Day Trading For Beginners

1. Intro: Hello everyone. My name is Zach Hartley and welcome to my day trading for beginners course. In this course, I'm going to provide you with a step-by-step guide to get you started day trading responsibly and profitably. This course is going to be made up of five to ten minute videos. They cover one topic per video so that they are simple, easy to understand, and you can apply that topic to your day trading or your strategy right away. I'm also going to incorporate real life examples from my trading history and my training experience so that you can easily understand and apply all of the concepts that we're going to talk about at the end of the course. I'm also going to have a couple of videos of live trading sessions so that you can see exactly how I personally apply all of the lessons from this course to my actual day trading. And you can see the results a little bit about me. I am 28 years old. I live in Calgary, Alberta and I've been trading since 2016. I also make content on YouTube and TikTok also have several other courses here on this platform. And I am an angel investor for private equity, meaning that I will invest into private technology companies to help them grow and scale. How did I learn to trade? Well, that's a great question. Thank you for asking. I actually took a course in university called Intro to the stock market in my fourth year at Mount Royal University here in Calgary. That was the little piece of bait that I needed to get hooked on the stock market. And ever since then, I've been trading and investing my own money. In the last two years, I've spent over $8 thousand buying day trading and investing courses from influencers on YouTube. I have made review videos, reviewing and taking all of those courses. So if you want to see any of that content, you can definitely go check it out on my YouTube channel. But the goal here was to take in as much knowledge as I possibly could distill and test out all of the best strategies. And then my goal with this is to bring it to you in an easy to consume package that you can take and apply to improve your own trading and become more profitable. My overarching goal with this course is to share everything I know about day trading with you through simple five to ten minute videos. I've broken this course into individual videos that only cover one topic each so that you can easily understand the topic, apply it to your trading and hopefully improve with every single video that you watch. That is my goal. And I have tried to distill all of the best strategies and information that I've gathered over the last, basically seven years. Now, a couple of things to know about the course. Number one is there's no experience required. I'm going to walk you through the basics. I'm going to go step-by-step. If you already know the basics, you can just skip to the next video. That's why I have divided it into so many videos. Simple, one topic videos that are easy to consume. There's also going to be a resource package that is gonna give you all the links and everything you need to get started and a project for this course that we will be talking about in the next video. If you get any value for this course, if you have ideas for improving this course or if you like the course, please consider leaving a review. I read and try to respond to every single review. And I sincerely appreciate the feedback as I tried to improve this course over time. If you have suggestions for how we can improve or topics that you'd like to see added to the course. Please leave a review or comment and I will make that content and added in to provide more value. That is, my goal is to provide as much value as I possibly can and get you guys started on the right foot. If you're interested in seeing any more content from me, there are five courses on Skillshare right now with more coming, I have a channel on YouTube, a page on TikTok also run a discord chat where I post all my trades, all of my analysis. You can get a more up-to-date sense of what I'm doing and what I'm investing in. I also have a website and you can book a phone call with me. If you need anything from me at all, you can get a hold of me. It should be very easy and I look forward to your feedback. Thank you so much for clicking that button. I hope to provide you as much value as possible throughout this course and look forward to seeing you in the next videos, talk to you soon. 2. Course Project: Alright everybody, thank you for making it through that first intro video. Before we get into the actual day training content though, I just want to talk real quickly about our course project. The course project is a very simple one-page PDF with a variety of different questions on it that is designed to help you build your trading plan. The answers to all the questions are going to be contained in this course. So what I would recommend is print off this page and start answering the questions with a pen or pencil as you go through the course content. By the end of this page and by the time you've answered all of these questions, you will have thought about every different aspect of your trading plan, whether it's risk management or how to manage the trade once you're in it. The idea here is that by answering these questions, you will build your own trading plan so that by the end of the course, when you're ready to start trading with real money, you can enter the market. You can evaluate opportunities to see if they fit within your training plan. And if they don't, you reject them. If they do, you execute on them to become a profitable trader. And then you can evaluate the performance of this plan and improve it over time. The idea here is that you have everything ready to go by the time you've finished this course, you can find this PDF under the projects and resources tab of this course. And if you consider submitting a photo of your finished first draft, I would sincerely appreciate it now without any further ado, let's start day trading. 3. What is a Stock?: All right, everybody, Welcome to lesson one. In this video, we're going to keep things very simple and we're just going to talk about what is the stock and what is market cap. Those are the only two topics we're gonna cover just so we can ease into things. So without any further ado, let's dive right in. So what is a stock? Or a stock represents ownership in a company. And the term stock is actually pretty interchangeable with the term shares or equity. All three of those words pretty much represent the exact same thing. And all of those shares or stocks can be either paper or digital. Now as day traders, we're only going to be dealing with digital shares because it's just much easier to transact. And most of the time these companies don't actually have paper shares that you can buy and sell. Everything these days is done on computers and it is done online. Now, why do people own stocks? Why do people day trade? Why do people get into this? Well, there's only two reasons. Number one is because stocks entitled people to the profit that the business generates. Now for us as day traders, we're not going to be holding these stocks for very long. So we're not gonna get any access to the profits that these companies generate. However, because these companies trade on public exchanges, they can be bought and sold at different prices to earn a profit. And that is what we're focused on as day traders. Now, what is the market cap? Market cap actually stands for market capitalisation, and it is the price of each stock multiplied by the number of stock that the company has. Basically, what we're trying to do is figure out if we wanted to buy this entire company, how much would we have to pay for it today if we wanted to buy all the shares at today's price, this is how much it would cost us. And we do this because it gives us an idea of what that company is completely valued at. What is the total price? What is the total value of that company? And we can compare variety of different companies to see which companies bigger, which company is more valuable, and which company is growing faster. Now, to calculate the market cap of accompany, all we're gonna do is we're going to take the price per share in this example, it's $5 and we're gonna multiply it by the number of shares that the company has. That definition or that term is called the shares outstanding. And in this example, it is 100 shares. So if we multiply 100 by five, that gives us a market cap of $500. This is usually how we identify the size of the company. We do not use the share price to identify the size of the company or the value of the company, or how good or bad that company as the share price actually doesn't have that large of an impact on it because this is super, super important here, a company can issue as many shares as they want. So if you go down the street and you start your own corporation, you can choose if you want one share, a million shares, or a billion shares. And when it comes to the companies that we're gonna be looking at, It's pretty much the same thing. They have a lot of control with regards to how many shares are out there in the world, which is referred to as shares outstanding, like I just mentioned to you, companies can control that number. And if they can control that number, they can also control the price of those shares relative to the number of shares outstanding. And so it's really, really important that you don't use the price per share as a metric of how valuable a company is. You have to use market cap as a metric of how valuable that entire company is. Now, just to give you an example of this, we have two companies here. We have company a and company B. Their price per share are very, very different. Company a is currently priced at $27 per share and company B is only a $1.79. However, the shares outstanding a company a, they only have 1207 shares outstanding. Company B has 18,500 shares outstanding. Now at first glance here, if you didn't already see this market cap number, it would be extremely difficult to try and figure out which one of these companies was worth more on a market cap basis without using a calculator. Like you couldn't just look at this and say, the $27 company is worth more. Because in reality here, when you multiply 27, 1207 shares outstanding comes out to $32,589. When we look at company B here, their share price is only a $1.79, but they have way more shares outstanding. That gives them a market cap of $33,115, which is bigger than company. A company with a much smaller share price can actually be worth a whole lot more than a company with a larger share price now just has a real life example of this. Here are two different stocks. On the left we have Berkshire Hathaway. This is Warren Buffett's company. And on the right we have Apple Incorporated, the company that makes the iPhone. And as you can see, Apple's currently trading at $166 while Berkshire Hathaway training at $443,450. So the price of Berkshire Hathaway shares is just exorbitantly high while Apple is trading at a $166. However, when you look at their market cap, you can see that berkshire Hathaway is only worth $650 billion, while Apple is worth $2.6 trillion. So Apple is worth like four or five times as much as Berkshire Hathaway, Even though their shares are only worth a fraction of Berkshire Hathaway. So again, the point I'm trying to get across to you here is you cannot compare companies based on the share price. You have to compare them based on the market cap. Apple is a much, much larger and much, much more valuable company than Berkshire Hathaway, Even though the share price is lower. And so in summary for this video, stocks represent ownership and accompany and we can buy or sell the stocks of public companies that are traded on exchanges to compare companies and figure out which one is larger or more valuable. We're going to use market cap. We're not going to use the share price. We're going to use the market cap because it takes into account the number of shares that gives us the total price if we basically wanted to buy that company today. So that is it for less than one. I hope you got some value out of it. Let's move on to less than two. I will see you guys there. 4. Stock Exchanges: All right, everybody, welcome to lesson two. In this video, we're gonna talk about stock exchanges, how they work, how you can interact with them, and how we got to where we are today. Let's dive right in. Okay, so first of all, what is a stock exchange? Well, Stock Exchange is a location that allows companies to list their shares and be bought or sold by a variety of different people. For us, we are traders and so we're going to access the exchange by using a broker. For us that's basically just going to be a software that we're going to use to buy and sell the shares. And in reality, what's happening here is we're the trader that is using a brokerage in order to access and exchange, to buy and sell those shares were using the broker as an intermediary to get access to that exchange where those shares are being bought and sold. And it's really a cool system. It's quite efficient and it works really well. And the way that we got to where we're at today is also a unique story, and that is the history of the stock market. The stock market started a hundreds of years ago in Amsterdam. Amsterdam was pretty much the center of the world, especially when it came to trade and commerce. There were a lot of people in Amsterdam that ran businesses. They would import goods from all over the world and they would sell them in Amsterdam to other people that were traveling from all over the world. And these people were merchants. And these merchants had to receive their goods from different places around the world. And in order to do that, they would send out ships. The ships would have people on them. They would go out to a certain area. They would find resources or ****** or whatever it might be, and they would bring them back to Amsterdam. Now the problem here is that back in the day when a ship left the port, there was a twenty-five percent chance that it didn't come back. There's a chance that it got looted by pirates or it's sank in rough weathers, or the sailors just didn't make it and they died on the voyage, or maybe they just didn't want to return. So there's a variety of reasons why those ships didn't come back. And if you're a small merchant, that it just saved up all of your money to afford one shifts worth of goods to go out and come back so that you can sell and run your business. That was a huge risk. And if the shifting come back, you might be out of business. And so what they did was instead of everybody sending out their own ships, they decided, let's pull together our money and let's get four or five shifts and all go out at the same time so that if one doesn't come back, we can all share what's left. And they did that by dividing up the rights and the bounty and the profits from these ships using shares. And that is where the idea of stock and shares and equity first started was to solve the problem of what happens if these ships don't come back. Now, over the course of years, a lot of people start to realize that this was a really good system. It kinda spread out the risk and it made everybody a little bit more profitable. And so this idea and this system kind of started to begin to infiltrate different areas of the economy. And eventually it pretty much took over to the point that people started to own shares, the right to profit in a variety of different companies. And eventually it got so big that people started to meet at a coffee house. And the main place where they started to meet was actually in London, at a small little coffee house where investors and traders and businesspeople would meet to buy and sell different shares. And that coffee house actually became the first ever Stock Exchange. And they grew so large that that system ended up beginning to travel around the world to the point where we now have the New York Stock Exchange, the Toronto Stock Exchange, the Shanghai Stock Exchange, and a variety of other ones. And it all blossomed from the shifts in the Netherlands at a couple of traders at a coffee house in London. Now we have the global financial system. So it's a really exciting story that I personally and just fascinated by Anna, actually driven or walked by where this all started in Amsterdam, which was really cool. I did a walking tour there in 2016. And it was just so unique to see that that was kind of where everything started. Now, when it comes to exchanges, there's a couple of different types of exchanges and there's different categories and levels to exchanges. Now what I mean by that is we have big exchanges like the New York Stock Exchange and the Nasdaq and the Toronto Stock Exchange, and even the Shanghai Stock Exchange in the London Stock Exchange all over the world. And there's kind of like that top tier of exchanges, usually one in every major country. And then after that you also have some smaller exchanges. We have the neo exchange, the OTC exchange, and there's a bunch of them all over the world. Now, the reason that these ones are smaller is because they usually take in smaller companies with lower market caps and they have lower reporting requirements in order to list your shares on the exchange. So for instance, if you start a company and you want to go public and you want to list on the New York Stock Exchange, there's a very large threshold of things that you have to be able to do and meet and reporting requirements. In order to list your shares on those exchanges. And I'm talking about the tens of millions of dollars worth of expenses. They get it done. Now when it comes to the smaller exchanges, those reporting requirements are much, much lower. And so it allows smaller companies to list their shares publicly and raise money without having to meet all of the major requirements. The problem here is that you get a lot of smaller companies that are much, much higher risk. You've got a couple of companies that aren't real companies and are there to just steal money. So that happens every once in awhile. And realistically, most of the companies on these smaller exchanges will be much more volatile than some of the larger exchanges, and they also won't have as much liquidity. Liquidity, what I mean by that is the number of people that are buying and selling the shares will be lower than on the larger exchanges. And that can make it more difficult for you to actually execute your orders at the price that you want to get in and out of. Now I'm going to dive into that in a whole lot more detail later in the course. But I just want to make this big difference here is that these smaller exchanges can be good. This is where you're going to find a lot of the penny stocks, but they can also be extremely high-risk. For me personally, I focus mostly on the larger exchanges, primarily because they still have good volatility. So I can make my trades in and out of them very easily, but they also have great liquidity. So getting in and out at the levels that I want much, much easier on the larger exchanges. So this is where we're going to spend most of our time in this course. Now, why does it matter? Why does it, why is there a difference between these large and small exchanges? Well, one of the reasons is that large money managers, So the people that run pensions and retirement funds and large pools of money, they're not allowed to buy shares income these that are listed on small exchanges because of the risks that I just listed for you, they're not allowed to invest big pools of money into these tiny companies that are very high risk. And so it kind of eliminates a whole section of the investing community that just aren't allowed to trade them. And the larger exchanges usually have better liquidity. If you're trying to invest a $100 million, obviously, you can invest that into a $50 million company that's listed on one of the smaller exchanges, You need to go invest that kind of money into billion-dollar companies that are usually going to be listed on the larger exchanges. And so there's a couple of different factors that go into it they need to be aware of now, when it comes to trading hours, when can you actually trade and invest your money and for us day trade? Well, here's what you need to know for us. And in this course I'm mostly going to focus on the North American markets. If you're watching this course from another area of the world, outside of North America, everything is the exact same. You just need to understand the different timings, the rules, all of the applications of everything I'm going to talk about in this course is the exact same strategy. You just kinda need to change the timeframe and some of the names, but everything else is going to be the exact same for this course though, I'm going to focus on the North American markets because that's where I trade. And in the North American markets, all of the exchanges are in New York or in Toronto. And so we're always going to be using Eastern Standard Time. So if you hear me refer to a time during a trading period, usually going to be an Eastern Standard Time. I currently live in Calgary, Alberta. I'm in Mountain Standard Time, something I have to adjust for. Trading hours though regular trading hours are going to be from 09:30 AM to 04:00 PM Eastern time. This is where the bulk and probably 95% of trading happens. This is where we're going to focus on and this is what we really want to be prepared for here. However, you can trade before 930 a M that is called the pre-market session. It goes from four AM to 930 AM. You can also trade after 4PM, that is called the after our session and that goes from 04:00 PM to 08:00 PM. So you do have some control. There are a variety of different options. However, the bulk of the trading happens right here during the regular hours. Now the reality for day traders is that almost all of your action, almost all of your traits are going to happen in the first three hours of the day. Most trading activity, most of the volatility, most of the big moves that we're going to see, day trading are going to happen in the first three hours of the day. So you need to be ready to go. By the time the market opens. You need to have already done your research. You need to be ready to sit down for a couple of hours and execute your strategy that we're gonna go through in this course. Now, just to reiterate this, the mornings are the most important for a day Treta, you need to be well-prepared and needs to be well-rested. A need to take this seriously if you're not a morning person, you need to change your routine. You need to become a morning person and you need to get better at this. I need to go to bed earlier more than likely. Also the evenings, the after our sessions. That's usually when we get a lot of earnings reports. And so what will happen is a company will finish the trading day at four PM, release their financials usually around for 15 or 430, and then you'll be able to trade and invest or sell or buy whatever you want to do based on those earnings in the aftermarket session, it's a little bit more difficult to do because there's a whole lot analysts and there's also a whole lot of computers that you would be competing with. Not necessarily going to focus on that strategy, but earnings usually come out in the evenings. So that's why I usually say evenings or for earnings. Now, in summary, notice was a bit longer video, but here we go. There are a variety of stock exchanges around the world that you can trade on. You can trade pretty much anywhere around the world. They all have different trading hours, so you need to be well aware of that. In this course, we're going to focus on the North American exchanges, are mostly going to focus on the large exchanges and usually the kind of medium to large market cap stocks. Now the mornings or when everything happens in the stock market. So if you already know that this is going to be a problem for you, start to slowly change your routine, start to get up half an hour earlier, maybe go for a walk in the mornings, maybe read a book. Just slowly start to change up your routine just slightly so that you can start to get up a little bit earlier and be ready to go when the market opens, because I promise you, it will help in the long term. So that's it for this video. I will see you guys in the next one and we'll talk to you soon. 5. How Exchanges Work: All right, everybody, welcome to lesson three. In this video, I'm going to walk you through how these exchanges work and how the price of a stock changes over time. Here's everything you need to know. Let's go. Okay, So starting us off here, how do exchanges work? Well, exchanges are very simple. All they do is accept orders from buyers and sellers. So the exchange exists, it has certain stocks that are listed on that exchange. And all it does is accept orders from the buyers and the sellers. And then what happens is when a buyer places an order at a price that the seller is willing to accept, a trade takes place now this could be vice versa, buyers or sellers. But basically what's happening here is the exchange is bringing in these orders. And as soon as a buyer and seller agree upon a price, a trade executes. Now, just to give you a visual representation of it, Let's say that this right here is the exchange were accepting by orders in the middle column, we're accepting sell orders on the right column. And here's the current price on the left-hand side. As you can see, we have buy orders all the way up to 105, and we have sell orders all the way down to 106. So it's very likely that the last transaction happened at, let's just call it 1.505. And now it'd be the current market price for this security. Now, if somebody wanted to come in here and just buy shares right away without placing any type of special order. They just wanted to buy shares right now. They would have to go in and buy shares from the person that is willing to sell them at the lowest price. And as of right now, it is at $106. This person is willing to sell 60 shares. The next person is willing to sell 50 shares out $107. So if the person that wants to come in and buy right now only wants to buy up to 60 shares, then they can buy all 60 shares at 106, and that would be the new market price. However, if the person wanted to buy, let's just call it 100 shares of Company X, Y, Z. They would buy all of the shares at 106, and then they would have to go up to 107 and they would have to buy 40 shares from this person. All of a sudden, that is the last transaction that happened for this security. And now the price has moved up from $105.50 all the way up to $107 because there's now no shares that are left to be sold at 106 since this order just captured all of those shares. Now, this also works the exact same way if somebody came in and they wanted to sell 100 shares of Company X, Y Zed, they would have to sell those shares to the person willing to buy 20 of them at 105, they would then have to sell 30 shares to the person willing to buy at 104. Then have to sell their last 50 shares to the person that is willing to buy out 103, and the current market price would then drop all the way down to $103. That'd be the last transacted price for this security. And that would bring the price from $105.50 all the way down to $103. And that is what moves the price of shares in the stock market. Now, just to give you an idea of what this looks like in real life, Here's just a screenshot from my dashboard. I'm going to walk you through every single detail of this screenshot here in, throughout the course. But as of right now, I just want to focus on this colored section right here and let you know that we are looking at Apple stock. As you can see right now, on the left-hand side, this is the bid section, and we have bids to buy the stock at $165.2421, at $164.49, at $162. This is where all of the bids are and this is what it looks like in real life. On the right-hand side here, we have the ask, this is all of the people that are willing to sell their shares. And the lowest cell right now is $165.34. You can see that the ask is higher than the bid. And the last price right here is right in the middle at a $165.27. This is what it looks like in real life. For an example, on Apple shares, you've got the bid on one side, you've got the ask on the right side, you've got the last transacted price. And if you wanted to go into the market and buy right now, you would be paying a $165.34. But if you want to sell, you would only get $165.24. So at $0.10 difference there, and that difference is what we refer to as the spread. Now, the big thing that I'm trying to get across to you here is what moves the stock price. And the answer to that is supply and demand. If more people want to buy those shares, they're going to be placing more orders to buy. And that is going to drive the price up because they're going to have to buy at higher and higher prices. The price of the share is determined by the last transaction that was executed. If the last transaction keeps going higher and higher, that is what moves the shares higher. That's what moves the price higher. However, if nobody wants to buy and everybody wants to sell, they're going to have to sell at lower and lower prices. And that's what moves the price down. So the price of a stock is completely dependent on supply and demand. Now, just to reiterate here, when it comes to supply and demand, if demand increases and supply either decreases or remains the same, the price will go up because the demand from these people will force them to pay higher and higher prices. However, if demand falls and supply remains the same or increases, prices will fall. Demand is usually what we're watching for in the stock market, the supply of shares, yes, it can be controlled by the company, but it usually doesn't fluctuate by much over short periods of time, especially day-to-day. So supply as a day trader is never going to be. What we're focusing on. We're always focusing on demand. Is demand increasing or decreasing? And if you can just figure that out, That's half the battle. Now, what causes supply and demand forces to change? Like I said, in the stock market, we're usually focused on demand. So what are the main factors that we're looking at? Well, for instance, news, if a company has really, really bad news, for instance, there a biotech company and their clinical trials just completely failed. That'd be terrible news that is going to reduce the demand for this stock, which means people are going to sell and it's going to drive the price down. You could also have industry trends. We're an industry is growing or there's a new booming market that could drive prices higher because of increased demand. And people wanting to buy those shares. If lots of people want to buy the shares and there's not many people willing to sell, you're going to have to pay higher and higher and higher prices in order to convince those people to sell. And that's what drives the price up. You also have politics that can change it. Recently we've seen that hype from celebrities and influencers can really have a significant impact on the markets and innovation. New technologies can really start to change things and disrupt them and create new industries that can increase demand. Now, in summary, Here's what I'm trying to say. Exchanges capture orders and when buyers and sellers match up and prices align, That's when trades execute. Prices change based on the orders. And orders are a result of supply and demand for a stock. Usually, especially for day traders, we are only focused on demand. We're trying to understand if demand is increasing or decreasing because on a day-to-day basis, the supply is almost always going to remain the same. And so this is what I'm trying to get across to you here, is how exchanges work and how in supply and demand impacts the price. Throughout this course, we're going to dive deep into this concept. I'm going to walk you through everything you need to know about how to place these orders, how to understand these charts, and basically get you started in day trading. So let's dive in and stay with me here as we move on to lesson four. 6. Market Participants: All right, everybody, Welcome to lesson four. In this video, we're going to talk about the market participants and who you're going to be trading again. So just to get us started here, there are three different market participants. The first one is retail investors, institutional investors and market makers. Retail investors are people like you and me. We are individual investors that are investing our own money using off-the-shelf tools, using basically our own brainpower. And it doesn't matter if you have $5 million or $10 million. If you're doing it yourself, you are an individual investor, you are a retail investor in a retail trader. Now traditionally, we used to make up about 10% of the market volume. In recent years. That has grown to somewhere between 10, 30% of market volume depending on the day in the market conditions. The reason it's going up so fast right now is because of the rise of commission free trading apps in Canada where I live, we have well simple and flamingo and the United States they have Robin Hood and Weibull. And around the world, there's a variety of different mobile applications so you can buy and sell stocks completely free width, which has lowered the barrier, is increased the number of retail investors that are entering the market over time, this number is probably going to continue to increase as well. So it's something to be aware of now, the second type here is institutional investors. This is organizations and companies that invest other people's money. Think of hedge funds, pension funds, mutual funds, and banks, all of these different types of organizations take in money from other people, pull it together and then go and invest it. Usually it's much larger amounts than retail investors. And usually it's done for the long term. And usually they have done an extremely large amount of research because they have access to analysts and manpower and better technology and softwares. And so this group of investors actually makes up about 70% of the market volume, again, depending on the day and the conditions and things like that. But they're usually investing for the medium to long-term hedge funds are probably going to be the shortest investors here. But pension funds, mutual funds, and banks will all be investing for the long term. Now, the third participant in the market here is what's known as a market maker. These are organizations that provide liquidity so that we can buy or sell without needing somebody on the other side of the transaction. So remember when I explained how exchanges work, when a bid and an ask match up, that's when a transaction happens, but there has to be somebody on either side of it. Well, when there's not somebody on the other side of it and you still want to sell your shares at a reasonable price. That's where market-makers come in. And their job is to basically provide additional liquidity and additional options for you to buy or sell your shares. Now they do this by offering a bid and ask price. So we can pretty much always trade. They make money not by holding the stock or by buying and selling the stock, but they make money on the transaction. So if you look and you remember our exchange diagram, the bid and the ask are always gonna be slightly different and then when they match up that transaction happens. But that difference is known as the spread. And market-makers make money by taking the same share and selling it at different prices to make that spread on every transaction. That's what they're trying to do. They're not trying to hold long term. They're trying to provide liquidity in the market and make a tiny little bit of profit for their bottom line, they're not trying to hold long term. Now, the big problem that a lot people have with market-makers has come from this term right here, known as payment for order flow. Robin Hood is one of the larger trading apps in the United States and they actually make money from payment for order flow. So when I put an order into Robinhood, they're actually selling that order to market makers. They might charge me ¢0.5 or an extra scent more for that trade. And that's how Robin Hood is making money. The market makers are making money on the spread and they're given Robin Hood, a little bit of a kickback. That's how Robin Hood offers commission free training. Definitely something to know because if you're using a broker or a platform that has payment for order flow, you might not get the best executions. Market-makers are also known for spoofing. That is, when they place fake orders in their broker that they don't plan to fill. And it makes it look like somebody is going to sell a ton of shares at this price, or they want to buy a ton of shares at this price. And then when the price starts to get up to that level, those orders disappear. It basically influences the stock price and it makes other people think that there are certain levels of support and resistance. We're going to dive more into that in a little bit. And they can also buy or sell to close stop losses or fake out traders. Obviously, if they are buying and selling in these transactions, they are going to have a good cash balance and a decent number of shares that they're just holding to facilitate those transactions. And if they see a large amount of stop losses or buy orders, they can actually manipulate the market to take up those stop losses or fill those by orders prematurely. And so they have a fairly large amount of control over the market. And it's something that you need to be aware of and it's something that we're gonna talk about throughout this course with regards to how to combat some of these problems. Now, if you want to tell how much of the shares of a company or owned by institutional versus retail investors. It's really easy. Yahoo Finance and then you click on Statistics. It's going to bring you to this little page here. And I've taken a screenshot of Apple where you can see that the percentage of shares held by institutions is 60.07%. So almost two-thirds of this company has held by institutions that have done a ton of research that have sent their analysts that have followed the stock and that believe in this company, that means it's probably a pretty safe company. However, if we look at GameStop, we can see that only 28% of the shares are held by institutions, a much smaller percentage. So the institutions have less faith in this company and retail investors are probably holding the majority of the shares, which means we're probably going to see more volatility. Retail investors trade on hype, they trade on news, they trade on emotions, and they trade on trends. They don't often trade on profit. They don't often trade on fundamentals of the business and they don't often trade for a long-term. And so when we see high retail ownership like we see in GameStop, that usually means that we're going to see more volatility. By volatility, I just means more rapid price movements up and down. It's probably going to move by five or ten or 15% per day. Whereas Apple is probably only going to move by one or two or 3% per day. So in summary, here, there are three main market participants. You've got retail investors, institutional investors, and market makers. If a stock has a high retail presence or it's a meme stock like GameStop or AMC. It means that those stocks are probably going to have a little bit higher volatility, meaning that they're going to move more rapidly than a stock like Apple or a stock like Procter and Gamble or like Johnson and Johnson, those stocks that a little bit safer and of high institutional ownership. And lastly, this is who we are gonna be training against. This is who is in the marketplace, and this is who we're trying to make a profit with or against. And so it's really important that you know this, it's important that you understand it, and it just helps you get an idea of the dynamics of the marketplace. So I just really wanted to share it with you. Now let's start moving on to lesson five. 7. Short Selling: All right, everybody, welcome to lesson five. In this video, you're going to talk about how you can make money when prices go down. Now, when it comes to day trading, there are two different ways to make money and profit. You're probably familiar with strategy number one here that is buying low and selling high. But strategy number two here is what we call shorting. This is basically where you're buying high and selling low. And I'm going to explain how that works. But first, just a little bit of terminology here. You may have heard these terms before. Somebody that has a long position or somebody that has a short position. If somebody has a long position, that means that they are currently holding the shares and they want the price to go up because they're gonna make money. If somebody says that they have a short position, that means that they are currently shorting the stock and they want the price to go down so that they can make money. That's what we're going to focus on in this video here is shortening and creating short positions and how that works. Okay, so here's a step-by-step process of what it looks like to short a stock. The first thing that we're gonna do is we're going to borrow the shares from our broker. So let's say that we want to short Apple stock. We want a short ten shares of it. So what we're gonna do first thing is we're going to borrow shares from a broker. We now own those shares and we owe our broker ten shares of Apple. The second thing that we're gonna do is we're going to sell those shares in the market and we're going to collect cash. So he borrowed them from the broker. We're gonna go into the market and we're going to sell those shares, and we're going to receive cash for those shares. Now we have a pile of cash and we owe our broker ten shares of Apple. Now the third step here is to wait for prices to fall. You have some idea in your head that the price is gonna go down over time. And so you're going to wait for that to happen. That is step number three. Step number four is to then go back into the market with that pile of cash that we have and we're going to buy those shares at the new lower market price. What's nice here is that we're not going to need to use our entire pile of cash because we actually sold them up here and we're going to buy them down here. So we're gonna take a little bit of our money, probably most of our money. And we're gonna go in and we're going to buy those shares back. And now we have a little bit of money leftover. We have ten shares of Apple stock, and we're going to return those shares to our broker, that is step number five here. And as you can see, we are leftover with a small little pile of money right here, and that is our profit on the trade. So basically what's happening here, we're borrowing shares from the broker. We're selling those shares in the market. We're waiting for the price to fall. We are buying those shares back. We're returning those shares to the broker and we're keeping that difference here as our profit. That is how shorting works, and that's how you can make money when prices go down. Now, let's walk through some examples here. Let's say we're looking at Apple stock again, this is the ticker. That ticker is a four digit code that represents a stalk and apples scenario. It is AAPL. If you looked at microsoft, is MSFT, if you look at Amazon, it is AMZN. This is the code that we use to identify the stock when we're putting it into our broker in our computer. I'll walk you through all of that shortly here. But let's say in this example, we're looking at Apple. The stock is currently trading at $100. That's the situation that we are walking into. For us. We're going to short five shares of Apple. So that means that we're going to go to our broker and borrow five shares. We're going to sell them in the market and we're gonna collect $500 in this example, step number three here is apple falls down to $75, so it's going to plan, the price is coming down, which is good for us, and we're still holding on to our pile of cash. Then when the price hits seventy-five dollars, we're gonna go into the market and we're going to buy five shares of Apple back at $75 per share. We're going to return those shares to our broker that we borrowed them from. So we're taking our $500 here. We spent a $100 per share on, we're going into the market at $75 per share to buy them, we have a little bit of cash left over. And once we buy those shares, we're going to return them to our broker and we're left over with twenty-five dollars in profit per share, or a twenty-five percent ROI, which is extremely nice. This is exactly how shorting works, and this is basically what we're looking to do and how we're going to make money if prices go down. Now, let's say that the price actually goes up. So this scenario, it starts off the exact same. Apple's trading at $100. We short five shares of Apple and they were holding a pile of cash and we owe our broker five shares. However, apple, instead of falling down, it has now increased to a $150. Now, here's the thing was shorting. You owe your broker five shares of Apple and they're not going to accept anything other than five shares of Apple. You can't give them cash, you can't give them money, you can't give them other shares. They have to receive five shares of Apple back. And so that forces you to now go into the market and buy five shares of Apple back at a $150 per share and return those shares to your broker. Now, you've just lost $50 per share because you sold them at 100 and you bought them 150. You've just lost $250 on your trade and it wasn't a very good result. So as you can see, there are some risks when it comes to shorting stocks. The big risk here is that if the price goes up, you will be forced to buy at the higher price. And unfortunately, it doesn't matter what that price goes up too. So if it goes to a million dollars, you're going to be forced to buy in at a million dollars. And that's why some people say that shorting stocks specifically has unlimited risk. However, in reality, your broker has safeguards that are in place there to prevent you from owing more money than, for instance, what is in your account, what you set as your parameters. We're going to talk about that more as we choose a broker here, but these are the risks. And as day traders, we're going to manage these risks and combat these risks by not holding short positions, overnight, companies release their earnings after hours. That is usually a huge catalyst for major price changes in a stock. So as long as we're not holding these securities overnight, we're probably not going to see any major price changes that could really hurt us if we were shorting a stock. So that is what we are focused on. That is how we are going to manage our risk when it comes to shorting. In summary, what I'm trying to get across from you here is that it doesn't matter if the stock is going up or down as day traders, we honestly don't care because we have strategies to make money if the stock goes up and we have strategies to make money if the stock goes down, well, we're trying to do as day traders is to identify what direction the stock is trading in and buy into that trend and then sell out of it when that trend changes or when the direction changes. That's in simple terms what we're trying to do as day traders. It honestly is no more complicated than that because we have strategies to make money when the stock goes up and when the stock goes down and to mitigate our risk, we're not going to hold short positions overnight. Now this sounds a little bit complicated and we haven't even started trading any stocks yet. But I want to do this lesson at the beginning of the course because it's really important for putting you in the right mindset that we can make money in any direction, in almost any condition. And it really comes down to our own strategy and discipline because there are so many ways to make money in the stock market. There's also a lot of ways to lose money. And what it really comes down to is understanding how the market works, which is what we're working on right now. And then building a strategy that fits your lifestyle and your trading style and your personal preferences. And that's what we're gonna be working on later. So stay with me as we move on to the next lesson and I'll see you soon. 8. Index and ETF's: All right, everybody, Welcome to lesson six. In this video, we're going to talk about what is an index, what is an ETF, and how can you use them in your trading? Let's dive right in. Alright, so to start us off here in index is very simple. It is a theoretical group of companies that is measured in points. You've probably heard of the nasdaq, the S&P 500, or the Dow Jones at some point throughout your life. And those are all examples of an index. An index is a radical group of companies and the reason that we measure it in points so that we can compare the performance of that index over long periods of time, because it's a group of companies. If one company goes bankrupt or one company gets acquired, it can be very difficult to adjust for that. And so by measuring endpoints, we make sure that we're comparing the same thing over a long period of time. And we can measure the performance year over year. Unfortunately, though, because it's measured in points, you can't actually buy an index. You can't buy the nasdaq. You cannot buy the S&P 500 and you cannot buy the Dow Jones. But you can buy a security that gives you the exact same result, the same performance, and it's pretty, pretty close to buying into an index. And that security is called an ETF. It's almost the exact same thing, but it's traded in dollars. And an EGF stands for exchange traded funds. A basket of stocks that is designed to track the performance of an index by holding the same stocks. So the ETF holds the stocks that are in the index so that you can actually buy into that basket or that group of securities. Now what's really nice about ETS is that they're very flexible and they come in a couple of different options. A regular ETF looks something like this, where it is going to track the S&P 500. So all of the companies that are in the S&P 500 index are going to be in this S&P 500 ETF and you can buy it for $411. So if you are a long-term investor or a swing trader or anything like that, and you just wanted to get exposure to the market. This could be a good option for you. However, we are day traders, so we're looking for something a little bit more advanced and something that's gonna give us a little bit more control. And luckily, there's a variety of different ETFs. For instance, there's what's known as an inverse ETF. And the inverse ETF is very similar to a regular ETF. It's a basket of stocks that moves in the opposite direction of the regular ETF. For instance, if the S&P 500 goes up by 2% 1 day, the inverse ETF is gonna go down by 2% 1 day. This can also be another option to short the market and make money as stocks or the market goes down. This is just another strategy or another way to do that. Now, this is just one example here. You can also buy an inverse ETF for the nasdaq or for a variety of different industries. There's actually a whole lot of options with regards to inverse ETFs. There's also the option to buy a leveraged ETF. Now, leveraged ETF, for instance, this one is for the S&P 500, so it tracks the performance of that index, the S&P 500 index. However, this one, as you can see, has a a3x leverage on it, meaning that if the regular S and P 500 index went up by 2%, this ETF is gonna go up by 6%. So whatever happens to the regular S&P 500, this one is gonna go up by a factor of three. So if the irregular S&P 500, ETF and index went up by, let's say 4% and add an amazing day. This one is gonna go up by 12%, which is really, really remarkable. So you can use it to get a little bit more leverage without having to borrow money from your broker. We're going to talk more about that in a little bit. But I wanted to bring this up here because we have the option of trading stocks, or we can trade ETFs, or we can trade options. We're going to dive into that at the end of the course. These are two different options and we're also going to use the index is to understand the direction of the market. The nasdaq represents a lot of technology companies. The S&P 500 represents the broad market and the Dow Jones represents a lot of banks and industrial companies. And so we can use these indexes to try and understand what direction the overall market is going in. And that is going to be extremely important for us later in the course. So it's really important that you understand what is it index, what are we trying to understand from it? What is an ETF and what is the difference? Because in summary, ETFs gives us the ability to purchase a group of stocks and treat it like a regular stock. Most of the time, they're designed to track an index such as S&P 500, nasdaq, the Dow Jones, or some other type of specific industry, for example, renewables or computer chips or, or consumer package goods. It could be a variety of different ETFs, just depends on what you're looking for. We also have the options by inverse and leveraged ETFs, which is very exciting. So for instance, when Russia invaded Ukraine, if you knew that that was going to put a lot of pressure on the oil and gas industry and prices we're going to go up. You could have bought a leveraged ETF for natural gas, for instance, and made it three times as much money buying the leveraged ETF as you would have if you had just bought the regular ETF. Oh, just a basket of natural gas stocks. And so we're going to use these different tools and leavers to her advantage as we start to build out our trading strategy. And the other thing that's nice about ETFs, they usually don't gap up or gap down very significantly. What I mean by that is if you have one single stock and it has great earnings, could gap up by 20% or if it has bad earnings could get down by 20%. When you hold an ETF, there's usually 50 to 100 different stocks in there. So one earnings result is usually not going to drive the price massively up or down. That is good for us because it means most of the action is probably going to happen during the day. And that's what we're trying to take advantage of as day traders. 