Technical Analysis Made Simple: Live Step-by-Step Stock Chart Analysis | James Nguyen | Skillshare

Technical Analysis Made Simple: Live Step-by-Step Stock Chart Analysis

James Nguyen, Professional Money and Lifestyle Manager

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12 Lessons (56m)
    • 1. Introduction

      2:55
    • 2. The Stacking System Overview

      4:55
    • 3. Step-by-Step 3 C's Walkthrough

      6:52
    • 4. When to Buy and When to Sell: 2 Examples

      4:57
    • 5. Bullish Trade: Twitter Daily Chart

      7:34
    • 6. Bitcoin: Secrets of Trading the Top

      4:52
    • 7. Day Trading Analysis: How to Apply the 3 C'ss

      2:44
    • 8. The Importance of Trade Management

      4:57
    • 9. Over My Shoulder Trade Management and Exit

      4:53
    • 10. The Right Trading Psychology

      2:36
    • 11. Six Final Trading Tips

      4:58
    • 12. Bonus: The Next Level

      3:33
14 students are watching this class

About This Class

Do you want to make smarter investing and trading decisions?

Imagine looking at any stock, commodity or crypto chart and knowing how to analyze it and knowing exactly if you want to buy or sell? 

What if you knew a proven, SIMPLE process to make smart, confident trading decisions?

Picture yourself having more winning investments and knowing how to manage your risk and cut your losses when you’re wrong?

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Live Step-by-Step Stock Chart Analysis is an end-to-end guide to the most important tools in reading a stock chart.

This class is the FIFTH in a series that will teach you the essentials of technical analysis and stock trading to help you make smart, profitable investing decisions. You’ll focus on the most important technical indicators and put it all together into a process that I actually use as a professional hedge fund manager. 

My classes are built around my Stacking System, a step-by-step process to analyze any price chart using simple, classic technical analysis.

If you can follow a recipe, you can learn my system. 

Technical analysis will give you an edge in trading, day trading and investing in anything from stocks and penny stocks to Bitcoin and cryptocurrency.

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I'm James and I've been a professional trader and hedge fund manager for over 20 years, trading billions of dollars. I'm active on Twitter using @marketmind3 and on my website marketmindtrading.com. I post trading and market analysis live, where I can't hide and fake my results.

My teaching style is focused on being simple and easy-to-follow. I'm also a big believer in using visual aids and live, video walkthroughs as often as I can, so you can look over my shoulder as I apply my concepts. 

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This class will put everything we covered in previous classes together with live walkthroughs of the key aspects of technical analysis and how to use them to trade smarter:

  • Lesson #1: Introduction
  • Lesson #2: The Stacking System Overview
  • Lesson #3: Step-by-Step 3 Cs Walkthrough
  • Lesson #4: When to Buy and When to Sell - 2 Examples
  • Lesson #5: Bullish Trade - Twitter Daily Chart
  • Lesson #6: Bullish Trade - Twitter Weekly Chart
  • Lesson #7: Bitcoin: Secrets of Trading the Top
  • Lesson #8: Bitcoin: Tips on Buying the Dip
  • Lesson #9:  Day Trading Analysis – How to Apply the 3 C's
  • Lesson #10:  The Importance of Trade Management
  • Lesson #11:  Over My Shoulder Trade Management and Exit
  • Lesson #12:  The Right Trading Psychology
  • Lesson #13:  Six Final Trading Tips
  • Bonus: The Next Level

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Understanding technical analysis will change the way you trade and give you control and confidence over your investments. My course will transform you from a “close-your-eyes-and-hope” beginner to a smart, consistent trader. If you want to learn how to read a stock chart, understand technical analysis and trade with confidence, you’re in the right place.

