ADR of this stock was 5.77 so here's the Gap through

the base highs see how it's eping basically to the base hours and trying to take out the base eyes and above all

the key moving averages 119 27 was the highest of the base so one minute chart so we're gonna do one minute five minute

Sixty Minute bar so here's the EP now on the first one minute chart it doesn't actually take out the highs of the base

so I actually think on this one what you could use the highs of the first one minute bar or you could wait for the

highs of the base around 1 19 24. that's my subjective viewpoint but let's just go opening range highs for the one

minute Candlestick to not add too much confusion to this right so decent volume coming through very good volume coming

through on a relative basis for the first one man in Kansas City good strong close check out to Martel the higher

that one minute Candlestick is 118 22 so opening Range High breakout through the higher the first one minute candle say

that's where you get filled stop loads of the day 114 32 what is that percentage risk 3.3 let's take a look at

the a Dr percentage 5.77 is it in check it's in check five minute chart first five minute Candlestick coming

through so K it's a doji there's good volume coming through higher that bar is 118.76 so stop loads of the day 114 32

percentage risk 3.74 is that in check with the ADR yes it is check next one here now we're on to the 60 Minute time

frame okay first one hour Candlestick is a good Candlestick yes it is why gapa powerful

Candlestick look at the volume coming through highs of that bar is 128.90 lows of the day 114 32 so the stop loss to go

lows of the day would be 11.31 is that good wrist versus wood look at the ADR percentage no it's about double it's out

of whack again so one minute Chart good we're in check five minute Chart good we're in check 16 minute chart again at

a whack so again this is going to be feeding into your strategy for thinking about these things let's do another one

here Uber wraps and sets reps and sets as Arnold said that's the best way to teach it so if you look at Uber here

okay it's not great in terms of the stock is potentially building a base but it's kind of been a downtrend isn't it

lower lows lower highs lower lows low highs it's not great but something that happens here here's the Gap up ADR is

3.6 let's go take a look at it and it's basically e-pinging into the highs of the best I think the other two were

better than this one because if you just look at the straps kind of EP trying to EP above the highs of the base and look

at Shopify as well it's going to EP above the highs of the base so I'd say Uber just on the face of it at the

minute on that kind of Gap up is not as strong as some of these other ones okay so

we're looking at this bar here okay so there's no kind of I'm really putting a high because would you use this eye this

eye this eye is not very clear and obvious so just the highs of this bar let's take a look so one minute chart

what happened well it actually gaps up the open is up here and then it sells off here so this is not as good a one

minute Candlestick as we saw on the other two examples being Shopify and smcr okay gaps up the highs here sells

down here then you get the checkout to Montel but the higher this bar is 3510 shake out demando so the lower the lower

the day is going to be 34.23 so when it takes out the high your entry is there and then your initial

stop is here lows of the day that is a 2.46 stop which is about two-thirds of the ADR which is 3.6 is it acceptable

I'd say it is acceptable next slide five minute chart so it's um overall it's a bearish

Candlestick but it's not quite doji and there's a supply there's a demand tail but either way this is the higher the

bar it's on the five minute chart 35 24 and then loads of the days 34 20 23. so you've got around about a dollar dollar

stop so again if you know you've got about a dollar stop you can then look at the ATR and go well the ATR is one and a

half dollars or two dollars or whatever you could do it that way as I said I prefer percentages my brain just works

better with percentages so stop slows a day would be 2.86 which again is about two-thirds or so versus the ADR okay

still in check isn't it next one for Uber well now we have one where

first one hour Candlestick is more of a hammer type doji bar highs of the bar is 3524 loads a day 34 22 so therefore the

initial stop if we went through the high of the first first 60 Minute Candlestick here and then stop loads of the day

would be 2.86 is this good resources what well this time actually is on the one hour chart isn't it because it's

about two-thirds versus the ADR percentage okay that's looking a little bit better

let's now do some EPS so Roku has three EPS it actually has four on this chart let's see if let's see if you can get

them can you rank them as well so there's three EPS I really want really want you to focus on there's four which

is like a dud I won't even consider it an EP ready three two one there we go did you get them did you

rank them as well so what I would actually say let's just start with the duck this one here is a no-go right why

well it's gapping up there's going to be overhead resistance because the Stock's in the downtrend it's gapping up into

the 50 the 200s there the gray line is the 100 it's bubble no no no no no okay this one here now number three the

reason I put it is number three well the Stock's not really basing here it's actually already in an uptrend so that

is just not as good for me so yeah it's kind of it's already been trending up for some months it roundabout and was

that nearly eight weeks or so it's kind of been trending up but number two which I rank second is is building a

constructive base here and then it EPS it EPS above all the key moving averages there is some overhead resistance

there's quite a big kind of what I call a resistance cluster where price has been trading in this range for some time

in here it's okay there's going to be trap buys but why I think number one why I rank this number one is well look at

where the stock is finding supportive action prior to this earnings see it's in a much more established uptrend and

it holds here around the 50 SMA here it holds around the 50 SMA here it's kind of languishing actually goes below it

reclaims kind of kind of a bit sluggish around here but here it just looks like a much stronger base to me and then the