9. Types of Trading: All right, everybody, welcome back to the next lesson. In this video, we're going to dive into the strategy that we're going to use for day trading. And we're also going to talk about the three different types of trading and investing that you should be familiar with. So let's jump right in. Alright, so when it comes to trading and investing, especially in the stock market, there's kinda three different categories that people fall into. The first one is investors, the second one is swing traders, and the third one is day traders. That is what this course focuses on. But you should be aware of the other two because I'm going to refer to them and talk about them throughout the course. But investors are buying into a company with a long-term horizon because they believe in the business, The future growth. This is like me buying it to Apple because I believe in the company and what they're doing. And as long as the company continues to innovate and create new products that are aligned with what I expect. I'm going to continue to hold that stock and even pass it onto my children. That would be the definition of an investor. That would be how they think. Now a swing trader is a little bit different. They are buying into a security with a plan to sell that security, because they are trying to take advantage of short-term trends that they can profit from. Basically, have Russia invades the Ukraine and the price of oil and gas skyrockets. A swing trader is going to go out and buy oil and gas stocks, hold them for a couple of weeks, and then sell them at a profit. That is what a swing trader is looking to do. That's not what we're focused on in this course. But I want you to be aware of this because if you get to the end of the course, like data and just isn't for me, you may be interested in swing trading or even just building a long-term investing portfolio because day trading is buying and selling the same day to profit from the movements in price, we're going to find a reason to trade. We're going to find a catalyst or we're going to find something that causes us to say, Hey, there could be an opportunity here. And then we're gonna go through our strategy that I'm going to break down for you right now. The strategy is to number one, identify trading opportunity. This could be based on earnings, is can be based on news. This could be based on the price action from the chart. This could be based on industry trends. It could be almost anything. You're going to try and identify training opportunity and then make a prediction based on that opportunity. If company X, Y, Z has good earnings, I think the stock is gonna go up from here to here. That could be your prediction. And then what we're gonna do is once we have that prediction, we're going to calculate the risk to reward ratio. How much do we have to gain by taking this trade? And how much are we risking when we take this trade? And do those parameters meet the conditions that we're setting for ourselves and our own trading style. If it meets all of our parameters and it meets all of our training conditions, We're gonna go on to execute the trade. And most importantly, as soon as we execute the trade and as soon as the trade closes, we're going to journal or trade so that we can measure how well we did. We can measure why we got into that trade, why we got out of that trade, and we can improve our performance over time. This is actually the most important part of any trading strategy is journalling your trades so that you can better improve that strategy over time. Now, throughout the course, I'm going to walk you through all five of these steps and we're gonna go through this strategy line by line in very fine details so that you fully understand what it takes to become a profitable trader. But in summary, here, there are three types of trading and investing. So if you don't like day trading or you're not an investor, maybe try one of the other types. Day trading is taking advantage of the price changes within a single day and profitability is dependent on your risk to reward ratio. This is something that you need to get through your head very early on. Trading is a numbers game as a game of probabilities. And if you can take a trade where you have a forex upside to a one downside and you can just make 50%, you can be right 50% of the time. You're going to be a very profitable traders. So that is the kind of system that we're gonna be looking to set up here. And the only way you can do that is by going through a strategy and actually tracking your trade. So I'm going to walk you through how to do that. And I'm going to give you all the tools that you need in the next couple of sections here. So stay with me. 10. Trading Platforms: All right, everybody, welcome back to another lesson. This one is extremely important because in this video we're going to start talking about trading platforms, practice accounts and account types so that we can get you started on the right foot. Here's everything you need to know. Let's go. Okay, so when it comes to training platforms, I am most familiar with the North American markets here in Canada and the United States. If you live outside of one of these two countries, I'm sorry, I can't offer a whole lot of expertise with regards to which platform is going to work best for you. You may need to do your own research on this specific topic. However, if you live in Canada, I personally recommend quests trade. This is the software and the platform that I use for all of my day trading. It's also where I'm going to pull all my examples and screenshots from, from throughout this course. If you're looking for a different broker, then quest trade in Canada, you can use interactive brokers. They actually have slightly lower commissions then quests trade. But I personally like the software and the visual aspect of trade much better than Interactive Brokers, more just personal preference and anything. If you live in the United States, I would recommend Weibull. They have a great software, a great platform, and it is commission free. You also have the option to use TD thinkorswim or Interactive Brokers is also available in the United States. Now the nice thing about these brokers and about these platforms is most of them have sign-up bonuses. Meaning if you use a specific link, when you sign up and create an account and deposit money, you will get either free cash or free commissions deposited directly into your account. I have put all of the links in the resource file associated with this course. So definitely go check that out if you are ready to open an account. Now, when it comes to choosing what type of account to open on these platforms, if you're a day trading, you want to open a margin account. It is very cut and dry. This is gonna be the best thing that you can do if you don't have the option for a margin account for whatever reason or you want to open a second account, then you would go with the cash account. However, a margin account is going to allow you to borrow money from your broker's. It's also going to allow you to clear and settle your trades almost instantly. So this is definitely the way you want to go for day trading if you are investing or swing trading. The other two types of training that we talked about here, where you have a EFSA or RSP and Canada, or an IRA or Roth IRA in the United States. This is when you're going to want to use this registered account. You're going to want to open these different types of accounts, but you do not want to do any day trading in these accounts. These are registered accounts that the government can see that gives you tax advantages and the government does not want you day trading inside of these accounts. So please be very aware of that. If you live in Canada, you should not be day trading on a consistent and regular basis in either of these accounts. And same thing if you live in the United States. That's why we have a margin account. That's why we have a cash account and allows you to do things like day trading. Because if you did that in your TFS, say you'd get to take advantage of the tax benefits that are not designed for DEI training, they're designed for long-term investing, and that is why the government doesn't like it. Now, the most important message from throughout this entire video is right here, and it is the term practice accounts. This is something that you need to take very, very seriously because I promise you it will be the best tool that I can give you from throughout this course. A practice account, also known as a paper account or paper money, gives you fake money to trade in the real markets. So it gives you a trading account with fake money in it that you can buy and sell real stocks with. Now what I mean by that is that you're using fake money so you don't actually own the stocks, but it's gonna give you the same results as if you did on the stock. So you can see if you're a profitable trade or if you would have made money, or if you would have lost money without actually losing your own money. It is the most important tool for any new trader. It is extremely important and this is the best way to get started and test out new strategies or traits. Anytime I'm trying out a new trade or a new strategy, or I'm looking at a tricky new security that I've never dealt with before. I do everything in a practice account because if I don't understand it completely and I mess up the trade, that way I can lose the fake money and not my real money. The most important concept here is that you are losing fake money. You can try new things out, you can be more risky. You can try out new trades and strategies, and you can do whatever you want with fake money without any risk of losing your own money and decreasing your personal net worth. Now, for me, I highly recommend quest trade. I will put a link basically in this video or in the resource guide that will take you here. It's like ten seconds to fill up the information here. Quest trade will give you $0.5 million Canadian, half-a-million dollars US. And they'll let you run in their practice count using all of their software and all their benefits, completely free for 90 days. It allows you to get used to the software. It gives you the opportunity to make trades, test out the strategy. And you can go through this entire course, test out all the examples, do everything I'm doing in a practice account and see if you're profitable before you actually put in your own money. Now, here is your homework for this lesson, I know homework, it doesn't sound like anything fun, but you need to do this. I'm very, very serious about this and it's super, super important. I can't emphasize it enough. You need to go out and need to open a practice account if you live in Canada, the United States, or somewhere else, find a software that will give you a practice account or a paper account, going to open it. And I'm going to walk you through in the next few lessons how to buy and sell your first stocks. So you need to use it as an exercise. You need to take what you learn in these videos and in these classes. And you need to go and apply it in this practice account and test it out and make sure you understand everything that I'm talking about as we go from one lesson to the next because it's just going to build on top of each other. Now, here is the reason that it's so important and here's the why behind that, why I'm pushing you to do this. And the reason is because the odds of you losing money or the chances of you losing money, and obviously that's a chance here and day trading, those chances are the greatest at the beginning, at the beginning of your journey when you are just learning how to make training and learning the new strategy and learning what I'm talking about, the odds and the risk of you losing money or the greatest at the very beginning. It's just like anything. Think about learning how to shoot a basketball. You're going to be terrible at the beginning. But if you practice for three weeks, you're probably going to get better at it. It's the exact same thing with day trading. It's just like going to practice instead of a gain. When you go to the game, you're trading with your real money. And when you go to practice your trading with fake money and you go practice for two weeks. And then when the game time comes, you're ready to go and hopefully you can hit the shop. Now, here's the best-case scenario. Here's what I recommend, here is what I wish every single person watching this video would do. Most people aren't gonna do this because it takes a lot of work and a lot of self-discipline, and it's very hard to manage your emotions. But the best thing you can do is use the practice accounts until you are profitable with fake money before ever trading with real money. And so if you can get good at trading and you can understand the concepts that I'm trying to teach you here. And you can put them into application with fake money and be profitable. That is, when you should transition to the real money, you shouldn't be using your real money and depositing your last $1000 into your trading account that you just don't bend and starting to train and test out new strategies with that, that is the worst thing you could possibly do to test out a new strategy They never done before. They've never even traded before with real money. That is the one thing I want you to avoid here. So please open a practice account. And I also want to tell you that you're not missing out on anything. People get this sensor, this urge that if they make a little bit of money early on now they're missing out because it was fake money. It wasn't real money. And the truth of the matter is, you're gonna make money in DEI training if you have a profitable strategy that you can scale up and then you can refine and improve over time. You're not gonna be missing out on anything because that is the key to it. And so you can just take that strategy and improve it over time. You can apply it at anytime period. The key is getting that strategy down, understanding it and being able to apply and execute it. And that's what the goal of this course is now here in summary, first thing you need to do a piece of homework is go open and practice account. Second thing is get started opening a brokerage account, preferably a margin account. You do not have to fund it right away, but just get that process going and get it started so that when you're profitable in your practice account, it's ready to go for you. And lastly, do not rush. The stock market has been trading for over 230 years. The New York Stock Exchange started in 1792, is not going to stop anytime soon. So whether you start trading with real money today or tomorrow, or next week or next month, I promise you it is not going to impact how wealthy you are 12 or three years from now. What is going to impact how wealthy you are? 12 or three years from now, is how well you can day trade, how well you can put together a strategy and how good you can make that strategy over time by journaling it and understanding how your personal emotions affect your trading, then adjusting your strategy to navigate that over time. That's my goal. That's what I want to teach you in this course. But don't rush it. Don't rush it. Take your time, use the practice account and don't lose your money in the beginning, loose big money in the beginning. We'll see you soon. 11. PDT Rule: All right, everybody, welcome back to the next lesson in this one, we're going to keep it nice and short because we're just going to talk about the PDT rule now the PDT rule stands for Pattern day trader rule. And in Canada this rule does not apply. There's nothing similar to it. So if you're from Canada and trading out of Canada, you don't have to worry about it at all. But if you're from the United States, it's gonna be very important for you because the PDT rule limits you to three-day traits within a five-day period. One day trade is considered a buyer and a cell within the same day. And you can only do that three times within a five-day period if your account has under twenty-five thousand dollars and if you're using a margin account, now, as you can see, this is kinda targeting and pointed at new traders. And it's designed to slow them down so that they don't risk too much. Now there are some ways to get around the pattern day trader role. But in general here what I would recommend is as a new trader, you should be very, very selective with your trades. You should only be taking the absolute best traits and you should be very, very careful, especially when you're first getting started. You should always be using a practice account to get started. And when you transition to your real money, it should be very selective and be very careful and make sure that you're doing things correctly. If you need more than three day trades within a five-day period, most people do. There's a couple of ways to get around it. Number one option here is you can open accounts with multiple brokers. So for instance, the PDT rule only applies on a per brokerage basis. So I gave you three different options for us brokerages to where you can open accounts. If you open an account at all three of those different brokerages, you'll then be able to execute nine day trades within a five-day period. You also have the option to open up cash accounts. Cash accounts are not subject to the PDT rule, so you can make as many trades in them as you want. However, the trades that you make in a cash account will usually take one to two days to settle. Meaning that when you exit that trade and you settle that trade, it may take 24 to 48 hours for that cash to become available for the next trade. And so using a cash account is also going to slow you down, but it isn't option that can give you a little bit more flexibility and a couple of more trades on a weekly basis. Now, in summary here, the PDT rule is very important. If you break the rules, you will be fine for it. I believe you get a warning first, but I live in Canada, so I haven't got one yet. You need to be careful and make sure that you follow those rules and you also need to be careful, especially when you're starting out trading. You should be very selective with the types of traits that you're making. So you shouldn't be needing to break that rule right away anyways, but there are a couple of strategies to get around it. You need to make sure that you're first starting out with the practice account though, you need to make sure that you're at least very close, if not already profitable in that practice count before you ever start trading with your real money. Now, that's it for this video and the next one we're gonna start talking about level two and some data packages that you can purchase from your brokers to help improve your trading over time. Definitely stay tuned and we'll see you there. 12. Level 2 Data and Real Time Data: All right, everybody, welcome back to another lesson. In this video, we're going to talk about levelled to data and real-time data. These are two things that you might get asked about when opening your brokerage account. So I just wanted to address them upfront so you know what they are. Let's jump right in. Okay, so leveled to data is sort of an idea that you should be familiar with because we've talked about it before. But Level two data is being able to see the orders that are stacked up on the buy and sell side. So like I said, these exchanges then these marketplace take orders from buyers and sellers and when they match up, they execute the trade. Level two data allows you to do is see which orders are stacked up. Now the reason that you might want to have level to data and the reason that that could be an advantage to you is because you can see if there are a lot of people planning to sell at a specific level and vice versa. So let's say that you are day trading. You're buying Apple at $110 and you think it's gonna go up to $120. Don't have any level to data. Basically, all you're doing is you're hoping it goes up to a $120 based on your own technical analysis and your strategy. But let's say that you have leveled to data and you can see that there are a couple of massive orders to sell out Apple stock at $118. Well, if you see that information and you're trying to get Apple to $120, you might have a good idea that it might not make it up to $120. So you might want to sell it at a $117 and still be able to capture some profit before those orders take the price back down. Now, obviously, this can happen on both sides. You might be able to see some massive orders to sell the stock. You might also be able to see some massive orders to buy the stock. You can change and adapt your trading based on those orders to try and take advantage of the price action. Now the downside here, and the downside to level two data is that number one, it costs money, you have to pay for this. It is an additional fee on a lot of different platforms. And like we mentioned before, the market-makers can take part in what is known as spoofing, where they will place fake orders specifically to get you to react to them. They will cancel those orders as the price goes in the direction that they're looking for. And so not every single order that makes it into level two is a good order. Not every order is gonna get filled at some of those orders are fake orders and so it can mess you up. If you don't understand that, it is not gonna be perfect every time, but it is an additional tool that you can pay for to improve your trading. Now here's my advice. You do not need Level two data when you're first getting started. Level to data is something that you can use to refine and incrementally improve and already profitable strategy. Level to data is not going to be the thing that turns you from an unprofitable trader to a profitable traders you need to focus on first is the basics and the fundamentals that we're gonna go through in this course that I'm going to show you how to use level two and add it into your training at the end of it to improve it. But you do not need to be spending this money upfront. You do not need to pay for all of these upgrades. Where you need to learn in the beginning is the core fundamentals of how to day trade, what the patterns look like, and all the basics that we're gonna go through in the next couple of sections of this course. That's what you should be focusing on the beginning. And then you can add in these features at the end to improve your training once you're already profitable. Now, the one thing that you will need though, in order to do some day trading is real-time data, and luckily this is included with most platforms. It is included with Quest trade, the platform that I use and recommend. The nice thing about real-time data is that it will give you accurate price info down to the second. So it will be up-to-date, it will be live and it will be a real readout of every single trade that is happening for that specific security, whichever one you decide to watch and allows you to get in and get out at the prices that you expect. So when you're going through and you're choosing a platform, if you're not choosing question or you're not choosing thinkorswim, make sure that whatever platform you are choosing either has real-time data completely free or that you purchase it because you will need that in order to day trade. Now with Quest trade, the level two data is fairly expensive. It's about $90 per month. If you want the real-time data for options trading, it is $20 per month. We're going to walk through options talking about how they integrate into our day trading strategy a little bit later in this course. But real-time data is completely free with clustering. Definitely look into this, this dealt level to data specifically is going to cost you some money. Luckily with Quest trade, it also reduces your commissions. So you can save some money with commissions when you buy level to the point that they almost offset, which is kinda nice, but it's definitely something to keep in mind. This is going to be an expense that you're probably going to have to pay every month if you decide that you do want to add a level two data to your trading. Now, in summary, here, you do need real-time data that is something that you must have in order to day trade, but you do not need Level two data when you're starting out. It is something that you can add on later. Do not pay for it in the beginning, you're going to have enough to learn and to focus on and to understand when we're just starting out. You don't need to add on that extra bell and whistle until the end, until you've had that foundation and you've fully understand everything else. And lastly, I said this before, but I need to repeat it at level two, data will only help you to improve and already profitable strategy. It will not be the thing that makes you profitable. So please do not spend the money unless you're already at that point. 13. Setting up your Broker: All right, everybody, welcome back to another lesson. I know that so far we've gone through a lot of PowerPoints. We've talked about a lot of theory and it's been a little bit dry. But today in this video, we're going to open up our brokerage account. We're going to start setting things up. We're going to look at charts, look at some order forms, and we're going to start getting ready to make that first trade. And I'm also going to give you the outline of what you're going to need to have so that you can understand and apply all of the different things you're going to learn in the rest of this course to your trading. So let's jump right in. Okay, so like I said before, I personally use Quest trade IQ edge for all of my day trading and investing. I will put the links, the resource file to this course so you can find everything you need to download the software, create an account, and get set up. And when you do that, this is what your page is gonna look like. It is a blank slate like this. Most of the training softwares are going to come out as a blank slate like this. And then the idea here is that you are going to click on whatever window you want. Most of the selections are usually at the top right here. So if we want to click on watch list, it is then going to give us a new window here that we can move around the screen. We can put it wherever we want and we can kind of customize this screen, look like and feel like whatever we want and set it up to our preference. So I'm going to show you how to do this. And the first thing they want is watch this. That's what we're going to use. As you can see right now, mine is set to market view and it's basically going to show us how these different indices are doing. So this is the nasdaq, this is the v6, this is the S&P 500. And this is what I'm going to use to kinda scroll through the different charts that I want to look at. But speaking of charts, that is the next step here. So the one thing that we need here is a chart and as you can see, there's a label at the top of the question software here that says Chart. And when you click on it, it is going to give us a new window here and we can expand it, we can contract it, we can move it wherever we'd like. I'm gonna basically expanded out like this so that now we have a chart on the left-hand side here and we have a watch list on the right-hand side. The problem here though, is that I'm currently looking at Apple stock here and on my watch list, I'm looking at the S&P 500, or SPX is the ticker right now. And so to link these up here on quests trade, and on most platforms is a little button in the top right-hand corner that's gonna give you a couple of different colors. I'm going to select a green color right here. I'm going to do the exact same thing for our chart. And as you can see now, the chart is linked to the S&P 500 and so is our watch this, there's a drop-down menu that will show up here. I don't think it came through on the screen recording, but you'll know that you'll know what I'm talking about when you click on this button, you just choose a color. As long as these two colors right here match up, it means that these windows are going to be sync together. So now when I click on the nasdaq or I click on the VIX is going to change the chart. And this way, I can now go through and I can choose, let's say a different watch this. So here I have a tech watch this. He doesn't just drop down menus. They're not coming up on my screen recording, so I'll fix that for the next video. But as you can see, I now have a tech watch this. These are all the tech stocks that I'm watching. And as I go through, I can go to Zoom, I can go to apps, I can go to PayPal, I can go to Coursera and I can start to go through my watch list here and see what the chart looks like for each of these stocks, which is really, really nice and really, really handy. Now, I'm going to walk you through how to read the chart and how to use all the indicators. The last thing that you're going to need for this course and for the next couple of videos here is your order entry form. This is how we're going to actually place the orders. You're not going to need this right away, but I am going to walk you through it. This is basically the form that you're going to use to buy and sell your shares. And once you have this window open, you have your watch this tear any of your chart on the left hand side, that is all you need. That is all that we're going to need in order to start date training. We're going to start from this simple foundation here, and we're just going to slowly add on new features and benefits and new, new strategies and new indicators so that we can hone in our strategy and improve it over time. But with regards to setting up your brokerage and getting that first step open to the point we're able to execute a trade. This is all you need. You need a chart, you need to watch this, and you need an order form so that you can execute your traits. And then just make sure that they're all synced up to the same color so that when I start looking at Amazon on my watch list, it gives me Amazon on the chart and it also gives me Amazon on my order form. Once you have that point, you have everything you need to start day trading. Now it's time to move on to technical analysis and learning how to actually understand these charts. And then we'll learn how to fill this order form so that we can understand the chart and decide what trade we want to make. Then we can execute that trade using the order type that is going to work best for that trade. I'm going to walk you through all of that in the next couple of sections. Let's dive right in. 14. Technical Analysis and Candle Stick Charts: All right, everybody, welcome back to another lesson. In this video, we're going to talk about technical analysis and chart types. That's right. We're going to start diving into actually learning how to read these charts here is everything you need to know. Let's go. Okay, so when it comes to stock analysis just in general, in the broadest sense, there are two categories that most types of research fall into. The first category is technical analysis, and the second category is fundamental analysis. If you're doing any type of research on accompany on an investment or on a stock, you are either doing one of these two types of analysis. Now, the first type of analysis here, fundamental analysis, is analyzing the business model, the financials, and the economic conditions to decide whether or not to invest in that security or that stock or that company. Most of the time, fundamental analysis is used for long-term investments. The reason that most long-term investors use fundamental analysis is because you're only getting the financials once every quarter. You're only getting economic updates maybe once a week at best. And you can only really analyze the business model once it's not like it really changes over time. And so as the fundamental analyst, you're doing this research and you're projecting out how this company is going to do over the long run. You're not trying to make any short-term traits. This is all just long-term investing here and it is not what we're going to be focused on, but you do need to know what the other side of the spectrum is called and what it includes for us, well, we're going to be focusing on is technical analysis. And this is very simply studying the past price and volume data to better understand price action in the future. Or in other words, we're very simply just looking at the chart. That is literally what we're doing when we are day training, we're trying to take in as much information as we can from external sources. But the majority of our analysis, the majority of what we are basing our decisions on is quite literally just happening on the chart. And so that's where we're going to spend a whole lot of effort and a whole lot of time and the next little while now when it comes to charts, there's a variety of different types of charts that you've probably heard of before when it comes to stocks, There's two primary types of charts that most people are familiar with. The first type of chart here is a line chart. This is what you're going to see if you pull up the stock app on your phone. This is what you're going to see if you go to Yahoo Finance. This is what you're going to see if you go to most intro or beginner or just informational websites. I'll show you a line chart like this. The problem with these line charts is that they just kind of take data points every few minutes or few seconds or a few hours and they say, Okay, price was here ten minutes ago and now it's here and they draw a line, but it doesn't really tell you what happened in between that time period and that information that is between those time periods can be very, very important for us. In order to get that information. We're not going to use line charts. We're actually going to use what is called candle charts. Now you're probably familiar with this. Look, if you've ever seen a stock chart before, this is what all professionals will use. This is what real day traders will use. This is what anybody that is performing actual technical analysis we'll use is candlestick charts. Now, when we look at this chart right here, you can see a couple of different pieces of information. First of all, we have red and green candles. We're going to talk about what that means in 1 second here. Each one of these vertical lines here represents one candle. That is what I'm referring to when I say a candle, this is a candle charts and as of right now, this chart represents the ticker symbol AAPL, which is the company Apple Incorporated, the company that makes the iPhone and the MacBook and all of our favorite products. So right now, we're looking at a candlestick charts of Apple Incorporated, the company. The current price right now is $173.03. You can see that highlighted in red right here. You can also see the price and the top-left corner right now, it is currently down by 0.09%. As I take this screenshot, or roughly $0.16, the high of the day was $173.27. So that is what we can see from this chart. And other big important thing to look for here is this little drop-down menu right here where it says one m. One m stands for one minute, and that is the time period of these candles. And so every vertical line here that's either green or red is a candle. And each one of those candles represents a time period of one minute. And so the candle represents the beginning of the minute. And then at the end of that minute, we move on to the next candle. And that's how you basically build out this chart over the course of the day. That's what your software or your brokerage does for you. Now, understanding these candles can be a little bit complicated at first, so I've got a good diagram here now you'll notice that these candles were red and green here. And basically what that means is that when it's a red candle, it means that the price at the beginning of that minute, in this example, we're looking at one minute candles. The price at the beginning of that minute was higher than it was at the end of that minute. When the price closes lower at the end of that minute, that's when we're going to get a red candle here. And this filled in section right here where it's thicker. This is what we call the body of the candle. This is where the price moved, enclosed within a minute. But you will also see these vertical lines that stick out of the body here. These lines here are called the shadow. There can also be called the wick, just kinda depending on who you're talking to, they mean the exact same thing. But you've got the upper shadow here and the lower shadow here. And what these represent is where the price moved between the open and close of that minute. So let's say that we were training on $100 when the price opened that minute and then went up to 101, it dropped down to $95 and it closed at $97. Well, that's going to give us a candle that looks like this because we opened 101 right here. We went up a little bit, we came all the way back down, and then we closed at 97 right here. That's gonna give us a candle that looks like this. So this body area that's shaded in area is where we opened and closed and those upper and lower shadows, or how high the price went and dropped in-between that one minute time period. Now when it's a green candle here, this means that we opened lower than we closed, or the price went up in that one minute time period. The price started here. It may have went down like in this example where we have a lower shadow. So the price went down, it went all the way up, and it came down a little bit more before a close that one minute time period. And that is what would give us a candle that looks like this. Now, if either of these candles didn't have an upper shadow or it didn't have a lower shadow. Basically, what that means is that the price, let's say, for example, it opened out one-on-one, it came down to 105 and a closed at 105. It did not drop anywhere below 105. That's what it would mean if it did not have a wick. Same thing on the green side here. If it opened at 102 and then it got all the way up to 107 and it closed out 107. It didn't get anywhere higher than 107. It would give us a green candle here without this wick. And so the candles represent the price action during that time period in this example, so far, the chart that I just recently showed you, this one right here. These are one-minute candles. However, these candles can represent whatever time period you would like them to. So for example, here, here's the Apple stock chart over the course of one day using one minute candles. So as you can see, we have a lot of red and green candles here all the way throughout the chart. And each one of these candles represents one minute. But we can also look at the exact same chart and use five-minute candles. And what that means is that for every one minute candle here, we're actually going to have just one five-minute candle. And this is what it looks like. As you can see, we're still trading at the exact same price of $173.03. The chart even looks very, very similar with regards to the direction that these candles are moving. However, there is only 1 fifth as mini candles because each one of these candles represents five-minutes. And so I'm just gonna go back so you can see the difference. Here are the one-minute candles, here are the five-minute candles. And just to take it even further back, here, are the same stock. So Apple stock at $173.03, you can see that price right here, but these are one, our candles. And so each one of these candles represents one hour. And you can see that over the last five days, the prices climb from $146.70 all the way up to $172.78. I'm currently holding Apple shares, so we're making a lot of money, which is really, really nice. But basically you can see how the price has moved up over time. You can see how the price has moved up and down throughout the day and within those candles and these candlesticks are really nice because they give us information about what is happening in-between those time periods that the line charts do not give us. So when it comes to technical analysis, we're going to use candlestick charts because they give us more information than the line charts will give us. Candlesticks can apply to any timeframe and then rules are always the same. So if we go to the one hour timeframe, this red candlestick right here where it has a very large lower shadow or bottom shadow right here. It means that the price started here if fell all the way down to here, and then it closed right here and it didn't go anywhere higher. That's what those candles mean. That's what these charts mean. And this is why we're going to be using candlestick charts for all of our technical analysis moving forward, hope you'll stay with me. Let's dive right in. 15. Bullish and Bearish Charts: All right, everybody, welcome to another lesson. In this video, we're going to start talking about the terms bullish and bearish. Those are two words that you're going to hear me and a lot of other people use throughout your investing lifetime. So without any further ado, let's jump right in. Okay, So the bull and the bear, or two animals that represent a lot of different things in the stock market. You've probably seen the photo of the bull out front of the New York Stock Exchange. You may have also seen a couple of statues of bulls fighting against bears. That doesn't actually happen in the wildlife. It happens in the stock market. And the reason it happens is because when we think of the terms bullish and bearish, it means that the stock market is either going up or it is going down. So bullish means that things are going up. If I say that this stock is bullish or I am bullish about the stock or the economy is bullish. That means that we think all of those things are gonna go up over the basically short to medium term. If we are bearish about things or if we're bearish on the stock or if the stock is trading at a bearish pattern, or if the market is trading bearish Lee, or if there's a lot of bearish sentiment in the marketplace, those are all kinda terms or things that mean that things are about to go down, or the stock is about to go down, or the value is about to decrease with regards to whatever you are talking about. So bullish means things are gonna go up. Bearish means things are gonna go down. I'm not sure exactly where those terms come from. My belief is that bullish means things are gonna go up because bulls, but their horns up to be aggressive whereas bearish jump up and slash downwards. That's what I heard online. I have no idea if it's true or not, but you're going to hear these terms very often in bullish basically means things are going up and bearish basically means things are going down. Now, to put this into an example and actually show you a bullish or bearish chart. I've found a couple of examples. This is Bed Bath and Beyond, as I'm filming this course right now, Bed Bath and Beyond has a lot of attention on it and the stock chart is going wild. It's given me some good examples here. Now, when we take a look at this chart right here, we can see that the ticker symbol is BBB. Why? You can see Bed Bath and Beyond. That's what company BBB y stands for. The current price is $17.75. It is down $5.30 or 22.99%. However, I am only looking at a small section of time from a few days ago. So realistically these two pieces of information don't really apply to this specific examples that I'm trying to show you. What I'm trying to show you here is that we have a chart, a candlestick chart here, where the price starts at around $15 in the left-hand corner, and it rises up to $24 in the right-hand corner. All the way through the chart, the price is basically going up. Yes, it pulls back for a couple of minutes at a few different points throughout the day here. But in general, the chart is going from the bottom-left corner to the top right corner in a fairly smooth line, in a fairly smooth price change. This is what I would call a very bullish chart. This is what I would call it very bullish price action. Price action refers to the movement of the price over time. This is going in a bullish direction. It is bullish price action, and this is a bullish stock based on this price chart. Now, just to give you an example of a bearish chart, this is what it would look like. We're starting in the top left-hand side at $20.81 and we're finishing off at the bottom right-hand side, $16 and around $0.50. And so we're starting in the left and we're just slowly moving down as time goes on. This would be an example of a bearish charge or a bearish stock, or this is a stock that has a lot of bare sentiment towards it. Right now the price action is moving in a very bearish way. And again, this is a one-minute chart for Bed Bath and Beyond. And it's just taken at a different timeframe on a different day. Now, these principles of bullish and bearish actually apply to all different timeframes and all different security. So just as an example here, we have the nasdaq 100 index ticker symbol as n d x right here. And I have, we're looking at it from October of 2020 all the way up until August of 2022. And as you can see, we're moving in a very bullish projection of very bullish price action right here. Very bullish movement all the way from about 10,600 up to around 16,700, and then this trend changes. So here is a chart where we actually have both bullish and bearish price action. Because now from basically the beginning of 2022 here, all the way to about halfway through 2022 here, we dropped from 16 thousand back down to 11 thousand. And that is a very bearish trend, that is very bearish price action. And we're moving in a very bearish direction. We are starting to see a little bit of a rally over the last few months here, which is bullish and it could indicates signs of a trend change. We do need a little bit more confirmation that the trend is changing because we do have a couple of peaks that we've seen in this bearish long-term trend here. But this is what the chart looks like right now. So we've got a bullish trend going into 2022. The beginning of 2022 has been a very bearish trend. And it looks like we could be at the beginning of a new trend starting right here. Now, why is this important? Why am I talking about this and why am I spending five-minutes on this? Well, it is because understanding if we're in a bullish or bearish trend can help us to decide if we should go short or long. Basically, what I mean by that is if we are in a bullish trend, we wanna go long on the position and we want to buy into the stock low and sell high. But if that stock or that security is trading in a bearish direction, we want to short that stock. We want to go short on the position we want to buy high and we want to sell to cover low. And that is going to make us profit if the stock or the security declines in price. Now, these rules and these principles apply to all timeframes with all securities. And what we're trying to do as day traders is we're trying to trade with the direction of the market. For instance, if the market in general is going up and the stock that we are watching is going up. We do not want to be shortening that stock. We want to be buying low and we want to be selling high, and we want to ride that trend up. In general, we want to make the assumption that these trends are always going to continue until we start to see signs of a turnaround. Now just as an example here of our strategy and what we're trying to do. Here's the Nasdaq 100's again. And this goes back and kind of highlights the COVID period that we saw, where we saw a big massive pullback. And so prior to COVID, we were seeing a nice, nice rally. We're in a bullish trend here. The stock prices are going up and the market is rallying in general, and then COVID hits and it changes very dramatically to a bearish trend. And it continues to go bearish until the index is almost cut in half, right down to 6700 here. And then that trend changes again, and it changes into a bullish pattern where we go from 6700 up to 11,497 here. So as traders, as day traders in this course, we're not trying to buy in at 6,771 here and then sell out at the top. That is so excruciatingly difficult to do. It is so tough to do, and it is almost impossible. What we're trying to do as day traders here is identify what trend we are in right now, or wait until we get a new trend confirmation and then buy-in at the beginning of that trend, sell out when that trend changes, that means that we don't have to pick and choose the top and the bottom. We just have to identify what direction that stock is going, buy into that direction and then sell out when that direction changes. That is the general premise and the idea of what we're trying to do as day traders. And that is what I plan to teach you in the next couple of courses. So let's keep going. 16. Support and Resistance: All right, everybody, welcome back. In this video, we're going to start talking about support and resistance levels. Now, support and resistance are very simple. They're key levels within the chart where people tend to buy the stock. Now what happens when people buy a lot of the stock? The price starts to go up. And so when we hit a support level, it's usually like the price is coming down to support and then bouncing off of it, you'll hear me use that term bouncing off of support quite often. You'll also hear me use the term getting rejected at resistance. That is where the stock approaches the key level where people tend to sell the stock. Now, just to give you some examples of exactly what I'm referring to here is an example of resistance. We're looking at Amazon stock on a one day time frame. So each candle here represents one day, so it's a little larger time-frame. And as you can see, the price starts at $149 and it comes all the way up to a $188 before dropping back down to $160. And then if you notice here, it comes all the way back up to 185186 and there's a wick that comes right back up to 188. Again, it obviously doesn't cross one eighty, eight, sixty five, but it comes extremely, extremely close before falling all the way back down to 165. And so price got back up to within one or 2% of the high where it hit last time and then it got rejected at that resistance. Basically what that tells me is that there are a bunch of people that are willing to sell the stock and take profits at a $188. And therefore, this becomes a key resistance level. And to connect this and to show this on the chart, all I've done here is just drawn a horizontal line that connects these two high points in the price chart. Now, here's an example of support. This is a company that I'm following quite closely right now. It is Udemy ticker symbol UDM, why they are an online learning platform. And if you look at this price, it started at $19.90 and it came all the way down $10 right here in March. It then test at $10 again in May, and it tested $9.47 right here at the end of June, beginning of July, before bouncing off support and writing all the way back up to $15. So basically what you're seeing here is that the stock has bounced off this $10 level of support three different times. And it shows that when Udemy drops to that $10 level, people think it is selling at a discount. People liked the value of buying Udemy shares at that $10 price. And I do want to point out something here. You'll see that this first drop right here, maybe it didn't even touch that 10-dollar level. Maybe it came to $10.05 or $0.10 here. The next one, it came right down to $10, and then the third one here actually dropped down to $9.47. So yes, these levels or these bottoms that I am referring to, they're not all stopping on the exact same price level down to the cent, but they are stopping on the exact same price level down to the closest five to 10%. That is what I'm looking for when we're looking at levels of support and resistance, I am not expecting the price to bounce or get rejected exactly at this line. This line indicates an area where I expect the price to either get rejected or balanced off of. So anywhere probably plus or minus 5% from this line, that would be considered a bounce off of support, just like what we saw on the third bounce rate here of Udemy at 947? Yes, the price fell below $10, but it didn't drop low $9. So it was still within a couple of percent of the key level that I'm looking for and then it rallied right after that. So that is a confirmed bounce off of support at $10 for this price chart. Now why does this happen? Why is this phenomenon so prevalent in the stock market? And when we're looking at these charts and it's very, very simple actually, it's because supply and demand forces, price movements on all of these stocks. It always comes back down to supply and demand most of the time, especially on a short-term basis. Not supply is not going to be changing. There's not new shares being added or removed from the market. And so really we're focusing on demand. Is demand increasing or is demand decreasing? Because that's usually going to tell us what direction the stock is going to move in. And so here's what happens when the price continues to bounce off a certain level. If the price falls down to a level where investors think it is a good deal, demand will increase and drive the price back up. So for instance, let's say you have a company that is returning you 5% per year on your money, that is your goal. You're trying to get 5% and all of a sudden the price goes up. And now all of a sudden your return is going down because the return is the same, but the investment to get that return is higher. Well, if the price comes back down and you can get that five per cent return again, you're probably going to buy more shares. And that is exactly what is happening when we see stocks that have key levels of support or resistance, people think it is becoming too valuable or to over-priced relative to what it is producing. So people continue to sell Amazon at a $188. People think that Udemy is producing enough revenue and enough profit that at $10, it is a discount so they continue to buy more. That is how these levels of support and resistance are built up. That's how they get determined. We just happened to be a deceive them in the price charts. And by drawing these lines, it allows us to understand where they are and what we should be looking for in the future. So to draw these lines of support and resistance, it's very simple. All you have to do is draw a line across the high points or low points of the price action. When I refer to price action, I am referring to where this price is moving on this chart over time. And all you have to do is draw a line that connects these dots. Now, I'll show you how to do that broker in just a couple of lessons here, but it's pretty much simple and identical on all of them. Now, the key thing that I have to emphasize to you is that these lines that we're drawing are not like very, very accurate, thin lines that you should be sticking to religiously, their areas. So anything kind of plus or minus five to 10% around that line is the area where you should be expecting support or resistance. So it's super, super crucial. You are never going to see a stock that bounces exactly off this 10-dollar line each and every time, it's always going to be plus or minus five or 10%. Now, here is something that I want to talk to you about because this is super important when we have a level that shows strong signs of resistance like we saw with Tesla right here. We have strong signs of resistance at $768. You can see we get rejected three times right here. If the price breaks through that resistance, that exact same level then becomes support. You can see an example of that happening right here. We have three areas where the stock price has got rejected at $768. We finally break through on this big green rate day right here. And then we come back down and we test the $768 level. It then act as support and we bounce off of that support. And so when we break through resistance, that level then becomes support. And when we fall through support, that level then becomes resistance. So it just depends on what side of the level you are on. You need to make sure that you are aware of that because that is what we're looking for is a stock they'll trade back-and-forth above and below this, we can use that crucial level as an entry and an exit level. We're going to talk more about that in a little bit here. But basically, what we need to do is learn how to use this information as a day trader. And the key to this is starting big and working your way down. So that Tesla chart that I just showed you here, we are looking on a one day timeframe. And as you can see, we've got three levels or resistance here, and we just broke through. And then we came back down and we tested support here. This is what it looks like on the larger scale. Well, when you zoom into this, it gets very exciting. So here's what the exact same chart looks like, but with 10-minute candles. So instead of every candle representing one day, every candle on this chart actually represents ten minutes. And these shaded areas, these lighter areas right here, this is actually after hours and pre-market trading so that we can see what is happening at night and in the mornings. And what's absolutely crazy about this is that the $768 level is right here. So this is the exact same level that we drew out on the larger chart. You can see that the stock broke through that level right here. This would have been a beautiful day to day trade. We had a very key level here, broke above it, and then we just continued to rally. So that would have been an ideal day to day trade. Tesla. And then over the next few days to stock actually started to come back down to that same exact $768 key level that we had highlighted earlier. And if you had noticed that you could have bought it on the bounce off of that level and wrote it back up again. So these are the kinds of things that we're looking for that can give us opportunity and trading ideas as day traders. And so what I want to get across to you in this video is that support and resistance levels are very important. They exist in the stock chart and you can draw them by just connecting the highs and lows. What they represent is changes to supply and demand forces. When a stock breaks through support, that level then becomes resistance. And when a stock breaks through resistance, that level then becomes support. And you can use that to create trading ideas and find opportunities in these stocks to day trade. We're going to dive into that strategy a whole lot more throughout this course. But I hope this was valuable and I hope it's kinda opening your eyes to show you what kind of opportunities are available. Because you could have seen this, you could have seen this coming, and you could have been prepared for it. He could have capitalised on it. So it's very, very exciting because I'm starting to give you a couple of breadcrumbs that show you, hey, there's a lot of opportunity in this market. You just need to understand how to read these charts. So we're going to keep working on that. Let's keep going. 