Transcripts

1. Introduction: How can I make smarter investing and trading decisions? Imagine looking at any stock index or Cryptocurrency chart and know exactly how to analyze it. Welcome to technical analysis. Made, simple live, step by step Stock chart analysis. This class is the fifth part of a series that will teach anyone how to analyze stock charts . Even if you're a complete beginner, what have you had? A simple, repeatable process to make confident, buy and sell decisions. If you watch my other classes, you already have all the tools. Now it's time to put it all together. All the concepts we learn and walk through live examples of my technical analysis process in action. We're gonna go through my stacking system, watching for the three C's catalysts, chart and confirmation again catalysts like trendline breaks or breaks of support or resistance. Then we're gonna look for chart patterns to help us identify potential bullish or bearish patterns, and we're going to confirm everything with various technical indicators. My process can be applied to charts in any markets stocks, E, T. ETFs, commodities and cryptocurrencies. And that's where we're going to do in this class. We're gonna walk through examples and show how I apply my three C stacking system toe long term investments, day trades, buying low and selling high and even Bitcoin. Hi, I'm James. I teach people how to read stock charts and trade with confidence. I have 20 years of experience as a hedge fund manager. I've been in front of the screens for decades, trading billions of dollars, and I believe anyone can learn to understand technical analysis. I'm not a paper creator who learned from a textbook I trade riel capital and post live trading and market analysis on my Twitter and website market mind trading dot com, where I can't hide or fake my results. My process both in how I teach and how I trade is to keep it simple so you don't have to be a finance wiz or a mass genius to learn how to read a stock chart. If you can follow a recipe, you can learn my process again. This is the final class in a series of classes that covered all the aspects of technical analysis and build upto my whole process of analyzing stock charts. We've gone through catalyst and charts and confirmation, and now we're gonna go through step by step, putting it all together with live video walk throughs. In this class, we're gonna walk through as many examples as we can, covering all the aspects and all the various situations we might encounter. And at the end, we're gonna cover general lessons on trade management entries and exits and trading psychology, as well as covering some final secret trading tips. So if you want to make more money trading or increase profits from investments you're already making or understand what a chart is telling you. So you can stop guessing when you buy ourselves or use long term strategies so you don't have a stair and stress at your trades every minute you're in the right place right now and let's begin. 2. The Stacking System Overview: The main idea about how I trade and about my process is to keep it simple. My process is all about simplicity. I use pretty basic stock charts and trends and very simple signals. I really believe a 10 year old can learn the basics of stock trading, and keeping it simple isn't just for the purposes of this course or to teach beginners is actually a strategy that I think will work trading in any market, no matter what your level is. Ah, and even for me, after years of doing this and managing a lot of money and trading professionally, this is actually primarily the process I actually use now. I know there's a lot of crazy analysis out there in a lot of different ways. People are reading stock charts and a lot of different systems people are using, and I'm sure a lot of people who use them consistently and really believe in them can make money from them. But my view is you don't really need to get that fancy, particularly Ah, if you're beginning, I kind of look at it like cooking a steak right? There's a lot of ways you can cook a steak. Ah, if you look around, there's all these people using all these fancy rubs and marinades and all these different fancy techniques. Ah, but you know, sometimes you'll even talk about five star chef. And even they'll say, you know, sometimes simple works best. Ah, lot of the best chefs in the world will just say, You know what? Ah, all you need to cook a good steak, a salt, pepper and heat. Ah, and that's that's what I am. I'm a salt, pepper and heat guy both in cooking my steaks and in How I trade stocks. So to start one of things about my system is that it's a trend of following system. Ah, and I really think this is the best overall trading philosophy for beginners. Ah, but as I said, it's also a core strategy that I used. Then I think a lot of experience traders should also use, um, you know, why trend following? Well, you know, a lot of people will try to call tops and bottoms and turning points and predict them on. That's great for the ego, but it's really an inconsistent way to trade in the long run, particularly if you're inexperienced. Um, you know, contrary and trading can make a lot of money a lot of times, but it does require that kind of experience with the market. Ah, and some added skill. Ah, and even then, a lot of the best traders, when they're trying to guess like that are often wrong. So instead, I focus on following trends or at least being early on trends, though not necessarily at the exact turning points. Ah, it's a safer way to trade. And over the long run, just cutting out that extra risk can add up over time and then yield better returns. I use a step by step stacking system for analyzing stock charts and making buy, sell and trading decisions. Ah, and the core of my stacking system are what I call the three C's. Looking for a catalyst chart and confirmation. You know, the words were always going to start with some sort of catalysts for making a trade. We're gonna analyze the chart pattern, and we're gonna look for confirmation from technical indicators and other studies were going to do, and we're gonna walk step by, step through all of this and learn all over this. The three C's process is all about taking simple basic tools and ways to look at a stock chart and stacking them all together to give really good, confident trading signals. So if we pull up any stock chart like this one right here, we would go through the step by step process for analyzing this chart to see if there's a trade here. Well, first, look for a catalyst. Is there something in the price action or the way the stock price is acting? Ah, that gives us a reason to make a trade. Did it break some sort of trend? Did it hold or break through some sort of support or resistance? We're gonna talk about how we look at these levels and how we identify these levels. And when we talk about the catalysts we're gonna be looking for, and once we identify a catalyst will next look for a chart pattern. Ah, and again we'll go through the different chart patterns to common chart patterns and what they say about potential stock price action and finally will look for confirmation from technical indicators. Ah, lt to what technical indicators are and why they add color and detail into what a stock prices doing and can add confirmation to any buy or sell decisions we may want to make. Once you get familiar with my process and analyzing a price chart, you'll see that these charts can be applied to any market. Basically, technical charts pretty much measure price action psychology Ah, and momentum and trends s so they can be applied to anything that's traded. Ah, whether it's stocks, large cap stocks, penny stocks, E T efs, even commodities and even crypto currencies were basically going to use simple, basic classic tools that, on their own, provides some insight but when stacked together, provide really good trading signals. 