EP is actually taking out all overhead resistances eping above the overhead resistance and above the key moving

averages for me that there is the best one that there is the best one next one so Mellie there are two setups on this

chart two setups one's an EP one's a continuation type pattern breakout can you find them three two one

here we go so here's the EP see how the stock is in an uptrend here I don't know why there's this red line

here that was probably from the last one forgot to say that but here you go it's in an uptrend fine support on the 10

then on the 21 in here tight tight and then it goes takes out this range above all the key moving averages good EP good

candle set now it does then pull back down it does find support of action around the 10 which is really good right

so the stock is now staying above it's 21. in here pulls down Fine support of action around the 10 and then what do

you notice tight tight tight tight call a magazine word this is a good setup right here it's a really good setup next

one so now we're going into a little bit more of the specifics actually so quote

from Crackle malings on some stocks you don't get good setups they're just choppy and go higher anyway

so what is a choppy stock so if you think about what have we been looking for we've been looking for stocks that

are in solid uptrend and have made a smooth move above the key moving averages okay so remember that Trend

which can oftentimes start post earnings so I.E something material happens and then the trend happens then it goes and

Trends along the 10 and the 20 day maybe the 50 day as well right but it stays above it and it holds it finds

supportive action well what quality Maggie is referring to here is a choppy stock is it doesn't respect it doesn't

hold the key moving averages it just chops around now this is very important if you've read

her livermore's work if you've read the um darvis's work as well stocks exhibit personality behaviors and you may not

like what do you want about that no they do stocks just move different stocks move

in different ways don't ask me why I couldn't explain it they just have personalities like I have a personality

which you may like or not like like you have a personality which people may like or not like but you will have those

Behavior traits which means in certain situations you will react probably how you did in Prior situations now that's

important to think about when you're looking at a stock why because how has a stock move previously is to my mind the

best indication how is it going to act in the future this is the personality point if you know someone's personality

and you know their behavior you know how they act in a certain situation therefore you can try and take advantage

of that thinking about that as stocks and how they how do they move how do they act so if you take a look at hubs

here this was one of the can the canceling winners of 2020 and 2021 but see how

choppy it is so remember you're looking for clean moves along the key moving averages whereas here well just kind of

choppy choppy choppy choppy choppy choppy choppy you getting the idea even up here it's just choppy even to the

downside it's pretty choppy see it's just it's chopping all around all over the place so if your trade management is

going to be well I'm gonna buy a tight a a nice tight breakout from a flag or something like that and then I'm going

to ride it along say the 10 or the 20. well if the stock has a history of just being able to whip back and forth

through the 1020 you're gonna get stopped out really quickly and probably be very frustrated that's why you want

to look back at the previous behavior of the stock how is it acted how is it trended it's a subtle point but a really

really important point I think so this one here this is now talking about sector

momentum so when you have sector momentum if it's a leading sector and or hot theme the setup doesn't have to be

really really good it's okay if it's three and a half star or four star setup it still counts like

a five-star setup because if everything is running in the sector there's increased probability of success now

this then links back to a couple of questions how do you identify sector momentum well in essence you identify

multiple stocks within a specific sector and or theme that are making big moves they are showing momentum they are

building Flags they're building cup and handles they're building vcps whatever they're trending higher they're riding

their key moving averages so what I've got here and these are lined up you've got right and you've got more of them

both of which are North American crypto miners so this is what Bitcoin was really running in the

market kind of went a little bit crazy but in the back end of 2020 and then into into 2021 which is when the growth

bear Market really started this was kind of the blow-off top for growth stocks and then it's been a bear market for

around about two years or so um just over certainly for Grove stocks and more kind of canceling grocery type names but

this it they may not have been the best setups I wouldn't really say for Riot or Marathon either one was

really a five-star kind of setup um but they were pulling into the 10 and 21 EMA they were doing it in here as

well you can see it with um with Marathon 1021 EMA in here you can see it in here see how it goes up pulls back

down find support on the 21 tightens up a bit in there you can sit in here as well they weren't I wouldn't say any of

these are really five star some of them are it's quite Maggie saying they're in the correct three and a half four star

tops but there was so much momentum there for crypto and crypto stocks think about what Bitcoin was doing during this

time I think cavi wood was being interviewed um every day about Bitcoin and price

targets and stuff like that like there was a lot of momentum in crypto stocks um that so on the next slide we're going

to be going into a relative strength okay the importance of relative strength and I'm using monster beverage which

built arguably the best kind of volatility contraction pattern you will ever see on the monthly jar especially

given the fundamentals of this stock where it did it in the con in the context of a bear Market as well on the

relative strength that it exhibited and then the move thereafter as well so let me take off a couple of points here the

best setups the best ones the best setups are those that show relative strength if you've read the likes of

O'Neill's book you'll know about relative shrimp that can't go lower even if the overall

if even if the market overall or the indexes are showing weakness and going lower these things being the stocks

can't go lower maybe even building high lows you may have heard the adage of the basketball being held underneath water

so the stock is the basketball being held underneath water and the water being the market so the market pressure

is pushing the stock down but every time that pressure is eased a little bit the stock pops out boats are high low as the

pressure comes back on that's the proverbial basketball underneath water if you're not paying attention to

relative strength well I guess you don't know what you are doing so see monster beverage here see how it builds this

huge base think about the cause and effect relationship as well now this is the monthly chart and because this is

then um just the strength of stock exhibited you can't really see the power of this

relative strength line here but believe me it was an uptrend as you can see with the 52 cars coming through and then you

see the tightness so remember the concepts that we were talking about and primarily we focus on the daily chart

okay start getting tight around key moving averages it happens on all time frames you can find these setups on the

monthly chart the weekly chart the daily chart the one hour chart the five minute chart the minute chart whatever chart it

is just supply and demand it's all it is it's absolutely Timeless so see the tightness that comes through and hit now

what I do just want to add in here quickly is the power of earnings growth sales growth and margins and breathing

as well okay really really important so sales growth margins growth and also the earnings growth coming in

really really important so if you can line up and we'll look at it a little bit later on of course if you can line