17. Understanding Candlesticks: All right, everybody, welcome back to another lesson. In this video, we're going to dive a little bit deeper into understanding candle sticks and what they can tell us about the supply and demand forces behind the price action here is everything you need to know. Let's go. Okay, So just as a quick refresher here, we have red candle sticks and we have green candlesticks. The red ones means that we opened here and we closed lower at the end of that candlestick. The green one basically means the opposite. It means that we opened lower and we closed hire, or that the price went up during the time period that this candle represents. These candles can represent everything down to a one-minute all the way up to one day or one week, just depends on the time frame that you're looking at. Now the body here, this represents the space in-between the open and the close, but the shadow or the wicks on the bottom and the top of these candles represent where the price action traded in-between that time period that the candle represents. So what we're gonna do in this video is talk about what the different shapes of the candle's can tell us about the supply and demand forces behind it. Now, there's three different things that we want to watch for when evaluating candlesticks. Number one is the size of the Wix. Number two is the size of the body, and number three is the order of the candles. So these are the three things that we're going to cover in this video, starting with the size of the wicks. Now, big wicks, like what you see here with a green and a red candle. Big wigs on either side means that we have buyers and sellers competing for control. It means that there's a lot of people trying to buy, There's a lot of people trying to sell. There's a decent amount of volatility right now, which means the price is going up and down. But when the price opens and closes out, roughly the same level here, or where we have a small body like this. It basically means that buyers and sellers are competing back-and-forth. And we're basically starting and finishing at the exact same spot. Now for us as traders, that shows that there's some in decisiveness in the market. Now, on the other side of things, when we see big wicks that are only on one side of the body here, on either the green or the red side, it means that the price is getting rejected or housebound support and that buyers are stepping in. And so basically what this means is if we've got a couple of candles where they have long wings that are down below. It means that the price keeps dropping and then investors or traders are coming in and saying, Hey, that's at a discount right now, that is trading way too cheap and they are buying it back up. And what that represents is a level of support. You have the same thing here. If for instance, Let's say that it looked like this. This just means that we've got a couple of weeks on the top side here. And it means that people are selling out every time the price gets up to that level. And so when we see Wix like this, these are kind of a first indication that the trend might be changing. That's how are we going to use these types of candles as day traders? They're kind of a sign that hey, we've got good support here. And if the price keeps coming down, that supports probably going to step in. That's what goes through our head when we see these kind of candles. And the exact opposite, when we see the red candles, especially with the Wix on the top side. Now, moving on to item number two, here is the size of the bodies. When you see a body that is filled in like this, basically what it means is that the price opened here and it closed here, and we saw a dramatic or a drastic price movement within that candle. So when we see big candles with big bodies, That means that buyers are in control or that sellers are in control. It means that there's not a whole lot of back-and-forth like what we saw with the wicks. It means that buyers are in here and they are pushing that price higher, or sellers are stepping in and they're selling out and driving that price lower. So when we see strong candles like this, it means that we have control on that side with its green buyers are in control, and if it's red, the sellers are in control. Now, if we see small bodies like this, this gives us pretty much the opposite feeling here. When we see small green bodies like this, it means that the momentum is slow and that there's not a whole lot happening. Same thing with when we see red candles like this. It means that there's not any dramatic price movements in-between that time period. And therefore, it's not that the buyers or the sellers have major control here. It's just that not much happened within that one-minute time period, especially since the Wix or small as well. So more than likely, what happened during this candle was that the price just kinda traded like this and move slightly up or slightly down. Basically, when we see small candles like this, with small bodies and small wicks, it means that there's not a whole lot of momentum right now. Nobody is in control and not a whole lot is really happening with the price. At the moment. However, if we see a small candle grow into a bigger candle, grow into a bigger candle, that would be a very good sign that they're gaining momentum. And this can be the first sign of a buying opportunity. Basically what it means is that nobody was really in control here and maybe the price just moved slightly upwards in kind of sideways trading. And then buyers started to step in, and then they started to step in more and more. And you know, this course that when buyers step in and when people wanted to buy the stock, that is what sends the stock higher. And so this is the first sign that that might be what's occurring. Now, going the other way here, if we see a big candle followed by a slightly smaller candle followed by an even smaller candle, especially with a big wick right here. That would be a very big sign that this trend is about to change. For instance, what I mean by this is the buyers are in control here and they are driving the price up higher and higher and higher. But if we have a smaller candle after that, it means that we might be running out of buyers. And if we have an even smaller candle rate after that and a wick that looks like we could have got rejected on the level of resistance. That'd be a pretty clear sign that this trend is about to change. And it might be time to get out of this position or take some profits, or at least watch it very closely. Now the other order that we might want to watch for is anytime that we see major Wix like this in short succession, maybe a couple of candles apart. This means that there could be a key level of support or resistance and we probably need to zoom in closer. So for instance, if we're looking at a one-day chart or a one-hour chart and we see some Wix that look like this, that gives us a sign that we need to move into a one-hour chart or a 10-minute chart, or five-minute chart, or even a one-minute chart just to see what's actually happening here and see if there's a good strong level of support here that we might do to make a trade on later in the day. That's what we're going to be watching for if we see candles like this. Now, in summary here, these are not the golden goose, this is not the secret to trading. These are just things that can give you signals that can be kind of little flags that you can look at and say, okay, this might be an opportunity. This might be something that I should watch for. This might be something I should look for confirmation on in the future. And this can be an early sign to get your attention and possibly give you a trade idea. And so we use the candlesticks to try and help us determine if the trend is getting stronger or weaker and when it may change. So if we see a trend like this, it means that we're probably running out of momentum and that trend is going to change. If we see candles that start to look like this, it means that we might be at the beginning of a trend that is just starting to gain some momentum here, if we see a lot of Wix like this, that gives us the indication that we're probably seeing a bit of volatility right now, we may need to zoom into a closer time period and we got to be pretty careful with our trading. And so there's a lot going on here. Definitely re-watch this video if you have any questions about candlesticks. But we're slowly just going to add layer on layer onto our trading until we have a solid strategy that's profitable and that we're comfortable with. And that's where we're gonna be building throughout the rest of this course. So let's keep going. 18. Volume: All right, everybody, welcome to another video. In this lesson, we're going to start talking about volume and how you can use it to identify the beginning of a trend or the end of a trend. Here we go. Alright, so what is volume? Well, it's actually really, really simple. Volume is the number of shares being traded on a stock chart. This is what it looks like. So we've got the stock price and the price action on top and down underneath here we have our first indicator and that is volume. And you can see each one of these kinda bar lines right here. It lines up with one candlestick from the chart, and it represents how many shares were traded within that candlestick. Now we are currently looking at one day chart. So each candle right here represents one day and over time you can see the price ran from $4.38 all the way up to $30, and it's now trading at $8.6. Each one of these bars here represents the volume of shares traded during that day. If we zoom into five-minute candles, each bar down below will represent how much volume was traded within that five-minute period. This example, though, we're looking at daily candles. So each volume bar represents how many shares are traded on a daily basis. You can see we've got all the way up to 400 million shares. That was kinda the peak right here on this nice green candles. So this is what volume looks like. Now we need to talk about how to understand it and how to use it as a day trader. And it's actually also very simple. Increasing volume confirms the trend. So if you start to see a breakout or a bullish trend that is just beginning to form and you see that volume is increasing, that would confirm that this is probably a good, strong trend that you're going to want to trade. But this does go in both bearish and bullish direction. So if all of a sudden you start to see the price starts to go downwards in the bearish direction and you start to see volume skyrocket. Very strong sign that you don't want to be holding that stock. Now, on the other side of things is when volume begins to decrease. So in volume starts to decline. That means that the trend could be changing now to go back to our Bed Bath and Beyond example right here you can see that the price is pretty much trading in a bearish pattern all the way down to $4.38. And then over the next month, it kind of works its way up to around this five-dollar, maybe $6 level right here. And then the volume starts to increase. It increases dramatically compared to how it had been trading in the basically three months prior to this. And that is a very good science. Now we have the price going up and we have the volume starting to increase, even though we have three red days right here, the volume has dropped a little bit. It is still two or three times higher than it was just three or four trading days ago. So that is still a very good sign and it is a show that there's increased volume in the stock. And as that price goes up, that is a very good sign because it confirms that trend that there's new traders entering the market, and that is what is driving the price up. This would be a very clear case of hype that is driving the stock up for whatever reason. And as you can see, the volume continues to increase all the way until we get to a high of around $30. And on the very next day the volume actually starts to decrease. And so that would be our first sign that, hey, maybe this trend isn't going to last. We can also see that with this specific candle right here, this very high specific red candle, we can see that the price tried to get up to $30 and then it got sold all the way back down to around 23 or $24 right here, just looking at that candle alone, that is a bearish indication that this trend might be changing. And then when you add in that we have decreased volume. That is kinda confirmation that this trend is probably coming to an end. And as you can see, that is exactly what happened over the next four days. And so we are using the price action as the primary determination of what is happening, whether we're in a bullish trend or a bearish trend, we see that first candle that's gonna be kind of a warning sign. First of all, it's red. Second of all, we closed lower than we open. So that's a big sign, a big red flag that this trend is probably coming to an end. And then at the same time the volume dropped off, indicating that there's less traders coming into the market for this specific security. There's probably less people that are going to be there to drive the price up. And if anybody starts to sell or take profit, that price is cut, probably coming back down pretty quick. And again, that is exactly what happened. We got down for two days straight as people began to take profit. And you could have seen it a day earlier if you are looking at the volume, understanding what this candle actually means, like what I've shown you in this course so far. Now, here's another example of this. This is Zoom video communications over a longer time frame. And it's really interesting because the volume going into 2020 here, it was extremely low. It barely even registers on the chart here. And then COVID hits. And all of a sudden people are like, I wonder what businesses are going to succeed during COVID, I wonder who's gonna do well and all of a sudden everybody gets an invite to a Zoom call because they can't go meet anybody and the light bulb clicks and everybody rushes into Zoom stock and you can see the volume increased dramatically over the next six months here. This this Zoom stock did not go up because the company got better. Zoom stock went up because everybody wanted to buy Zoom stock because they thought they could get rich because it was going to do well during COVID. And you can see that with the dramatic increase in volume right here of new traders and new investors entering the market and driving the price up all the way to $588. If you check the price today, it's it's dropped pretty significantly. Let's just take a look right now. Yeah. So as of today, it's currently trading at $82.77. So it's not looking so great for Zoom communications considering that one time, that increase in volume there drove the price all the way up to $588. Now, just as another final example here, let's talk about day trading. So this is, as you can see, a day training chart. These are one-minute candles and these are one-minute time periods for the volume. And what I want to show you here is just the trend that you're generally going to see with regards to volume in day trading, we are going to see the most volume on most shares, on most stocks at the beginning of the day and at the end of the day, there usually isn't a whole lot of stuff that happens in those middle, three or four hours there, unless there is news about economic events or interest rates or something dramatic is happening in the market. Usually most of the action happens at the beginning of the day and a little bit of action at the end of the dance. So what we wanna do with volume is try and look at larger charts. Look at one day charts, one week charts to try and identify where some volume is picking up right now and where some key levels might be. And then we want to zoom in and we want to try and take advantage of it throughout the day. If we see spurts and increases in volume throughout the day, the same rules apply, but a lot of the time we're actually using volume on the larger scale to try and identify trading opportunities where that volume is either increasing or decreasing. So we can have a bias or a trading idea or a plan going into that stock on the day that we plan to trade it. Now, in summary, Here's the idea, use volume with daily candlesticks to try and find good stocks today trait, That's the basic premise here. And then the same rules apply it once you get into that day trade and you've identified that stock. Secondly, a stock that is breaking out with good volume will likely continue to break out if it has good volume and that volume continues to increase, that is a good show of confidence. But as soon as that volume starts to decline, it could mean that that trend is likely to change. Now, obviously, none of these rules are a 100%. None of them will work every single time. I am talking about things in general here and on average. So please keep that in mind. It's not like this is a foolproof method or anything. It's just human psychology that we are trying to apply to what we're seeing in the charts and then use it to our advantage to profit through the process of day trading. That's what we're trying to accomplish here. I'll see you guys in the next one. 19. Trend Lines: All right, everybody, welcome back to another video. In this one we're going to talk about trends and how you can use them to identify trading opportunities. Let's jump right in, okay, so first of all, what is the trend? What am I referring to when I say that? And basically what I'm referring to is the general direction that the price is going in most of the time it's gonna be a bullish trend or a bearish trend. Sometimes you'll also see the stock trading sideways and consolidating. And this has very similar principles and rules to the support and resistance that we covered earlier. The only difference here is that most of the time it is going to be on a diagonal. And so here you can see Callaway Golf ticker symbol E LY started out at $37.75 and a traded all the way down to $17.78 in pretty much a zigzag. And so to identify this trend and mark it on our chart, all we're gonna do is take a straight line that connects the highs of the price action and a straight line that connects the lows of the price action. Now, it is not going to be perfect. Again, it's that kind of plus or minus five or 10% rule. All we're trying to do is identify the general direction that the price is moving in. And then once we have that marked on our chart, once we have it drawn out like this, There's two different ways that we can trade it. Number one is to buy or sell on the bounce off of the bottom or the top of the trends. What I mean by that is once you've identified this trend and let's say you identify it by this point here. You want to buy in on the bottom, you want to sell out on the top and you want to short the stock at the top. And then by the cover on the bottom, if you're willing to take that on. What I mean by this is we're basically trying to take these insights. Zigzag movements are trying to profit off of each bounce from side-to-side. The second strategy here is to be a little bit more patient and wait for the breakout. So what we're seeing right here is we've got our trend line, and now the price has broken through that trend line. It looks like this trend could be changing and we now have a breakout because of price action, the price action moving beyond the trend line. And that is a very clear sign that it could be a buying opportunity. And so you can wait for the breakout of the bearish trends to break out in a bullish way. And that'll be your buying opportunity. If this trend was going in a bullish direction and it was going up and to the right, we would be looking for the breakout downwards and we'd be looking to short the stock at that point. Now as we zoom into Callaway Golf here you can see, I want to point out to you a few opportunities here. So if you notice that we were in a trend, and you said, okay, the price is coming towards the top of the trend right now. I want to make some money because I think it's going to come to the bottom of the trend and this is just going to continue. Well, you could have played short, you could have sold the stock short at twenty-five dollars. You have made your money all the way down here to $17. And then you could have close out your position and made a nice kind of seven or $8. You could have bought the stock and wrote it all the way back up to $23 where it approach the top of the channel. And you could have made another trade there for some nice and easy profit. If you didn't want to trade the inside of the channel like this, you could have waited for the breakout and you could have bought on the breakout and wrote it all the way up to $25. Now, the other examples that I want to show you here on a day training charts. So this is Google. It's not quite as clear here, but it's a real example that I literally just took today. And so it's a good scenario that we should look at. So here's Google. As you can see, major price movement at the beginning of the day. Like I said, a lot of the volatility in the price movement in day trading is going to happen in those first two hours. You can see exactly that scenario right here. After that, the price comes down to 114 and then it bounces off this trend line three different times. So this is a very key level of support. This is very important here. It, by the second time you could have said, okay, we've got some resistance on the top, we've got some support on the bottom. We're probably trading within a channel here. You could have bought it 114. You could have sold at 11560. You could have done the exact same thing back and forth a couple of times here. Really, really nice. Now it looks like the price chart is starting to fall through support. And so this could be an opportunity to short the stock. You've got you Well, you've only got about an hour, maybe half an hour left in the day. So you don't have a whole lot of opportunity with this example here, but it does show you a little bit of support, a little bit of resistance, and a very clear opportunity to buy off support and sell it the next resistance. Now, the last example here I want to show you is Apple. These are one-day candles and the trend is a little bit longer. As you can see, we hit a high of one seventy, nine sixty one. And then we traded all the way down to 12904 in a bit of choppy trading, not super clear trend right here. But since that low of 1234, we traded through and we broke through our previous resistance, this line right here. And ever since then I've been able to connect the highest, connect the lows. We're trading in a very, very clear bullish trend. And so as a day trader looking at this, apple is going to be at the top of my watch list for bullish trades are buying into Apple and selling out at the end of the day. And I would also be considering swing trading. This, this is a very clear technical breakout and it's a great opportunity that did pay off excellent for us. So lots of opportunities here both on the day trading, swing trading opportunity. This is the kind of technical analysis that will apply to basically everything that you do. But as you narrow it down as a day trader, it does get a little bit more messier, so you have to be a little bit more concise with it and you have to watch for it a little bit more carefully. So we're gonna walk through all of that. And in summary here, I just want to say that identifying trends with daily candles can help us to find stocks to day trade. And then when you identify the trends on a day trading chart, that can help us to execute the trades as day traders. So that's what we're trying to do, is basically start with the big picture, narrow it down to the best opportunities possible that are gonna give us the most likelihood of making money and then execute on those traits. Let's keep going. 20. Chart Patterns: All right, everybody, welcome back to another lesson. In this video, we're gonna be talking about chart patterns and how you can use them to identify your entry and exit points. Here we go. Okay, so first of all, what am I talking about when I say chart patterns? What am I referring to? Well, chart patterns are common trading patterns. They usually lead to the same results. So when we can identify a trading pattern, we can usually also predict what the next movement in price is going to be, whether it's up or down. Now, I emphasize usually here because none of these patterns are gonna be 100%, nothing in investing and trading is ever 100%. So if anybody tells you that they're completely lying to you, what we're doing here is playing the game of odds and probabilities. And we're trying to stack those probabilities in our favor. And by identifying chart patterns that usually leads to the same results, we can improve our probability and hopefully become a more profitable trader. So that's what we're going to focus on then when it comes to chart patterns, there are hundreds of different patterns and bunch of different names for it. And some people will call this same pattern five different names, but basically they all kind of fall into a couple of different categories and the two categories of pattern. So we're going to focus on today double top and the double bottom, as well as the wedge patterns. So these are the two kind of categories that we're going to focus on in this video. Okay, So starting us off here, we have the double taught pattern and we're looking at an Amazon stock chart right now. And as you can see, the price ran up to a high of $188.65 before coming back down to around $160 and then going back up to that exact same $188 level and getting rejected for a second time. This is what we would refer to as a double top. Now if this happened for a third time, you could call it a triple talk. You can call it whatever you want. But basically what we're seeing here is a very clear level of rejection at pretty much the exact same price level multiple times. That's what we're looking for in this pattern. Second thing we're looking for is what we call the neck line. The neck line is where those rejections find support. So as you can see, we have rejected at 188 here and we do a double bounce off of 160. That means that we can identify 160 as our neck line. We have major resistance at 188, and as soon as we get rejected at 188 for the second time, we now have a double top with a neck line out 160. The trading opportunity here is when the price breaks below the neck line. So you can see right here that as soon as the price falls below 160, it falls all the way down to a 133. Actually see a small uptick in the volume as well. This is confirmation of a double top, perfectly executed with a 15 to 20% decline in price, which is exactly what we're looking for as short-term traders. So day trading on any of these days throughout this decline would have been extremely easy. And if you want it to swing trade it, you could have done that as well. So this is a perfect example of a double top collapsing through the neck line. And here is your trading opportunity. Now, the double top is also the exact same thing on the other side where it becomes a double bottom. Here is an example with Udemy stock. You can see we had a double bottom at $10 right here. We bounced off of $10 twice. We found resistance right here around $13. This then becomes our neck line because it's in-between are two levels where we got rejected. We have our neck line right here and as soon as the price breaks above the neck line in this scenario, that is our buying opportunity. And on either of these days to day trade, would it be an extremely easy we have increasing volume, as you can see, we're expecting a breakout. We have confirmation of the double bottom and basically throw both of these days, the price opened here and it closed dramatically higher. Which means that would have been the perfect signal that we should be day trading Udemy that day. And we have a bias with regards to what direction we think it's going to go into. That gives us everything we need to pull up that chart, start performing technical analysis on the one-minute candles and enter that trade on the write-up. Now, the second pattern here is what we refer to as the wedge pattern. The wedge pattern is basically where you have support and resistance levels that are coming together at some point. So basically either one of them will be completely flat or they will both be on an angle. In this example, we are looking at Tesla stock and we have a very clear level of resistance that is pretty much flat, around 768 or $770. But we also have major support kicking in as a trend line with consecutively high or low. So as you can see here, we have four consecutively higher lows. We have three areas of resistance that are pretty much flat across the top. That means that these two lines are going to come together at some point. And that means that we have a wedge pattern. Now when we have a wedge pattern, we are looking to buy or sell on the breakout of that wedge patterns. So what you're seeing here is a level of resistance, a level of support. And we're looking for the price to break out of that support or resistance. In this case, the price is breaking out to the upside, is going in a bullish direction. And we want to be buying in on the breakout of resistance here. Here's another example with the stock into it. This company owns the software, QuickBooks and TurboTax and a variety of others. They're basically an accounting and this utility software. And it's really interesting as well. We've got a very clear level of resistance. We've got rejected at this for 20 price three times right here, and we have three ascending higher lows. That means that when we draw these trend lines, they are going to come together at some point. And in this example we have another breakthrough to the bullish side. Usually what I find most of the times when we have a flat trend line like this, that is the side that it is going to break out too. So if for instance, the price just kept bouncing off of $10 and the highest kept getting lower, I would expect the price to go downwards. But if the price kept getting rejected at $10 with higher lows, That's when I would expect the price to go higher. And so depending on which side this flatline is on, that is usually the side that we see the breakout to. However, we're not going to enter into any trades in here until we actually see that breakout when we're trying to trade the wedge pattern. Here's another example of $0.10. This is a Chinese technology company, kinda like Amazon and Google combined. And they're really, really interesting. We've got actually a little bit at two wedges right here you can see ascending support with higher lows, we've got a trend line that's coming in a bearish direction over a little bit longer term. And we break out through our support level right here, and the price falls from $60 all the way down to thirty-seven dollars. Great opportunity of price movement right here. And then we set a new high around $55 right here. We said new lows around 40, new highs, around 46, new lows around 42. And so basically we've got two lines that are just slowly coming together here and now we are watching for the breakout. It looks like in this example we'll probably see a breakout to the bullish side based on the current price action. But if it comes back down and breaks through support here, that'll be your opportunity to short the stock again. Okay. So in summary, double top and double bottoms usually show signs of a reversal when it breaks the neck line. Same thing happens when you see a triple top or a triple bottom. It's just one extra high or one extra low. When it comes to wedges, we're looking for a breakout of support or resistance. We're not entering the trade until you see confirmation of that breakout. And what we tend to see is when we have a flat line like this that access support or resistance, we usually tend to see the breakout to that side. However, nothing is guaranteed and you have to be ready for both options. So that's it for this video, we're going to put all of this knowledge into play in the next few lessons here. So stay tuned. 21. Gaps: All right, everybody, welcome back to another video. In this one we're going to talk about gaps and how you can use them for your day trading. Let's jump right in. Okay, so first of all, what is a gap? What am I referring to and what do they look like? Basically, what I'm referring to when I talk about a gap is the change in price between where the stock closes and where it opens the next day. So if the stock closes at a $100, opens at 110, that'll be a gap of $10. Here's what it looks like on an actual price chart, we're looking at five-minute candles of Apple stock. On August 19th, the stock closed just under 172 here. And then on August 22nd, it opened at around a $169. It was probably a weekend. So there's a two day period in-between there and the price gapped by about $2 a gap in the bearish direction at Gap downwards. And this is what I'm referring to when I talk about gaps. Now, why do they happen and what causes them? Well, it happens because things can change when the markets are closed. You can only trade stocks from nine to four unless you go after hours or pre-market. And therefore, if things change when the market is closed, it might impact what orders are in the system when the market opens up the next day. For instance, if a company releases really bad earnings, a lot of the buy orders for that stock that are in the system might get taken out and it might reduce the price overnight. If there's an economic event or political event that can impact the company, that can change the orders in the system because investors might no longer want to buy or sell that stock. There's also the chances on a war or an environmental event that could drastically impact the production or the profitability of a company. And all those things can happen at anytime of the day and they can affect the stock. And that is why we see the prices change. They close and when they open. Now, how do we manage this as day traders? Well, basically, we do not hold positions overnight, so we can eliminate the risk outside of market hours. As day traders, we are only trying to buy in during the day and we are trying to sell that position by the end of the day so that we do not have any overnight risk. If you are comfortable with overnight risk or you want to manage that, then you would become a swing trader and you would basically adjust your strategy just a little bit. Most of the rules and the analysis and the chart reading is almost identical. But your timeframe and your mindset really need to shift a little bit. Now, when we talk about gaps, gaps are useful the day traders because they can give us trade setup. So if we see a stock that wraps up or gaps down, we can use that to our advantage because hopefully we can identify whether it is a good gap or whether it is bad gap, and then we can go long or short. Now, here's an example of a bad gap from an example that we've used before. This is Bed Bath and Beyond just recently here, you can see that the stock gapped up. What I mean by that is on this green candle day it closed at let's just call it twenty-five dollar. The next day it opened right here almost at $29 a traded a little bit and then it fell throughout the day, so gapped up and then throughout the day if fell down, what that tells us is that demand is diminishing, the stock is losing momentum. And that gap of was not successful, it was not continued, it was not maintained, and there was not enough momentum behind it to continue running that price higher. And so when I see a gap like this, it tells me that though momentum and the demand for that stock is probably starting to run out. And as you can see here at the stock then began to gap down, basically confirming our suspicions here. And this would have been an excellent opportunity to day trade it the next day or the next day, or even swing traded on your way down. Now, a lot of people will call this type of gap and exhaustion gap. And it usually signals the end of a trend. So a lot of the times we will use a gap like this as the signal to exit our trades or to enter it short if you feel like holding it over time. Now, here's an example of a good gap. This is a company called Splash beverage group. And as you can see, the stock was trading kind of bearish Lee here around $2 and then it fell all the way down to $1 before seeing a massive gap up. And if you look at this candle here, it's really nice because it opened up one level and it closed higher. That means that demand throughout the day continued to increase. And we also had it continued by two or three more green candles and then a massive green candle even higher here. But it was this initial gap up. They gave us the indication that probably put our eyes on it. And it's this initial gap up here. They usually begins to set that trend. What happens in these scenarios is that a company will release good earnings or good news, or they'll sign a new partnership or something positive will happen in that company. And it might change the investor's perspective as a whole, instead of selling as a whole, like we saw for the last three or four months, people began to buy as a whole. And if there's enough demand there, as you can see by the volume, it can really start to send the price higher, which is exactly what we saw in this example. Now, at the same time, we're also going to have just some normal gaps from regular trading activity. So as you can see this as Google or parent company Alphabet. We've got some regular gaps here in some of these prices. And as you can see, that they're fairly decent sized gaps, but none of them are super dramatic. None of them are way out of the ordinary. None of them are more than that five to 10% level. And so this is just sort of normal trading activity for Google. And so when you look at gaps, you really have to take it in context with the rest of the market doing right now. Is it super volatile right now, which is just causing gaps in every single stock? And why did a gap, did a gap because of good earnings or bad news or good results or maybe an environmental impact or the country where the manufacturer is going to war. It could be a variety of different things. So when you see a gap like this, you have to take it into context and say, what happened with the company? What's happening in the markets? Is this a good thing or a bad thing for the company? And do I think that it could continue? Because if it could continue, then you've got a big opportunity to watch that stock on that day as well as the next couple of days to look for trading opportunities to go in the same direction of that gap. So that's what you should be looking for when evaluating different gaps. Now, in summary here, a gap up on major news is usually a very good sign and a signal that the start of a new trend gaps down on bad news usually signaled the start of a new bearish trends. So basically what we're looking for is a gap in either direction because we can trade either bullish or bearish. We're looking for a gap in either direction. And we're looking for enough confidence with that gap that the trend is going to continue. Because if we see a gap down on bad earnings and let's say the market is trading bearish Lee, and the economic forecasts for that specific industry is also bearish. Well, this is probably the start of a brand new trend. But if the gap is good based on good earnings and the market's doing great, and we expect growth in the industry. Well, this could be the start of a new trend. And so we want to use these gap ups and gaps downs to identify opportunities and then trying to evaluate whether or not we think the momentum there is strong enough to continue. Because if it is, then we have our trading opportunity now stalks that gap up, but are unable to maintain the momentum, are usually signs of exhaustion from buyers. And those are the stocks that we do not want to be buying. We possibly want to be shorting them depending on the rest of the economic conditions. Now, just finally here, how do we use this as day traders? Very simply, large gaps give us a reason to look at the stock, evaluate it for a trading opportunity. Determining if it is a good gap or a bad gap can give us a strategy going into the trade. It can either give us an opportunity to go buy the stock or to sell it short, go bearish or go bullish. But gaps do not usually happen during regular trading hours. And so as a day trader, we're not going to be trading in and out of gaps throughout the day from nine to four PM, we're going to be looking for gaps, usually outside of market hours to try and identify which stocks we actually want to trade throughout the day. You're not going to see major gaps throughout the day, especially on a lot of the stocks that we're going to focus on in this course. 22. Moving Averages: All right, everybody, welcome back to another lesson. In this video, we're going to talk about moving averages and how you can use them to identify a trend as well as find some buy and sell signals. Here's everything you need to know. Let's go. Okay, so first of all, what is a moving average? The moving average is just simply a line that shows this the average price of the stock over a given number of candlesticks is usually displayed on top of the price chart. And all we're doing here is just trying to get an average price over a certain period of time. Here is a chart of Apple on one-minute candles. So two-day training chart. See I have a blue line and our red line, these are moving averages. I have two on the chart at the moment. You could have three or four or even just one or you could take them off if you just don't like the idea. I always like to trade with two different moving averages on my price chart. And basically what they are is they are a line that is calculating the average price over a certain period of time. And then it is just continuing to build that line. As you can see, we've got the blue line right here with a flag on the right side of the price chart here. It says it's out of $167.32. That means that the average price over the last 20 candlesticks here is $167.32. This red line right here is calculating the average over 50 candle sticks and it has a flag at a $166.97. And so these moving averages are just a math calculation that takes the average price over a given period of time and then just continues to build this line. The nice thing about them is that we can use them to identify the trend as well as find some buy and sell signals. So we're using them as day traders to try and figure out the trend. If the price is above the moving average, that would be considered a bullish trend. If the price is below the moving average, that would be considered a bearish trend. And as day traders, we always want to buy or sell into the trends. So if we are in a bullish trend, we do not want to be shorting the stock. If we're in a bearish trend, we do not want to be buying the stock. And so you can use the moving averages to just very easily and simply look at a chart and say, are we above the long term moving average? If we are, I only want to buy in if we're below the moving average, the only trades I want to take are too short. The stock we, as day traders are trying to buy into momentum. We're not trying to fight upriver and go against the grain. So we use the moving averages to determine what direction we want to be trading into. Now, let's say that things are changing and if the price moves above the moving average, in other words, we've got they're moving average right here and the price breaks do that moving average, that would be considered a bullish indication and possibly assign that that trend is changing if the price moves below the moving average, that would be a bearish indication and it could mean that that Bull Run is coming to an end. And so we use the moving average to determine what trend we're in and when the price crosses above or below that moving average, that can be a sign or a signal that the trend is changing and we wait, may want to buy or sell a position. Now, when it comes to moving averages, there are three different variables right here. The first one is the input, the second one is the title, and the third one is the period. You can remember from this example I just showed you, we see moving average that shows that we have this on our chart right here. And then we have three different categories. You can see it says close SMA and 20. These are the three different variables that we can control as day traders to try and get cleaner signals out of our moving averages on the price chart. And this is what I'm going to walk you through right now, is these three different variables that you can control. Now, the first one here is the input. You'll remember I mentioned that we are measuring the average price over a set number of candlesticks. And those candlesticks, they have opening prices, closing prices, they have highs, they have lows. They have a variety of different data points. And so we need to choose what data point we want to use in our calculation. Myself and almost every trade are out there. We're going to stick with closing price. That is where the candle closes and moves on to the next candle. That is going to be the data point that we use in our calculation. This is a small variable that is not going to change the end result very much, but you do have the control and the choice to change it on most platforms. Now the second variable here is the type of moving average. And on most platforms there's at least three different types of moving averages. The simple moving average is the simplest and the slowest. Basically what it's gonna do is it's going to take your, let's call it ten candlesticks here. It's going to take the closing price from each one. I'm just going to average them out to give you that line that is displayed on the chart. The exponential moving average is going to take the same number of candlesticks, but it's going to put a lot of emphasis on the most recent candlesticks. And that emphasis is gonna go in and exponential curve so that the last set of data, or the tenth day back, isn't going to mean a whole lot. But the most recent day is going to be very, very important in determining that new average. The third option here is the weighted moving average. And instead of changing it on an exponential curve, the weighted average usually makes it a very even curve. So that yes, again, the most recent data is the most important and the oldest data is not as important in determining the moving average. What is a more gradual and level inclined to the most important data, whereas the exponential moving average looks more like this. Now, like I mentioned, the simple moving average is gonna be the slowest and the smoothest moving average. The exponential moving average is probably going to be the fastest, the most jagged, and it's going to follow the price the closest, and the weighted moving average is gonna be somewhere in-between. Now the third factor here is the period. And this is basically referring to how many candlesticks you want to use in the calculation. This is going to be by far the most important variable that you choose when setting up your moving averages. This is going to determine how much data it uses in that calculation. If we go back to my first example here, you can see that the blue moving average only took in 20 days worth of data. And it moved very closely to the price. As the price moved, the other moving average, the red line took in 50 days worth of data. And it was a very smooth line with very gradual turns. And it did not track the price as closely because it was taking in so much more data. And so by changing this variable here, you make a very large impact to how well this moving average actually tracks the price. Now, for me personally, I like to have two moving averages. I like to have one very short moving average that's going to track the price very closely. I like to have one longer moving average that's going to track the price a little bit more broadly and give me some smoother and cleaner signals. For me, it's usually an exponential moving average over ten candle sticks and a simple moving average over 50 candlesticks. However, I change these variables all the time depending on the stock chart to give me cleaner signal. So for instance, if I have a moving average that is just super, super choppy and the price is really choppy as well. I will smooth that out and I will extend this time period so that it gives me cleaner signals and cleaner idea of what direction the stock is actually going in. Because if the moving averages goose going like this and the price is going like this and they're crisscrossing all the time does not give me very clear data and a whole lot of information that I can actually use in my training. So I will adjust these variables, usually starting with the time period so I can get cleaner signals. Now, here are a couple of examples of how you may want to use these as a day trader. Okay, so first example here we're looking at Google on a one-minute chart. And this is a very, very nice day trading charts. So like you can see here in the first couple of minutes, things get wild. I honestly never trade the first five to ten minutes of the stock market. It's not worth it. You have no idea what's happening and there's no clear direction set yet. So the first five-minutes happened and as you can see, we settle out below our long-term moving average here that is taking in 50 candlesticks. Eventually though, at around 945 here, we break through this moving average and we cross above our short moving average as well. Both of which are very good by signals and bullish signal. So if you had entered the position right here, you would have got in around $114.40 and you could have wrote it up for the next two to three hours here, all the way up to 11567. So this is just a very clear signal where only one thing happened today. Google dipped below the moving average and then broke above it and basically wrote that up the next two to three hours, this would have been a very clear signal. And as soon as the price falls below this moving average, that would have been your cell signal and you would have just made that much profit. Now the next example here is Netflix. Again, as you can see, lots of volatility here. And the first five-minutes we dip below are moving average. And then we finally break back above it. And by the time we're like 101520 minutes into the market, it's very clear that we are in a bullish trend and we are slowly moving higher. This would be a really good sign as a day trader. And as soon as we start to break through the resistance rate here, this could be your entry point on a really nice entry at 226. You could ride that up all the way along. And then as you can see, we're starting to see some resistance around $234 right here, about 1520 minutes ago. It looks like we're testing that to 34 again here pretty soon. But if we get rejected at 234, that would be what looks like a double taught to me. And if we fall below that moving average or the neck line, that would be a clear indication to get out of this position. Then the last example I want to show you here is Nvidia. Again, lots of volatility in the first five minutes of the market, stocks settles out below the moving average. It finally breaks through the moving average with strength and then bounces off the moving average several times. And again, as you can see, we're starting to just sort of level off right here. This would be a very nice and clean entry point right here. And the stock falls below one seventy three fifty right here. That's probably where I would exit the position. So you can see how you can use these moving averages. You very clear buy and sell signals that can put you in the right direction, but you always want to be buying into the trend if the price crosses above the moving average and it stays above the moving average, I do not want to be shorting the stock. The price is going in a bullish direction and I always want to be buying or selling into the trend, not against it. Now, in summary, for moving averages, you need to get in there and you need to change the variables so that you're moving averages can give you a cleaner buy and sell signals. We need to use the moving averages to identify what direction the stock is trading in and when that trend changes. And lastly, the price is crossing above or below a moving average represent bullish or bearish signals. They are never going to work 100% of the time. This is not a foolproof method, but this is just another tool to add to your tool belt when performing technical analysis and trying to decide, do I want to get in? Do I have enough confidence? And do I think this is going to continue with the momentum that is what you're using this information for is to build an overall position and an overall hypothesis with evidence and signals that support that hypothesis. And so you're using the moving average as just one tool on your tool belt. It is not the only tool. So you're not going to just rely on moving averages because it just never going to work 100%. But we're going to combine it with our indicators and technical analysis to build our positions and make some money. 