3. Step-by-Step 3 C's Walkthrough: So now let's put everything together and walk through, analyzing a stock chart and analyzing a potential trade. Ah, first, we always want to start off with some fundamental reason. Whether it's you like the company, the industry or the story. For some reason, that's always a good starting point. Ah, once you have that, then you can walk through my stacking system and look for the three C's. But through it all, what you always want to do is be patient. Don't force trades, be methodical on walk through everything to make sure everything is there and that you understand betrayed, that you're looking for. By now, you should have a pretty good sense of how the process is gonna work. We're going to go through my stacking system looking for a catalyst chart and confirmation the three C's so we'll start with the first part. The catalyst. Ah, the most important part for buys. We're gonna look for downtrend line breaks if the stock's been in a downtrend, has it breaking above that resistance? We're also look for some levels of horizontal resistance or moving average resistance that it's breaking through Ah, alternately. Sometimes we'll look for ah if a stock that's been in an uptrend has it pulled back and is now at some sort of support level, that it should hold and would be a good bye spot a same time on the other end for cells were, look for the opposite right. We're gonna look for uptrend line break for breaking blossoms or horizontal support or moving average support levels that it should hold that it's not holding. Um, and just like with breaking above support. Sometimes when a stock will hit a resistance level, that might be an interesting point. Toe potentially look for a cell. And ideally, when we're looking for Catalyst, we want to stack multiple catalysts. In other words, we want to see multiple trendline breaks or multiple tests of some sort of support or resistance level, all kind of agreeing with each other. So let's walk through an example Here I put up a chart here of salesforce dot com. Let's say we pulled up this chart and we're deciding whether there's a trade here, whether there's a buy or a sell. At first glance, the first thing we want to see is it's obviously in an uptrend kind of over this time period. All the moving averages are trending in the right direction in a bullish configuration, with the short terms above the longer terms. Ah, and it's generally a bullish pattern. But at the same time it's been in a downtrend, at least for ah, a short time period. So the first thing we want to do is identify all the levels of support, resistance and trends weaken, see Ah, and certainly the most obvious ones again sticking with the idea of just trying to find major highs and lows we can see Ah, major high up here in a major Ah, significant turning point right here. So we do a trend line that would kind of signify this more immediate downtrend line Within this larger uptrend, we could also draw some horizontal resistance again. Trying to pick a line that touches multiple points on this horizontal resistance seemed to be an important level, right? Provided, ah, near term top. Ah, this week a swell as kind of a significant turning point right here. So if we do our trend lines in this way with the horizontal resistance and this, uh, this down trendline resistance Ah, we have a couple levels to work with to see if there's a potential trade if it breaks above there. And in this case, we do have that catalyst. We have a break of a downtrend line as well as a break above resistance, all kind of setting up a nice trigger for a potential trade. So they will move to the next step in my stacking system, which is looking for a chart pattern that might confirm the catalyst we've we've already established. Ah, in this case, we would look be looking for time, typical bullish by chart patterns, bull flags and triangle breakouts, inverse head and shoulders and coupled handles or double bottoms. You know, if we were looking for Ah, we are cows with a cell, we might be focused on the cell truck patterns, bear flags and breakdowns, head and shoulders tops as well as double tops. Whatever the case, what we're trying to do is kind of match up the cattle's. We're seeing with some sort of pattern that if it plays out, what kind of add to our conviction in our trade? So going back to this chart of Salesforce Ah, we can see we you know, in this pattern right here, we can see a clear double bottom. So, you know, we have these trendline breaks. We have the cows on top of it. We have a nice double bottom pattern that's that's been played out by a stab by breaking this neckline. Ah. Which would be kind of like the confirmation of that pattern. Eso We've checked two of the boxes already. We've got the catalyst, and we've got a chart pattern backing it up. Ideally, we might want mawr chart patterns. Ah, and sometimes you'll see that Ah, you know, with whether it's a flag or a triangle breakout. Uh, but in this case, we at least have, ah, a double bottom pattern and finally will go to the confirmation. The confirmation for me is always looking for the technical indicators. Ah, you know, as as I've said before, you can use whatever technical indicators you want. I use a Mac D. So I would be looking for a bullish Mac D configuration. As we've talked about Ah green d m I. The demise of another technical indicator I use, um, and I'd look for a positive divergence setting up into Theis into that trade. Ah, you know, And that's something you have to kind of look to see in the past or is kind of the previous , you know, the trailing period. Whether you you also have positive divergence setting that up. Ah, and again with, ah, with the cell signals, you look for the opposite bears configurations, red demise and negative diversions. So jumping back to this chart we've already established the 1st 2 stacks is that are the technicals confirming All right, In this case, it is with the Mac D You're looking for a crossovers and positive divergence on. You have both of them. You have the maxi single about, or the Mac D line above the single line. You've actually have it crossing into the zero r crossing into the positive territory. So you have pretty much the beginnings of the bullish confirmation, right? Ah, and similarly, we had that set up going in right? You had on this, uh, this bottom. You had positive divergence, right? A higher low on this Mac D line. So the mackie is confirming you have the d. M. I also confirming with a green about to turn over to the red you know hasn't officially confirmed yet, but it's certainly trending that way. And a lot of times that's enough to give you that confirmation. And that's pretty much what it would look like. Just a few lines we would draw. Ah, a couple pictures. We would look at a couple indicators we would watch on. We'd go step by step through them through some simple, basic tools on, we'd have a potential by right here. 4. When to Buy and When to Sell: 2 Examples: I'm gonna go through a couple examples now to put everything together. First we have a bullish by trade. Um Ah, in this case Apple. Ah, so you know, we'll look for again, are three C's will notice right away. The stock was in a downtrend. Ah, and we if we drew this kind of downtrend resistance lined, connecting these kind of highs, that would be what that would be. The level would be looking for for a potential catalyst. In this case, it breaks above the downtrend line. So that kind of checks the first box on. Then we look for some sort of chart pattern or confirmation from technicals. In this case, there wasn't really a chart pattern. Ah, and so that's something we take note off. But we do see some sort of ah, technical indicators starting toe potentially confirm that Break another as we did have positive divergence on the Mac D ah, for example. Like here it was making the stock price was making lower lows. You can see the Mac D signal line on the Mac D line was making higher lows so that we had positive divergence coming into this trendline break. Ah, and that at this trendline break, we did have kind of the early makings of the Mac D turning up above the signal line. Not quite positive yet. Remember, the most bullish configuration is above the signal line, but also above the zero line and being positive. So we weren't quite there yet. Ah, and the d m. I was still kind of in red territory. Ah, so you know, this would be a trade where that doesn't fully check all the boxes. Ah, you know, a better set up looking at that same chart, if you just were patient, would be toe. You know, make note of that first down trendline break, but not do any trades on weight on. In this case, you would maybe pick another kind of like the next, not potential catalysts. Ah, resistance line. And if you do it appear, you could kind of confirm that. Ah, you know, in this case, if we're break this resistance line, that would be a second catalyst. Um, you know, and obviously would be also breaking above the 50 day moving average. So that be another kind of resistance. It would be breaking through a same time you've got in this configuration, you've got the moving averages starting to flatten out instead of trending down. Ah, and right now, you do have confirmation from the Mac D where it is now turned positive and, uh, and turned above the signal line. Ah, and also, at the same time, the D M eyes also turning positive. So this is a more interesting set up. Ah, where? You know, if you're a patient, it you know, you might have made note of at the first kind of potential catalyst, but then confirmed it with more catalysts, mawr, uh, confirmation from technical indicators, Um, and and also kind of a better bullish configuration of moving averages. And again, as I said before, you know, part of any trade is kind of like thinking about trade management. Ah, so you know what you want to do when you enter the trade is think about setting your stops . Now, you know where where what would happen for the story to change? When do the patterns transit indicators confirm that the bullish price action you're buying for would change? So you know, if we're making these trays potentials, potential stop points would be Obviously it was if it was in. Ah, you know, an uptrend again. Break of that uptrend line. Ah, you know, if it were to, you know, kind of reach some sort of support level breaking of that support if you were taking the straight up here where we were buying with kind of an eye towards this last line being support. Yeah, potentially. We're broke to support if it broke this moving average line down below or if he's technicals turned back negative. That would be a level where you will want to sell on. And that is the kind of level we would want to pick. Almost ads were entering the trade in the first place. Just so we kind of have ah, clear understand of what are risks are Ah, and where Ah, we might exit that trade just to kind of take emotion out of it. Here we have. Ah, Barris, trade a potential sell or short if if you're going to short something here, we have a catalyst Uptrend line. This long term uptrend line is broken. Ah, you know, right around here. At the same time, we've got the moving averages being broken. The 50 day moving average. So they were right there. We have our potential catalysts, and, you know, all the while we have our indicators confirming the Mac D line had been showing negative divergence on these high. So you can see all these new highs that the stock price is making. The Mac D was making lower highs trending down. Um, and then finally, the, you know, with this trendline break, we also had the Mac D line crossing below this signal line crossing below the zero line and the d m. I turning red. So that would be kind of like on this chart. Would be, you know, a decent cell signal, a short it, or if you are long the stock, ah, place where you might want to sell that stock. 5. Bullish Trade: Twitter Daily Chart: So here's Twitter and Twitter is a good example on. And it just happens to be on picking a timely day to do this because they just announced earnings and the stock is up, I think like 16% in one day. Ah, but what I really want to focus is on is kind of the set up into today and how you should have, you know, potentially. If you were looking at this chart and you like Twitter Ah, you would have probably stayed long and he should have stayed long because again, using this most simplest metrics Ah, you know, it was kind of giving all the signs that it was at least a hold. If not, you know, if we weren't involved. If not a by eso. If you If you have pulled this up and looked at this, you can see multiple, kind of like positive charts, signs. Even when the stock was basically going sideways for the last Ah, for the last year. Ah, and even was retesting its lows. They're so right around here is where you kind of step aside and say, Wow, this is bearish. I don't really want any part of it. It's breaking down support. It's being confirmed by the D. M I the Mac D's in negative territory. Nothing to do here. It's right around here where it kind of peaks your interest, right? You know, it established this downtrend and it broke through this down trend. That's the first sign it broke through with positive divergence on the Mac D. And some, if you squint some positive divergence on the d m. I write the red is making you know it's kind of trending down, so the leather is less selling pressure here. There's less negative selling pressure on the Mac D, and it's breaking through the suffering but hasn't really done anything yet, right, Because as we know, this area right here where this previous low was is now gonna become resistance and it's gonna test It broke and really kind of like failed at this test. So nothing really positive yet. Then you see the first signs of life, right? So I think they announced earnings around here stock pops and actually gaps up above this resistance line, so that's a positive sign. Meanwhile, the Mac D confirms the d M I back into the green So now you're looking at and saying, OK, while this is probably some sort of Ah, you know, this could mean something, right? And so if you bought here, put a stop at this, uh, at this resistance or now hopefully it becomes support line and see how it goes. Ah, and and it Did. You know, if you can see it held this support line. This resistance now becomes support this red horizontal line. Ah, and it bounces around for our retested again. Holds again. Holds again. Um, and so you're seeing positive signs. Ah, but again, it's kind of, like failed again once it, You know, if you were trading this, you would probably put some sort of stop, uh, or, you know, around this level, right? Um, to say Okay, well, it didn't hold this support line. If you have really antsy and you're really trading, um, kind of with a shorter time frame, you might want to step aside once it broke this line because it broke this line back in the red, back in the rand. And, you know, we don't know what it would have happened. So, for safety and for discipline, you maybe step aside for some. Obviously, once it breaks here, the next test is this previous low, right? This becomes, like, really important. Ah, support. Right. If it breaks this low and everything's turning down, it's pretty bearish, right? And that's what it kind of does to shake people out. So, you know, as you know, is often the case. This previous low just became huge support, and once it hit that, buyers came right back in. Ah, and then you kind of start the process over where you're like, Okay, now what do I do? Do I add again? You're now this support or this trend line becomes important. Ah, this. Ah, this previous high area becomes important. I like to draw again trend lines or support and resistance lines around dominant levels. Right. So, you know, you can draw it right at this high. That's one level. But what I like to do is kind of look at Is there an