23. Setting up the charts: All right, everybody, welcome back to another video. In this one we're going to start applying some of the things that we have just learned. I'm going to walk you through how to add volume to your chart, how to add moving averages to your chart, and how to start drawing support and resistance lines for your technical analysis. Here's everything you need to know. Let's go. Okay, so here is my dashboard. As you can see, I've just got one chart open right now we are on a one-minute timeframe and we're looking at Nvidia. Now, just as a quick walk through here, if you want to look at a different stock, you just type in the ticker here and Apple. And if you want to change the time period, you just click this drop-down menu and you can choose whatever you'd like if you want to go one month, ten minutes. Every candle here will represent ten minutes and the shaded areas here represent the after hours trading. So these lighter areas here represent what has happened after hours. If you want to turn that off, you just go to right-click. You go to Settings here, and then you click on Show, pre-market and post-market and make sure that's unchecked. Click on Okay, and now it will get rid of all of the pre and post market trading. Just kinda depends if you're interested in looking at that at the moment. Now, I'm gonna go back to NVIDIA because I haven't done anything on that chart yet and we can take a good look at it. I'm going to change this back to the one day, one-minute timeframe and we're going to start doing some technical analysis here. The first thing that you may want to do is draw some trend lines. And up here in this menu bar, you can see where it says drawings right here. And you have a couple of different options. You have trend line, Priceline, Fibonacci fan, and a couple of others here. I'm going to walk you through these ones later. But the ones that you're going to want to focus on, our trend line and price line. The trend line is going to allow you to draw lines in a diagonal. It's going to allow you to basically connect all the highest, connect the lows. And you can basically put these lines anywhere you want. The price line is going to be a little bit different here because it is going to draw the line only horizontally, is going to highlight a certain price level so that you can focus on just that price level. These lines are always going to be horizontal. And as of right now, I actually have them set to extend to the right side so that as the price continues to move on, my price levels will continue to stay there. Now I set that up. You're going to draw a price line. You're going to right-click on it and you're going to click on Edit price line. And then right here where it says extend the price line to the right. You're going to make sure that's either selected or deselected depending on what you prefer. I personally like to have my lines completely extend to the right. So that is how you're going to draw it, your support and resistance levels. You can draw it your resistance levels on top. You can draw your support levels underneath. And then you can draw your trend levels by just clicking on the drawing here and clicking on trend line. Now to get rid of any of these price levels, you're just going to right-click on them and click on Remove price line, right-click, remove price line, and right-click remove price line. And there we go. Got a nice clean chart ready for some moving averages. Okay, so to add the moving averages here, we're gonna go to store the same section right here, but we're going to click on studies and then we're going to drop down to trend indicators. Remember what we're trying to identify the trend with the moving average. Everything kinda makes sense there. And so we're gonna go down and we're going to click on moving average. And it is automatically going to give us a moving average that uses the closing price as the input. And it's gonna give us a simple moving average, is going to measure it on 20 candlesticks. And that is this blue line right here. If we go in and we click on studies again, and we add another moving average is gonna give us a red line here, but it's gonna give us pretty much the same characteristics and the same variables. And we don't want that, we want to change this up, so we're going to double-click on it. And as you can see, we have the parameters right here. And we can choose the input whether we want it to be the open and close, the higher, the low or the combination of any of those. We're going to leave it as a close. We're going to change this to an exponential moving average. And I'm going to drop this down to a period of just ten candlesticks. I'm going to click on, Okay, and I'm also going to go change our simple moving average to a period of 50 candlesticks so that we have a fast moving average and a slow moving average. And there we can see them now displayed on our price chart, and it looks pretty good. You can see that the price crust above our blue moving average right here, it stayed above it all the way up to a price of 173, where it is cross below it and now it has stayed below it all the way down to 171. So at first glance here we've got some resistance on the top. We've got maybe a little bit of a price level of support right here around 170, we're definitely in a bearish trend right now because our price is below both of our moving averages, it looks like we may be finding some support right here around 170. Now, one tool that can help us determine if we're going to see some support come in right here is the volume indicator. So we're gonna go back up to studies right here. And we're going to click on volume. And it is automatically going to give us a little chart right here at the bottom. And as you can see, we've actually seen a bit of volume pick up in just the last few minutes as the price has started to sell off. So it looks like maybe this trend downwards is probably going to continue. Now, here we can see that we can actually move the price and the volume bar so that we can shrink the volume compared to the price chart. I usually like to have it about a quarter of the size. Like I said before, I like to have the volume Bart match the color of the candles and the price chart. We're going to click, right-click here. We're going to click on Edit studies. And then we're going to click on lines and we're going to go all the way to the right side and we're going to click on match tick, apply. Okay, and there as you can see, now our volume also matches the color of the candles and it looks like our price is continuing to sell off with fairly high volume. So this trend is probably going to increase and I don t think this support level here is going to hold up for us. Now throughout the rest of the course, I'm gonna be showing you a couple of different indicators and tools that you can add to your chart. And I'm going to walk you through how to use them. But if you're interested in checking out some other ones or getting a head start on them. You can find pretty much everything in this studies column right here. Go to trend indicators. We're gonna be looking at the Mac D as well as the relative strength index and a couple of others in here. These are all just technical indicators that take some calculation based on the price and turn it into a visual representation that you can use to buy or sell the stocks, or at least pull information from the chart and get some signals out of. So we're going to walk through a little bit more in depth how to use these throughout the course. But I just wanted to give you a quick run through so that you can start to apply what you've just learned in the last few lessons. 24. MACD: All right, everybody, welcome to another lesson. In this video, we're going to talk about the Mac D and how you can use it to improve your trading. Now, first of all, let's just talk about indicators. The Mac D is a type of indicators like the RSI or volume or the moving averages. And all they are is mathematical equations that displayed buy or sell signals or give us some visual cue on the charts. I want to emphasize to you that no indicators work 100% of the time and you should never be taking a trade based on just an indicator. You should also not be adding a bunch of indicators to your analysis into your charts. You need maybe two or three, some of the ones that we're going to walk through in this course. But if you're adding 567 indicators to your chart, it is not going to improve your trading is just gonna give you mixed signals. Now, when it comes to the Mac D, This is an indicator that stands for moving average convergence divergence. And we're going to use it to identify changes in trends. So if we're in a bearish trend and that price is changing to a bullish trend. This MAC D is going to help us to identify that. Now, here's what it looks like on a stock chart. As you can see, we're looking at Apple stock, a six-month time period with one day candles. You can see some of the technical analysis that we've done here. The stock is currently trading within a channel, and we have our blue and our red moving average on top here, we have our volume with the matching bars right here. And then on the bottom we have our Mac D. This is the new indicator that we've just added. And as you can see it as a red line and a blue line and a bar chart in the middle. When we zoom in here, this is what it looks like. So we've got the blue line, and that is actually going to be called our Mac D line. And as you can see, it is a fairly quick line here that crosses above and below the red line. That red line is what we're going to call our signal line. Histogram in the middle is just this bar chart right here that actually represents the difference in space between the red line and the blue line. Soon notice when the blue line is below the red line, the bars are on the bottom of this 0 level. When the blue line is above the red line like right here, for instance, the bars are above the 0 level. And so the bars in the middle just represent the difference between the signal line and the Mac D line. Now, how does this work and how are we going to use it? Well, first of all, the blue line represents a fast moving average, or a moving average that takes into account a short time period. What I mean by that is this blue line is literally very similar to the moving average that we put on our price chart, but it is taking into account a short time period. Whereas our red line here, our signal line, is taking into account a longer time period and therefore it is a slower moving average. Or in other words, it is much smoother as it goes across the chart. As you can see, the red line is much more smooth and gradual, whereas the blue line crosses above and below it because it is taking information from a shorter time period. And again, the bar chart in the middle just represents the difference between them. Now, how do we use this as traders? How does it work and what kind of information are we pulling from it? Well, as traders, the buy signal or the bullish signal, or the change in trend to a bullish direction occurs when the blue Mac D line crosses above the red signal lines. So you can see right here on this green line here where the blue line crosses above the red line. This is an example where the histogram goes from the bottom to the top and the blue line crosses above the red line, and it stays above the red line for a certain period of time. A sell signal from the Mac D occurs when the blue Mac D line crosses below the red signal line. I have highlighted that right here. You can see that the blue line comes here and then right in this area, a crosses below the red line. I've indicated with this vertical red line right here. And this would represent a sell signal from the Mac D. And so just based on this Mac D histogram on the last two trades right here. We have a buy signal right here, and we have a sell signal right here, because the blue Mac D line has crossed above the red signal line, or it has crossed below the red signal line. Now, when we take that same MAC D and we add the chart back onto it, you can see that our buy signal occurred right here around $140, and then we received our cell signal right here around a $170. So just based on the Mac D, If we had traded based on the Mac D, which we're not going to do that exclusively. But if we had, we would have made about $30 per share, which is a nice little tray. Now, to zoom in a little bit here is the Google stock over a four minute candle. So this is actually today's charts, just over a four minute candles. So we've got basically at 930 in the morning right here where we opened. Now we've got two PM my time, four PM Eastern time where a closed. And if you look at this, each candle here represents a four-minute period. And we have one by signal rate at the beginning of the day rate here around 10:00 AM, We have another cell signal right here around 12:30 PM. And as you can see, you could have gotten at 11430 and sold out at 11572 just in a matter of an hour-and-a-half based on the buy and sell signals from the Mac D, we had another by signal here around 230 PM Eastern, and another cell signaling rate before the market closed. Four PM Eastern. And so just based on these traits, again, you would a man a nice little couple of percent. And so this is how you use the Mac D, you get buy and sell signals based on when these lines cross-over. Now, I want to point something out here. As you can see, we have just four signals on this chart right now because we're looking at the four-minute candles, I basically rotated through the different options that I have for how I can look at this chart. And I found that the four-minute candles gave me the cleanest signals. We had to buy signals and to sell signals. And as you can see, it would've worked out extremely well if we had executed just solely on the Mac D. However, if I change this chart to the one-minute candles, it is the exact same stock chart over the exact same time period. However, we have like 30 or 40 different buy and sell signals here, and none of them would have made us very much profit. So what I'm trying to emphasize here is that you have the Mac D. This is a tool that we can use, but you also need to adjust it based on the time period that best suits the chart for Google stock today, for minute candles gave me the best and cleanest signals that would have generated the most profit for me if I was looking at the chart on one-minute candles though, it would have given me 30 or 40 signals from throughout the day. And it wasn't really helped me out in any way. Just in summary here, the Mac D is a tool that we can use to improve our trading. However, price action is the most important thing, but we can use the Mac D to confirm or dispute our idea. What I mean by that is the movement of the price chart itself. That is the most important thing when we're drawing our support and resistance levels, or the stock is trading in a channel or it's forming a double top. That kind of analysis is the top priority that is the most important and that is where we should put the most weight for our decision-making. However, we can then complement that decision-making with our indicators like the Mac D, and like some of the other ones I'm going to walk you through to emphasize and to basically fill out and round out our position and confirm that yes, this is a good idea to enter the trade at this timeframe. And we use these tools as part of our tool belt to basically improve our trading. We are never going to trade just on the Mac D, We're never going to trade just on moving averages. We're never going to trade just on volume. We're gonna put all of that together and then evaluate it compared to other opportunities in the market. We're going to take whatever opportunity we see either fits our requirements or that we have the most confidence in. Now, just to finish off these last two bullet points, we're never going to rely on just an indicator. I keep trying to emphasize that too many people are trying to sell an indicator or an algorithm like it's the holy grail. And the truth is, it's just never going to work because nothing is 100%. You can start to combine all of it together. You can build a better idea and improve your probabilities. Lastly, here, we use the Mac D to identify a change in trend and then buy into the trend. We want to know when the stock is either going down or going up or when that trend changes. Because when that trend changes and we have confirmation of that trend change, that is the best opportunity for us to either buy or sell short. The Mac D can help us identify those opportunities. Coupled with our technical analysis of the price action. That's how we fill out our trading. That's how we build a position here, and that's how you generate a trading ideas. So I hope this helped. I will see you in the next video. 25. Multiple Time Frame Analysis: All right, everybody, welcome back to another video. In this one we're going to talk about multiple timeframe analysis, which is an extremely important concept for you to integrate into your trading. And I'm also going to walk you through a really good example that I'm sort of selfishly proud of. So let's jump right in. Okay, so multiple timeframe analysis, when I say these words, basically what I'm referring to as looking at a stock over a long period of time, a medium period of time, in a short period of time, multiple timeframes. That's the idea here. And we always want to start with the big picture and work our way down. Now what I mean when I say big picture is we want to start with the country that we want to trade it in. For me, it's Canada and the United States and a little bit of China we've done, we want to choose the market. I usually like to trade nasdaq, dow Jones and S and P 500 companies, the larger cap companies because they have lots of volume and it's easy to get in and out of them as a day trader. I also like to focus on the technology industry specifically because it's where I find the most interests and I find it the most exciting, and it's also where I have the most experience. Now, once I have a stock that I think there's a trading opportunity in that I want to pursue. I will always look at that stock on the daily candlestick chart. I'll usually look at it over a six month to two-year time period and try to understand what is happening right now, what has happened in the past, and what is the overall direction of this company over the long term? If I feel like there's a trading opportunity that I want to take advantage of that that point, I will then go into the hourly chart. I'll perform my technical analysis. I'll draw my support and resistance line and I'll try to understand what are the key levels that I need to know about. And if I still feel like there's an opportunity that I want to trade and I want to take advantage of. Then we'll zoom into our day trading charts. We will start looking at the five-minute chart and the one-minute chart and planning out our executions. So we are working from the large picture here all the way down to the one-minute chart, we're actually going to execute our traits. Now, the reason we do this is because our goal as traders is to identify what direction the market or the stock is trading in and then buy or sell into that direction. We're not trying to pick the absolute top and the absolute bottom. We're trying to wait until that point is established. A new trend is formed that we can read and we can analyze. And then we want to bind to that trend to take advantage of the movement. We're not trying to pick the top and the bottom. And when that trend changes, we're trying to identify when a trend has been established and by herself into that trend. Here's some things that you need to know and they're super important. Number one is that most dogs will trade in the direction of the market on a daily basis. So what I mean when I say market as I'm talking about the broad market in general, usually the S&P 500, nasdaq and the Dow Jones. Those are the indices that I use to represent the broad market here in North America basically. Now, what I mean when I say most docs will move in the direction of the market, is that if you looked at those three indices in the morning to start your day and you notice that they were all up, at least just slightly. You'd be able to look at the rest of your portfolio and your watch list and almost every other stock. And it would more than likely be up to the tune of like 90 to ninety-five percent of stocks be up. If the nasdaq, the Dow Jones and the S&P 500 are all rising on that day. And it's because the market moves as a whole, it goes the other way though. If you wake up in the Nasdaq, dow Jones and S and P 500 are all tumbling a little bit. 95 to 99% of the stocks you look at that day are probably also going to be declining. The remedies and the exceptions to that case will be the companies that just had major news or just reported earnings or how to major catalysts that dramatically affects them. But most cases, most times most stocks, they will move either up or down together. Now the variation and the amount that they move up or down depends on how good the company is and how much the news affect them. The reason it happens is because there are a lot of large factors outside of general markets that can affect how people feel about their position. So for instance, if there was a war right next to you that is going to affect your country. Everybody's get a panic. Everybody's going to sell off and everything is going to come down that day. But for instance, if the government releases a large piece of news that investors are very positive about, that would probably lift the entire market altogether. So it's not like half the market goes up and half the market goes down each and every day. It's usually like 90% of the market goes up, or 90% of the market goes down almost every single day. Now, just to give you a visual example of what I mean by this, here is Apple stock with one day candles over a three-year time period. And this green line underneath here is the nasdaq Composite. Now, obviously Apple has done better than the nasdaq Composite. But what I want you to focus on here is when the nasdaq is going up, what is Apple's stock doing? Is it doing the exact same thing or is it doing the opposite? And what you'll find is that throughout this entire chart, it does the exact same thing. When the nasdaq is going up, Apple stock is going up, nasdaq is going down, Apple stock is going down. When the nasdaq goes up over a two-year time period. Apple goes up over a two-year time period. When the nasdaq starts to fall, Apple starts to fall. So when I'm trying to show you here, is that most stocks will move up and down together. If you can understand what direction the market is going in, you can start to understand what direction the stocks are going in. You can start to understand what direction you need to be trading it. Now, how do we use this as day traders? Well, once we find a stock that we want to evaluate for a trade, We then need to evaluate that stock on multiple timeframes. Like I said, daily candlesticks, five-minute candlesticks, one-minute candlesticks, and even hourly candlesticks in-between here, if you'd prefer. Now, here is an example that I pulled from this morning and it's actually really cool. So the company has called Snowflake. They make enterprise software as there are very, very exciting company and they just reported really good earnings last night or this morning. It was after hours here. And the stock, as you can see, has gapped up by 20% here from one fifty, one, ninety two. It is doing extremely well right now. And this is a good gap. This is a very positive gap because it's gapping up on a good catalyst and has broken through previous resistance. And we're in kind of what you would call a short-term bullish trend right now. So this is a very positive catalysts. This is a great reason to trade the stock. This is great momentum and the overall market is going up today as well. Now, when it comes to this technical analysis on this chart, you can see we were training bearish Lee and a channel right here. We broke out of that channel, which is a very positive bullish sign. We have now also established three consecutive higher lows right here, which has formed a new level of support, which is extremely nice to see. We have gapped above our previous resistance here at the beginning of August. We also have increasing volume right now. And if you zoomed into the Mac D, be able to see that it is crossing over. So everything on this chart is looking very, very positive, giving us a lot of reason to trade this doc and try and make some profit here. Okay, So now that we're zooming into our five-minute candles, It's very exciting because we can see this gap up in great detail here. And we can see that the price actually opened around 191192 right here before coming up to 193 and closing below, giving us a red candle, followed by two more red candles, which means the first 15 minutes of the day wasn't so good for Snowflake and we established our first level of resistance rate around 193. We came down to 184 here and we found support before rallying backup to 193 and getting rejected for a second time before trading sideways for about two hours and then coming back up to 193 again for what looks like it could be the third test. Now for us, we just had a very positive gap up the market is moving higher and we have a great catalyst for the stock. So we're gonna be looking for a buying opportunity. And as we come up to this 193 area, it looks like there could be an opportunity to get in. So we're going to zoom in closer to our one-minute candles. Okay, So this is what our one-minute candle chart looks like right here. And it's very exciting because as you can see, we're definitely reproaching the previous high at around $193.60. We're also above are moving averages right here. We're starting to see a little bit of an increased in volume. And we're definitely watching this one very closely for the bullish side. And so at this point right now, I would be watching this one like a hawk. I'd be looking to buy in on the breakout of 193, probably fifty, one, ninety three sixty as soon as we can get above this level, that'd be confirmation of a breakout and I'll be looking to ride that up until the trend starts to change again. Now, just to show you the end result here, here is what happened over the next hour to hour and a 0.5%. As you can see, we broke through the 1 ninth 350 level and we actually ran all the way up to $196.99 before starting to cross back through our moving averages. This is where you would want to kinda take your profit and exit the tray. And just in right there, you could have captured two or $3, a nice, beautiful profit per share, and a great, great trading opportunity, all just strictly based on starting with the big timeframe, narrowing it down, performing your multiple timeframe analysis and using a rational mindset to understand what the price action is doing. And so when it comes to multiple timeframe analysis, always start with the big picture and work your way down. Always try to understand the direction of the market before trading individual stocks and always make sure to buy or sell into the prevailing trend. We do not want to be swimming upstream. And if there's anything you take from this video, please take that. 26. Analyzing the Market: All right, everybody, welcome back to another video. And this one we're going to start talking about how to analyze the market. Now you've probably heard me say several times that we want to be trading with the market and not against it. In this video, I'm going to walk you through what that means and how to understand what direction the market is going in. Let's jump right in. Okay, So the overarching theme here is that we always want to start with the big picture and then zoom in. So for me, that means starting with the country where I want to invest, seeing how the markets overall are doing in that country, then choosing an industry within those markets, and then starting to zoom in and evaluate different stocks. The goal of this strategy is to understand what is happening in the big picture so that we can have contexts. When we start to zoom in. Think about it. If you were like Award general and you're going to war, you want to have a full idea and as much information as possible about the terrain and the enemy and what is happening. And then you want to start zooming into a strategy so that you can slowly start picking your enemy apart. That is the exact same thing as what is happening here in the market. We want to get as large an idea and as good of information and context as to what is happening in the overall market. So we can start choosing the best opportunities and zooming in and finalizing our strategy. We want to start with the big picture and then zoom our way in. Now when it comes to evaluating the country, you probably have that already chosen. But a couple of factors you may want to consider are political stability, environmental factors like drought or forest fires, or power consumption, things like that. And then lastly, as interest rates, we're going to talk about interest rates and a second video and then a separate section because it's a big topic. But in this video, I want to start looking at the market and the industry. So Here we're going to go through three different factors that you should be evaluating before you start choosing stocks. The first one is looking at the indices, the second one is looking at the V6. And then the third one is starting to look at how the industries within that market are doing. This is what we're going to focus on in this video. Okay, so the first factor here is the indices. I think that's multiple for index just so you're aware that the exact same thing when I say index and indices, indices is just multiple indexes, but here is a comparison. This is Microsoft stock with daily candles compared to the nasdaq Composite Index. The nasdaq Composite is this green line right here. And then Microsoft stock is the irregular candles. And what I want to point out to you, and I've kinda showed you this before. But the stocks move in the same direction as the index. And so we can use the index to understand what direction the stocks are probably going to go in. So for instance, when this green line is going up, Microsoft is going up. When the green line turns around, microsoft goes down. Same thing that happens over the next year right here as the green line or the nasdaq Composite goes up, microsoft goes up, and as soon as it starts to change, microsoft starts to change as well. Now this happens on a long timeframe, like what you are seeing right here, as well as a short time-frame. So here's the exact same stock, Microsoft stock, but with one minute candles taken from today's screenshot. As you can see, it moves almost perfectly in line with the index. As data is the first thing you should be doing when you sit down at your computer and you open up your platform, is looking at the indices and how they're doing from me. I've made a watch list that is basically the market view. Watch this, that shows me all of the major indices for Canada and the United States. So on this list, we've got the S&P 500, we've got the Nasdaq 100's, we've got the TSX composite, the Russell one thousand and two thousand. We've got the nasdaq Composite, we got all the major indices that I would want to look at. So that as soon as I sit down at my computer, I pulled this up and I'll zoom in and let's say I want to look at the nasdaq 100 index. Well, it pulls up my chart. I can perform my technical analysis. And if I look at this chart right now, it's very easy to see. We were in a very strong bullish channel right here. We broke through support that started a new bearish channel. We have three consecutively lower highs, so we have a strong level of resistance right here. We also have support based on these consecutively lower lows right here. So we are now trading in a bearish channel. It looks like we've just been rejected at resistance right here. We have crossed through our moving averages to the bearish side and the RSI is also heading downwards. And so overall here, this is a very bearish sentiment, were in a bearish long-term trend where an embarrassed short-term gender, the RSI is heading down and volume doesn't look like it's increasing in any way. I expect this to come down to the 11 thousand or 10 thousand level here the next few weeks. And so after looking at the nasdaq 100 here, everything is bearish. It means that if I'm gonna be trading stocks within the Nasdaq 100's, I probably want to be trading them to the downside or to the short side. So how do we use this as traders wealth for us, we're going to keep a chart of the correlating index open on your screen so that you can understand the direction in the market. So if your training technology stocks, you're gonna have a technology index open on your screen so that you can see how the stock is doing relative to the rest of the market. And we always want to be trading in the direction of the market. If you're trading and industrial company, you probably want to have the Dow Jones Industrial chart. If you're trading just a regular consumer package goods company, you probably want to have the S and P 500. It just depends on what you're trading, but you want to have an index that that stock is with them up on your screen so that you can understand how the broad market is doing with regards to that specific security. Now, the next tool that we're going to use here to understand the market is what is called the v6. It stands for the Volatility Index and it is also known as the fear index. When this goes up, it means that people are scared and they are gonna be selling their securities to basically meant that fear and turn their risky asset into solid cash that they know isn't gonna go down in value. When people get scared, they sell out. When people sell out, prices fall. You saw that from the first videos that we did as more and more people want to sell, that is what drives the price down. And so when people get scared and they sell prices go down. And the VIX helps us understand when that is occurring. Now, you can't buy or sell the VIX, but you can use it to buy or sell other securities and understand what direction they're likely to go in. So for us, we use the VIX because if the VIX begins to increase, it means that people are becoming concerned about condition of the market. If the VIX begins to decrease and not increase, it means the opposite. And it means that people are becoming more confident in the market, then the market may begin to go up. V6 goes up, we go short. If the v6 goes down, we go along. Now, just to show you an example of this, here is the VIX over the basically three-month period where COVID hit the markets. So we've got January of 2022, May of 2020. You can see where are around 1175 years and we go all the way up to 8547 and we hit the higher of the v6 on the 18th of March 2020. So the absolute high of the VIX was the 18th of March 2020. And then after that, the next day we didn't get nearly as high. We kept down the next day, the day after that was pretty volatile, but we didn't get nearly as high. And the basically the trend started to decline after that. So the v6 went all the way up and start to increase here, hit a high on the 18th of March 2020, And then it started to go down. As the v6 goes down. We want to be going long. We want to be buying into the market and trying to make money by buying and holding for the upside. Now, if we had done that in the S&P 500, let's just see how it would've worked out. So here's a chart of the S&P 500 pretty much over this same time period here. And as you can see, we started at 3393 and we fell down to 2191 here. And the low on the S&P 500 was hit on March 23rd, five days after the v6 topped out, the S and P 500 bottomed out. And if you had bought and you could have wrote it all the way up higher than the pre-COVID highs. What have done extremely well. And the VIX actually gave us the first signal that the market was about to turn around. Now, once you get to understand what direction the market is going in and how the VIX is doing is time to start looking at individual industries. And what I think you should do, and what I personally do is I've built a watch this, it shows me the 11 different sectors in the market. These 11 sectors represent pretty much the entire market. And as you can see, I've got the description on the right side. So we've got health care, financial, consumer staples all the way up to materials and energy, basically broken down here. And what this does is it takes the overall market, cuts it into 11 different pieces so that you can see how those individual industries are doing. And it helps, you know that if the entire market is down, just like today, we can see which industry is down the worst, which industries down the least. Or hopefully maybe there's an outlier that we can use to trade on. So how do we use this industry watch list? Well, first of all, you need to make this watch this. So take a screenshot of this, go to your broker, plug this in and create your own industry watch list. You can start to zoom in and see which industries are doing better. This is really nice because it allows us to go from the market to the industry and then into the individual stocks in a step-by-step process. It's also nice because if we see one industry that is doing way better than the others or even way worse than the others. We can use that as a reason to look into it further and see if there's a trading opportunity. Okay, so here's an example of something that could theoretically happen where looking at this industry can really help you out. So let's say that you sit down at your computer, you look at the market and things are down. You go to the industry watch list and you start to notice that everything is down except for energy. Energy is up by three or 4% and you're like, Whoa, what's going on here? Everything is down right now except for just this industry. So you look into a little bit further and you do some research and you find out that there's a war starting between two oil and gas-producing countries. That is a big concern here because if two oil and gas-producing countries go to war, it means that they might not be able to produce oil and gas. And if there's less supply of oil and gas, that means that the price is probably going to go up, especially if demand stays the same. If demand stays the same and there is less resources to go around, all of these people are going to pay more for those resources so that they can secure them. That means that oil prices are gonna go up because supply has been constraint. When supply goes down and demand remains the same, prices are gonna go up. So as the smart trader that wants to take advantage of this and try and profit from it. We're going to buy oil and gas stocks in countries that are safe and stable and will continue to produce oil and gas. Because as long as they continue to produce, if prices go up, these companies will be generating more profit and their stock will become more valuable. And so for us, as traders, we're going to take advantage of what we noticed in our industry watch list. Because then we did some research. We found a catalyst and we found an angle that gives us an opportunity to make money from the change in price. That's what we're trying to do is day traders. This is just a golden example of how you can do that. Now, in summary here, the overarching thing is that we want as much info as possible about the conditions of the market. Before we start looking for traits, we want to know how the entire battlefield is looking before we start zooming in and choosing which targets we're gonna go for first. We also want to use this info to help us find the traits as well as the direction of the market. We want to use this info to figure out where are the outliers, What's happening right now? Is there a catalyst that we can take advantage of? And if not, what direction is the overall market going in so that at least I can understand what I should be looking for when I start zooming in. Also, we want to be trading with them market, not against it. I've said that a lot here. The market is going down. You do not want to be buying securities. If the market is going up, you do not want to be short-selling. We want to be trading with the market. We want to be swimming downstream. We don't want to be trying to go up against the current. That is not how we're going to make money. We're gonna make money by swimming in the direction of the river. So we'll see you guys in the next video. Hope this one was helpful and we'll see you there. 27. Economics and Interest Rates: All right, everybody, welcome back to another lesson. In this video, we're going to talk about economics and interests rates and how they can affect your trading. Let's jump right in, okay, so first of all, interest rates, interest rates in general are set by the Federal Reserve in the United States of America and the Bank of Canada. In Canada, depending on what country you live in, you're probably going to have a regulator that sets what is known as your prime rate. The prime rate is used as the base rate for almost all debt, including mortgages, car loans and business loans and pretty much everything else. So what happens is when you go out to get a mortgage, you're gonna get a mortgage with an interest rate. That interest rate is made up of prime plus, let's call it 2%, whatever prime is that is set by the government and you have to pay that no matter what, then you're paying an additional 2% to the bank for giving you that money. And that gives you a total interest rate of, let's just call it 4%. So prime is at 2%, the bank is charging you to present your total interest rate on your mortgage is 4%. If the prime rate changes to 1%, then your total interest rate is only 3%. But if the prime rate goes up, let's say it goes up to 5%, then your total interest rate is 7%. So the Federal Reserve and the regulators set what is known as the prime rate. And that is the baseline for pretty much all debt in the economy. Now, when the Federal Reserve or the Bank of Canada chooses to set a high interest rate that is super important for us to know as traders because it makes borrowing money very, very expensive. And if you are a growth stock that is borrowing money from marketing to acquire new users, to grow your company. It makes it more expensive and it's probably going to slow down your growth. That is why high-interest rates slow down the economy because companies can borrow less money to accelerate their growth, that slows the company's down and it usually deflates a stock prices as well. However, one benefit of high-interest rates is that it also slows down and decreases inflation. So this is really important right now as a film, It's August of 2022. Interest rates are like seven or 8% in Canada and the United States. The Federal Reserve and the Bank of Canada, or increasing interest rates to try and bring down inflation. The downside of that is that borrowing money is now more expensive and people in general have less expendable income because let's say that you're a family of four and all of a sudden your car loan on your mortgage just went up. That means that you will all of a sudden have less money to spend on Apple and Samsung products, which means those companies are going to bring in less revenue, which means their stock price is probably going to fall. Everything in the economy is connected. And that's what you need to understand. Now, let's say we go vice versa. And the Federal Reserve and the Bank of Canada actually decided to set low interest rates, maybe around 1%. Really, really nice because it makes it easy to borrow money. If you're a company that is trying to grow quickly and you can borrow money at one or 2% and invest it at five or six per cent. Well, you just made four per cent profit there and you're gonna do extremely well. Low-interest rates speed up the economy because it helps companies to grow faster and people can afford to borrow more money. If the interest rate is low, you can afford to buy a bigger house. You can afford to build a bigger mansion, hire more people, hire more carpenters, do all of these things. And that accelerates what is happening in the economy. And it really, it gives people more expendable income because they can usually make more money as well. So as you can see, we've got two different scenarios. We got low interest rates and we got high-interest rates. But the real question is, why does it change? Well, I gave you one example already. For instance, in Canada, the United States, we have very high inflation right now. So the Federal Reserve Bank of Canada, or increasing interest rates to slow down inflation. And it's basically like do you want the pain of inflation or do you want the pain of high interest rates? The Federal Reserve has decided for us that we're going to take the pain of higher interest rates so that inflation doesn't get out of control. That is one reason why you might be in a condition of high interest rates. Regulators use interests rates to provide price stability to the markets. The goal of the regulators is to try and achieve consistent inflation and consistent prices over a long period of time. So that businesspeople and executives and regular folks can go out and they can predict what their food is going to cost them six to 12 months from now, they can predict what their mortgage is going to cost them six to 12 months from now. It allows people to forecast and make decisions based on stable prices so that they don't have to worry about the price of milk going up and down like this. They don't have to worry about the price of housing going up and down like this. The goal of regulators is to try and maintain a smooth and consistent economy. And they do that by increasing or decreasing the inflation rate to speed things up or slow them down. Now, how do interest rates change? That's a very good question and I'm so glad you asked very simply, regulators meet every six weeks to evaluate economic data and choose whether or not they want to increase or decrease the interests rates. And so every six weeks they'll pull together the inflation information, the jobs information, unemployment. They'll pull together housing information. Evaluate all of that data. And just like us, they'll try and get a big picture idea of what is going on in the economy. And then they will make a decision of whether or not they should speed things up by decreasing interest rates or slow things down by increasing interest rates. Regulators very interestingly, also talk in public about how they feel with regards to raising or lowering rates. And this is actually kind of cool. This just happened like two days ago, three days ago as I'm filming this video, a regulator came out, they did a speech, they said something, and the market reacted. I'm going to show you that in just 1 second, but I want to talk about why does this all matter? Why am I covering it and why do you need to know about this? And it's because interest rate changes, move the market. If interest rates are going up, that means that your house became more expensive and you have less money to spend on Apple and Samsung products. So their sales might go down. Higher. Interest rates make it harder for companies to grow. It makes it harder for the companies to sell products. It makes it harder for them to borrow money. And in those scenarios, stocks are a little more than likely going to go down. Now if interest rates are very low and everybody has a bunch of money and it's easy to borrow money and everybody's making money. Stocks you're likely to go up. And so interest rates going up or down can sometimes dictate the direction of the market just like what is happening right now as I film this course, it's not always the case though. And also because regulators talk in public about how they feel with regards to raising or lowering rates, the markets also react to those speeches. So just as an example here, this is a photo of Jerome Powell. He is the chairman of the FOMC, which is the basically regulatory body that decides whether interest rates will go up or down. He just did a speech at Jackson Hole on August 262022, just a few days before I am filming this. And it's really, really crazy because he basically came out and said, Our job is not done yet. We're going to continue to increase interest rates. And I caution anybody against trying to pull their foot off the pedal too early. We've seen what's happened in history. That's not the right case. We're going to keep going ahead until the job is done. That's basically what he said in his speech. And as soon as he said that the market went from 13,175 all the way down to 12,620. It's sold off massively. The entire market tanked by like three or 4%. And it was a bloodbath on Friday, 100% because of his speech saying that interest rates are going to continue to go up. We're not slowing down anytime soon and you should get ready for it because growth is probably going to slow down. He even came out and said that we're probably going to experience a sustained period of below trend growth. And when the guy that dictates interests rates, which has a big effect on the economy and the stocks. When he comes out and says that kinda news, it's not a good situation for the stock market. And you can see exactly how we reacted. We dropped by a massive amount on this day and I was like three or 4% for the entire market, which is rough. So imagine you've got $100 thousand portfolio just because of this guy's speech, he just has three grand overnight and it actually continued going into Monday and Tuesday. So what you need to think about is how do you use this information as day traders? If regulators are raising rates, it makes it harder for stocks to grow quickly. So if you're in an environment where the regulators are pushing rates up real fast, you might want to think twice about trying to buy long and buy these companies for growth and trying to get in on alongside. You might want to go short, especially around some of these conversations because when rates change or when regulators discuss making changes, like what I just showed you here, the market usually reacts dramatically, either up or down, depending on what they're saying. And as day traders, we can use that momentum to execute our own traits and make some money. 28. Trading Process: All right, everybody, welcome back to another video. In this one, I just wanted to talk about the trading process and what we're going to go through in order to evaluate different companies and execute the trade. I also want to talk about my daily trading routines that you can kind of get an idea for what my outline looks like and then you can customize it for whatever fits your lifestyle best. And at the end of it, I also just want to give you a couple of tips and tricks for what I would do if I was just starting out. This is what I recommend and this is the framework that I think most people should use. That's what we're going to cover in this video. Okay, so first of all, this steps to trading. This is the process that we're going to go through in order to start with the big picture and get all the way down to the execution and the journaling where we basically cycled through and try to improve our strategy. So first of all, start with the big picture and analyze the market. How are the indices doing? What is the economic situation look like? What does inflation out? What are interests rates at, and how are people reacting to the overall market conditions. Taking a look at the V6, for instance, could give you an idea of that. Once you have an idea of the big picture, that's when we're going to start narrowing and we're going to start dialing and we're going to try and find a catalyst or reason to trade a specific stock and perform technical analysis. So for instance, the example we used earlier was every industry was down except for energy, because oil and gas was about to skyrocket and pricing could be a reason to trade oil and gas stocks that day. If Apple releases earnings one day, that could be a reason to trade apple. If the technology industry is booming and everybody is shifting to the Cloud, that can be a reason to focus on that specific segment. It's really up to you and it comes down to your personal preference. But what you're looking for is a reason for a stock to go up or down. You want to try and trade in that direction, as long as it lines up with the market. Once you have found a stock and you have performed your technical analysis, and you think there's an opportunity there, you then need to calculate the risk to reward ratio and make a decision of whether or not this opportunity fits your criteria. Now, you might have a set list of criteria and as soon as it fits it, you execute the trade. What I would recommend for you when starting out is look at the market as a whole, try and find a couple of different opportunities and then choose the best opportunity that you think has the most likely odds of coming out profitable and in your favor, That's the first trade that you should take. The idea here is that you've got thousands and thousands of stocks to pick from. Every single one is going to show you some technical analysis opportunities and going to have some catalysts. What your job is to do is to take that giant list of all of these stocks and narrow it down to the very best opportunity for that day. And that's where you want to try and put your time and effort. Once you have found that you want to execute and manage the trade, we're going to walk through all the different order types and all the different ways to do this. And then once you've done that, you want to journalling your trade so you can analyze the data and improve your trading over time. The best traders are the ones that keep track of their data the best, because then you can use that past data to improve their strategy moving forward, find out what they're good at, finding out what they're bad at, find out what works for them and doesn't work for them. And that is the best way to get better over time. This is like a pilot's log. You would never fly with the pilot. That can't prove he's being on all these flights. You would never give somebody your money if they can't prove that they're profitable over a long term. This is how you prove that you're profitable over the long term, is by journaling your traits and improving to get better. So those are the steps that we're going to go through to actually execute the trade and find our trades. But as day traders, we also need our own set of steps and our own routine in our life. So this is what I do, This is how I personally manage my day and what I like to do. So first of all, I wake up and the first thing I do, I have a big glass of orange juice and I have a really small breakfast. Usually it's an apple or a bag or something like that. I go through my morning routine and I just kinda get ready, brush my teeth, get dressed, and kinda just put myself in the head-space. Before I sit down at my computer, I turn on some music and I just researched what's happening in the market for 15 to 20 minutes. There's no pressure here. It's really chill. I'm just kinda zone in and getting used to things, reading a couple of articles online, going through a couple of scanners and just seeing what's moved overnight, what new news has come out, what economic events happened overnight? How are the other market's doing? And I'm just trying to get a feel for what condition the market is in. For me, I live in Calgary, Alberta, so the market opens at 07:30 AM. At that point, I do not trade the first five minutes of the day. It is going to be super volatile and nobody knows what direction it's going in. So I usually wait for at least the first levels of support and resistance to be established. That way, I'm not jumping into early on patient with it. And I can evaluate a few different options before narrowing in on the stock that I like best, I will start to make my trades. I'm usually making just a couple of trades a day. So nothing drastic, nothing insane. And I'm trading for one to three hours if it's a good day and I'm doing well and I feel accomplished all walk away and half an hour or an hour or an hour-and-a-half. But if things aren't going so well and I'm just kinda making a couple of breakeven trades. I might stick out for two or three hours, but I'm usually not shading anything past that. Once I'm done trading, I'll journal all of my trades and I will spend the afternoon making content. Sometimes I have the charts open if there is a company that's going to IPO or release earnings or any piece of big news that's happening. For instance, if Jerome Powell, who's speaking, any events like that, I might try and take advantage of. But the day-to-day trading, the 80% of my trading usually occurs in the first, let's call it 15 to 20 minutes to the three-hour mark of market open. That's usually where I'm doing most of my training and my mentality here, especially when I'm starting out, is that I'm trying to make steady and consistent profits each day. I'm not trying to blow it out of the park. I am not trying to just make hundreds of thousands of dollars in one day. I'm just trying to build a strategy that works and that is profitable. And if I can get that out of the way, then I can just increase the dollar amount in that account and in that strategy. And I shouldn't be able to scale it up. I'm not trying to hit home runs. I'm trying to build a safe and reliable strategy that can scale up by just increasing the dollar amount and doing everything else the exact same way. That is the holy grail to trading. That's what we're trying to achieve here. And it doesn't matter if you're trading with a 100 thousand or $3 thousand. Most of the stocks and most of the things that we're going to talk about and trade in this course. It doesn't matter how much money you have, it matters how good your strategy is. And that's what we're going to try and build out. Now, when it comes to starting out as a new trader, the first thing you need to do, like I've said throughout this course, is start with a practice account. Make some trades in there and make sure that you're profitable for a one to two-week period at a minimum in that practice account before you start date treating with real money. Once you put in your real money, only put in one thousand and five thousand dollars maximum. Just get used to it, try it out for a week or two to make sure everything is the same in the real account as it was in the practice account. A lot of practice accounts don't charge commissions, for instance. So there are going to be a couple of subtle differences. You need to make sure that you're just testing things out and dipping your waters. And solely, once you feel confident with a thousand or $5 thousand and you're starting to be profitable, then you can put the rest of your money in. But don't just put all of your life savings into the account and start detraining with it right away. You're making a mistake. I'm telling you right now. Also, you need to be journaling your traits from the beginning, we're gonna talk about this in depth in this course. You need to be doing that from day one. I promise you it will help you so much. I didn't journal for the first year of my trading and I wish I had all of that data x I could have improved so much faster. I promise you it is well-worth the time and effort you need to focus on building a profitable strategy rather than making a ton of money. What I mean by that is if you have a profitable strategy that you can repeat over and over again, that is what you need. That's the holy grail, that's the golden goose. Because all you need to do is just do it for a longer period of time or take some other money that you have, put it into that account and just wash and repeat. That is the golden goose here. That's what we're trying to achieve as a profitable strategy, not a lucky trade. There's big difference there, and that's what we're trying to focus on. So see you guys in the next video. 