area of congestion where a lot of different supporter resistance levels kind of like coincide? All right, so if I do this, look this high here horizontal line. We're kind of in the ballpark of this, you know, this kind of like tried to break and failed. So this seems to be kind of a dominant line. Um And so that's kind of like how we would look at it. So we have this downtrend line from this new high. Ah, we have this horizontal line for resistance, and again, it keeps failing. Keeps, um ah, kind of bouncing around in this kind of tight range. Um, so again, nothing particularly bullish, but also nothing particularly bearish. I mean, it is generally bears because there's a downtrend, but it's sideways. Ah, and more importantly, it's going sideways and testing these lows attested to slow here, but with positive divergence, right, This Mac D was able to bounce and hold with the higher low that this previous low as its trading along these levels as it's making testing lows and testing highs in this case in a downtrend as its testing lows is their positive version. And we're seeing it right. You can if you do a line from here to these previous lows on the Mac D on terms of momentum when it makes thes lows. When a test these loads, it's actually doing it with less selling momentum. Same with on this levels less selling mo mentum. So it's like this tightly coiled spring that's that's waiting to make a big move. Um, and here again, it's hold this level and again it gets gets bullish again. And this at this point, really? On the daily you have this long downtrend line and it holds thes support. Lines are kind of protests around the support and resistance lines breaks above it. And you give you look here, right at this level, it is important. Zoom in. Ah, this is the this This kind of brown line is the downtrend lines with a long term downtrend line, and this red support line was important level, right? You can see where it held. It holds here. It breaks and holds breaks in kind of trades around this level, so you can see how important that line is. A lot of people watching this, that red line, that horizontal line. A lot of people watching this brown line and once it broke above both of you can kind of see this big move in today. I mean, doesn't look like it being moved. That's but that's that's a good almost 10% move. Um, and that's important level. Ah, And from there, it really got bullish, right, Because you've got the Mackie in positive territory. You've got the d m I direction move clearly in the green and holding the green. And you had it above all these support lines, support of the moving averages, support of these downtrend lines to support of the horizontal resistance with the bullish configuration. So that's where you kind of look in and say, You know what? Things are pretty bullish here. Um, and then you can even start drawing. If you kind of say, you know, this is bullish. I like this trend. You can even start drawing trend lights on the uptrend, Right? Cause you can say this is a mini uptrend. I'm gonna trade this. Ah, and then and kind of Look at it, start looking from there. And that's kind of a set up, right? You had a new uptrend. You had the configuration bullish. You had to d m i in the green. And that was the set up for being long into this earnings release. 6. Bitcoin: Secrets of Trading the Top: So I wanted to look at Bitcoin for a little bit just to kind of show how ah, just these technical patterns. Because they're just based on behavior in psychology. Ah, and just supply demand can be applied not just a stock charts, but two currencies and pretty much anything that has a price chart. Eso I'm looking a bit coin here, and I wanted to point out two things. One is how you could have traded around the top that it made in 2007 late 2017 and how you can maybe kind of look at it. Ah, 2019 as it's as bottoming. So first on the 2017 top Ah, you know, on the big fan of just letting winners run and so obviously Bitcoin if you had if you were long it in late 2017 it just went on this parabolic rally. It almost doubled in the span of a month. Everyone was talking about it. But I can show you how it you know, you might have traded it. Ah, and maybe kind of protected some of your profits if you were long it because of the signs were there. Ah, you know, if you you know, as it was rallying here, you could see this is the daily trend in late 2017 inches, Just just just going straight up. Ah, and really, there were no signs for you. Toe be worried about your long position other than the fact that it was, ah, that it was going up. Because on the mo mentum and technical indicators, it was everything was good. I mean, he had strong d m. I had a Mac d just trending up with no real signs of stopping. And now so with volatile securities like this, it can run. You can rally really hard, but it can correctly hard, eh? So what you want to do is kind of like watch for these signals and watch for the signs in this case, um, as it was rallying, you know, it did pause for a little bit. But again, as it was, pausing didn't break any trend lines, didn't break any supports, was actually holding this kind of support area around here where my cursor is. Ah, with all the technical indicators strongly positive, Mac D strongly positive. No. Real negative divergence. on the d M I as well. Ah, and so you know, I probably have held it. What I what I would have done, though, is watched. You know, when When it does make these rallies and you are worried about protecting profits, you want to watch for signs on. And you actually did see a sign, Um, right around this time frame. So it made this route maybe kind of a last rally and then sold off on this day. Now, you know, not so. Sell offs are things you have to worry about. But in this case ah, on December 19 2017 it sold off. But also it turned negative on the Mac D with a negative divergence, right? So lower high on this peak before it turned down again and again, lower high on the d m I. So, for the first time, this selloff right here was something that maybe would have kind of, like, caught your eye if you are long it. But it's certainly broke The steeper trendline that it had been rallying from So break this trend line with negative versions. Mac d turning. Ah, negative. And you know, a trending down d m. I probably would have told you. Okay, there's something I worry about. Maybe you would have waited for it to break this horizontal support area. But even if it did, what if you could exit around this area or around this area? Ah, you know, you could have protected yourself from a good amount of losses. Um, and then you can look at things fresh, right? You could of, ah, you know, protected yourself from this fall and then watched it and, you know, and what you would have seen is it would have the technicals would have stayed negative, and it would have been hitting this resistance line, and you probably would have stayed away, you know, even longer here on a weekly. And again weeklies are, I think, better indicated for a lot of people. Ah, kind of a better time for him to look at just cause it. It Smoothes out a lot of just a lot of the noise, and it's it's just involved. Less trading. But you could have more simply said All right, on this break on, um, of the ah of the Mac D line or whatever indicator you watch but I look at the Mac D. Maybe you kind of exit profits. Ah, and then just stayed away on because as you as you watch, you would have seen on a weekly basis. The indicator stayed negative. The Mac D actually turned negative, which is bearish. Um, and it it kind of stayed about, you know, bull in this down trend for a while, you know, you could have just stepped aside. I mean, trading is a lot about patient. A lot of times, if you just trust these weekly signals that you have, you would have seen that. Would they have been telling you there's no rush to get into this. 7. Day Trading Analysis: How to Apply the 3 C'ss : just to give an example of how you could use the stacking system. If you're a day trader, you can pull up pretty much any time frame. So in this case, I pulled up just the spider E T f. I put up a five minute timeframe. Ah, and you could see on this particular day this morning to stock or the e t f the market gap down and was really trending down all day. So ah, lot of people would really kind of like there's this inclination for people for people to buy the dip, the markets down I want to buy. But, ah, if you can use my indicators used my process to just kind of at least guide you a little bit in terms of when a good entry point might be draw the trend lines be dynamic about it. Ah, but just step aside for most of the day, right? I mean, most of the morning, there was really no, uh, certainly no catalyst, right? The market really just kind of went along this downtrend line, but along the way, you could kind of see, on a five minute timeframe the Mac D was trending up. There was divergence on that front. It hadn't quite turned positive yet. But you could kind of see you. As the market was drifting down, there were signs that if it could break, it might be a good trade. Ah, it's similarly with the Di m I. Which is again what? I'd like to use divergence, right? The selling pressure was going down all day, but it never really crossed. So if you're a patient trader, what you could have done is just let you know other people try to buy the dip and just wait for the signal. Maybe it came. Maybe a wouldn't. Ah, but in this case, if you just waited long enough, uh, you ended up having everything kind of aligning, right? You had a downtrend line that you could have drawn. And then it was bouncing, bouncing, bouncing couldn't quite break it. But then it kind of did. Ah, you know, later, at this point where it broke this uptrend or downtrend line along with the Mac D not only showing divergence all day but actually turning positive and the d m I, uh, positive turning Ah, crossing over. So right here You could have just wait and said I'm gonna I'm gonna watch this. And this would be by trade. This would be my long trade. Ah, And so and it worked. Obviously it's had a nice move off of this, this catalyst, this uptrend or this break of the down trendline. And now you can watch. I mean, what you can do is if you're going to trade it if it gets back into this range. If these indicators turned back down right away, you'll notice the fake out and you can step aside. That's what I would do now if you were a for whatever reason, you have some other view that the market or this particular security would continue up. You've picked a big you picked a good entry point. The system allowed you to be patient, and you can hold it for as long as you want. 8. The Importance of Trade Management: So you've analyzed this doctor and you've decided to make a trade. Now what? Well, now comes actually, In some ways, the more important part the key to long term trading success is actually what you do after you take a position. So when you enter exit a trade you always want to understand what you're actually doing. What your mentality is. Why are you buying? Where could you be wrong? Ah and PS, you're gonna be wrong A lot. Even the best traders really only have barely better than a 50% hit rate on So how you manage that trade? Ah, and how you manage your potential losses. Eyes gonna be cute, a key to a long term trading success. So the way I think about trade management is in three different ways. One is defining your trade when you make the trade to a setting your exit. Ah, and three is knowing Went toe. Add on confirmation. The first thing you want to do is always define your trade. Really understand what trade you're making, why we're making it and your mentality behind your trade. For example, uh, is that a long term position or a short term create that will affect kind of how patient you're gonna be. Ah, when the trade doesn't access Exactly. Act like, um, you know how How you're expecting it to act right away. Ah, and also really understanding what the three C's are that made you make that position. So if we think about the example we used before with salesforce dot com Ah, and we're going to define our trade, we were said, Well, what what causes to make that trade? Waas These multiple breaks of resistance this double bottom pattern. Ah, and is the technicals turning up? And so that's kind of how why we made that trade. So just understanding that right off the bat would would kind of help us define what that trade was, why we did it and help. It's kind of pick levels where we would be exiting that trade. And that leads to the second part of trade management, which is setting your exit. And this is actually the most important part because what it really does is takes the emotion out of your trading when your trading and you're gonna be proven either right or wrong, and you can actually lose or make money. There's a lot of emotion involved, Uh, and so if you can think about your stops, in other words, your exit points when you enter your trade Ah, and set them ahead of time. Ah, and continue update those levels with set discipline levels. You can take a lot of the emotion out of your trading as the market fluctuates. So again, we talked about it a little bit before, but you want to set an exit where you're defined. Trade your catalyst. Charter confirmation is proven wrong. For example, for Catalyst. If you were buying because it was hitting some support level well, if it breaks that support level, ah, or trendline, that would prove your trade wrong. And it's something potentially where you would want to exit your trade. Similarly, if you were buying because technicals indicators were strong and turning up, if they were to turn down, that would kind of like four suit potentially exit that trade as well. Also, a lot of people just set lost limits. In other words, they'll say, Well, I don't I don't want to lose any more than 5% or 10% on a particular trade or some other level. Ah, and that just forces them to when it hits that level, just be out of it. And that's a great way to kind of set an exit to take away complete emotion out of out of your trading. So in the example, we used setting your exit when you make that trade, for example Ah, you know this break of resistance or these technicals turning up Ah, or this chart pattern If it breaks down below. For example, this double bottom pattern Ah, you know, or breaks down below this resistance level, that could be a level where, you know, even as you're entering the trade, you could say, you know what? If it breaks this level, I'm out. Or if this technical bit turns back negative or this, you know, the d m I whatever turns back negative, I'm out. And it's also important to continually update your exit as time goes on. Ah, you know some of these exits you might set right at the beginning, but hopefully you won't have to worry about them because you're trade will actually work. Ah, And as your trade works, that will give you a whole new levels to potentially update potential exits for well, once that uptrend is established, you know we have new levels. Weaken, pick. We have new uptrend lines we can draw. We have new resistance levels, weaken set. And we have technicals kind of maturing. The last part of trade management is you actually have to be willing to add on confirmation again. This kind of goes along the lines of just being dynamic and constantly monitoring your positions. But you also not only want to look for exit points, but you want to look for potentially new entry points. As your trade is confirmed, you want to be looking for potential spots. Toe add in that uptrend as a stock established an uptrend, you might test that trend line, and that would be a place where you know it might provide support if it is able to break through a potential resistance and go back and test it again, that might be a spot you want to add. Ah, and you want to be