29. Risk To Reward Ratio: All right, everybody, welcome back to another video. In this one, we're going to talk about your risk to reward ratio and how to use that when evaluating a trade. Here we go, okay, so what is the risk to reward ratio? Well, very simply it is the ratio between what you expect to make or profit on the trade versus what you are willing to lose if that trade doesn't work out. So just as an example, if you buy stock XYZ with the expectation that it will go to a $120 and you buy it at $100, buy at $100, you set a stop-loss and $90. Now I know we haven't talked about that yet. We're going to talk about it in detail in a little bit. But a stop-loss is an order that will get you out of a trade if it falls below a certain level, basically limiting your downside risk. And so if you enter a trade out $100, you expect the stock to go up to $120 based on your technical analysis and you set a stop-loss at $90. What is the risk to reward ratio? I'm asking you that question. Think about it in your head right now. The answer to that is a one-to-two risk to reward ratio. You're risking $10 to make $20. You're risking one to make to it as a one-to-two risk to reward ratio. And that is what we're going to talk about in this example. This is how you calculate it though your entry points and where you expect the stock to go, that's your profit, and where your stop-loss is, that is your risk. All we're doing is comparing those and turning them into a ratio. And this one, is it a ratio of one to two? Now, the reason that this is so important for day traders is because that number is kinda dictates how many traits that we have to be right on in order to be profitable. What I mean by that, Let's assume that every trade either goes away or it doesn't go our way, either hits our take profit, where it hits our stop loss. That's not the reality of day trading, but let's just say for this example, that is what happened. Well, if we had a risk to reward ratio of one-to-one, meaning that we're risking just as much as we can gain on this. Then we only have to be right on our trades 51% of the time, kinda like casino odds. You only have to be right 51% of the time. If it is 5050 odds, kinda like going to the casino, you only have to be right 51% of the time if the risk to reward ratio is one to one, that way at the end of the day, as long as you trade enough and you make enough traits, what kind of average out you will be profitable. The same thing goes here. If the risk to reward ratio is one to two, like what we just saw in our example, we're risking $10 to make $20, risking one to make two. That means that in order to be a profitable trader, we only have to be correct about 34% of our traits if you think about it, if we're correct, about one in every three traits here, and we make twice as much as we lose. That means that our break-even point is gonna be at 34%. If our risk to reward ratio is one to three, we only have to be right just over a quarter of the time. If the risk to reward ratio is one to four, jumps to just over 20%. You can kind of get the idea here. What we're trying to focus on is how much are you risking versus how much are you able to make and how often does that work in your favor? Those two factors are what will dictate your profitability as a trader. Those are the largest two factors when it comes to trading. And if you could just be positive here, this is what proves whether or not you have a profitable strategy. Now when it comes to my risk reward ratio, it kinda depends a little bit on the situation. But my absolute minimum that I will take for one of these traits is a one-point five risk to reward ratio. So if I am risking $10, I want to make an absolute minimum of $15 in every single situation. In that scenario at those odds, I only need to win about 40% of my trades to be a profitable trader. Now, here is an example of what that could look like. So this is snowflake with one day candles. We've used this example throughout the course because it's just kinda good timing right now. Based on our analysis, we've got support along the support line. We just kept up, we have previous resistance at around $180 because we have kept up above that resistance, that level is now becoming support. I do expect us to find some support at a $180. So as they zoom into my daily chart, remember we're starting with the big picture. We're zooming our way in as we zoom into our day trading chart, we're looking at one-minute candles here, and we can see that the support level at 180 is actually holding up pretty strong. We bounced off in the morning. We bounced off at around 1045 right here. Then right here was very interesting. We actually had another double bottom at this one hundred and eighty one hundred and eighty one level right here. And then we broke through the neck line of this double bottom. You can see that breakthrough right here. If you had bought in at 182, you could have set a stop-loss at $180, that would have given you a downside of $2. And you could have set your take profit at $185. And that would have given us a risk to reward ratio of 1.5. It would have been a nice, beautiful trade right here. You could have wrote it all the way up on Snowflake. I'm looking at the chart today because I'm actually filling this in the next day and the stock just tested 180 again. And so that is why we start with the big picture and work our way down. Without that analysis, we went to have known to look for that 180 level. But really, really nice example here. Now, in summary here, the risk to reward ratio represents what you are willing to risk compared to what you stand to gain in profit on each and every trade. We never want to take a trade that is below a 1.5 risk reward ratio. And we always want to keep track of all of our trades in our journal, the risk reward ratio is one of the most important metrics that you can measure as a trader. And this variable or this factor, this risk reward ratio can also be called the r-value or the are multiple, just depending on who you're talking to, what software is you're using, and what journal you're keeping track of your trades. And so that is it for the risk to reward ratio. This is one of the most important topics for throughout the entire course. So please make sure that you understand it because we're going to use it in almost everything that we do moving forward. 30. Position Size: All right, everybody, welcome back to another video. In this one, we're gonna be talking about position size, which is an extremely important topic for any trader. So I hope you get some value. Let's jump right in. Okay, So when it comes to position size, what I'm referring to here is how much money do you place individual trades with? So if you decide that you're going to day trade apple, you're going a day trade Amazon. Are you going to enter a position in Snowflake? What I'm referring to is how much money are you entering that position with now, when it comes to determining position size, I have a methodology for you here that I use that so far has been the best way of determining what type of sides you should put on for your trades. Now step number one to this methodology is to choose your maximum loss percentage based on your portfolio size. So if you take a trade, how much of your overall portfolio are you comfortable with losing or risking in that tree? For me, it is usually 2% of my portfolio. So if I'm trading with a $10 thousand portfolio, my maximum loss on a single trade should be $200. The maximum amount of loss that I want to take, one of my portfolio is $10 thousand, is $200 on an individual trait. That's what I've set out as my rule and my guideline. And I'm not going to change that until I'm profitable. That's how you should be thinking as a new trader. Now step number two here is to divide your maximum loss. In this case it's $200 by your risk on the trade. What I mean by this is if you enter stock XYZ at, at $100 and you put a stop-loss at $90, your risk is $10 per share. If your maximum loss is $200 that you're willing to accept as a trader and the risk is $10 per share. You're going to divide those two numbers here, and it is going to give you a position size 20 shares. So what we're doing here is we're taking the total amount of money that we're willing to lose on a single position. And then we're taking the total amount of money that we could lose on an individual stock basis, we're dividing them to tell us how many stocks that we can buy without going over our maximum loss here. And the idea is, if we do this math is should protect us and it should give us a position size that is never going to exceed our maximum loss of 2%. And so in this example, we should be buying 20 shares of Company X, Y, Z. Because if the trade does not go in our favor, we will only lose a maximum of 2% or $200. And so your position size is a factor of your stop-loss, as well as your maximum loss based on your entire portfolio. That's how you should determine how much money to invest into an individual position. Now, why is this important? Why am I hammering this and why are we doing it this way? The answer is because if your maximum loss is 2% per trade, you would have to lose 34 trades in a row to lose half of your account. This rule is designed to help us reduce our risk by not taking on positions that are too large. Am I making sure that we have tight stop losses with appropriate levels of risk reward ratios and appropriate position sizes. So that if we lose a couple of trades in a row, it's not going to have a major impact on our portfolio. Remember, we're going to have good days, we're going to have bad days. Sometimes you're going to lose several trades in a row. And we wanna make sure that we have systems and protections in place so that if you lose three trades in a row, it is not going to completely destroy your account. It's not going to set you back three years. It's not going to mess with you, is just gonna be a little bump in the road that we can overcome because we're long-term profitable traders. That's what we're trying to build here is not a get rich quick scheme, but a long-term profitable strategy that can manage the ups and downs. Now, in summary here, your position size is a factor of your maximum loss percentage and your stop-loss on the tray, you divide your maximum loss by your stop-loss per share. And that will give you the number of shares that you should be buying for that position. This is a risk management strategy to make sure you don't blow up your account. You should not be choosing your position size based on emotions and based on how you feel and based on how you're trading, it needs to be a set list of rules that keeps me protected. It reduces your risk and it makes sure that you're following a process and not just veering off based on your emotions, that's what we're trying to avoid as traders, if you're trading based on emotion and you're just doing whatever feels right. That is not a system, that is not a strategy and that is not replicatable. We're looking for something that we can scale up over time by just rinsing and repeating and doing the exact same thing. Emotions are the enemy of that system. We are only also going to increase our maximum loss when we're profitable. So when you're just starting out, I highly, highly recommend that 2% level only when you are profitable for a month or two at a time. Should you increase that to three or 4% and you should only ever increase it by 1% at a time. Now, that's it for this video. These last two ones here with regards to position, size and the risk to reward ratio, have been extremely, extremely important topics and I've covered them quickly. So if you're interested, please go back and re-watch those videos because these are topics that are going to come up throughout the rest of the course. 31. Stop Loss: All right, everybody, welcome back to another video. In this one we're going to talk about stop losses and how you can use them to manage your risk. Let's jump right in. Okay, so what is a stop-loss? Well, very simply, a stop-loss is an additional order that you are going to place to exit your position if you're wrong. So let's say that you get into Apple stock at $100 with the expectation that it's going to go to one-to-five? Well, a stop-loss will get you out of the stock starts to fall. So if we place our stop-loss at $90 and the stock falls below $90, it will exit that trade for us. And if the price continues to fall, we will already be out of that trade so that we're not just continuing to hold those shares. A decrease in value, a stop-loss is used to exit our position when we're wrong and we use it to manage our risk. Now, how do you place a stop loss? Well, that is going to depend a little bit depending on the software and the broker that you use. Each one is going to be slightly different, but this is what it looks like in Quest rate. We're gonna go to Apple stock right here. Aapl, either currently just set for one share and the order type is a stop. This is where you're going to choose the stop-loss order. I'm going to walk you through all of these different order types coming up here in a future lesson. For this example, we're going to use a stop order. We're going to set it at $129, which means that the price of apple falls below 129, it will exit us out of that trade. In this example, it's just one share the duration and the routes are good to close an auto. We're going to talk about what that means later. And the account is in my tax-free savings account. And when I click on cell, it's going to ask me to confirm. And then this is what it's gonna look like on the chart. You can see this line right here where it says negative one. So that means I'm selling one share using a stop order at a $129. And you can see it is listed right at the 129 right here. So if the price of apple falls below 129 right here, this trade or this order, I should say, will execute and we'll sell one of my shares. Now, this was just an example, so you can kinda see it visually. I'm going to walk through a couple of more examples in just 1 second. But first I want to talk about why do we place a stop loss on our trades? Well, first of all, it helps us to visually see the risk and the downside of the trade. By placing a stop-loss, it forces us to set a point at which we are wrong and at which we're going to cap our risks and exit the trade. It makes us go through their process and actually think about what is the reward, what is the risk? Does this fit into my criteria? And is this a trade that we actually want to do? Therefore, it helps us to reduce our risk and actually think about the downside. We also use the stop-loss to calculate our risk to reward ratio. Ever entry point right here, wherever our stop-loss is, that is our risk. And wherever we set our take profit, that is the reward. We need our stop-loss in order to set the risk to reward ratio, which we're using in order to meet a minimum requirement to enter the trade. Remember, we're not going to enter any trades that are below a 1.5 risk reward ratio. And ideally, we're looking for a two or three risk reward ratio to make a really good trait. Number three here is that by setting a stop-loss, it reduces our risks to large price swings. So if the company comes out with an announcement or something happens in the economy, or an interest rate changes anything along those lines that can really fluctuate the price during the middle of the day, setting a stop-loss allows us to protect the downside against one of those large fluctuations that goes against our trade and would cause us some losses. The stop-loss prevents us and it also protects our downside, basically in general. So having a stop-loss will protect you from losing a large amount of money. Now, the million-dollar question here that everybody asks is where do you place your stop-loss? And I've seen a lot of people explain this a lot of different ways. And the best explanation that I've seen and what has worked best for me is that you placed the stop loss at the level where your analysis is wrong. So if we are inevitable and we think that the stock is going to one-to-five and we set our stop-loss at 90. That is because if the price falls below 90, that proves that our analysis is wrong, that the support level we were watching for is no longer valid and that the price is going against what we thought was going to happen in a way that makes our hypothesis completely invalid. That's what we're trying to do here is set the stop loss at the level where our analysis is wrong. Now, let's walk through a couple of examples of what that means. So here's a stock chart of Shopify. As you can see, we're trading around $94.73 right here. Coming back down to this 30% to 50 range where we found support at $38, we found some resistance at around $55, and we'd been bouncing back and forth between their support and resistance several times over the last few months, we recently got rejected at resistance and we are now trading directly along support. And so when I look at this chart and I think about what is the risk to reward ratio and where would I place my stop-loss? Here's what goes through my head. So number one here, if support breaks down and the price falls through $38.50, that is where my analysis is going to be wrong. That is where the support level is probably failing. That is where this technical analysis kind of breaks down. So at that point, I want to set my stop-loss just below that level so that if it fluctuates based on a big order or I'm off by just one or 2%, I don't want it to take me out, so I want to give it a little bit of room and I'm going to set my stop-loss at $3,838.25. So just below the previous low of this channel. So during this channel the price got it down to $38.63. I'm setting my stop-loss just a little bit lower than that at $38.25. So that if we come down and we set just a slightly lower low, it's not going to exit my position. Now I'm also not going to get into this position until we start to see a bounce off of support. So my entry into this trade would be at $41, my stop losses at 3825. So that gives me a total risk on this trade of a $1.75. Now for me personally, I would set my tape profit around $50 here, because as you can see, every time we bounce off of support, we get back above $50 each and every single time. So by setting my take profit of $50, I'm fairly confident that if this works out the way I think it's going to, that price will break through $50 and I'll be able to get out with my money. Now if my entries at 4100 AM I take profit is at $50. That means my reward on this trade is $9. And since my risk is a $1.75, that gives me a risk to reward ratio of 5.14, which is extremely good and extremely safe. So in this example, I'm setting my stop-loss at 38 Twenty-five, just below support right here. I am taking my profit just below resistance right here, so that I have a very good chance of getting filled on that order. I am looking for a $9 upside, gives me a risk to reward ratio of over five. And this is a very good and very healthy trade. Now, just to show you another example, this is a day trading chart. I can show you this one because we know how it ended up, which is really nice. This is Amazon. I was watching Amazon today and it showed me some really interesting things. It wasn't a great start to the day, but we did bounce higher and we actually bokeh above our previous resistance here at 130. This was a very bullish sign. I didn't enter the position here, but I was watching it very closely and it's stuck out to me because 130 enacted as resistance right here, enacted as resistance for about ten minutes right here. And then we broke through it to one thirty one thirty eight, and we came right back down to this 130 level. And so it's acted as resistance twice now attached to this support. So very important level for us today. Now, as the price continues on, we can see that we rise back up, but we don't set a new high. We actually set a lower high, which is a sign that we don't have continued momentum. So as you can see, our all-time high here was one thirty one thirty eight. Our next high was lower than that. Our next high after that was at about the same level. Now we started trading in the downward direction. So this made me start to think, okay, we're losing momentum here. This bullish run might be coming to an end. If I want to go short on Amazon, how would I do it? And I went back to this 130 level here because it was super important. It acted as resistance than enacted as support. And I thought if we fall through 130, that could be a great trading opportunity for us to go short on Amazon. So when I look at entering this trade, Here's what goes through my mind. I don't want to get into this trade until support breaks down if the price falls below 1 third, That's going to be my entry point. And so I would be willing to get into this stock below one thirty one twenty nine point seven, five. That way I can get in right on the brake and hopefully I can write it down. Now because 130 is the level that I am watching for. This is the key levels that I'm trading off of. And we're going short on this trade. I'm going to set my stop-loss at 130.25. So it's going to be above this key level that I'm trading based off of. And if the price comes back above 130.25, it means that the price did not fall through support. It's actually bouncing off of support. And I want to get out of that position. I want to exit that trade because my analysis was wrong. So the price starts to break down below 130. I'm gonna be entering at one twenty nine seventy five, setting my stop-loss at 130.25 and I'm going to set my take profit at 128. We can see right here we got down to a 128.1-six. If we really sell off here, I think we're gonna get down to at least close to this level if not setting a new low, because at this point the market was also starting to sell off. So in this trait here, we have a risk of $0.50. We're getting in at one twenty nine seventy five were out at 13025 to $0.50 risk right there. And we're trying to take profit at 128, which gives us a reward of $1.75. Risk to reward ratio of 3.5. So now that we've got this trade setup, we can enter the trade when the stock breaks below. And just to show you exactly how this trade played out, this is what the rest of the day looked like. You can see that we flushed below this 130 level. We came all the way down to 126.72 and our trade would have filled out 128. And we would have made that very nice 3.5 risk to return ratio and a beautiful couple of percent on this trade. And so that is how I think about these traits. That's how I think about risk reward ratio. And that is how you should be setting your stop-loss. Your stop loss should be based on where your analysis is wrong and your take profit should be based on previous levels of support or a minimum risk to reward ratio. Now, in summary, the stop-loss is part of how we mitigate our risk and determine our risk setting. The stop-loss is something that we do on every trade because it forces us to think about the risks on the trade, the reward on the trade, and what the risk reward ratio is while protecting our downside and protecting our portfolio. So the stop-loss is extremely, extremely important on every single trade. We placed the stop-loss based on where analysis would be wrong. And we're using a stop-loss when buying long or selling short in the Shopify example here, we were buying long. We're setting our stop-loss below the level of support. In the Amazon example here, we're selling short and so we're setting our stop-loss just above the key level that we are trading off of. Makes sure that you understand how to use a stop-loss. Because we're gonna be going through this for the rest of the course. We're going to use a stop-loss on just about every single trade. 32. Trading Journal: All right, everybody, welcome back to another video. In this one we're going to talk about trading journals and how you can use them to improve your performance over time. Let's jump right in. Okay, so first of all, a trading journal, what am I referring to when I say that? Well, basically what I'm referring to is a journal to keep track of your trading performance. We are trying to document our win rate, our risk reward ratios, what stocks are going well for us? What stocks are we losing money on? What times of day, what days of the week, what types of securities are going well for us? And we keep track of all of that information in our trading journal so that we can look back on it and improve our performance moving forward by adjusting our strategy. Trading journal is the equivalent of a pilot's flight log. You wouldn't get into a plane or a fly with a pilot if he couldn't show and prove to you all of the flights he's done in the past. It's the exact same thing here when it comes to your trading journal, you want to keep track of your performance so that you can analyze what went wrong and you can prove it moving forward. Now, when it comes to journal options, you've got lots of different options. You can do everything by hand and the calculations by hand, and you can keep track of everything in a notebook. That's actually where I started with, just document everything by hand, talk about y-intercept, y-axis did it and kinda did it from there. The problem with that, so you have to do everything manually and you have to do all the calculations yourself. When you get tired of the notebook, then you can move on to the Excel sheet. The nice thing about an Excel sheet that you can build in some of those calculations so that it's a lot less work. But the problem with the excel sheet that you still have to manually enter most of your trades or most of what you were doing so that you can then run those calculations. So these are the two free options that you can use as a trading journal if you're okay paying a little bit of money and you want a cheap version, I would recommend trader sync. I'll put links to these in the resource tab as well. But trader sink is what I used for probably two or three years here. It did a really good job as 20 to $30 per month depending on what plan you get. Basically, you make your trade throughout your day. You download all of your traits, upload them to trade or sink, and then you can access all of your analytics in trade or sink because it will pull all of your trades from that download so you don't actually have to manually enter anything. Dreyer sink was great. It did a good job for me for a very long time. Now, today I'm currently using a platform called trade cella. It's a pretty good trading journal right now. It's a new company that just kinda got started a little while ago. So it's still up and coming. They're still trying to improve things, but so far, it's working out pretty good for me. It is a little bit more expensive though. So if you're looking for something on the cheaper side or you don't want to pay that money up front, I would go to Trader sink and then move on to trade cella. If you're not getting what you want, Autotrader sink when it comes to the goals for your trading journal, here's what we're trying to achieve. Number one is we want to keep track of major trading statistics like our win rate and risk to reward ratio. We want to help to identify what we're good at and what we're not good at. So if we're really good at training tech stocks and really bad at trading utility stocks. Hopefully, we can use the data in our journal over the first couple of weeks of our trading career to try and understand that so that we can avoid the stocks we're bad at and stick to the stocks that we're good at or that we're having more success with. Training journals also allow you to go back and analyze and improve your trading strategy. If you notice that you are buying into early on the breakouts and their false breakouts and they're coming back down on you. You should be able to document that in your trading journal so you can go back, analyze it, and realize, oh, I made the same mistake three times that week. Let's try and cut that out of my strategy. Now, just to get you guys started, I am going to share my free trading journal with you. It is an Excel sheet on Google Drive and it is also linked in the resources to this course. So definitely check it out. But here's what it looks like. It is a very, very simple trading journal. All you do is you enter in the month here. So let's say it is September when you were starting to trade, you enter that in here. And if you go onto the next month, all you do is just copy this page over and start a new page for the next month. When you make a trade, you enter in the date of the trade. So let's say it was September fifth, 2022, and we were trading on Snowflake again, just as an example, let's say that we got into Snowflake at 190 was our entry, our stop-loss was at 180 and we're trying to take profit at 210. Then we enter in our exit price. Once we're done the trade, once we're actually out of it and we've closed our position, what was our average exit price? Let's say that we didn't make it all the way up to 210. We actually only made it up to 209. We're going to then click on Tab and we're going to highlight the squares right here. We're going to drag these formulas down and it's gonna give us all of our new steps. So our projected risk to reward ratio, a two-to-one risk to reward ratio. Our actual realized ratio was 1.9 because we actually sold for $1 less than our take profit or gain or loss on the trade was about 16%. And we won that trade because we made some profit. Alright, and then as you make your next trades, you enter in the same information here. You highlight these cells, bring the formula down and it will automatically calculate your average when rates are right here. So basically wins versus losses, and then your average risk to reward ratio based on your projections. These are the two major statistics that you want to keep track of as a day trader. Because if you have these going in the right direction, you'll be profitable no matter what. Now, like I said, that was just a free trading journal. You, you're welcome to download it and build on it and add new features and benefits. I highly recommend it actually, but it is at least something to get you started completely free and it won't cost you anything. So I highly recommend it now when it comes to the paid trade, trading journals, There's actually a lot of advantages to them and I would recommend them. Once you get started, you don't need them in week one or two. But if you get into this and you're a month or two into any like yeah, day training is for me, then I would recommend going out and getting a paid trading journal because those paid journals will provide you with much better analytics and data. So basically, in this one here, I'm really just providing you with the win rate and the average risk to return ratio. Kinda see how well you've done by tracking your trades. But realistically, there's not a whole lot of information here. So if you are interested in getting into this more seriously, definitely check out one of the penetrating journals because they'll give you a whole lot more analytics. And you can usually export your trades directly from the broker into the trading journal so you don't have to manually enter anything. You go through your day, you upload your trades, you analyze your data, and that's it, you're done. It's a very, very smooth and efficient system. Now, in summary, here, you need to have a trading journal on day one when you get started. So the dune in your notebook, use that Excel sheet that I made for you or go out and pay for one of these services, but you have to have it. You get started because the trading journal is just like a pilot's Flight Log is absolutely mandatory. Now, once you get that training journal up and running and you get some data in it, you then need to use it to improve your trading overtime by figuring out what you're good at and what you're not good at. You need to analyze that data to try and refine your strategy. And you can even say to yourself, Jeez, if I didn't make this trade, this trade and this trait, what would my actual win rate be? What would my actual risk to reward B? And then you can use that to try and either eliminate things from your training or adding new strategies or add to the strategies that are working for you. So that's the idea behind the trading journal, is to help you improve your trading overtime by analyzing the data from your actual traits. 33. Risk management Plan: All right, everybody, welcome back to another video. In this one, I want to talk about risk management plans and what factors you need to consider when building your own risk management plan, okay, so when I talk about risk management plans, basically what I am talking about is the safe guards and the protocols and the systems that we have in place to make sure that we do not lose too much money. Basically, these are the safety nets and the things that we're going to do to try and protect ourselves in the event that a trade goes the wrong way. Now, when it comes to building out a risk management plan as a day trader, a couple of different factors to that plan and things that you should focus on. I'm gonna kinda summarize them for you here, but you definitely need to go into more detail for yourself when it comes to the first one that is position size. We've talked about this before. Your position size should be based on a maximum 2% loss to your entire portfolio based on your stop-loss. That is the first factor of your risk management plan. I personally think it should be a maximum of two per cent if you're a new trade or you might want to start with 1%. And if you're feeling really risky and confident and you're actually profitable, then you can up it to 3%. The second factor here is a stop-loss. You need to identify where you're going to set your stop losses. And me, I personally recommend set your stop loss is based on where your analysis is proven wrong things to price action. Now once you have your stop-loss set, you're going to need to calculate your risk to reward ratio. And this is the third factor of our risk management plan. In order to manage our risk, we are only going to accept traits that have a minimum of 1.5 risk to reward ratio, we would rather a trade that has a 23 or four risk reward ratio. But we're not even going to consider or look at anything below 1.5. It is not worth the risk for us as traders, there are better opportunities out there. Give us better risk reward ratios. We just need to do the work and finding them next year is your entry criteria. This is usually going to be based on market conditions and technical analysis. What is it that is making you look at the stock? What is it that makes you feel confident about support or resistance and your entry point? Same thing goes with your exit criteria. If the market starts to turn, that could be an indication that it's time to get out. So these are the different factors that you are going to want to list when identifying what is your entry criteria and your exit criteria. Then you also want to journal your trades so that you can look at how much risk you took on that day or that week, and evaluate how you can reduce that risk or get a better return for that risk in the future. The journal is part of our risk management plan and it helps us to identify where we're good, where we're bad, and how we can reduce or improve our risk reward ratios. And then morning routine, I know this sounds kind of strange here. But going through a morning routine, getting in the right mindset, being physically healthy and attentive when you sit down at the computer can help you reduce your risk because you will have less brain fog. You'll make clear decisions and I promise you that you'll be more profitable. So actually going through a proper morning routine, waking up early, brushing your teeth, getting breakfast, taken a shower, doing some exercise during your morning research, and then getting into the training mindset can significantly help you improve your performance. That is why it's part of the risk management plan. Now, when it comes to my risk management plan, you're probably already familiar with except talked about different pieces throughout this course. But like I said, position size 2% max loss based on the stop-loss. The stop-loss is paste where my analysis has proven wrong, 1.5 minimum risk to reward ratio. My entry criteria is based on a strong catalyst with market confirmation and good technical analysis. My exit criteria is that I want to change in trend based on technical analysis or when the market's changed direction. That's probably when I want to exit that position. I journaled my trades every day with a paid service where I upload my transactions at the end of each day and then analyze my performance. I go through a morning routine each and every day that includes breakfast and market preparation. And I will always step away from the computer after three bad traits. So if I make three losing traits that were just poor performance or they just didn't work out. If I make three of those in a row, I will step away from my computer. I will go for a bike ride OK. Oval on the treadmill. I'll go to the gym. I'll go do something else that has absolutely nothing to do with trading so that I can clear my head and I can come back later. And I know that as long as I have a max loss of 2% of my entire portfolio, I'm only losing a maximum of 6% that day. That is something that I can stomach, that's something that I could swallow. And it's not really a big deal in the long term. Now, why are we doing this? And why is this important? And why is there a whole video about this? Well, it's super important because we want to be trading based on strategy that we can scale up. I keep repeating this because strategy is the most important factor here. All you're trying to do is build a system that is profitable at the end. Because if that's the case, you can just add more money or you can let it run longer and you're gonna be extremely wealthy. But the problem is, if you are trading on emotions, if you're training on feelings, if you're trading on signals from somebody else, if you're trading on anything that isn't your strategy, you are not going to be at to scale it up. You're not going to be able to rely on it over the long term. It is not going to serve you as well as if you just learn how to do this yourself. You write down your own strategy, your own risk mitigation plan. You analyze your data to improve it over time. That is the key here and that is the golden goose to day trading because the riskier if you don't do this is very, very large. If you lose money, let's say, for instance, you lose 50% of your catchment and a couple of bad trades. You now need to make 100% returns on what you have left in order to just be back where you started. So not blowing up your account in the beginning is so crucially important. I can't stress this enough. Start with practice money until you're profitable. Start with a small account when you are profitable and then only add and once you have the data to back it up. Because if you take a loss in the beginning, the amount of money and the amount of returns, the percentage return that you need to make back up is ridiculous and it just gets worse and worse the more money that you lose. So in the beginning, especially losing money is much worse than not making money. You are so much better off having a break-even day making absolutely no trades, or making three trades that took you two hours and you walk out with a big goose egg. That is so much better off than losing money. Because now you have data and now you have knowledge. Now you can learn about the markets and how your brain thinks when you see different price actions. But if you lose money in the beginning, it is so tough to recover from. So that's why I'm stressing practice accounts, risk management plans, and taking responsible traits. Now, in summary here, couple of points I want to talk with, create a one-page risk management plan. You saw the points that I highlighted here. Go to Google Drive, create a new document, just lists these different points and then talk about exactly what your strategy and your plan is. It should be almost identical to this, but it's just important that you write it down for yourself and you keep that with you and your trading. You should also be making sure that you've thought about the different scenarios before they come up. So let's say that you make to portrayed, so you're going to walk away. Are you going to make another trade? Is it going to be high risk or low risk? Or let's say that you're doing really well. You've made three profitable trades, really, really back-to-back. You're doing extremely well. You're feeling confident. Are you going to increase your ratios, are going to increase the amount of money that you're trading with. What you should do is think about those scenarios now, type them into your risk management plan so that you know what your game plan is, what your strategy is, and how you going to manage that scenario before it comes up. Because I promised you a emotions are the enemy of your trading. If you get over confident the market will slap you in the face. And if you get so down on yourself, you're going to miss the big opportunities. You really need to be careful with your emotions. You need to stay away from your emotions. You need to focus on the strategy and the risk management plan as part of that strategy. And this is usually the factor separates the good traders and the profitable traders from the traders and the guys that are only at this for a month or two. So please be careful here. Super important lesson. Please take the time and effort to develop your own risk management plan. And I'll also put a template for this in the resources tab for this course so that you have something to base your risk management plan off of and kind of an outline that you can use. I highly recommend it, super, super important. And this is, I can't emphasize this enough that this is separate. What separates the profitable or not profitable traders? 34. Order Types: All right, everybody, welcome back to another video. In this one we're going to talk about order types and how to actually execute on the order once you've identified the trade, let's jump right in. Okay, So just to recap everything here, our process as traders is to start with the big picture and narrower our way down until you identified and found a trading opportunity. Once we have identified that opportunity, we want to take a look at our risk management plan and see if that trade fits within that plan. We want to buy or sell into the direction of the market, We're looking for a risk to reward ratio of 1.5 or maximum loss on the trade is 2%. Does this fit in with what we're looking for? And once it does and we're happy with how things are going, we wanted then execute the trade. Now when we execute the trade, there's a couple of different ways to place an order to buy or sell. In this video, we're going to talk about those different ways, and those are called your order types. Here we're going to cover three main order types. There's a variety of different ways to place this order, but the majority of the order types that you are going to use are either a market order or a limit order or a stop order that kinda makes up the majority of trading. That's what we're going to cover from here. Now we're going to build on it later in the course. Okay, So the first-order that we're going to talk about here is the market order. The market order is really nice because it will execute your order right away at the closest bid or ask. So here we've got a chart with the price on the left. We've got the bid or the buyer right here. So people are willing to buy shares, 20 shares at 10530, shares at 10450, shares at 103. And on the other side of the trade we have the sellers or the ask, where people are willing to sell or they're asking for $106 for 60 shares, a $107 for 50 shares, under an $8 for 20 shares. We have an exchange with a bunch of buyers and sellers located all around the country or all around the world. They've placed their different orders. And the marketplace right now is somewhere between 15106, wherever the last transaction close that. Now if we come in there as traders and we place a market order to buy 100 shares. That order would execute 60 shares at 10640, shares at 107, because there's only one person that is willing to sell their shares out, 106 and there's only 60 shares available, but because our orders for 100, it is going to buy all the shares at 106 right here, and it is then going to buy 40 of the shares, 107 to complete our full 100s share order, it is going to move the market price of the security up to 107, but it is going to fill our entire order absolutely. Instantly. We're gonna be able to click the button and it should fill within a second. We're going to get those shares at an average price of somewhere between 106, $107. So probably like $106.40 would be the average price for the shares, which is really, really nice. And there'll be inner account ready to go pretty much instantly as day traders. So we can sell them into minutes. We can do whatever we want. And it'll be really, really nice as long as we're using a margin account like what I recommended earlier. Now, if we decided to go short and we wanted to short sell a stock using a market security, it'd be pretty much the exact same thing. But if we wanted to sell 100 shares, for instance, we'd go borrow the shares from our broker. We would sell them directly into the market. And because there's only people willing to buy 20 shares at 105, we would fill all of those, would fill the next 3104 and we would fill all of the 50 here at 103, and it would drop the price down to somewhere between 13102. And so depending on how you place your order and how many shares are trading, and what security or trading. Sometimes your orders can actually move the price, especially if it's a market order. Or imagine that you're placing an order and a quarter of a second before you hit the buy button. Many else places a massive order as well and their order moves the price up and then your order moves the price up. So sometimes if it is a security that has a very large spread or a difference between the bid and the ask where it has very low volume. Placing a market order can be a little bit risky because the price can move and you're order might execute at a price that you weren't expecting. And so to overcome that specific problem, especially as day traders, That's when we would use a limit order. Now, a limit order will execute your order up to the limit price. So here's an example. We've got the same chart down here on the left, and we place a limit order to buy 100 shares with a limit price of $106 and $0.50. So we're buying a 100 shares, but our limit price on that by $106.50. So the maximum that we are ever going to pay in this order is $106.50. And so in this scenario here, we're trying to buy a 100 shares. We can easily buy 60 shares at 106, but then next batch of shares that somebody is willing to sell aren't until 107. We have a limit on this order of 10650, which is below 107. And it means that we're not gonna be able to buy those shares. And so in this example, we would have a partial fill of 60 shares out of the 100 that we were trying to buy. We would not be able to buy anymore because on this specific security, there's nobody left to sell our shares at a price that is lower than $106.50. And so the limit order. Allows us to get into a stock or out-of-stock quickly, but at a maximum buy or sell price so that we know exactly what we're going to pay or what we're going to receive for the security. So we're transacting with a limit order is similar to a market order, but it puts a cap either on the upside or the downside. And it allows you to control the ultimate execution of that order. Because for instance, if we go back to the market order here, and let's say I wanted to buy 1 thousand shares while I'm going to buy all of these shares all the way here, and it is going to drive the price way up. And if I'm not willing to do that, or if I'm worried about that, I'm worried about moving the price with my orders, then I can place a limit order so that that doesn't happen. Now, generally, it's not that our orders are going to be moving the price. It's at somebody else's orders, a big institution or a big bank, or somebody else is going to front-run the orders. So for instance, if you trade on a platform that is commissioned free, what is usually happening there, especially if you place a market order is they're taking your order, they're selling it to somebody else that is going to buy that security and sell it to you for ¢0.5 or a cent more and make a tiny little margin. And so a limit price prevents that from ever happening and allows you to get in and out of the prices that you want. And if somebody else places an order in front of you, it is not going to move the price before you get your trade executed. We, as day traders use limit prices, especially when the big spreads, when we have a big spread between the bid and the ask, when this difference is more than 0.5% or 1%, that is absolutely huge. So we gotta be really, really careful with that. We also use it to just control our trading. We're not just trying to get in and out instantly now in order to protect our risk, that is when we would use a stop order, also known as a stop loss order. This is the type of order that will execute when the price crosses the stock levels. So, for instance, exact same chart down here on the left. If you place a stop order to sell 100 shares. So we're assuming that you already own the shares, you're holding them in your portfolio. You're trying to protect your downside with a stop-loss and mitigate your risk. You place a stop loss order to sell 100 shares at $104.50, that order would only be filled if somebody was willing to sell the 20 shares out 105 first. So for instance, in this example you have a stop-loss at 10450. Your order is only ever going to fill if the market price falls below 10450. That's what I'm trying to say here. So if you set a stop-loss out 10450 and the price drops to 10 for it is going to fill your order and it's going to get you out because its price dropped below. If the price just touches it, even touches it for $0.01, it is going to fill your order and is going to try and sell your shares. It might not be a cell all of your shares depending on how you place the trade. We're going to talk about that a little bit later. But the stop-loss is designed to get your position closed when the price crosses through a certain level. Now when do we use these different types of trades? The market orders are used when we have securities with a tight spread and I need to get in or out faster if you're trading Apple, Google, Amazon, Shopify, any of these big name companies that have high volume and very tight spreads, you can use a market order to get in and out. Most of the time, you're not gonna have too much trouble. But if you're training a penny stock or company that doesn't have very much volume, or a company that is moving very, very quickly. That's when you would want to place a limit order because you can get more control over the execution of your traits that is the key with the limit order. And when it comes to the stock order here, we use this when we need to protect our downside, calculate our risk to return ratio, and make sure that we are mitigating any of the losses that we could accrue on each individual trade. Now, in summary, here, we need to use the appropriate order type based on what we are trying to achieve and how large the spread is. Like I said, if you're trading the big name text docs and they have very tight spreads and everything is pretty liquid. You don't really need to worry about using the limit orders too often. However, if you're training these younger companies that are really, really volatile and are moving quickly, you may want to consider it also, you should always be starting with the practice count. Test out these orders, test what it's like to go long tests what it's like to go short, place a stop-loss on a long and a short position, makes sure that you understand how these work. Orders work and you can control them. And lastly, some securities may require you to use a limit order. So if you use Quest trade and you're buying Canadian securities, I'm pretty sure that you almost have to use a limit order on everything. You can add a limit to your stop-loss isn't option that you can do. And so when that price crosses below your stop-loss, your limit is the maximum amount that you're willing to sell for. So if the price crossed below $85, it would trigger stop-loss and it would sell at a maximum low value of $80, which means it would sell anywhere between 8480. Unfortunately, if it opened up below that, you would still be holding the securities. And so you need to consider those things, but I'll walk you through exactly what that looks like on the actual request trade dashboard shortly. 