able to confirm it with chart patterns and technicals as well 9. Over My Shoulder Trade Management and Exit: I'm gonna go through two examples of trade management One where we would kind of dynamically set and exit when a trade is working. Ah, and one where a trade doesn't work. First, we have a bi set up here with Spotify ticker s p o T. Ah, and you can see kind of the classic three C's, right, So you can see where Ah, I like this as a long trade. Ah, it had was in a downtrend. It broke above this downtrend, so that would be my catalyst. We have probably have a double bottom pattern. Um, with divergence on the Mac D And now with the breakout, it confirms with the Mac D turning positive and above the signal line and the d m I turning positive as well turning green. So everything's lining up. My entry would be right on this breakout. Ah, And again, as I'm entering this trade, I would look for what my potential exit is. Ah, even as I'm making the straight. So in this case Ah, and obvious exit would be either breaking down below this resistance or this now support line. Uh, or, you know, maybe some support down here right. Ah, but more likely you'd want to give it some room, depending on your time frame. So it could be as low as this support down here. Either way, you have a set exit where if it breaks down below that, you would be out. Um, because of the volatility of the stock, I would probably set my exit. Uh, probably at, you know, just some this level right here. Right, cause they would line up with a couple important levels. Ah, and that would be probably a level word. What exit? Ah, in this case, actually, the trade worked, right? And so as it's working ah, and moving away from your stop out level, you're almost You don't even have to think about this level anymore. And you really want to kind of manage your trade actively and be dynamic about where you're going to set your exit points? Eso You know, as you get profits as the trade is working. Ah, you don't want to sell too early. You wanna let it ride to some degree a zoo, long as it's breaking above all the resistance is and doing everything it needs to do. Staying in an uptrend eso as we kind of get to this level where we are right now. Um, you know, as the stock is moving up, you'd probably I'd move my exit points to maybe ah, different levels of support either the 50 day this 108 its 200 day. Ah, you know, you know, as that keeps breaking up this level, just change your support levels of where you might exit and take profits. In this case, this is a really important level right here that it was able to break above. Ah, and if it, you know, cells breaks down below, That's where I would kind of probably watch. So this is an example of a trade that's working, and hopefully most of your trays will work. Ah, but you know, as you have profits, you want to dynamically set different levels where you might want to either take partial profits or exit your position and take full profits. Ah, and you know, it kind of constantly be thinking about part potential target levels where you might be wanting to sell. But either way, you're essentially using the three C's again, right? In other words, this time as one with a stock in an uptrend. You're looking for cells spots of looking for a cell catalyst with all the potential chart patterns or technicals confirming those as well. And here's an example of a trade that doesn't work. But again, it's this almost the same set up, right. We have a down trendline break. We have our Mac Deacon confirming or turning up or d m I potentially turning up. Ah, and we believe to be buying here. But again, we want to set ah, potential stop as were entering our trade just so that you know, if it doesn't work, well, take some emotion out of it. In this case, we're buying this uptrend line or this downtrend line break. But maybe we would set a level just similar, like how we did with with Spotify where pick an important level. Maybe this level right here this previous loaded breaks above breaks below. Here are creators, probably wrong. Ah, and in this case, you know, it had a little break, and immediately it broke back down below it released earnings and broke. So on this break right here, you know, it would be kind of an automatic cell right. We gets decided on that beforehand the trade looked like was gonna work and then it didn't . So here's where we would just kind of, like take emotion out of it. We had our level set. Step aside, we actually have ah lot of things confirming with the technicals, confirming down as well. So it's really kind of a good place to step aside and just, you know, kind of like move onto the next trade. This one didn't work. And, ah, you know, we can always buy back if if every you know the technicals kind of never been in the chart pattern, everything turns again before now we would step aside and sell. 10. The Right Trading Psychology: so understanding how my process and how I think about things and how I set up my trades is one thing. But actually trading is a completely different thing because there's so much emotion involved in trading on. When you actually have real money at stake, it becomes a whole different thing. So when you're actually trading and applying my concepts, you really want it could keep a couple things in mind. Ah, one is to just be patient. That's kind of the biggest mistake that most traders make is just trying to force traits. Don't force trades. What you want to do is just wait for to find breaks, wait for these catalysts and wait to see multiple positive setups. And for the most part, you won't see everything lining up all the time. And that's okay. Just don't force it. Let them happen. Ah, there's hundreds of stocks for you to trade. You don't have to trade everything right. Wait for the market to tell you what to dio. Ah, and when you do trade, have a defined level of where you want to exit, you know, have a defined level of of of why you're entering a trade and understanding the story behind whether it's a catalyst or a trendline, break or support break or a stock pattern understanding where that story would change. What would make you change your mind about that? That stock or that that set up? You know, you always have wanna have a reason to buy or sell, and my process helps give you that reason. It gives you a catalyst that gives you some sort of chart pattern. Uh, that that that's bullish or bearish. I mean, so often people just like, you know, arbitrarily just buy or sell just cause they they see the stocks down. They want to buy, or they see the stocks up and they feel like they're selling. But really, there's no reason to do anything, so just don't pick random spots. Let the process tell you what to do. Follow a systematic system. Ah, and and that's just a better way to trade. And remember that experience and actual trading is really the only way to get better. Ah, you can learn you know my process or anyone else's process you can learn. Um, you know, whatever since you want. Ah, but you'll really get better a trading by listening to someone talk about trading. You get better by actually doing it. Ah, and so that's scary because you're actually putting money at risk, but a tely stiff. You start with my system and my process. In my way of looking at stocks, I think you can minimize some of your risk, and at the very least, it gives you just a better process in a better system toe. Actually think methodically about a stock chart and whether you want to buy or sell. 11. Six Final Trading Tips: Let's talk about some random odds and ends and six final trading tips. Number one crate small to manage the risk. Don't be afraid to adjust your sizing as conviction and situations change. In other words, sometimes you have a situation or trade where you're not really sure of. Not everything is lining up. So instead of going full, why, why not just go small or make a smaller investment? It'll help keep your emotions in check, and it'll manager risk. Similarly, if things aren't working out instead of fully exiting a position, just you can reduce the size. That's one way to kind of manage a situation when you're wrong number to think about possible support levels when you're actually buying number one, it helps you understand what you're risking. Ah, but also it gives you kind of like a framework for thinking about your trade. Ah, I'll give you an example. In this case, if you look at this chart, let's say we were buying on this catalyst on this break of this uptrend line, right? So that's the reason you're buying. But even as you're buying, you can kind of think about ah, potential support in other words as you're buying up here, you can look at it and say, Well, if I'm wrong Ah, you know, potentially has support. Ah, at this Ah, 100 day moving average or this 200 day moving average or even this support line down here. Ah, so it kind of gives you conviction in your by right? So even if you're buying up here, you can kind of say, Well, you know, I think there's so much support below that Ah, that I think the market should hold it here. And it's it's safer by number three. Don't obsess over the right exact right support and resistance levels on, But that I mean, a lot of people will kind of, like worry about what lines their drawing right. But again, the idea is not that support and resistance lines are levels that will always be respected and are always gonna be correct. So as long as you can justify it in some way, whether it's a previous high ah, or previous low, um, e at least give you some edge over just doing something randomly, right? Therefore, not all the three C's will always be there. Right? So, um you know, we have catalysts were looking for chart patterns, were looking for confirmation from technical indicators and in most trades are gonna line up perfectly. Sometimes you may want to anticipate trades, right? You'll you'll you'll see off some of the things lining up. And maybe there's not a full chart pattern that's that's perfect. Or maybe you'll see. Um ah ah break out. But you know, the technically and technical indicators haven't fully confirmed yet, but they're close that are about to Ah, so in this case is you can anticipate ah or kind of trade with what you see. But, you know, not every trade is going to be perfect on you have to be willing to kind of like trade, you know, with some amount of risk. Ah, number five. Check all timeframes before trade. Ah, so you know, you can look at even if you're trading on a weekly chart or some sort of weekly. Ah, you know, set up that you're seeing, uh, take a minute and look at the our lease of the dailies or even the minute charts to see if there are any other patterns or setups that may be telling you something that may either influence the timing of the trade or influence, whether you want to enter the trade or not at all. And finally number six. Stay disciplined, control your emotions. Obviously, there's something I've talked about throughout the course on, and it's really the most important thing in trading controlling your psychology and controlling your emotions, especially when there's real money and real trading involved. This is where most traders go wrong. Even professionals. Ah, and it's too aspect of it. One eyes controlling your foam. Oh, your fear of missing out. Ah, lot of times you're just gonna miss trades. The set up isn't gonna be there perfectly, Um, or you're just gonna not see it. Ah, and then what you don't want to do is chase the trade. Obviously, the other thing is, don't be stubborn when you're wrong. This is also a huge problem with most traders. Ah, when they're wrong, they're going to stick with their trades because they don't want toe, um, lose money. But to be honest, it's better to lose small amounts of money, um, than potentially big amounts of money. So if you're wrong and it's breaking through levels that you had set ahead of time. Ah, as exit points stick to those exit points, Um, and that's really what my process really tries to do. Give you signals with catalysts and chart patterns, and confirmation for your buys and sells on gives you levels to kind of look at when you're when you're trading. So if you can stick to some sort of process, some sort of system that helps you control your emotions, that's a huge advantage you'll have over the long term. 12. Bonus: The Next Level: by now, you should have a really good understanding of stock charts and technical analysis and, more specifically, the simple basic tools and process that I use. So now what's next? First step, Go to my website market mind trading dot com. You'll find links to resource is in my courses and you'll be able to join my free email list. It's free money making content from an experienced trader delivered right to your inbox. I'm gonna regularly send charts that I'm seeing that I think are interesting market insights and trading tips. My charts are gonna follow my basic stacking system process so you'll be able to follow and get investing ideas. You can understand, uh, and hopefully make money from. And as you look at these charts, you'll be able to get that much more experience analysing stock charts with me, giving my own insight along the way. Also, you'll get discounts on future courses and services I might be offering. Also, you can follow me on Twitter. There I'm a little more active I post daily charts and tips and real time trades that actually do on real time market insights. Just follow me a twitter at market mind. Three. And finally look for future courses that I may be offering either here or through my website. Um, I'm gonna try to be covering advanced training strategies, deep industry dives covering specific industries like crypto or cannabis or tech or other kind of like high growth, you know, kind of long term investment opportunities. A swell as maybe courses designed around kind of like hedge fund strategies and hedge funds . Secrets that I've learned over the years, joined by again joined my mailing list on my website for updates on these courses as they're coming on a swell as discounts on them wherever they're offered. One of things as you begin trading Ah, you'll find, is that you'll want more information. You'll get it from news. You'll get it from Twitter. You'll get it from blog's or online. Ah, but there's a lot of information out there, so you want to filter out the noise. You know all those talking heads on CNBC and Internet business sites and blog's and trading blog's and financial twitter. Ah, they may seem like investing wizards, and a lot of times they'll get calls, right. Um, but, you know, information overload can actually hurt you. We always want to let the market tell us what it's going to dio not random, so called experts. Well, whether you're a beginner or an experienced trader, the best thing you can do is actually go out practice and actually trade. Nothing beats the experience of watching the market. Ah, and actually doing real trades. Ah, watching the market in action, being right, being wrong, controlling your emotions and putting real money at stake. Ah, so that's irreplaceable. And as I said before, the best traders in the world, the ones that make money aren't necessarily using fancy techniques. It's just that they have experience Now, if you're really new and just starting out, you can start it with paper trading, which is basically just monitoring stock charts, keeping track and not putting actual money toe work. There's actually, uh, APS that you can use where you can just, ah, put kind of like hypothetical trades on. You can do it that way, or you just kind of like keep track of it by hand. It's a good way to kind of like monitor your process and your own mentality on and get some practice without actually risking money. So good luck with your trading. I'll be trading right along with you. Follow me at market mind trading dot com or on Twitter at Market Mine. Three. Good luck.