35. Order Form: All right, everybody, welcome back to another video. In this one, we're going to talk about the order form and all the other variables that you're going to need to fill out in order to place that trade. Let's jump right in. Okay, So when it comes to the order form, you should recognize this image right here. This is the same order form that I pulled up when I introduced you to the brokerage platform. It has a bunch of different kinda drop-down menus in here that you are going to need to select in order to place the trade that you want. The first one here is the ticker. This is what we're trading in this example, we are training Udemy ticker symbol UDM y, and we're trading the stock. If you're training the options, This would see, say, OPT right here. But for us, we're first going to start with all stock trading. And so we're looking at UD, MY stock. We also have our little paperclip linked up right here. So it is linked to our charts so that everything is going to be lined up, which is really, really nice. After that, the first thing that you need to fill out for the actual order is the quantity of shares that you want to purchase for right now we have just set at one because this is an example. And then we have the order type. This is what we just talked about. And one of the last videos where we talked about market orders and limit orders and stop orders. That is right here. After that, we have the duration of the order, the route of the order, and the account. That is what we're going to focus on in this video. When you click on the drop-down menu for the duration button right here, you are going to see a bunch of different options, probably four or five or six, depending on which broker you use. Again, this might look slightly different, depending if you're using a different software. But most of the time all of these different factors are going to be the exact same. So when it comes to duration, you've got a bunch of different options right here. For us as day traders most of the time we're just going to place de orders. And what that means is that when we place an order to buy or we'd want to stop loss out there, or we put a take profit. That order is going to exist throughout the day. And then at the end of the market close, that order is going to cancel. It's going to erase. It's not going to exist. Going into after hours, are going into the next day is what we're going to primarily use as day traders. Because as data is we want to get in and out on the same day. We don't want any orders to execute the next day. Other options that you do have though, just so you are aware of it, or a GTC order which stands for good till canceled. Basically, if you don't cancel this order, it will continue to exist for as long as possible. Usually most of the brokers cancel them after 90 or 180 days. But if you send an order to buy Apple at 120, and Apple just never gets to 120, but it's a GTC order or good til canceled. That order will exist for as long as the platform will allow it. The next type of order here is a good till extended market order, and this is very similar to a day order. It will go into after hours trading. So if you want to buy or sell anything in after hours, this is probably the order duration that you are going to need to use. The other option here is a good till date option where let's say that your swing trading or long-term investing and you're willing to buy Apple at 120 up until two weeks from now, you can actually set that date in the order here, and as soon as that date arrives, it will cancel your order. You also have a fill or kill order, which basically means fill this order right away or cancel it. Other option here is the immediate or cancel, which is basically trading and you could get a partial fill or cancel it right away. So both of these ones are pretty much going to happen right away. Ferc Order requires a fill of your entire order, whereas the immediate or cancel order only requires a partial fill. Now, as the atria is, like I said, we're mostly going to use the day order because we want our orders to work on the day that we are training and we don't want those orders to exist in the system three or four or five days later, we may use a good till extended market order when we want to trade after hours, but we'll talk about that a little bit later. The next variable that we need to talk about on our order form here is the route. The route determines how our order makes it to the exchange, how it goes. Oh, my light just change there. I don't know what happened. This determines how the order makes it to the exchange and how it gets from our computer to our software to the exchange. Most of the time, your broker is obligated to get you the best price possible and at the quickest rate. And so most of the time you're going to want to leave this to auto. This will basically force your broker to choose whatever is the cheapest and fastest rate for you. Otherwise, if you are trading in after hours, you have to use an arco route. Arc. This is designed specifically for after hours training. It may depend on your brokerage as well. So you may need to do some research on this, but this is where I would start. Always leave your order route, Otto. And if you are training after hours, I would use an arco route. Now the last factor here that you need to consider is your account. This is probably the most important thing that you need to think about when placing your order. Because for instance, right now, I have a EFSA account and RSP account and a margin account all with Quest Training. So if I start day trading in my tea EFSA or RSP account, that can have some major, major tax implications for me. It can also really just mess up my entire portfolio. And so what you need to do is always double-check that you're trading in the right account. Make sure that you're trading in a margin account. I just have selected for my TFS, say right now, we need to make sure your day trading in a margin account. And you always want to double-check that every time you buy or sell a stock that you are buying and selling it in the right account because nothing looks different between your TFS and your RSP. Other than this little drop-down menu, that is the only difference here, the only difference between any of your accounts. So you gotta be really, really careful and you always got to double-check this. I've made this mistake countless times, especially when starting out. So please be very careful with this. Now, when it comes to your order form, you're also going to get some other information, mostly located here at the bottom, you're going to see the bid or the ask. That is the price that somebody is willing to buy shares for. And that is the lowest price is somebody who's willing to sell shares for. The difference between the bid and the ask of 16241627 is $0.03. That means that our spread on the security is $0.03. You can also see the size right here represented by S. These are actually multiples of 100. So somebody is willing to buy 200 shares at $16.24. Somebody who's willing to sell 400 shares at $16.27. And it also gives you the last price. So the last transaction, somebody who was willing to come up in what they were willing to buy it, meet this person at the ask at 16, 27th. So that's what this information means here down at the bottom, this Greenlight here where it says real-time, basically shows you that you are paying for data to get real-time information on the stock. Otherwise, it would probably be a white light and they probably have a 15-minute delay. Now, in summary, here, you need to fully master and understand how to use this window to place the trade you want. We've talked about a variety of different setups. We've talked about the stop-loss that take profit, different things like that. You need to control this order form in order to execute what you want on that stock chart. And the only way to get good at it is by practicing and the only way to practice without losing money because you're experimenting using a practice account. And so this is one of the most important times that you should have a practice count, because when you are placing orders for the first time, it can get confusing, it can get disorientating. It can get really, really nerve wracking. Because if you're training with real money and you make a mistake, it is going to hurt, it is going to be painful and it's going to cost you. But if you do another practice count, you can make as many mistakes as you want. You can basically just try out new things and figure it out for yourself while you're playing with it. So that is what I recommend opening of practice account, test out these different order types and get used to it before you start using real money. 36. Bracket Orders: All right, everybody, welcome back. In this video, we're going to start talking about bracket orders now this is one of my favorite tools on any trading platform because it gives you a huge advantage when it comes to actually executing your orders with an established risk to reward ratio. So let's jump right in and I'll walk you through how it works, okay, So when it comes to a bracket order, a bracket order is designed so that when you enter a position, you already have a take profit level established and a stop-loss established. And it does that by basically placing all three orders at the same time. So bracket order is placing your take profit and stop-loss when entering the trait. The idea here and the reason that we use a bracket order is to control your risk to reward ratio when entering the trade. And so here we've got the same example. We are looking at Udemy stock. We're going to buy one share on a market order to enter the position with a day duration, the route is set at IE X. I don't know why it's set like that right now. It should be auto. And then the account that we're using is a margin account. Now, as you'll notice here, there's a little button right here that says bracket order. And when you click this button, this little section at the bottom drops down. And this is where we're going to fill in the information for the bracket order. But before we do that, let's just talk about the strategy here and why this is so important. And the number one reason is because as you saw in the last video placing these orders, there's a couple of different drop-down menus. There's some things to think about, and it takes a little bit of time by placing a bracket order. Instead of doing that same repetitive process three different times, you can do it altogether all at once. And you can make sure that you haven't established risk to reward ratio before entering the position. That is the main advantage here. The other advantage is that it costs absolutely 0 money in order to place an order. You're not going to pay a commission, you're not going to pay for anything until that order actually fills. So I could sit at my computer, I could place a thousand orders and if none of them fill, I'm gonna get charged absolutely $0. No transactions are going to happen and I'm going to pay 0 and commissions. So placing orders to protect yourself costs you nothing. There's no downside to it, and you can protect yourself from losing additional money. That's why we use a bracket order and that's why we have no hesitation when it comes to placing orders that will protect our portfolio. Now how do we fill in this bracket order? What does it actually look like? Well, first of all, we're going to place our entry order up top here. This is going to be the exact same process that I've already walked you through. You can place the quantity, the order type today you're going to set the route to auto and you're going to choose your account. Nothing here is changing. This is how you are entering the position. This is how you get into the stock. This is how you start your day trade. Nothing here is going to change at all. However, when you click on the bracket order, this is where you're going to set your take profit as well as your stop loss. You can see these two different rows here basically in the bracket order section. If you only want to set a stop loss or you only want to take profit, you can select or unselect these arrows here. And then you're going to click on the quantity of shares that you want to set. Usually I keep this equivalent to the entire position for us on the stop-loss here, we have it set as a stop. If you're training a Canadian Security though, you're going to need to set this as a stop limit and you're going to have to set the limit price right here. Your stock price is, let's say when the price crosses below 80 and your limit price is 70, so you're not willing to sell anything below 70. Sometimes that's just a regulatory requirements. So you're going to have to choose stop or limit right here. You set your quantity, and then right here is where you set your first stop level. This is the price where you want your trade to activate when the price drops through it. For us, this is gonna be that stop-loss level. Currently you can see it highlighted with a dollar sign. If you click on this dollar sign, you will usually be able to turn it to a percentage as well. So you can set up percentage stop-loss or percentage take profit if you'd like. You set your limit order right here for the amount out where you'd like to take your profit, you set your duration as good till close or good for the day depending on what type of trade you are making. And then you leave it, you leave everything here and you double-check it. You take a look and you go through every single box a makes sure it is set up correctly and it is going to execute the trade that you actually want it to execute. And then if you're getting into the position and you're going along on the position with a take profit and a stop loss, you would click on Buy. If you're selling short and doing the opposite, you would click on cell. It will give you a summary screen and then you click on Execute. Now, as day traders, we want to try and use a bracket order whenever possible, we can change this order. Once the order is placed, we can move our stop-loss up and down and we can change our take profit. There is some flexibility here, but at least having it there will protect our downside and it will allow us to filter out the trades based on established risk to reward ratio. So I highly recommend trying to enter most of your trades with a bracket order. But you need to always make sure that you understand your risk reward ratios before entering the trade. If you're going to enter at a 100 and put a stop-loss at 80. You need to either have that in your head and you need to be ready to place that order right away, or you need to have a bracket order in place to protect your downside in case a major swing happens or the trade just doesn't go your way. Everything that I'm talking about in this section here and everything that we're doing is to protect the downside, mitigate your risk, and to lose a little bit of money or lose no money at all when the trade doesn't go our way, we never want to have a bad trade. They'll wipe this out. That is what we were trying to avoid here. That is, what everything is about is protecting us from that one scenario so that when the trade does go our way, we can try and let it run as far as possible. Or we can at least capture those small, consistent profits to equal out on any of the small little losses that we have down below. And when we hit that Runner, We're going to let it run all the way up and we're just going to slowly move our stop-loss higher and higher. And we're going to try and take advantage of that. So we're going to talk about that a little bit later on. But this is a summary and this is why we are using bracket orders. 37. Placing Orders: All right, everybody, welcome back to another video and this one I want to walk you through a real life example of how to place an order to buy, how to place an order to sell, and how to take advantage of bracket orders. Here's everything you need to know. Let's jump right in. Okay, so here is an Apple stock chart. You can see we're looking at AAPL and the top left hand corner, we are looking at the stock and we are looking at it on a one-minute candle chart. This blue line that runs across here is actually the opening price of where they started trading throughout the day. And as you can see, we've bounced off this key level right here twice in the morning. It looks like we've just got rejected by it twice here in the afternoon. So this is a pretty key level. We were trading in a bit of a bullish channel here throughout the day, but it looks like we've just broken through the support level there to the bearish side, and we've now been trading sideways for about an hour to an hour-and-a-half. We're going to use this chart as an example for how to place orders. It's not the best example of a perfect trade or a trade that I'd like to enter, but it is a good example. So first of all, we're going to make sure that our charts are linked up to our order form. You can see both of these paper clips here are blue and the first thing we wanna do is it looks like we've got a little bit of a double bottom right here. The price is starting to move up. It looks like the Mac D could be moving higher. So we're going to place a market order to buy two shares a day duration, the auto route, and we're going to be trading in my margin account. We're going to buy this confirmation window comes up here. You want to make sure everything looks good. Then we're going to click on Send order. Now, we currently own two shares of Apple, and this is working out well, the price is rising right now, but the first thing we wanna do is think about our risks. So we may want to set a stop-loss right here below support for that stop-loss. The only thing we're gonna do is change the order type to a stop. And we're going to enter in the price at which we want that order to execute. For us, I want it to execute at 153.45. So I'm going to type that in here, 1.4553. I'm going to leave the duration as day and leave the route as auto and then leave the account as margin. And then I'm going to click on cell. It's gonna give me another confirmation window here. You want to make sure that everything in this window looks correct. You're going to click on Send order and it is going to put our stop loss rate here. You can see it is now a line that runs across the screen. And as soon as the price falls below that line, execute our order to sell two shares at a $153.45. So that is very nice. We have now protected our downside. We have entered the trade with a market order. And because it's Apple, the bid and the ask, or very, very close together, apple is one of the most popular stocks on the entire market. So you will never see the bid and the ask much more than two or $0.03 apart. So using a market order on Apple has no problem. You can usually get in at the price you are expecting. So now at this point we own some shares and we have a stop order on Apple. One thing we may want to consider now is setting a take profit. But the problem that we're going to have is if we own two shares here and we have an order to sell two shares here. If we set another order to sell two shares here, we could run into a problem because if the price goes up and we sell two shares, we now have 0 shares. And if the price comes back down, we have another order to sell two shares, and that would initiate a short position, straight. And most brokers know that that is not what most traders want to do. And so they will not allow you to place a second cell order in order for us to just place a take profit on its own, we're actually going to need to delete this stop-loss. Now in order to do that, we're just going to go to pointer right here. And if you want to edit or delete it at all, you can edit it by changing any of the factors right here and clicking on the pencil button. You can also move it up or down, which is really nice. So if you want to move your stop-loss down, all you do is highlight it like that. It will bring a confirmation window up. You click on Send order and it will move your stop-loss down. However, if you want to exit your stop-loss and just cancel that order, You click on the X button right here, click on Yes, and it will completely cancel your order. At this point though, we have two shares and we're starting to think about our take profit. I know the price is changing right here, so it's not a great example. But let's say that we still wanted to place a take profit. The only thing we're gonna do is we're gonna go to the order type here and we're going to change it from a stop to a limit order. And this limit is going to be the price at which we want that trait to execute. In this example, it's going to be 154.40. I'll leave the duration as day. The route is auto and the account as margin. I'll click on cell again. It will give me a confirmation window. And here you can see it has placed my take profit at $154.40 to sell two shares so that if the price comes up to this level, it will exit my position. It will lock in the profit and I'll be golden. I'll make a bunch of money and will be set and ready to go. I hope you can understand, know why we can't set both of those orders. Because if the price goes up and then fills the other order, it will initiate the opposite of what you want to happen. Now to overcome that problem, that is why I told you about bracket orders. Bracket orders are really nice. Because what happens with a bracket orders? If you enter the stock at $150 and it goes up and it hits your take profit, it will cancel the stop loss, or vice versa. If the price goes down and hit your stop-loss, it will cancel the take profit so that if the price goes down and then comes back up, it doesn't initiate that other order right here, and it doesn't really mess you up in screw you up. It will exit the trade if it doesn't give you what you want, which is really, really nice. And so as of right now, I currently own two shares of Apple as it take profit of 154, actually want to get rid of that order so that we can place. A brand new bracket order. So I'm going to click on market right here. I'm going to click on day. We're going to use Auto as the route and we're going to keep make sure that it is our margin account. We want to make sure that we're using the same account every single time. And instead of clicking buy at market here, I want to click on cell. But first I'm going to get rid of this take profit level. We're going to click on cell and we're gonna get out of this order so that we can place a bracket order. So there you can see my order filled. That is how you sell two shares. We made a little bit of money on that, which is kinda nice, not a whole lot, maybe like $0.50 or whatever, but we did make a little bit of money. Now, let's try and place a bracket order. So here you can see it will just trade with one share and keep it simple. We will enter the position with another market order. We will keep it as the day. We'll leave the route as auto and we'll use a margin account. Make sure when your day training you use a margin account. In the bottom here, this is where we set our take profit and our stop-loss. So first of all, our take profit here, we are only going to use one share because we're entering with one share, we're going to set our limit here. This is the level at which we want to take our profits. For this example, we'll set it a little higher, 546100.6054. And we will leave it as good till close to what that means is that this order is going to exist until it gets canceled. But if the stop-loss gifts filled, it's also going to cancel that order, which is really, really nice. The advantage of the bracket order when it comes to setting our stop-loss here, we want to make sure that this is highlighted. We want to choose our stock. We want to make sure that the quantity is set to one. Then we want to enter the dollar level where we want that stop-loss to kick in. For us, it'll be one fifty three forty five, just below the lowest point there, 1.4553. And we'll leave it like that. No one option that I really like about Quest trade, that's kinda cool, is if you click on this dollar sign here, you can actually change it to a percentage difference or a price difference, which is really nice. So you've got some control there. We're not going to set a limit on it because it's not required for right now. But when we click on Buy here, what it's gonna do is it's going to execute our market order, set our take profit right here, and it's going to set our stop-loss down here. Now click on Buy. Oh, I put a typo in here, 153. Oh, I did this wrong. 153.45. That's why you gotta double-check everything. So we're going to click on Buy here. Try this again. You can see our orders to buy Apple as a market order or take profit order and our stop-loss order are all here on the confirmation page. So please make sure that you read through this, makes sure that you confirm and know what your training and when you click on Send order here, you can see it placed. We've got our take profit order up on the top. We've got our stop-loss down here and we've got our order filled confirmation that just popped up. So now in one single trade, we have entered the position. We have set our take profit and we have set our stop-loss, and as soon as one of those gets hit, it'll cancel the other order. Now again, if you want to cancel or edit either of these orders, all you have to do is click on the pencil right here, or click on the X, and you'll be able to cancel your order. You can cancel them independently. So now we have no stop-loss, but we still have a take profit. You can also cancel this one so that now we're just holding our current position of one apple share. And if you want to get out of Apple, we can set a limit orders that we know exactly what we're going to get for it. The lowest price that we're willing to take for Apple array. Now, let's just say as 154.15, we will click on cell. Our bracket order is still selected here, so we're going to remove the bracket order. Click on cell here. It's gonna give us a confirmation. We will click on Send order. And because our limit was within the basically trading area there, it executed it right away. And now we are out of all of our positions. We're all set to go. And that is how you use a market order, a limit order, a stop order, and a bracket order. Please replay this video if you need help. If you have any questions, please let me know. Thank you guys for watching this one. And let's move on to the next video. 38. Currency Conversion: All right everybody, welcome back. In this video we're gonna talk about currency conversion and what you need to do in order to buy stocks that are listed in another country. Here's everything you need to know. Let's go. Okay, so when it comes to currency conversion, the thing that you need to remember is that you need to buy stocks in the currency of the exchange. Now this is super important because think about a company like Alibaba or $0.10. They are Chinese companies, but they are listed on US exchanges, which means you need to buy them in US dollars if you're an American and you want to buy Canadian securities listed on the TSX, the Toronto Stock Exchange, you're going to need to convert your US dollars into Canadian dollars in order to buy those securities. So the key thing here to remember is that it doesn't matter where the company operates. What matters is where the stock is listed and what country that is exchanges in. Because if it's listed or that exchanges in the US, you're going to need to use US dollars. So that includes the New York Stock Exchange and nasdaq and most OTC markets. If you're in Canada, that includes the Toronto Stock Exchange, the TSX Venture Exchange, and the Canadian Securities Exchange. Makes sure that you understand what stock you're buying, what exchange that stock is trading on, where that exchange is located. Because that is what is going to determine the currency that you need to use in order to buy that stock. Now, if you decide that you need to convert some of your money in order to buy a stock. You have three different ways to do it. The first one is using margin, the second one is using your broker, and the third one is Norbert gambit. So in this one, I'm going to walk you through these three strategies and some of the factors that you may want to consider before choosing one or the other. Now starting with margin, the idea here is that if you hold Canadian dollars as an example, this can go vice versa with us or Canadian. But let's say in this example, you hold Canadian dollars in a margin account and you go out to buy a US stock on Quest trade, for instance, it will usually borrow money from your broker to buy that stock. So we'll borrow money from your Canadian funds. It will give you US dollars that is secured against those Canadian funds and it will buy that stock. So you will be borrowing money from your broker. It's not going to take that $4 thousand away from you, but you're going to have less buying power and you can made to buy less securities because you are basically borrowing against that $4 thousand. Whatever money you borrow gets locked up and Quest trade or whatever broker you're using will give you those shares and you'll own those shares. The downside here, you will have to pay a little bit of interest on it. So if you're gonna do this over the long term, margin might not be the best option for you, but if you're going to just day trade a security that's traded on another exchange for one day and see how it goes. This is probably the best option for you. Now, if you plan to swing trade or invest, you may want to convert some of your money. Or if you just plan to day trade both Canadian and US markets, you may want to have some Canadian funds and some US funds. And if you were trading with a large amount or you're converting a large amount, your broker is going to charge you between 1, 2%. That isn't really a big deal if you're trading with $100, but if you're trading with $10 thousand, you're going to pay $200 just to convert your money. And that is kind of a pain in the *** and it only gets worse. Now some brokers are better. Some brokers or worse, usually it's between 1, 2%, but they will charge you a fee if you just want your broker to straight up convert canadian to US dollars. So to get around this massive fee, especially for large amounts of money, like imagine if it was a $100 thousand, you'd be paying $2 thousand just to convert your money. It's kinda ridiculous. And so to get around that, we use the third strategy here and it's called Norbert gambit. The idea here is that there is no fee and there is no cost to convert your money. It takes a couple of days. So the benefit is that you don't have to pay anything to convert your money. The downside is that it could take a couple of days to actually make that conversion. So you need to ask yourself, are you willing to pay the fee to your broker of $2 thousand here or are you okay waiting a couple of days for your money to convert? Now, when it comes to Norbert, gambit is a three-step process here. So the first thing you're gonna do is you're going to buy a Canadian Security. However, that security has to be listed on both US and Canadian exchanges. That is the key factor here. I'm going to tell you which one I recommend buying in just 1 second here, but that is the first step by a Canadian Security that's listed on both exchanges. You're going to reach out to your broker and you are going to ask them to journal to the equivalent US security. So you buy it in Canada, you reach out to your broker and you ask them to do something called journalling, which is basically converting that security from canadian to US dollars. It's just going to give you the equivalent number of shares. But on the US security of the exact same company or ETF or whatever you are buying. So that's the idea here is you're going to reach out to your broker. You're going to ask them to journal it to the US equivalent and then you're going to sell that US security for US dollars. You will have US dollars come into your account. And that way you will have converted your Canadian dollars into US dollars without paying any currency conversion fees and without paying any processing fees. Now, when it comes to choosing a security that's listed in both Canada and the US, I highly recommend a US dollar currency ETF. This is an ETF that tracks Canadian and US dollar. And it basically is trying to stay equivalent to what the Canadian and US dollars worth. And so if it takes you a couple of days to make this transaction, it doesn't really matter because you're not going to be losing any value here. The idea here is that this ETF trades both in Canada and the United States. And it's designed to track the value of the US currency. That way, when you are trading Canadian dollars for US dollars, if it was a company that you were doing this with those listed in Canada and US, that company came out with earnings and they were awful. You could lose some value there that if you do it with DLR dot TO and DLR.edu.TO. You're not going to lose any value there because there's not gonna be really any news because it's just a currency ETF that tracks the value of the dollar. Now, when you send that message to customer service and to your broker, here's what I recommend you say, hello, I currently own 100 shares of DLR dot TO this could be any number of shares you want. I own them in my margin account and I would like to journal them over to DLR.edu.TO, which is the American version. Can you please help me with this? They will then ask you to verify your account through a couple of questions. They'll let you know that they've completed the transaction. You should see those shares arrive in your account and usually two to three, maybe four business days, depending on your broker. Now, in summary, here, you must buy securities and the currency of the exchange if it's a Canadian company, but they're listed on the US exchange, you need to use US dollars. If they're a Chinese company that's listed on a US exchange, you need to use US dollars. You need to match your currency that you are transacting with to the currency of the exchange if you're dealing with large amounts of money, I highly recommend Norbert gambit. It is gonna be the most cost-effective way to convert currency. And you need to make sure that you are always aware of when you are borrowing money from your broker. Make sure you understand and go through the FAQs and look at how your broker is set up for currency conversions. Some of them might let you borrow money. Some of them might just automatically convert your money and charge you a fee. Make sure you are well aware of that. With trade, for instance, they will let you borrow money. So just make sure you know that going into it that you're gonna be paying interests when you borrow that money. Probably not a good long-term play. Lots of things to consider here. If you have any questions, leave them down below and I'll try and answer them. I know Currency is a big one that a lot of people have questions about. Let me know if I can help out at all and we'll see you in the next one. 39. Adjusting a stop loss: All right, everybody, welcome back to another video. In this one, we're going to talk about adjusting your stop-loss once you have entered the trade. A lot of people refer to this as trade management. And in this video, I'm gonna give you everything you need to know. Let's go. Okay, so just to recap here at your stop-loss is in order to exit the trade. If you're wrong, once you've set your stop-loss, you use that to determine your position size. And for most of us, we're going to use a rule of thumb of only taking a position size that is gonna give us a 2% maximum loss on our entire portfolio. We're also only going to take traits that have an absolute minimum risk to reward ratio of 1.5. Ideally, we are looking for a 23 or four risk to reward ratio, but we are willing to take a 1.5 if we're just looking for traits and we're looking for opportunities, however, we always want that number to be higher. Now when it comes to an example of adjusting your stop-loss, I want to run you through a scenario that I went through today. I'm filming this on September 8th, 2022. I'm looking at Google and this is what the chart looks like throughout today. I was watching it and I was thinking, Hey, trading opportunity. And I want to just show you what I saw and how I think about this opportunity because it was just a great example of chain management and moving your stop-loss. Okay, so first of all, this is what the stock chart looked like throughout the day we had, I drew this key level right here because it acted as resistance for about two hours, maybe an hour-and-a-half. And here between 1112 and then we broke out of that level and we had bounced off of it twice. So I thought it acted as resistance in here and I thought it acted as support right here. It was just a $109.50 level. That was super important to me. I noticed that the market was going in a bullish direction. Google was also starting to go in a bullish direction, but we're trading in a bit of a channel right here. This was exemplified by a high those set right here around 1245, another high set around 105110 right here. And then we were just approaching that level right here. And because the market was going up, Google's had some good news lately. I thought that this stock was going to continue to break out and move higher. And so I looked at entering this position when the stock broke above $110, you can see we're about $0.06 away from it. So I was just setting up the trade at this point. I wanted to enter the stock at $110. I want to set my stop-loss just below the highest rate here at $109.80. So you can see that red line right here. This is gonna be my stop-loss. This green line right here was gonna be my entry. I was looking to take profit at a $110.60, which would have given me a risk to reward ratio of three. I was looking for a 67 game and I was willing to risk $0.20 on this day trade for Google stock at about 130 in the afternoon. Now, as you can see, the stock did end up breaking out and I did get my entry rate at $110. I set my stop-loss at a $109.80 and I have a take profit at $110.60. So I got n right here at $110. My stop-loss is this red line right here at $109.80 and might take profit right here is a $110.60. Now my question to you and the reason that this is an exercise is under this scenario, now that the price has moved, the stock is broken out. I still have a take profit up here and I have a stop-loss down here. My question to you is, what is the current risk to reward ratio? In this example, I want you to write it down on a piece of paper. I want you to do it in your head. I want you to think about this for a minute and pause the video until you have figured that out and come up with a number. I want you to think about that real, real hard and just consider, here's the current situation. The price right now is $110.50. You can see this label right here. What is the current risk to reward ratio based on the trade that I entered right here. Okay, So now that you've got that in your head, Here's the answer to it. The current price right now, like we said, is a $110.52. My stop-loss is still at $109.80. So if this trait doesn't work out and I don't do anything here, I am going to lose $0.72 from where the current price is at, right now, I'm also only going to make $0.08 from where the current price is at right now if this trade works out. So if I'm completely hands-off and I don't do anything and this trade works out. I'm going to make $0.08 per share, but if it doesn't work out, I stand to lose $0.72 per share. So my risk on this trade at this point, after the price has moved now dramatically, dramatically higher than the reward. And that is not a good situation for me to be in. I want to be in a position where my reward is significantly higher than my wrist. And this has happened because the trade went my way. Now, I need to manage this trade because the risk to reward ratio is not where I want it to be, and it's well below 1.5. It's actually negative here because my risk is much, much greater than the reward. So how do we manage this? What do we do? What are our options? And how do we think about this as traders? Well, as traders, we have a couple of different options here. Number one. We can close the entire position and just take our profit. We can say, Hey, we made our money, we're doing well, we're above our minimum of 1.5 risk to reward ratio. I risk $0.20 and I could take $0.53 in profit off the table right here. I can close that the entire position and I can walk away and call it a wind. That is option number one. Option number two here is to sell part of the position and take the profits and see what happens in the future. You can sell 25% of the position of 50% or as much as you'd like. And you can just leave a little bit in there to see what happens. That's option two. Option three is you can move your stop-loss up, like we said before, you can adjust that stop-loss. Do you can modify it, you can even click on it and drag it higher and lower. And what's really nice about that is it doesn't cost you anything. You don't have to pay for anything, but it reduces the amount of risks that you have. So that could be one option here is to move your stop-loss up, or option for here is to do nothing. Just let the trade play out. You can do whatever you want. Just leave it alone, let it happen. You made your analysis in the beginning. Let's just see if you're right or wrong. That's option for, I want you to think about this again. Decide for yourself, what would you do? What is the right thing to do here? How do you manage this? How you think about this? And then I'm going to show you what I would do. Now hopefully you've got an answer. I hope you've got chosen 123 or four. I want you to stick with that in your head and just stick with it and glued into your thoughts. And then I want to show you the next chart, the next chart here as two additional candles. These are the next two candles that had just formed on this stock chart. And the price went from a $110.52 or $0.53. Here it is now at, let's call it a $110.38. We've had two very strong red candles back-to-back. It also looks like our Mac D is about to cross over. It looks like the volume has actually increased on this second candle here, and we're about to test our moving averages. So now my question to you is your answer is still the same. You had these four options one minute ago. What was your answer? And now that you know, we've had to read candles like this, is your answer, still the same? That's my question for you. I want you to think about that just for a second and ask yourself, what would you do right now? Now I'm going to tell you my strategy, how I think about it and what I would do here it is, number one, I will always move my stop-loss up to reset my risk to reward ratio. I am not gonna do it every second. I'm not gonna do it every minute, but every couple of minutes, every five minutes, every ten minutes, I will be moving my stop-loss up and resetting that risk to reward ratio. So for instance, in the last scenario where we were at a $110.52, we only had $0.08 to gain rate here, which means I am setting my stop-loss at like three or $0.04 below where the current prices that is going to protect my downside and that is going to reset my risk reward ratio. I am not going to do it every ten seconds. Definitely going to do it every at least five to ten minutes. Secondly, I'm always going to make sure that that's stop-loss is set above the next key level. What I mean by that is if we go back to this example here, and we know that we just broke through resistance here. That means that that resistance is now support. And as we move up, I want to make sure that this stop-loss is above that key level of support. And then as we see this next level of resistance here with a price consolidated, that is resistance as you break through that then becomes support. And I want to move this stop-loss up to the next level of support. I want to make sure that at a minimum, my stop-loss is that the next key level? And I also want to make sure that it has a good risk to reward ratio. I want to make sure that I'm protecting my downside. And as long as I am making money, that is ten times better than losing money. As soon as I have the opportunity to make money and lock in profits, I wanted to eliminate any risk of losing money. We want to be safe, we want to be steady, we want to be consistent, and we're looking for small profits rather than trying to hit it out of the park, hit a home run, and blow up our account. Now the third thing that I would consider here is because we were so close to hitting our take profit level, I would start selling part of my position on the way up. You can see here that we moved up very strongly. We basically had another breakout right here. After not pulling back significantly at all, we didn't even retest the previous level right here at $109.8990 right here, we didn't even retest this previous level. And so as we break out here, that is showing stronger momentum, a stronger breakout, we're running higher and we're not pulling back at all. Which means when we do pull back, we're probably going to see a significant pullback. And as a trader, I want to get up and I want to get ahead of that. Therefore, I'm gonna be selling part of my position. This strong breakout right here. As I'm moving that stop-loss up, that way I'm protecting my downside. I'm locking in profits and I'm making sure that I'm capturing as much profit as possible on this train. And this is the next two candles here. So for me in this scenario, what would have happened is on this second red candle here, my stop-loss was hit. I got out of this trade, I exited it, I took my profit and yes, we did not hit our initial take profit level. We did not hit that initial analysis pinpoint that we wanted to get to, but we got pretty darn close. And we also got well above our risk to return ratio minimum of 1.5, we risk $0.20 here. Locked in at least $0.40 here. So we locked in at least a two risk reward ratio, which is still a good trade. So at the end of this, we didn't hit our initial take profit level, but we locked in a good trade, we made good money on it. It was good profit and our analysis was correct. So that is what we're looking for. Our strategy as traders. This is what happened here. So in this scenario, our strategy has traders. We went into the trade looking for a breakout. We saw a strong level that acted as resistance, it acted as support. We were chatting in a channel, we are breaking out of that channel. That's what we're looking for. And we went in with a very healthy risk to reward ratio, three x. That's what we went into the trade with. The stock then broke out and made 2.5 x what we had wrist before starting to pull back. You'll remember that the stock minute all the way up to like 110, $0.52 here when we had only rest $0.20 on the downside. So it made a 2.5 x risk to reward ratio before it even started to pull back. And so as traders, we are trying to capture that quick breakout. We thought there was gonna be a breakout, there was a breakout. And so we're just trying to capture just that breakout. We're not trying to capture the rest of the day. We're not trying to hit a home run here. We're trying to capture that small move in price that we think has the best odds of happening we can take advantage of. We're not trying to get greedy if we can't get all the way up to our three x risk reward ratio, but we can get to 2.5. I am happy with that all day long. So in summary here what I am trying to tell you is to manage your trade. You want to periodically reset your stop-loss to realign with your risk to reward ratio. Your risk to reward ratio should be somewhere in the range of two to three. When you are resetting your stop loss, you probably don't want to use the 1.5 numbers because there might be just a little bit too tight. Secondly, you want to focus on just trying to capture one price move. Yes, even in this example, the price actually continued to just move up all the way throughout the day. But that is not what we're looking for as day traders. We are trying to get in and out on a price movement that we can predict and capitalize on. That's what we're trying to do. And that's the example that I walked you through today. Also, don't get greedy and remember to take profits along the way. As soon as you have the opportunity to lock in profits, you need to eliminate any risk of losing money. You also need to adjust that stop-loss all the way up. And I personally, I sell part of my position if it's going really well, I lock in that profit. And that allows me to say, Hey, this was a good trade, no matter what. And if it just continues to skyrocket, I've still got money in the game. But if it turns back the other way real quick or unexpectedly, Just honestly sometimes happens, at least this way. I'm protected and I'm not worried about it. And I've already locked in profits to make it a good trade and a good day. That is what is most important to me. And honestly, if you can be profitable over the long term and mentally healthy, is just going to help you so much more along the way. So that's what I tried to focus on it and that's what I'm trying to share with you. Protect your downside risk, make small consistent profits, keep healthy, and keep on trucking. See you guys in the next video. 40. Margin: All right, everybody, welcome back to another video. In this one we're going to start talking about margin because I know you're probably thinking in the examples that I've gone through in this course, zack, that stock price moves by like $0.20 or $0.40. How am I actually going to make real money on such a small little price movement? While hopefully I can answer that question in this video, Let's jump right in. Okay, So when it comes to margin, what I'm referring to is margin allows you to borrow money from your broker to increase the amount of money that you can trade with. Margin is also known as leverage. And the idea here is that you're borrowing money from your broker to increase the total amount of cash that you can actually make transactions with. Now, in order to do that, you have to have a margin account. And when you create that margin account, it's really nice because it allows you to make those immediate transaction so you can day trade multiple times in the same day, but it also gives you access to margin or to the ability to borrow money if you choose to use it. If you do not choose to use it, this margin account will operate very similarly to a cash account. You will just stay within the limits of your own cash balance. Now, there's a lot of positives to using margin. Basically, the positive here that allows you to trade with more funds. So that if you have a profitable strategy, key point there. If you have a profitable strategy, you will make more profits. It's the same idea as like if you're training on the $1000 and you make it 10% return, you'll get a $100 back. But if you're chatting with a $100 thousand and you make a 10% return, you'll make $10 thousand. We're trying to do here is just scale up the pot. But using this same profitable strategy that we're establishing and building throughout this course. Now the negative side is that if you do not have a profitable strategy, you'll just lose your money faster. You will lose more money. It will become more stressful and it will be, it will just destroy your account. So you gotta be very careful using margin. The other downside here is that you will have to pay interest on the borrowed money. Usually it's between 5, 7%, but it depends on your broker. Some brokers also do not charge you if you do not hold it overnight. You're just doing a training with margin buying in the morning, selling in the afternoon. And you do not hold that margin overnight, you may not have to pay any interest, which is really, really nice, but each brokers a little bit different. So make sure you read into it for your broker. That's how trade works. Okay, So now here's a screenshot. This is just level one of Apple stock. You can get to this from any broker. It's basically just the overview that shows some stats about the security. What's really nice here is that inquest trade, it shows you the long margin requirement and the short margin requirement. They are shown as percentages. Long margin requirement is what you need when you buy. Short margin requirement is what you need when you sell. And the margin requirement here basically refers to how much money of your own you need to have in the position. For Apple, you need to have 30% of your own money in the position. And then question, will lend you 70%. This does vary depending on the risk of the stock. 30% is extremely low. Usually it's 50%, sometimes it's as high as 75%, and a lot of penny stocks are risky. Companies will not get any margin at all, so it does depend on your broker. Again, to get to this page though in question, you just click on level one. Basically this is just the stock overview page for any account. Now, let's put this into an example here and let's use the same Apple stock here where the long margin requirement was 30%. I've rounded the numbers here to just big round numbers. So it's easy for this example. And let's say that step one here is you buy three shares of Apple and $100, then you borrow $300 from your broker to buy three more shares of Apple. You now have six shares of Apple with $300 of your own money and $300 of your broker money. If you take 300 and divide it by the total position of 600, that gives you 50%, which means your money makes up 50% of the position, which is higher than the requirement of 30% that is set by quest trade. So at this point we're good to go. Our current margin is 50% were well above the requirement of 30% and things are looking good. And let's see what happens with the stock. Now, in scenario one here, Apple stock goes up to $200. This is very good for us because we like the $200 price point and we decide to sell six doc for a total of $1200. And then we return the $300 plus interest that we borrowed from our broker. We profit $600 minus that interest payment on a $300 investment. Remember, we put $300 of our own money and we borrowed 300 from our broker and went up to $1200. We returned 300 from our broker. We returned our initial $300. And when leftover with $600 in profit minus any interest rate that we may have to pay to your broker. Now, the key here is that using margin, we generated $600 in profit, but without using that margin, we would've generated just $300 in profit. So in this scenario, with the stock going up, using margin helped us to make more money. That's the overall idea and the goal here, but sometimes the stock goes the other way. In this example here, the stock actually goes from $100 down to $65. Now let's see what happens to our margin. So when you multiply 65 times the six stocks that we have, our current position is now worth $390. However, we still owe our broker $300 for the money that we borrowed to buy the shares. That means that in our current position, we only have $90 worth of equity. We have $390 worth of value here. We owe our broker $300, which means the difference there is $90. And that's what we have. The problem is that when you divide the $90 divided by the 390 and value, that is only 23%. And we have now fallen below are 30% margin requirement for Apple stock. And that, ladies and gentlemen, is a very bad thing because when that happens, you're gonna get something that is called a margin call. That margin call will always come through in e-mail. It may even be somebody on the phone trying to get a hold of you bright and early in the morning. And it basically means that you have run out of money, you no longer meet the margin requirements and you have a couple of options before your broker basically takes over here account and starts to make some transactions on your behalf. So here's an example of an email that I received back in 2020. This margin call was only for $86, so realistically, not a big deal at all, but this is exactly what it looks like. They will send you an email that says your account is in margin call, your combined maintenance excess is negative, which means you've fallen below the margin requirements here. And you need to take action right now. And they give you a couple of options when they send you this e-mail. And those options are to one, deposit more money to close the positions yourself so that you can free up some cash to meet the margin requirement. Or three, cancel any open orders that might violate your margin requirement. Now, usually this is not really an option because most people don't have open orders that they can cancel. Usually people either have to close their positions or they will have to deposit more money. And the problem is that if you do not take action within 24 hours or within a certain price band, depending on that security, then your broker will sell your positions to recover the funds and they will also charge you fees for doing so. If quests trait has to make a transaction on your behalf, they will charge you the irregular commissions plus $45 from making the trade. So you gotta be very careful when you use margin and as soon as it starts to go against you, it can happen very quickly. And when you get this letter, you need to take immediate action to protect your account, deposit more money, or close out your positions that are losing. Now, here are my thoughts when it comes to margin number one, do not use margin when you are starting out. When you are starting out, you need to start with a practice account. Then you need to start with a small cash amount that you need to build on that calcium out. Then you need to prove that you're a profitable trader, then you can use margin. But if you start using margin before you're profitable, it is just going to make you lose money faster. It's gonna make you lose more money. And it's gonna make your training trading journey, uphill battle, which is not what you want when you are starting out, margin is extremely risky, especially when it is not used correctly and each broker is slightly different. So please read into your broker to understand how they treat margin. Now, in summary here when it comes to trade, you can find margin requirements in level one and stock view tabs. You can find them both right there, but you'd need to make sure that you understand how your broker will treat margin and how to use margin and how to actually read it on your broker and in your statements. And you should only use margin when you can prove in your trading journal and in your actual trading statements, we're already profitable. You need to make sure that you're profitable before you use margin. If you are not profitable, you're just getting closer and closer to the M line and losing your account. So I don't mean to discourage you by any means. I do mean to give you a stern warning about using margin too early. But it is a great tool that can help us capitalize and can increase our total funds so that when we see that 2050, $0.60 price moves, we can actually put some real money in there and we can take advantage of those small moves based on technical analysis. So I hope this video helped, hope that answered some questions. If you have any more questions, leave them down below. I'll make sure to monitor this thread and we'll see you guys in the next video. 41. Taking Profit: All right, everybody, welcome back to another video. In this one we're going to start talking about how to take profits, manage your trade, and set that take profit level. Let's jump right in. Okay, So when it comes to setting your take profit level, there's basically two different ways that you might want to think about this. Number one is setting your take profit level as the next key level of resistance based on your technical analysis. So if you notice that the stock is trading within a channel, you're buying off the bottom. Your next key level of resistance is probably going to be the top of that channel. If you're trading a stock and it keeps getting rejected at a $100 and you're buying in at $8,100 levels probably going to be your next key level of resistance, whatever it might be, depending on the situation and the technical analysis for your stock, that's how you should think about it. Now if you do not have a key level of resistance because maybe the stock is breaking out to all-time highs or it just hasn't happened in a year or two, that's fine. Or you should be doing is setting your stop-loss below the key level of support that you are trading on. And then you should be using your risk to reward ratio to set your take profit. If you do not have a key level to set that take profit on, I would recommend a risk to reward ratio of at least two. That should be your minimum. Ideally, we're looking for three or four, but I would be willing to take two on a breakout to a new all-time high. Now, when it comes to your mindset here, there's a couple of things that you really need to ingrained into your head here because as day traders, mindset is one of the most important factors that determines our success or failure. And here's how I think about managing my trade and taking my profit. Number one, don't get greedy. That's what I just keep repeating to myself in the back of my head as I'm in a trade. Don't get greedy. Is this the right thing to do based on the technical analysis and the risk reward ratios. How should you act in this trade without being greedy and being grateful for what you've already been given. That's what I think about when I'm in the trade. I also think about locking in profits early because it's much better to make a little bit of money, then you go home even or lose money. It is so much better to just make steady, consistent, small profits. Lose any money at all. Like I said, we are trying to get rich with small, consistent profitable traits. Those small consistent profitable trades build up momentum for us and give us confidence as day traders. The goal of this course is not to try and hit a home run with a life-changing trade that's going to make you a millionaire and give you a Lamborghini overnight. The goal of this course is to give you a system and a protocol that you can follow, that you can adjust for your personal preferences, that you can scale up to become a profitable trader and do this as a full-time profession and basically give you freedom for your family. That's what we're trying to focus on here. And so you need to focus on the mindset behind your trading. And these are the concepts and ideas that go through my head as I'm in the trade now when it comes to my strategy here, here's how I manage things. Number one, I am consistently moving up my stop-loss to protect the downside risks. I'm not doing this every minute, but as the price moves up, I'm moving it to the next key levels that I think are important or that will be good for me to manage my risk. So for instance, if we get two-thirds of the way up to my take profit level, I'm going to move my stop-loss up to readjust my risk reward ratio and to make sure that my stop-loss is now above my entry point. So that no matter what, I am profitable on this trait, when we approached my key levels or where might take profit level is, I'm going to watch that trade extremely, extremely closely because we come super close to my take profit level. And then all of a sudden the market starts to crash and the economic conditions change. I'm just going to exit that trade, take my profits, walk away from it and re-analyze this situation. However, if the stock price gets close to my take profit level and it does good momentum and I think it's going to break through. That is when I might adjust things a little bit differently. That's what I would convert to a trailing stop-loss order. And I would do that if the stock has indications of breaking through the key level. Now we haven't talked about the trailing stop-loss much. So let's talk about it here. The idea with a trailing stop-loss order is that it will move up with the price, but it will not move down. So if we're buying into a stock, we're buying in and it's going up. We have a stop-loss right here and the price moves up. Our trailing stop-loss will move up with the price. And if the price starts to come down, the stop-loss will not move, that order will not move and it will fill as soon as the price falls below that stop-loss. So it'll get us out of the position. The idea here is that it allows us to stay in the trade if the stock goes up, but it will get us out of the stock goes down. That's the idea here is that this order protects your downside, but it gives you the upside if the price continues to climb higher. Now, in order to place this trade, It's very simple. You go to the order form just like what we have done throughout this entire course, you click on Order Type and then you change it to a trailing stop order. Under trailing right here, you will have to set a variable. Now, you can choose to set a dollar amount, or if you click on this button, you can change it to a percentage. Then you fill in the values that you want here, either the dollar amount or the percentage. And what happens is if Apple is out of $100 and you set a $1 trailing stop-loss on it. As Apple moves up, the trailing stop-loss will continually stay $1 below the market high. And then as soon as the price comes down, if it falls by $1 from the high, it will then execute this order and get you out of that position. Now, a couple of things to know about placing a trailing stop-loss. It is the exact same as placing a regular stop-loss. You're just changing the order type and entering that value. It's very, very simple to do and I'll show you through a couple of examples a little bit later in this course. But basically, this should be used when the stock is moving in a favorable direction. I personally do not use a trailing stop-loss to start my traits. The reason I don't use a stop-loss to start my trades is let's say I'm buying into outlet a 100, I set a stop-loss and $90 here. Then the first little bit of the, of the trade, the stock goes up to 104 and then down to 10 to 101 and backup to 104105. Well, just that regular little trading right there is going to move my stop-loss up. And if it comes back down, then my stop-loss has already been moved up. My risk to reward ratio is way off here. And it could come down and hit my stop-loss prematurely because it already moved it up. So personally, I do not start my trades with a trailing stop-loss, but I will convert to a trailing stop-loss once the trade is starting to go into my direction, that way my stop-loss is set and establish and it's not going to be hit early just because of some regular trading action. And lastly, this is a tool that can give you more upside on a good trade, but it should be used carefully. You do have to click a couple of buttons and change some variables here. So you need to make sure that you have full understanding and control of how to use that order form before you start canceling trades in the middle of open tray. So you need to make sure that you have full control and knowledge of how to use that order form before you start canceling orders in the middle of an open trade. Now, when it comes to scaling out of your trade, this isn't also an option that you can use to lock in profits. But the idea here is keep it simple, stupid. This was Tiger Woods saying the acronym is kiss for it. And I thought it was really good. So the way that I keep it simple, stupid when it comes to scaling in and out of my trade is I will only break my trade into halves. So for instance, if I'm concerned about my trade or we're starting to approach resistance or trade sideways. That is when I will sell half of my position because that is the first sign of a trend change. Once that trend change is confirmed, hello cell the second half of my confirmation. So if the stock is moving higher and then it trades sideways, that's gonna be the first sign or an indication that the trend might be changing. And as soon as it starts to trade bearish li, that is when I would exit the position and get out of that stock, especially in the event where it hasn't hit my take profit yet. That is how I would handle that situation. Now if you're going to scale in and out of your Trades, please keep it simple. If you're trading with quarters of your account or fifths or your position size, it can start to get really, really complicated and you have to make a lot of decisions which can be overwhelming and it's just too much to think about. So for me, Keep It Simple, Stupid as the best acronym, impossible when it comes to scaling in and out of your traits. Now, in summary here, this is what I think about number one is taking profit is just as important as entering the position, how you manage the trade, how you exit the trait and how you capture as much profit as possible is just as important as what traits you take. So you need to make sure that you're putting effort and practice into this. And you should be tracking all of your exits and all of your analysis in your training journals so that you can analyze that data and improve over time. If you notice that every time you scale up or scale out of a position, you are losing money or it doesn't go very well, or you get in and out at the wrong times, maybe you should eliminate that strategy. Maybe you should just not do that at all and you should just buy and sell full position sizes. Same thing, vice versa. Maybe you're not having so much luck with the trailing stop-loss. Maybe you should just set it, take profit and move your stop-loss up until one of the two gets hit. You need to adjust your strategy based on what is working best for you, based on your personal preferences and based on your own risk to reward tolerances. Now, when it comes to trading and managing your risk, the goal here is to reduce your risks and lock in profits. So that's what you should be thinking about. That should be your mindset when you go into these traits. And that should be the focus when you're sitting down at your computer and when you've entered a trait, I hope this was helpful. I hope this was valuable and will see you in the next one. 42. How To Find Stocks To Trade: All right, everybody, welcome back to another video. And this one, we're going to talk about how to figure out what stocks to trade when you sit down at your computer in the morning, let's jump right in. Okay, So in this video I'm going to walk you through my five steps that I go through in order to find a trade. And then I'm gonna give you a real-life example so that you can see it in action. Step number one here is to start the day with a morning routine. I recommend keeping it as short and simple as possible for me, it involves waking up, taking a shower and making breakfast and grabbing a glass of juice. You, it could be slightly longer, it could be shorter. The goal here is to go through some type routine that is the same every morning that will get you in the right mindset to sit down at your computer with no distractions and devote all of your effort and energy into making profitable traits. That is the goal you need to figure out what works best for you. Step number two here is to check online for any major news, economic events, or earnings. This could be things like interest rates changing. It could also be new data about inflation or GDP. It could be a major press release from a couple of companies. It could be political changes, could be a natural disaster, it could be a war, it could be a trade embargo. It could be a tariff, could be a variety of different things. What you are trying to understand is what is happening in the world so that you have context. When you start to zoom in, we're starting with the big picture. We're zooming into individual stocks and we want to know and understand what is happening around the world. So that as we zoom in, we can keep that in our mind and we can try and buy into the general overall direction. We're not trying to buy the DIP. We're not trying to pick the absolute bottom and sell it at the absolute top. We're trying to find the direction and buy into that trend and sell out when that trend changes. Now, step number three here is to check the markets and major indices to see what direction things are going in. Most of these indices and a lot of these stocks are going to be trading long before you get up in the pre-market hours. So before the market opens, you can check the nasdaq, the S&P 500 and the Dow Jones. Those are the three that I check to see what direction they're going in. Now, I live in Canada. I trade the North American markets and trade mostly US securities. So these are the indices that I check if you live in Europe or you live in Asia or somewhere else around the world, you need to check the indices that represent the markets that you are going to be trading it. The idea here is that now that you've seen the big picture around the world, we're going to zoom into the markets that we're trading in to understand how the market overall is doing. Now, once you have checked into the market, then you zoom in one level further. This is where our sector watch list is going to come into play. I've talked about this previously on the course. The sector watch list is 11 different sectors or industries within the market that make up the entire market. And it's basically a division of the US economy. And so it is divided into 11 sectors. Communication, energy, real estate, consumer, discretionary consumer staples, health care, financial industrials, utilities, materials and technology. And the idea here by zooming in and looking at these industries, you can see which ones are the most bullish, which ones are the most bearish? And if you are interested in trading technology, for instance, and every other sector is up and the overall indices are up, but the technology sector is down. That is something that you are going to want to know before you go start trading and looking for individual stocks, you're going to want to understand, okay, maybe the entire market is up, but the one sector that I'm looking at or that I'm interested in down. You need to know about that ahead of time because you're probably not going to want to buy long when that sector is moving down. So you gotta be very careful here. And it's basically like zooming in one extra level here before you start looking at individual stocks. Now, step number five, once you have looked at the sectors, is to start looking at your personal watch this to look for individual trading opportunities. For me, I keep watch list for technology, softwares, electric vehicles, energy, and real estate. Those are the major industries that I tend to be day trading most of the time. There are obviously other industries that I play with from time to time. But most of my day trades usually come from these industries. And so I would build a watch list for all of my favorite tech companies, my favorite software companies, my favorite EV companies, energy companies and real estate companies. And depending on the information that I've gathered previously from starting with the big picture and working our way down. I will then go into whichever industry I think has the most potential to be very clearly long or be very clearly short. And I will start to evaluate training opportunities based on technical analysis. At that point. Then when the technical analysis is good, I will evaluate the risk to return ratio. I will evaluate everything else going on. Then I would possibly execute the trade, and then I will manage the trade and move my stop-loss up as the price moves up or in the direction that I'm trying to trade it into. Now, just as an example of what I've just talked about, Let's put this into a real life scenario that happened to me this week. This is how I came up with the trade and this is what I was thinking about. So on Tuesday of this week, I think it was the 13th of September 2022, inflation data came out and that inflation came out and it was higher than expected, which means the inflation number was 8.3. I think analysts were expecting 8.2. That is bad because it means inflation is too high. And it also means that the federal government is probably going to increase interest rates to try and bring inflation down. Now if that sounds confusing, I'm going to talk about it a little bit later in the course. But basically this was bad news for the economy. This was bad news for the markets. And it means that it's going to cost more money to borrow from the government. It's going to cost more money to borrow from the banks. And it's basically going to slow the economy down. That is not good. And pre-market, all the indices were selling off. Everybody was selling out of it. People were getting scared. The nasdaq, the S&P 500 and the Dow Jones or all selling off in the pre-market. Now, in my mind, I think that tech stocks are gonna get hit the hardest. Because when interest rates go up, that means your mortgage payments go up, your debt payments go up, and it means you have less discretionary income. When people have less discretionary income to spend on the goods and services that they don't absolutely need. The companies that feel the biggest hit are usually the technology companies like Apple, or the technology companies that provide a luxury good. For instance, I don t think as many people are going to be buying the iPhone 14 if interest rates continue to climb and they have less discretionary income. So this inflation data was actually really bad for Apple because it means that inflation was higher than we thought. Which means the government's going to raise interest rates, which means people are going to have less money to spend on luxury products like the new iPhone or the new Mac. And that is going to reduce Apple's profits. Therefore, I think tech stocks you're going to sell off. And I am planning to short the big tech stocks such as Apple. So when I sit down at my computer, this is the stock chart that I see. Obviously we're selling off in the pre-market and then we actually started to trade sideways for a couple of hours here from eight forty nine forty eight m, We were pretty much trading sideways, and we established a new low rate here around $159, and then we traded a little bit higher. We almost made it back up to 160 before crossing below that support to one fifty eight forty two, this screenshot. So as I'm analyzing the stock, I'm thinking to myself, okay, markets trading down, technology's about to take a hit. I think it's going to continue to trade down throughout the rest of the day. We just found through our technical support level, the Mac D is still below. It looks like the line is crossing right now. The volume is starting to drain out a little bit. It's not as high as it was earlier in the day. This is probably assigned for me to go short on Apple. Everything that I'm looking for is lining up when I evaluate the risk to return ratio, I can see that we're falling through support at one fifty eight seventy three, I can currently enter the stock at one fifty eight forty two, I can set my stop-loss at 159 is basically white line right here, which is now above the support level that we had established earlier on in the day right here. And that would give me a risk of about $0.58 on this trait. Now, throughout the day, Apple continued to sell off. This trade worked out extremely well and the price actually fell all the way down to a $153.38 before starting to make its way back up and currently trading around a $154, that is where I exited and we profited about $4.74 per share on an initial investments that had a risk of only $0.58. We made basically like six or seven x risk to return ratio on this trade, which is extremely phenomenal. I'm very happy with it. This is just an example of how you can start with the big picture, which was a GDP number. You can narrow that down to an industry that's going to suffer, which is luxury technology. And you can find an individual trade which was Apple, because all of the technical analysis lined up, it was going in the direction of the market. And it basically checked all the boxes that we needed in order to enter this trade. Now, my strategy here is that the goal is to gather enough information so that by the time you are looking at individual stocks, you already have an idea of what trade you want to make. I could have made that same trade with Google or Microsoft or probably Zoom or Shopify. All of them were high-end technology stocks that we're going to take a major hit, something like that. And so there is that opportunity to evaluate this and take that same shade on a variety of different stocks. The goal is to have that trait in mind so that by the time you're evaluating different stocks, all you're doing is choosing the one that gives you the clearest indication based on technical analysis. In this scenario, it was Apple. And the idea here is again, start with the big picture and work your way down. Now, other options that you can have other than just trading blue chips, a lot of people start detraining with penny stocks and it is definitely something that you can do. All of the analysis is the exact same. A lot of this strategy is very similar, but here's where they are different. Penny stocks are more volatile, risky, and prone to hype or manipulation. Penny stocks trade at lower valuations, They have much, much lower market caps. And sometimes these companies are only worth millions of dollars. So if a rich person comes around, or if a day trader with a lot of money comes around, they can start buying or selling the stocks and moving that price Extremely dramatically. You can also get influencers or investment banks that write reports or short reports that will come out to either hype up the stock or tear it down. And that can drastically move the prices without any actual changes in the business. And so when it comes to penny stocks, lot of their price and valuation is based on future potential and the hype around that company. Whereas with blue-chip stocks, most of the time is based around earnings and revenue and profits, which is usually a little bit easier to understand. Large market cap stocks like Apple, Amazon, Google, any of these large companies that have been around for ten years and are already profitable, they usually have more information available for us as traders. And they trade on the principles of organic supply and demand, meaning that they're less or more difficult to manipulate large money, or by traders, or by people that are hyping up the stock or trying to tear it down. So in summary here, what I recommend is trading in the direction of the market, tried to find a reason to trade a specific stock. We call that a catalyst. And you find that catalysed by starting with the big picture and narrowing your way down. The goal is that by the time you start evaluating individual stocks, you should have gathered enough information on the way there that you have an idea of whether you want to go long or short and what industry you want to trade and think about that for a minute. Lastly, here, you want to always approach the market with an open-mind and do not become biased. The market could go up or down at any point. Usually it goes in the same direction throughout the day. We need to approach the market with an open-mind because that trend can change at any point. And when that trend changes, you don't want to say, okay, I'm gonna move my stop-loss or I'm just going to adjust this a little bit. You want to be real with yourself. You want to be honest with yourself and say, Okay, I made a wrong trade, or that trend is changing. Or the signs that I thought made this a great trade, just are no longer there and I need to adjust course. That is the most difficult thing as a trader is being real with yourself and actually approaching these scenarios with an open-mind and not being biased because you'll really like to stock or you made a bunch of money longing it or shortening it last week. You gotta be very careful with that. And this is the system and the methodology that I personally use. 43. Level 2: All right, everybody, welcome back to another video. In this one, we're gonna talk about level two and how you can use it to improve your trading. Let's jump right in, okay, So when it comes to level two, this is what I'm referring to. This is the level two windows that are just taken a screenshot from on Quest trade, every broker is going to have this. It might be set-up a little bit differently. The colors might be slightly different, but it's gonna be the same principles. You're going to have a chart here with the bid on the left side and the ask on the right-hand side. As you can see, this is just all of the orders of people that are willing to buy and at what price and quantity they're willing to buy. Same thing on the other side here with the cells. On the other side here we can see this green and red right here. This is the order print. This is every single order that actually gets filled for whatever security you are looking at for us, we are looking at Apple. And so here is every single order that is going through the system. As I took this screenshot, that is what we are looking at when we talk about level two. Now the real question is, how do we use level two? And here it is. Here's the basic simple version of it. Number one, it is not needed for new traders, so it is not a requirement you do not need level two. It is not something that you have to have in order to get started. Level two is a tool that you can use to incrementally improve your training. It is not going to be the difference between a profitable and unprofitable trader, but it will give you a little bit more information that you can use an analyze when making your traits. That is the idea behind level two and is not the golden goose. It is not the key to get rich. It is not going to fundamentally change how you trade. It is not going to change our system at all. It is just an additional tool that you can use, an add to your tool belt to improve your trading incrementally. The idea behind Level two is that we're going to use it to help confirm a breakout or a rejection. So when the price approaches a key level, that is when we're going to look at level two to help us determine as the price breaking out or is the price getting rejected? The idea is that we want to watch a level too closely when the stock price approaches those key levels. In-between those key levels though, Level two is not going to tell us very much. So if a stock is just training sideways in a tight little zigzag like that. Level two is not going to really tell us anything because at that level, supply and demand forces are pretty much equal if the price is moving higher and it's approaching a key level of resistance where it's been rejected in the past. Looking at level two can help us to understand and give us a first indication of whether or not the price is going to break through or get rejected. Now, when it comes to the bid and the ask, so this was the left side of that example here what we're looking for is large orders. So when we go through this and we see that most of these orders are one hundred, two hundred shares. We've got an order for 1000 shares up here, but nothing nothing above 1 thousand right here, and nothing really above two or 300 on the sell side, that means that there's no big whales that are placing big orders. There's no giant stop losses that are set. There's no huge take profit orders in the system. But if we did see that, like let's say that we saw a massive, massive order to sell shares at a certain level right here, one forty nine sixty two. If we saw that, that would be a large take profit order and we would expect that the price might not be able to get above that level because there's large selling pressure at that specific level. That's what we're trying to understand here, is where's the buying pressure? Where's the selling pressure? And is it at a certain price level that we can use to base our trading off of. Now the problem is that a lot of the time, and we've talked about this before in the course. This concept of spoofing. That is where somebody will place a trade or an order, if I should say they will place an order that gets entered into the system that they have no intention and filling. So somebody will place a big order to make it look like you have a stop-loss or take profit order. And then as the price gets there and they'll just cancel that order and then we'll get rid of it. And that can influence the price action. And other traders, they're looking at level two, so you have to be very careful for that. It is not going to be a 100% accurate all the time because of that factor. Now the other thing that you may want to watch for is the spread. That is the difference between the bid and the ask price. In this scenario, we're looking at Apple, so there's only one sense. Apple is one of the most popular stocks in the world. So usually the spread is only one or $0.02. But if you were starting to trade a penny stock or small market cap stock, we're just a company that doesn't have a whole lot of volume or attention. This spread might be very important for you and it might dictate what type of orders you're going to use. If the spread is large, you may not want to use a market order. You might want to use a limit order, that kind of thing. So you want to keep an eye on this spread, which is the difference between the bid and the ask. And you want to watch for large orders that will act as a stop-loss or a take profit. The problem is that sometimes those orders are spoofed. In other words, they are fake. Those orders will get deleted as soon as the price starts to move towards them. Now the other side of it here is the tape that's usually what most people call it. And basically it is a summary of every single transaction that goes through the system where a buyer and a seller meet. The idea behind the tape is to document what is happening in real time. Read orders here mean that the order was filled at the bids. So somebody who is willing to pay one forty nine fifty one, and somebody that had shares came down to fill their or too quickly, they came down to the bid. And that means that it came out and it printed as red. When it prints out is green. That means that somebody was asking for one forty nine fifty one, and somebody that didn't have shares was willing to pay that price and they came. That price, because those orders move the prices when we see a green print or when this entire screen is green, that means that there is buying pressure and the price is likely to go up. Remember, everything in the stock market is connected to supply and demand forces. And so when we see a bunch of green orders come through the system, that means that buyers are stepping in and they're willing to pay higher and higher prices. And that eventually if continued at a high enough volume, is no matter what going to continue to push the price higher. However, it works the exact same way as well. If we see a bunch of red orders here, that means that people that own shares right now are coming down in price to sell their shares. And eventually that is going to push the price down. And so what we're looking for it when we look at the tape, is, are we printing a bunch of green orders or are we printing a bunch of red orders? And is the price moving with those orders? That's what we're trying to understand and look for. A bunch of red orders means that orders are filled at the bid, which means the price is coming down. A bunch of green orders means people were coming up to meet the ask price and that is going to push the price higher. So just as an example, here's a screenshot of the tape that I took of Apple just as I was making this PowerPoint. And as you can see, this is a full print of red. This means that people were coming down in price to sell their orders at the bid. We then got one order right here that was between the bid and the ask, which means two people met in the middle between the bid and the ask. You can see it was sold with a 0.5 at the end of it. And so what we're looking for is if you see this type of screen here where the tape is just printing red, that means that people are starting to take profit and that the stock could be losing momentum if you see it print completely green. That means that people are coming into the market and they are buying up the stock and is gaining momentum and gaining volume. It's gaining traction and their price is likely to go higher. Now what we're looking for is for it to either print read or print green at key levels. Because if we start to approach a key level, see it print green. That is our first indication that the stock is going to continue to breakout if we see it print read, that is the first indication that the stock is likely to get rejected. Now, in summary here, the tape is much more important than the bid ask orders. The bid-ask orders can be manipulated, they can be spoofed, and they are difficult to read when they move quickly, the tape will tell you what has happened, and it will show you in a very bright green or a bright red what is happening right now? However, it does move quickly, so it does take some time to get used to. I will walk you through a couple of examples in our live day trading videos. Secondly, you should focus on the tape at key levels. We're not trying to read the tape. And level two, when the stock is in the middle of the channel, we're trying to read the tape. And level two, when the stock approaches key levels of resistance or support, we're trying to understand is that most likely going to break through or get rejected. That's what we're trying to figure out when reading the tape. And we're looking for strong indications of buying or selling by a green print or a red print that is moving the price. That is the summary, that is the goal of level two. And it is a tool that we can use to incrementally improve our trading. That is not going to be the secret to trading and is not going to be the difference between a profitable and unprofitable trader. But like I said, you can use it to hopefully give you the first sign or an early indication of a breakthrough or rejection. 44. ETFs: All right, everybody, welcome back to another video. In this one we're going to talk about how you can use ETFs as another option when it comes to day trading, let's jump right in. Okay, So when it comes to the acronym ETF, basically what this stands for is exchange traded fund. And ETF is a basket of stocks that trade like a single security. So you're taking a bunch of different individual securities and you're putting them together in a basket. And this ETF can be bought and sold just like a normal stock. So it has a ticker, it has a price. And you can see all of the stocks that are held within that basket. The nice thing about ETF's is that they usually have very low commissions depending on what broker and platform you use. Sometimes ETFs are even free to trade. Now, just to give you an example of an ETF, this is QQQ, this is put on by invest go, and this is an ETF that tracks the nasdaq 100 Index. The nasdaq 100 is the 100 largest non-financial companies on the Nasdaq. The Nasdaq is the exchange. The nasdaq 100 is an index of that exchange that represents the 100 largest companies on that exchange. And QQQ is an ETF that tracks the Nasdaq 100's. So when you buy QQQ, you're buying into or selling out of the Nasdaq 100's. That is the idea here because you cannot buy an index. An index is measured in points. It is a theoretical group of companies, but you can buy an ETF that tracks that index. And for the Nasdaq 100's, that ETF is QQQ. So for instance, if you wanted to day trade the Nasdaq 100's, you would pull up the chart for QQQ and you would place your orders to buy or sell this ETF that currently cost $289.44 per share. That is how it works and that's basically what would happen. Now what I want you to do is remember this pattern here, okay, the stock trades sideways. It has a nice little run-up right here, comes back in and then it starts to break out. This is what the Nasdaq 100's looked like today. This is what the ETF that tracks the Nasdaq 100's looks like today. However, there are some other options when it comes to ETFs, and that's what we're going to talk about now. So the first one here is a leveraged ETF. Etf will track the index. A leveraged ETF is still a basket of stocks, but it trades at a multiple of another ETF. So when we look at a leveraged ETF and we see that it is two times leveraged or it is three times leveraged. That means that it is going to move by two times or three times as much. So for instance, if we look at T Q, Q, Q, This is the leveraged version of the Nasdaq 100's or the three times leveraged version of QQQ. And so this security moves at three times the up or down movement that QQQ moves at t q. Q is the leveraged version of QQQ. It is a3x leveraged, which means it is going to move by three times as much. If you look at the percentage of movement at the time I took this screenshot, it was 2.35 per cent. If you look at QQQ, it was like 0.57%. I took these screenshots a couple of minutes apart, so the price obviously moved. But as you can see, T QQQ shows you almost the same pattern, but the price is moving by just a much more dramatic amount with regards to a percentage that dollar numbers are never going to line up because they're just different dollar values because of how they're set up. But the percentages that they are moving in the day, t QQQ is going to move at three times. What QQQ is going to move that. And QQQ is tracking the Nasdaq 100's index. So now we've talked about regular ETFs that track an index. We have also talked about leveraged ETFs that track an index but give you two or three times the movement in the price. The next option that we have is an inverse ETF. An inverse ETF is very similar. It's still a basket of stocks. Usually trades in the opposite direction of the other ETF for us, QQQ is gonna be that baseline ETF that we're comparing to all the time. And inverse ETF is going to move in the opposite direction. So in this example, P S Q is the inverse of QQQ. And when QQQ goes down, this will go up. As you can see, it's the exact same pattern as QQQ, but it's in the opposite direction. We break down early and then we start to trade lower QQQ. We broke out early, and then we start to trade higher P S Q is the exact opposite of QQQ, and it gives you the ability to still buy the security without having to short it and take on that unlimited risk, as well as pay interest on the money that you're borrowing from your broker. Now the last type of ETF that I want to share with you is basically combining the leveraged ETF and the inverse ETF. It is called the leveraged inverse ETF. And again, it is still a basket of stocks, but it usually traits and the opposite of another ETF and add a multiple. So for instance, an example of this is S QQQ. As QQQ is the inverse three times leverage of the QQQ. Basically, what's happening here is that when QQQ goes down, this will go up by three times as much and it will go in the opposite direction as QQQ. You're taking advantage of the leverage and you're also going the opposite way of the underlying ETF or index. The idea here is that you're trying to make money when the market sells off by buying the inverse ETF. Now, as day traders, why would we want to use ETFs? Well, very simply if we can understand the direction of the market, ETFs will give us another option for DEI training. So if we can't find any great opportunities, individual stocks, but we can identify the direction of the market. Trading. Etfs gives us an excellent opportunity to still make profit and make some trades throughout the day. They can also help us to make money when the market is crashing. So if some terrible economic events come out, countries are going to war, major issues are happening around the world and markets are crashing. You can buy inverse ETFs to make money as the value of the underlying ETF goes down. Now, there are some risks to ETFs and a couple of downsides. Number one, liquidity can be a challenge depending on the ETFs. So as you saw, P, S Q here has much lower volume. So getting in and out of ps q at the levels that you want, or if you're in an even smaller ETF, it can definitely be a challenge. So you have to be very careful. You have to make sure that you understand the spreads and the liquidity on that security. The other challenge here is that ETFs are more heavily focused on economic events rather than individual company events. So individual companies report earnings and how products and they're fairly easy to understand. But the economic events that are driving the markets can be a little bit more complicated. Things like GDP and inflation and CPI, inventory numbers. They're a little bit more harder to understand and see how everything is connected. So you do sometimes get less information when trading strictly ETFs as opposed to stocks. So you do have to be careful and you have to understand the dynamics that are moving the ETFs because they're a little bit different than what is moving the stocks. However, when it comes to finding ETFs, It's very, very simple. All you need to do is go to Google. You can type in your industry and then the word ETF. And it will pop up all the different ETFs that apply to whatever you're looking for. You can also find a bunch of people on YouTube that talks about all their favorite ETFs or which ones they're buying. I highly recommend doing one of these two so that you can get some different ideas. But what you should make sure you focus on making sure that the ETF you are buying, you know what exchanges it is on. So for instance, if you're buying an ETF on a US exchange, you need to use US dollars. Same thing if it's in Canada or another country. You need to make sure that you know where that ETF is traded and where it is listed. Now in summary here, ETFs are a great option for day traders and many traders prefer ETFs Overstock because of the lower volatility and low commissions. Not everybody trades ETF. A lot of people trade stocks. I personally trade mostly stocks, sometimes ETFs, but they are a great option to have an understanding. What I would recommend is trying them out and our practice account, that's what I recommend. Anytime you're trying something new when it comes to investing and day trading tested on an HR practices cow. First, see if you like it, see if you can understand the technicals behind the ETFs better than you can understand the stocks. You might find that you have a strategic advantage in one or the other, but you do need to make sure that you're still journalling your trades. And most of the technical analysis is gonna be the exact same on the ETFs as it is on the stocks. What is changing is what is moving those ETFs and what is moving those stocks. That's a big difference there if you have any questions, leave them down below. Thank you for watching and I'll see you guys in the next video. 45. Profit when stocks fall: All right, everybody, welcome back to another video. In this one we're going to talk a little bit more in-depth about how to make money when the markets are falling. Let's jump right in. Okay, so throughout this course I've talked about two different strategies now for how to make money when stocks are going down. The first one we covered at the beginning of the course, and that was how to short stocks. That's when you borrow shares from your broker, you sell them in the market and then you wait a period of time and hopefully buy them back at a lower price to return those shares and capture the difference as a prophet, That's how you short a stock. And we just covered recently what an inverse ETF is. It is something that trades like a basket of stocks that tracks in index and an inverse ETF goes up when that index goes down so that you can make profit as prices fall. Those are two different strategies that you can use to make money when markets are crashing. Now the strategy and the thought process behind this is really, really important because you want to be sure of what is happening in the first thing you need to know is first of all, what is happening and why, why is the important part here? Why are oil prices falling? Why our home prices rising? Why is this happening or that happening? You need to know what is the catalyst, what started it, and what is it going to take to maintain whatever is happening right now. After that, you need to ask yourself what companies and industries will be most negatively affected by this recent change or event or catalyst that has just happened. And I'm gonna walk you through an example here in just 1 second. And then the last thing you need to think about is how to short the stocks, the worst-performing companies, or how to buy an inverse ETF for the industry that is going to be most heavily affected. Again, we want to start with the big picture and work our way down to the best possible opportunities. If there are no possible opportunities in individual stocks, then we will consider industry ETFs. Now, here's an example that happened almost two years ago now, but it's just the perfect, most glaring biggest example that I think we've probably seen in the last ten years, and that was COVID. Covid outbreak begins at the beginning of 2020 and it expands around the world and it forces people to stay home. Covid was the event that happened. The result is basically people are afraid to go out. They have to stay in their house. They are locked down. Because of that. Nobody is booking a cruise ships, nobody is going on a cruise ships. Cruise ships aren't even allowed to operate, they're not even allowed to bring on guests. And everybody is worried about what is going to happen. And Cruz Industries and cruise companies have absolutely 0 revenue coming in because they can't operate any of their tours and they don't even know when they're going to be at, just start operating again. So it is not looking good for the cruise industry as soon as COVID starts to come about. Because of that, we can think to ourselves, hey, everybody staying home to Cruz Industries are going to be the hardest affected. Maybe we should be shorting the poorest cruise companies or the cruise companies that have the worst financial results or have the most debt on their balance sheet. So that's the strategy here, and this is the example. And if you had gone through this example, you probably would have come across Royal Caribbean because their stock price fell from a $135 all the way down to $19.25. And then get might've even gone a little bit lower after this, but basically for about a month to a month-and-a-half period of time here, there was 80% days where it was completely red and the stock finished lower than an open. You can see the odd green candle here, but it really didn't happen often and almost every single day here the stock finished lower than it opened. Which means you could have shorted the stock and done extremely well for literally the exact same trade for almost a month. So this is what I'm looking for when we talk about how to make money when the market is falling, figure out what is going to follow the fastest, what's going to follow the hardest, and what's gonna be the most negatively affected by the reason or the catalyst that's causing everything to fall. And then you want to short that individual security. Now, in summary here what I want to get across to you with this video is that you have options. You have the opportunity to go long or short at any point on any security while you are trying to do is narrow into the one opportunity that's going to give you the best odds with the best risk to return ratio. That happens to be shorting the stock, that's fine, that's totally normal, That's absolutely fantastic. Just make sure that you are managing your risk and you understand why you are shorting it and why you think it's gonna go down and what it's going to take to continue to push it down. Secondly, the key isn't identifying the trend. I am giving you tools to make money whether the stock goes up or down, it is your job to identify what the trend is and then use those tools to take advantage and profit from that trend. That's how we think about this. Lastly, bear markets give us just as many opportunities as bull markets. Markets are really easy to trade in if you have no idea what you're doing because you can just go out and buy anything. And over time, if the market is rising, you'll probably do okay. The bear markets are where day traders actually prosper. This is where we thrive because we can make money, whether their stocks are going up or down. It just comes down to our strategy and our ability to determine and realize and have an open mind and a clear vision of whether that stock and that industry is going up or down and then buying into that trend and taking advantage of the tools that I'm showing you here to profit from that trend. That is the goal, that's what we're trying to achieve. I will see you in the next video. 46. Trading Strategy: All right, everybody, welcome back to another video. In this one, I just wanna do a quick summary of everything that we have learned with regards to our trading strategy. I want to put it all together and kind of summarize everything so that it's easy to digest. And you've got all the main points I want to try and get across, okay, so first of all, the key principles to what I've been talking about, I've summarized it here. And number one, always start with the big picture and work your way down. This comes when you are evaluating which stocks to look at. It also happens when you are evaluating a single stock. You want to start with the daily time frame and then the hourly timeframe, and then five-minute and then one minute, we want to start with the big picture and work our way down so that we understand what is happening in the large picture. We have it as context with regards to our traits and we can use that information to hopefully make us more profitable trader. Always start with the big picture. Secondly, we want to identify the direction of the market and buy or sell in the same direction. When I say direction of the market, what I'm referring to is the general overall sentiment of the majority of the market. If we notice that all three of our major indices in the United States, the S&P 500, the Dow Jones, and the nasdaq, if they're all negative, that is a bearish market, that is a downward training market. And in that situation, we want to take advantage of that downward movement. We're not going to be trying to buy stocks on that day. That is not the goal. We want to be trading with the direction of the market. And lastly here, risk management is what is going to separate you from a profitable or unprofitable trader? It is what is going to separate you from a good to a great trader. And this is the key differentiator between day traders. It is your risk management plan is how you handle a trade when it doesn't go your way. And is whether or not that trade blows up your account and then is how you come back from defeat. That is what makes good traders Great. All comes down to managing your risk management plan. We're going to talk about that in just 1 second. First of all, I want to talk about finding trades. We talked about this a couple of lessons back, but really it is super, super important when you sit down at your computer, you're starting from a blank slate every single morning. How do you figure out your strategy and figure out what you're going to trade that day. First, you want to do some research on the global market conditions. Are there any wars? Are there any natural disasters? What is the economic situation like? What is inflation like around the world? You want to understand the overall large situation. So you have context when you zoom in, when you do start to zoom in, you want to zoom into an individual market for me, it's usually North America, Canada, and the United States. So look at the indices that represent those markets. Next, I'm looking at individual sectors. I have shared that watch list with you several times now, you should make a copy of that. Watch this so that you can understand how the 11 different sections sectors of the US economy are performing on that day. So you can understand which sectors are performing better, which sectors are performing worse. And hopefully you can use that to your advantage when you are making trades. And then lastly, that is when you start to look for individual stocks or ETFs, and you compare them to figure out which one is giving you the best opportunity in the world. Think about it as if you're going to the buffet of the stock market and you are trying to find the single dish that looks the absolute best. You can get the most money, the most value for your money. That is exactly what is happening here. We're starting with the entire buffet. We're narrowing it down to our specific type of food that we like and then which pasta sauce looks the best and the topics that we want on it. We're starting big or narrowing down to find exactly what we want and find the trading opportunity that he's going to make us the most money, give us the best odds, the best opportunity for us to spend our time on as we sit down at our computer. Now, when it comes to your risk management plan, there's a couple of key things that you need to remember. Number one is your maximum loss per position. You are going to set your stop-loss. Then you're going to run your calculation to see how much money you are losing per share. You're going to divide your total loss per position divided by that amount per share. And that's going to tell you how many shares you can buy it. I personally recommend a 2% maximum loss per position or portrayed that you make that way, you're not going to blow up your account. You probably going to make a couple of small chains in the beginning, but it's going to slowly grow over time and it's going to protect you. I also recommend only taking a trade with a absolute minimum risk to reward ratio, 1.5. Ideally you want this to be 2345, but 1.5 is gonna be the absolute minimum that you should ever take. You wanna be as picky as you possibly can when you're a new trader, you want to just understand the concept. You want to take one trait at a time and take it very slowly. I also think that you should put a stop-loss on every single trade that you take. This will protect you from the downside. This will lock in your risk when you calculate your risk to reward ratio. So it's super, super important and I think you should have it on every single trade. You should also be journaling every single trade that you make so that you can gather data about what you're good at, what you're not good at, and you can adjust over time to improve your performance. Lastly, you should walk away from the computer if you make three bad trades in a row. If you're not in the right mindset, if you're not feeling good, if you are distracted or if you make a couple of bad trades in a row, take the rest of the day off, go do something else, go mow the lawn, Go work for your buddy, go find some other way to make money that day. Do not sit at the computer. Do not dig yourself deeper. Have the self-control and the consciousness to sit down and say Today is not my day. I'm going to come back a better guide tomorrow. I'm going to come back stronger tomorrow. I'm going to come back in a better mindset Tomorrow. I'm going to do something differently. I'm going to change up my morning routine. Adjust your strategy to what works best for you. Every single human is different. Some people are morning people, some people are not. Some people need to meditate in the morning. Some people just need a coffee and they need to sit down. It depends on what works best for you. You're only going to understand what works best for you by journaling your trade and keeping track of it next, when it comes to technical analysis, this is really, really important. We're going to dive into this a little bit more, a little bit later on, but always perform multiple timeframe analysis. You should be looking at these stocks anytime you look at an individual stock or an ETF, the first chart you should be looking at is the one day candle chart. Then you should zoom into the our chart than the 15-minute than the five-minute than the one minute. You should start with the big picture and zoom your way. And using multiple timeframe analysis, you can see where the key levels of support and resistance are from back throughout history. Next, you need to make sure you have volume on your chart. This will show you if it is a strong trend or a weak trend depending on if volume is increasing or decreasing, you need to make sure you have moving averages on your charts so that you can tell if we were in bullish territory or bears territory. They will also help you to understand what direction we're going in over the longer term. You need to make sure you have your Mac D on there to give you some indications of when that trend is changing, then you need to go in and you need to draw your key levels of support and resistance so that you can understand where you are expecting this stock to either continue with the trend or reverse the trend at that point. That is where we're looking for a bounce off of resistance, a bounce off of support, or a breakthrough of that exact same key level. We're looking for the stock to hit a key level and either continue going through or to change direction if it continues going through that as confirmation of a bullish trend and we want to buy em if it changes direction, that is confirmation of a change in trend. And if the market is selling off, that could be an opportunity to short the stock or the ETF. Now, in summary here, this is a quote that has stuck with me and that I've kind of adjusted a little bit. But here's how I think about day trading. Day trading is the ability to see what is happening. Nothing fancy here, there's nothing crazy. Everything is shown to you. So day training is literally you're looking at a chart and trying to understand what is happening and then using your skills to take advantage of what is happening. All you are trying to do is observe what direction the market is going in than we are trying to use our skills and the tools that I've taught you throughout this course to try and take advantage of that direction. And when that direction changes, we want to get out of that trend hopefully without losing too much money. That's the goal. That's what we're trying to accomplish throughout this course and through the next couple of lessons, I just want to basically add continuously, add new tools to your tool belt. Now that you've got the foundations of what we're trying to accomplish here. 47. Share Splits and Mergers: All right, everybody, welcome back to another video. In this one, we're going to talk about stock splits as well as mergers and acquisitions and how you can take advantage of them as a day trader. Let's jump right in, okay, so first of all, a stock split is when a company will split or merge their shares, the market cap and the value of the company stays the same. So nothing actually changes with the company or the value of the company, or how much it's worth, or what the company does. However, the price and the number of shares outstanding does change. So for instance, if a company does a two to one stock split, that means for every one share you owned before the split, you will own two shares after this split that are worth half as much. It will be the exact same, equal value, but you'll have two shares over here, and you'll only have one share before the split. Basically, nothing is changing with the company, but the price and the number of shares outstanding are changing. Now, here are two examples. You can see that Tesla actually went through a three-to-one stock split here back in August. This is very exciting. It brought their shares down from $891 to $297. And on the other side of it, we've got hexachord, which is a Canadian cannabis company. And they did a reverse split or a share merge, where for every four shares that you own before, you owned one share afterwards, now, you're probably thinking to yourself, why are companies doing this? What is the point? If nothing is actually changing with the company? And here's the answer. If the price is too high, like in Tesla's case, it can make it difficult for retail investors to buy the stock. So Tesla knows that a large portion of their shareholders are regular average people that are investors that just want to own the company because they liked the cars where they believe in the vision, not training with large amounts of money. So when the price goes too high, it eliminates some people from being able to purchase shares by doing a stock split, they can bring that price down and make it more accessible for almost everybody to own shares in Tesla. That is good for the company because it also drives the price higher. On the other side of it, hexose is interested in doing that share merge or that reverse split because their price got to low and the company risks being removed from the exchange. So in hexose situation, they were on an exchange that required your shares to stay above $1. Their price per share fell below $1 for a continuous period of time, and therefore they went through a reverse split to bring that price back up above $1, meet the requirements of the exchange. Now the next type of event that I want to talk to you about, the second half of this video here is about mergers and buyouts. This is where one company will acquire or merge with another company. Every deal here though, is different and not all deals end up going through. And these deals take a lot of time. I am talking about half a year to a year timeframe for most of these deals. And not all of them go through because governments oversee a lot of these large mergers and acquisitions and they do not want to allow any of these companies to establish a monopoly where they're the major player in that marketplace. So sometimes the governments will break up these deals or even break up individual companies to make sure that there's no monopolies forming within their country. Now, here's an example of a merger or an acquisition. This is Adobe. They're set to acquire a company called Figma and they're paying $20 billion for it in stock and cash. Figma is privately held, so their shares aren't really changing much, but Adobe's chairs are fluctuating pretty drastically on this news. There's also a lot of other acquisitions happening in the space. For instance, Microsoft is set to acquire Activision Blizzard that is going through the system right now and that is in the process. So there's a lot of things happening here. But what I want to point out to you here is that this article was published on September 15th of 2022. And they note here that the deal is expected to close some time in 2023. So there's like four months left in 2022. And this deal isn't gonna close till sometime in 2023. It's gonna be a long time. It's going to take awhile. There's a lot of paperwork and a lot of things that have to happen for a deal like this. Now, why do companies go through mergers and acquisitions? Well, there's two main reasons companies will acquire or merge with other companies to accelerate their own growth. That's reason number one, or to eliminate competition. That is usually Reason number two, adobe acquiring Figma in that situation was to eliminate their competition. Figma was the number two player in this space. Adobe just said, will write you a check, will acquire the company and will eliminate our competition. We'll see if that makes it through the US government. But honestly it's kind of a smaller market, So I don't expect them to have too many hurdles. On the other side, we also have Microsoft who was acquiring Activision, and that is to accelerate their growth in gaming. Activision is not really a competitor to Microsoft. They actually make games for the Microsoft platform, So they kinda work together. Microsoft is just trying to expand their reach and get into some new markets. And they are doing that through acquisitions. So it's good to understand why the company is making the acquisition then in order to take advantage of it as a day trader, there's a couple of things you want to think about. Number one is that as the atria is, we are trading on the short time-frame. So what we wanna do is we want to trade on the day that this news comes out. Because usually an acquisition is a good thing that drives a lot of volume and a lot of attention. When a company announces that they're acquiring another company, that is usually a good thing. And if they're getting it for a good deal, that is usually going to drive the price higher. Share splits are also good at drawing a lot of attention, but you need to realize that they do not fundamentally changed the company in any way. However, here's how you take advantage of it as a day trader. If a stock was previously too expensive for a lot of retail traders, means that when they do that stock split, there's gonna be a lot of retail traders that can now enter the market, which means they're likely to drive the price higher. And you can take advantage of that going long and riding in the new wave of retail investors. That is usually the strategy when it comes to managing these share splits. Now, just as a quick summary here, share splits are done to change the price of the stock, but they do not change the company, they do not change anything underlying, and they do not change the valuation. The one thing that they do, do is make it easier for retail investors to get into this company. So if you can arrive that new wave of retail investors entering the stock to the bullish side, you may have a great opportunity for a short-term trade. Acquisitions are made to accelerate growth or eliminate competition. That is the only role of acquisitions or mergers. So please keep that in mind. Try to determine what they're trying to do with that merger acquisition. And when that news comes out, see if it has good deal and if it is, you may be able to make another short-term trade. Both events are usually bullish. You are looking for any red flags when you read through that press release, if there are no red flags, you kinda wanna trust management and think they're doing the right thing. And that is usually going to send the price higher as long as you have volume. Volume is gonna be the key indicator here. If you have good, higher volume and the price is going up, that means it was probably a good deal. If you have higher volume and the price is starting to go down or sideways, that means it might not be a good deal and the market is concerned about it. Use the volume to help you understand what direction the majority of people are going in. And then find that trend trade into the trend and exit the trade when that trend changes, the principles are all the same. These are just unique market events that I wanted to explain to you. I hope you got some value out of it and we'll see you in the next one. 48. Company News: All right, everybody, welcome back to another video. In this one, I'm going to walk you through step-by-step how to find company news from a variety of different sources. Let's jump right in. Okay, so to start us off here, a couple of different places where you can find news. Number one is the company websites. I'm going to walk you through how to do that as well as how to find the news and financials on CDR and Edgar, you also have a couple of other news stations and news websites that you can go to. But first, we're going to talk about the company websites. If you want to find the company news, the press releases, the financials, anything like that? On the company website, you're first going to go to Google. You're going to type in the company name. And then right after that you're going to type Investor Relations. So if you're looking for the Nike stuff, you're going to type in Nike Investor Relations, Tesla investor relations, whatever it might be. Because if you just type in Tesla, it's gonna take you to their website and you're gonna have to sort through it and you're going to have to go through everything. But if you type in Tesla and investor relations into YouTube, it's going to take you directly into Google, I should say. It's going to take you directly into the page that you need That's going to give you all of the quarterly earnings. It's gonna give you all of their documents, their events, or annual reports. Everything you need is gonna be at company name, investor relations in Google, it'll be the first link less way to do it. Now, if you don't want to go through the company website, you can go through the official source, and that is going to be through CDR or Edgar. Cdr is the system we use in Canada, and Edgar is the system we use in the United States. These are the official platforms where companies must submit all of their filings and investors can also view all of their filings. So if your company trades in Canada and Canadian exchange, they're gonna be submitting their documents to see if they're in the US on a US exchange, they're going to be submitting their documents to Edgar. Here are the two websites that you can just click onto go-to it, just to show you an example, we'll go through one right now. So this is the seat, our website, both of these websites look extremely old. They have no bells and whistles, but they work well when you go to search database right here, you can type in company. And let's say that we are looking for a drone delivery Canada. That is a company that I follow a little bit. You type it in there, you click on Search, and it's gonna pull up basically their name on the left-hand side here and then their document type. I always like to click on the name and then click View this company's documents and it will sort by the dates. So you can see September 13th, that company put out a press release and then back in August, they put out their financial statements that a couple of more press releases in here. And you can go through and you can literally click on every single document that the company has ever submitted to regulators. Now if you want to go to the edgar website, it's also very simple and very similar. It's actually looks a little bit better than the Canadian one. You just type in the company or the ticker right here for this one, we'll look up Apple for example. And here you can see all of their information, their eight K reports. You can see their current reports, you can see their annual reports. You can get all of the information that you want a belt the company going through these links, that company websites themselves will probably be designed a little bit better though. Now, other sources where you can get information about press releases and new news and new agreements and mergers and acquisitions and financials from these companies. You can get your information from Yahoo Finance, CNBC, or Bloomberg. The only problem is that when you start clicking on links out of these homepages, some of those articles are paid media, which means journalists are getting paid to talk about and promote specific stocks. So make sure that whatever article you read, look at the top or look at the very bottom of the article and figure out if the author received any compensation for writing that article. If they did, you need to basically just ignore that article because they're getting paid to pump that stock. So you need to be very careful with that. It is completely legal. Yahoo, CNBC, all of these companies sell articles to promote and pump and promote certain securities. Realistically, they're getting paid to pump them up. And you need to be very, very careful because the best companies don't need to pay for that. So think about that. Lastly here, my favorite resources for finding information, especially about earnings. I like to go to earnings whispers when I'm day trading, I usually have trader TV live. You can get through them through YouTube. I watch a lot of the news, honestly, a lot of the major economic, political, or legal events that happened around the world will usually have some type of impact, usually on a large sector. And there you can find the best opportunities with individual stocks within that sector. So I watch a lot of the news to try and find training opportunities as well. Now, in summary, here when it comes to company news and financials, that news can come out at anytime. So you kinda need to be ready for it when it comes to financials, most companies will give you some heads up as to when they expect to release the financials. Not all companies though some companies will just post them without any warning, any notice, drone delivery Canada is one of those companies, for example. Secondly, you need to try and see if there's any recent news when you decide to day trade something. So when you sit down and you're ready to day trade, what you might want to do is just take a quick 5 second peek to see if the company has any press releases that have come out today, if they have any financials or if there's any other major events or news that could impact the direction of the stock or if there are any that are forecast to come out that day, something you should definitely be aware of. And then the last thing here is when a company puts out a press release, you need to ask yourself, how important is this news to the actual business operations of the company? How important are the new financials? How important is that press release? How important is that merger? How important is that announcement They just put out to the actual business model that they are operating. A lot of companies before they go to raise money, will put out a bunch of press releases to try and drive the stock up so that they can raise at a higher valuation. You need to be very careful and easy to actually ask yourself when a company puts out a press release, is that good for the business? Is that bad for the business? How much does it change the business? And if I were the CEO, would I be doing the same thing? You need to ask yourself those questions very carefully when you're trading based off news. Other than that, I hope this video helped and we'll see you in the next one. Talk to you soon. 49. Economic Events: All right, everybody, welcome back to another video. In this one we're gonna talk about economic events. We're going to talk about how to find them, what they mean, and how to take advantage of them as a day trader. Let's jump right in, okay, so first of all, economic events, what am I actually referring to when I say those words? Basically what I'm referring to is reports that are released indicating how the economy is doing. The three major reports that we're going to talk about, our GDP inflation and employment. Economic events also include changes to the interest rates or discussions about the interest rates. We're going to dive into all of this in this video, but that is what I'm referring to now, starting this off here. Gdp. Gdp stands for Gross Domestic Product is the total amount of all the goods and services produced within a country. It is a statistic and a measurement that we use to analyze how your country is doing. Is it growing? Is it producing more in goods and services, or is it shrinking and contracting? We use GDP to try and understand that. Now, in most cases, 2% growth in GDP is extremely healthy. That's a good, healthy operating economy that most world leaders are striving for. However, when you get to quarters of declining GDP, that is what puts countries into a technical recession. When you see GDP declined by as much as 10% or when it declines over a sustained period of time, like two or three years. That is what puts countries into a technical depression. You remember the depression of the 1800s. You remember the recession of 2008. Those are the definitions that we're using. And most of the time those definitions come from the result of gross domestic product. Now when it comes to finding GDP, that number is released once per quarter. It is released at this website right here. I'll put a link to it in the resources for this course so you can find it very easily. But here's a screenshot of what GDP has looked like in the United States for the last six quarters. As you can see, it has reduced in the last two quarters in a row, which would put the United States into a technical recession. They don't want to admit it and nobody from government will come out and say that. But based on the technical definition, they are definitely in a recession. Now, the next factor and the next basically indicator and metric that I want to talk about here is inflation. Inflation is really important because it refers to how much spending power you lose from one year to the next. As an example, if inflation is at 5%, your $100 this year will only buy you $95 worth of goods. Next year, everybody will remember those posters and those old school photos and videos of people going and buying a Coca-Cola for like $0.05 or $0.10. You can't do that anymore. Everywhere you go, it's going to be like a dollar or 2.3 a can of Coca-Cola. And that's because of inflation. It's because the price of goods and services go up steadily over time because governments are printing money and because the cost of those inputs become more expensive. Now, how do you find inflation? While it's actually fairly simple, you go to this website here again, I will link it in the resources tab. Let's just open it up real quick. And as you scroll down here, this is what inflation has looked like. This data comes out each and every single month, which is really, really nice. But you can kinda see where currently at 8.3% inflation in August of 2022. So it is quite high, especially compared to where it used to be, like two or 3% about two years ago, which would have been really, really nice if we could sustain that. But as of right now, inflation is climbing up. It is climbing higher, and it's not a good thing because it means that everything costs more for consumers. Now, why does inflation happened? Well, like I said, it happens because of two reasons. Number one, governments are printing money to stimulate the economy. That is what happened to put us into the current situation. Covid hit in 2020, governments printed money to give to businesses and consumers, and they spent that money and basically erased all of the prices because there were more dollars chasing after a limited number of goods. And that drove all the prices up because companies could just charge more. Now unfortunately, about a year or two later, the goods and services are also starting to become a little bit scarce because of supply chain issues and demand issues and being able to actually source products. And so as of right now, we're sitting in this weird situation where governments have printed money and goods and services are becoming scarce. And that is why the United States has very high inflation right now. Now, obviously people can't afford to lose 8% of their money each and every single year. So the United States government is trying to step in and reduce inflation in order to do that, they're controlling the interest rates. Interest rates are the governments gas pedal and brake pedal. The interest rates how the United States government pushes the car forward and stops it when it's going too fast. That is the idea with interest rates, the goal is to keep prices steady, growth, Steady, and keep the United States economy just humming along. Nice and steady. Governments will use interests rates because they're the base of all other interests rates. What I mean by that is if you get a mortgage, a credit card, a line of credit, or a car loan, the interest rate that you pay on that debt is going to be a factor of the government interests rate plus a risk factor. And so if the government interests rate increases, it means that you as a consumer are going to be paying more in interest. That is how pretty much every interest rate in the world works right now. It is the government interest rate plus a risk factor, depending on your profile that will dictate the ending interest rate that you must pay. Now, when government interest rates go up, that makes borrowing money more expensive and it slows down the economy because less people are taking out loans and buying houses and starting businesses, because the interest rate is just too expensive. And so governments raise the interest rate to slow down the economy to reduced inflation because there'll be less people chasing after the same amount of goods. That is how the governments slows down the economy. And when they want to speed it back up, they reduce the interest rates to make it very easy to borrow money, to go out and start a business, to buy a house, to get a loan for a car. The government makes it very easy by reducing that interest rate and that starts to accelerate the economy, starts to accelerate GDP, and it also can in some situations, start to accelerate inflation rates. Now, why does the government changed the interest rates? Well, like I said before, they do it to try and keep price stability. That is the goal of the Federal Reserve, the body that controls the interest rates and their number-one mandate is to try and keep steady price stability. They want to keep inflation at a target rate of 2%, which means you're Coca-Cola only goes up by 2% more each and every year instead of the 8.3%, which is where we're at right now, the government will use low interest rates to stimulate the economy and they will raise interest rates to slow down the economy and try to reduce inflation. Now, what impact does that have on us? Well, like I said, when interest rates go up, people have to spend more money in paying off their interests and they have less disposable income. Think about it. If you have a variable rate mortgage on a $500 thousand house and your interest rate goes from 2% to 3%. That means that your mortgage payment probably just went from $2 thousand to $2500 per month, which means you have $500 less disposable income in your, in your pocket. That means that the people that are affected by that are going to buy less products and services, which means the economy is going to slow down. There's going to be less transactions. And that means that companies are going to sell less products and services, which means they're going to reduce prices, lay off employees, and they're going to end up making less profit. Now, how do we use this information as day trader as well? The idea here is that economic events will usually have a large impact on market day. So for instance, if your day trading on a day where interest rates are changing, GDP information is coming out, inflation information is coming out. You're probably going to notice that there is an increase in volatility. And there's also gonna be dramatic price swings around that news depending on if it was good news or bad news. For us, we want to try and take advantage of that news as day traders and be ready to go with a strategy when that news comes out. And then from the big picture side, if the Fed is raising interest rates, It means that going long will become more difficult because consumers will have less disposable income, which means they're gonna be spending less money. Companies will be producing less profit and their stock prices are more likely to fall than they are to increase. So in a scenario and an event and an environment where interest rates are going up, inflation as extremely high and stock prices are falling, we are going to want to go short on most of our traits. You also want to think about is based on all the information that I've given you and that you've gathered about inflation at GDP and interest rates, you want to start thinking about, okay, Out of every company in the marketplace right now, which company is going to benefit the most from this? Or which company is going to be hurt the most from this. And then you want to trade those specific stocks because they give you the best likelihood of making money and making returns on the trade. So that's how we think about it as day traders. Just in summary, here you want to use economic events to your advantage by treating the direction of the news, you want to understand what the economic environment looks like. We want to start with the big picture and that usually includes the economy. And then we want to work our way down. We want to understand GDP, inflation and interest rates. And we want to use all this information to help us with the big picture, work our way down and find the best opportunity across the marketplace. That's what we're trying to do and we'll see you in the next video. 50. Trading Halts: All right, everybody, welcome back to another video. In this one, we're going to take a look at trading halts and we're going to talk about how they work, what they mean, and how you can protect yourself as a day trader. Let's jump right in. Okay, so first of all, trading halts. This is when regulators to spend trading on a market or a security. Basically the regulators will come in, they'll step in and they will say no more buying or selling on the entire market or on an individual stock. Now, when they do this on entire market is because a major index is moving too much and too quickly. They want to basically slow things down. They want to stop everything for usually about 15 minutes and they tell everybody go do some research to see what's actually happening. Come back with a cooler head and we'll reopen the markets in 15 minutes. It's kinda like a just automatic stop that puts the markets on pause if anything happens too quickly. Now, on the other side of things is when they do it for individual stocks. Now, individual trading halts happen when a regulator or director of that company chooses to stop trading, their specific security, regulators will do it if they're worried that something is wrong. If the company is releasing wrong information, if they're worried something bad is happening. If there's insider trading, if there's manipulation happening, if there's anything happening, regulators can step in. And we have also seen companies stepped in and implement their own trading halts when they have big news that is coming out usually during training hours. Now, what happens when this actually goes into effect? Well, unfortunately you get absolutely no heads up. There's no early warning system, there is no notification system. What happens is all of the trading just automatically stops. None of your brokers will take your trades. None of the traits will go through everything. Literally just pauses almost instantly. And in order for you to figure it out, you either have to either look it up, you have to realize what's happening. You have to go to the news and figure out what's happening with that individual stocks. So it can be a little bit worrisome, It can be a little bit concerning. But if you ever noticed that all of a sudden there's no volume and your traits aren't going through. That's probably because there was a trading halt. Now, why does this happen? Well, like I said before, it is to give investors and traders time to appropriately react to whatever has happened. We are all very, very aware that fear in the marketplace can be a very ******* and damaging thing. And so if everybody gets scared all at the same time and everybody tries to panic cell, that can do some really, really big damage to the markets. And that is what we are trying to prevent. We're also trying to help a company released news during market hours without allowing people to front-run that news or figure out what's going on ahead of time. So just to show you a couple of examples, here is one summary of a trading halt. This came out of Vancouver for Joan delivery Canada, ticker symbol FLT. And the reason for the halt was at the request of the company pending news. So this company was about to release news in the middle of the trading day and they put a halt on their stock so they could release the news. Everybody could see the news and then reopen it. And everybody had a fair chance at basically making trades based on when the stock reopened. Another example of this came during COVID of 2020. On March ninth, 2020, the Dow Jones fell 7.979 per cent within minutes of opening. And because of that, it triggered an automatic market shut down for 15 minutes. I have never seen the Dow Jones moved by 7.79 per cent in my life, except for during COVID. And that is when we saw several market shutdowns because the prices were just moving so dramatically. And honestly, I think it was a very good thing. It really saved a lot of people and it made people calm down a little bit because if you're sitting there and you just can't do anything, then you kinda think about it. You analyze the data a little bit more and you kinda calm down a little bit. I think it's a really good system. And if you ever notice that just know trades are going through not even for any security, well, this is probably what could be happening now. How to manage it as a trade or when you see a trading halt either on the market or on your stock, what should be going through your mind? How do we manage it? Number one, you need to try and understand the news or why the stock or the market was halted. If it is a market hall because everything is crashing, you'll probably be well aware of that. But if it is a individual stock, you need to try and figure out why that stock was halted specifically. Secondly, you need to protect your downside risk a lot of the times these halts or not for good reasons. So when you see a halt, more than likely it's because of a bad reason. So you need to protect your downside risk. You need to put a stop loss in. You need to make sure that you're not going to lose a ton of money. You also need to set stock alerts so that you can be notified when it begins trading or moving. Again, you want to set an alert so that as soon as it starts training again, you get notified on your computer depending on what brokerage you use, you should be able to just right-click on a price chart and click on Set alert. And you should be able to set that up very, very easily. Now, in summary, here, if you ever want to look into trading halts or if you think your stock has just been hit with a trading halt. I ROC dot ca, it will give you all of the information. And I will also link this in the resources tab for this course. So you have all of these links. Remember, trading halts are usually not a good thing. So make sure to manage your risk appropriately. They are very rare though. So for instance, while arm day training, they've only ever happened a handful of times. They do not happen very often. They are fairly rare, but when they happen, there's usually a big reason or big piece of news tied to them, so please be very careful with them. If you see a training called, make sure that first thing you do is protect your downside risk. And I hope this video was helpful to see you in the next one. 51. 49 Day Trading Taxes: All right, everybody, welcome back to another video. In this one, we're going to talk about day trading taxes. And I'm going to share with you how I personally set up my day trading business to manage my taxes. Let's jump right in. Okay, So when it comes to taxes for trading and investment, There's two major types of taxes that you need to be aware of and you should fully understand. The first one is capital gains tax, and the second one is income tax. When you generate a profit or when you pay yourself, you're going to have to put that money through one of these two types of taxes. And which one you choose is going to be very important. First type here is capital gains tax is meant for long-term investments and you'll have to pay tax on 50% of the profits at your marginal rate. Let's break that down for a second. If you buy a stock at $1000 and it goes up to $3 thousand, you have generated $2 thousand worth of profit. You have to pay tax on 50% of that profit, which means you have to pay tax on $100. You have to pay that tax at your marginal tax rate. What that refers to is if you make one additional dollars this year, what tax bracket is that dollar in? In North America, we operate on tax brackets where your first $10 thousand gets taxed at this rate, your next 20 or 30 thousand gets taxed at this rate, your next 40 or 50 thousand gets taxed at this rate and you slowly move up. Your marginal tax rate is whatever taught bracket you are in. So in theory, if you are in a 30% marginal tax bracket and you generate a $2 thousand in profit, you would have to pay taxes on 50% of that profit, which is a $1000, and you would pay 30% tax or $300. That's how capital gains taxes work in Alberta, for instance, if you made all of your money through capital gains, generated $100 thousand and you lived in Calgary, Alberta, Canada, which is where I live right now, you would have to pay $8,403 in tax, which is an 8.4% tax rate, which is extremely, extremely good. So there's a lot of incentive and a lot of people want to claim their income as capital gains tax because that tax rate is so extremely low. Now, the other type of tax that we need to be aware of is income tax. This is probably a tax that you are familiar with. This is the tax that you had to pay on your first job in every job you've had since. This is the tax that you pay on regular income that you are earning on a day-to-day basis. This is basically the tax that you pay on your job and you have to pay income tax on 100% of the income that you bring in. If you go work a job and you make $100 thousand a year, you got to pay taxes on $100 thousand a year. There's no 50% rule like there is with capital gains. Because of that means you're probably going to end up paying more tax. So for instance, if you make $100 thousand and you claim it as income on your T4 or on your taxes in Alberta, Canada, you're going end up paying $26,764 worth of tax. And here is how that is broken down. So as you can see, income tax is going to cost you a whole lot more than capital gains tax. Now the real question for us as day traders is how do we decide whether the profits we're generating is capital gains or income? Well, here's how you choose. Number one, income tax is meant for your regular income or jobs. So if day trading becomes your job or your primary source of income, you're going to have to claim those profits as income tax. Capital gains tax, on the other hand, is meant for your long-term investments. And it's designed to not double tax you because think about it this way. You generate income, it goes into your bank account and you have to pay income tax on that. You then go to invest it into a property or into a stock, and you've already paid tax on that money that you're investing. Therefore, they want to encourage you to invest it, to put it back into the economy. So they're gonna give you a lower tax bracket on the profit that you are generating. They do not want to double tax you are triple tax you, but they do want to get a little bit of tax on the profits you are generating from the money that you're investing. That is the idea behind capital gains tax. But if it is your primary income or your regular income or this is what you are doing on a day-to-day basis. The government wants you to treat that as income and pay income tax on it. So for us is day traders, like I said, if you're making a living with day trading than it is considered income, and I highly recommend you do not try to submit your day trading profit as capital gains. Capital gains taxes are meant for long-term investments. If you try and submit your day traits where your in and out in a couple of minutes or hours. As capital gains, you will likely get audited, you will get flagged and you will get searched and they will go through every single document you have, and you will probably end up having to pay tax on it as if it were a regular income. Now, as a new day trader getting started, I know this can be kind of scary and you're like, holy cow, I don't want a bunch of tax on all the money that I make, Don't worry. It's fairly simple when you're first getting started, you don't need to take it super seriously. Well, you do need to figure out those how to build a profitable strategy. And if you actually like day trading, those are the two most important things. When you're getting started, you do not need to form a company. You don't need to do anything, test things out preferably in a practice account to start. And then with like $5 thousand maximum of real money, nobody is really going to blink an eye at that. You can experiment for a little while. Don't worry about it too much. However, you must keep your day training accounts separate from your long-term accounts. So if you've maxilla see live in Canada and you've maxed out your registered accounts, you live in the US. You've maxed out your Roth IRA and you're opening regular cash or margin accounts. Make sure that whatever account your day trading in, all you are doing as day training that way you can classify every single transaction in that account as income or as a day trade, you can treat it separately. Then you would treat your long-term accounts that you're going to subject to capital gains. You can segregate your day trading account. You can subject that to income tax. Very, very important here. You do not want to be mixing your long-term investments with your short-term investments in the same account, you want to keep those separate as much as possible. And trust me, you can open as many accounts as you want with these brokers. There's almost no penalty and no fees. I highly recommend completely separating your medium, long-term, and short-term investing into very separate accounts. Now when you are a beginner and you're just starting out and you're just getting into day trading and you're just feeling the water a little bit. Here's how you manage your taxes, keep track of all of your profits and add any day trading profits to your income at the end of the year. If you are generating a couple of thousand dollars worth of day trading profits on a monthly basis or a weekly basis, no problem, just add it to your income at the end of the year and you will have to end up paying taxes on that. So be prepared for it. Make sure you're saving about thirty-five percent of your profits for tax and better yet, go to an online calculator, see what your bracket or your taxes you're going to be with day trading and without day trading, and then save the difference so that you can be ready for your tax bill. That is the way to do it. But basically when you're just getting started out up until the point where you're making more than several thousand dollars per month. You don't really need to start a company. You don't really need to do anything. You can just add that profit as additional income to your taxes and manage it that way. For me personally, here's how I have it set up for my company and my day trading. I have set up a numbered company. It's just like a seven or eight digit, 22954 or five, whatever. Alberta incorporated, that's all it is. That's the company name and that's the organization. And I run all of my profits and revenue into that numbered company. And then I pay for all of my expenses through that company. And I pay myself a salary out of that company. That's how I have it set up. And the idea here is that the goal is I bring in my top-line revenue and that's my day trading profits. I have all my expenses, which are my computer or my software, my Internet, My commission's pretty much all of those expenses, reduces my taxable income. I then pay myself a salary to reduce my taxable income even more, the company is leftover with no profit. The profit is paid out to me as a salary, and then I then pay income tax on that salary. And so basically what's happening here is all of my expenses for day trading are write-offs and they basically reduce my tax burden. Then I reduce my company tax burden by paying myself a salary and I personally pay tax, income tax on that salary. Now, in summary here, I've spent a lot of time trying to avoid taxes and trying to reduce my tax burden. And here's what I have learned. Taxes are just part of life, honestly. The harder you try to avoid taxes, the harder they're going to come after you when they find out you're trying to avoid taxes. So please be very careful with that. Your time and your energy is much better spent trying to make more money rather than trying to avoid taxes. So if you find yourself spending hours and thousands of dollars just to try and avoid a big tax bill or reduce your tax bill. I am telling you that you are personally wasting your time and your energy and it would be better spent trying to go out and create more money than reduce your tax bill. Because either one, you're going to reduce it so slightly that it doesn't matter or two, you're going to reduce it so much that somebody is going to start looking into it, gonna cause you an absolute nightmare. So I highly recommend being very, very careful with that. If your day trading and that is your main source of income, you need to treat it that way. You need to claim that profit as income tax. You need to pay it out to yourself through a corporation or you need to add it to your income at the end of the year when you go to file your personal income taxes. And lastly, the last thing I want to leave you with is when you get into this and especially if you decide to start a business around your day trading, please make sure you keep clean books and you are documenting everything correctly and you're not mixing together your different accounts every day trading and long-term investing. Because I promised you that if you get audited and you have to open up those books and explain every transaction you've ever made. It will not be worth the time. It will not be worth the effort. You will regret it so much, I promise you it is not worth it. I've been through it, I've gone through that experience and it's just not worth the time and the effort. So keep clean bucks, pay your taxes, handle things right from the beginning, do things appropriately and make sure that all of your accounts are separated into their own individual accounts based off what type of trading you are doing so that you can manage them most appropriately. I hope this video helped and we'll see you guys in the next video. I hope you never get audited. 53. After Hours and Pre Market: All right, everybody, welcome back to another video. In this one, we're going to talk about pre-market and after hours trading and how you can use them as a day trader. Let's jump right in. Okay, so first of all, when I refer to pre-market and after hours trading, what I am talking about is your ability to buy and sell stocks outside of the regular trading hours. Those regular trading hours are from 09:30 A.M. to 04:00 P.M. Eastern Standard Time. In Canada, there is no pre-market trading unfortunately, but in the United States, pre-market trading starts at 04:00 A.M. and it goes to about 09:30 A.M. after hours training though, does exist in Canada, It starts at 04:00 P.M. and it goes till 05:00 P.M. and then the United States, it actually goes to 08:00 P.M. so the US after hours in pre-market sessions are much larger than they are in Canada. But there's a couple of things you need to know about those training sessions. Number one is that volume is usually much lower outside of regular trading hours. So execution can be more difficult when there's a lot of volume and there's a lot of transactions happening. It's very easy to get your trade in or out. But when there's less volume and there's not as many transactions, the spreads are larger and it can be more difficult to execute the trade that you want to execute. Secondly, specific trade settings are required for after hours and pre-market trading. Canada, for instance, with Quest trade, it has to be a limit order, it has to be an auto route. The day has to be set as duration, and it has to be in multiples of 100 units. Each broker is gonna be a little bit different. So just do some research on your broker to figure out how they want you to enter that order. But there usually will be some specific requirements that you need to have in there when you place that order. Now as a day trader, how do we use pre-market data? So right now we're going to talk about the trading session that happens before the market actually opens. For us. We're gonna be looking for key levels of support and resistance as well as a general direction. So I want to know, did the stock gap up or gap down overnight? Is the stock trading higher or lower in pre-market trading? Are we seeing a clear direction or did it jump up and kind of level out? I want to understand the price action that is happening before the market opens so that I can identify key levels of support and resistance, as well as try and have an idea of what direction I think that market or stock or index is going to go throughout the day. Now, to give you an example of this, here is the chart that I was looking at this morning. This is a real example. This is T QQQ. So this is the three times leveraged version of the nasdaq 100. And I was looking at this one because we had a major gap up after a strong day yesterday. So we've got some very positive momentum. We had a huge gap up overnight right here. We traded a little bit sideways Going into the actual session today with some major resistance at $22.09. Ever since then, it kinda traded basically sideways, almost in a channel right here. And so what I'm looking at as I go into this as number one, massive gap up for t q, Q, q. And at the same time, all of the other indices were rising. So I was like, Okay, this is probably going to be a good day for the stock market. We had clearly established three-level resistance at 22:09 and we were looking for the breakout of 20 209 with a stop-loss at $22 on this trade. I was looking for the breakout because volume is increasing, we had positive direction because we already had a gap up all of the other indices. We're going in the right direction. A very strong day yesterday and we had some good economic news come out. So everything was going into bullish direction. Therefore, I'm looking for t QQQ to break through the pre-market resistance. When the market opens up, I'm going to set my stop-loss at $22 and I'm going to enter the position on the break of 20 209 with a profit target of roughly $22.30. But I would convert it to a trailing stop-loss if we see good momentum. Now, just to show you how this played out, we saw excellent meant momentum. We actually saw a breakthrough of 2,209 in the first couple of minutes of the day. We broke through it, we retested it, and then we continue to run higher. It ran all the way up to $22.77. We did convert it to a trailing stop-loss. We did extremely well on this trade. It was a small dollar value of the actual money that we made here. But what was nice about this is that we only risked $0.09 on this trade and we hit our take profit level of $22.30. And since we converted it to a trailing stop-loss, I think I actually got out around $22.50. We make five times as much money as we rest on this trade, which in my books is absolutely phenomenal. Now, how do we use after hours data? Let's talk about the after our session and what happens after the market closes. For me personally, this is an opportunity to trade on earnings or presentations. For instance, Tesla just did there AID a couple of weeks ago. Apple does their big presentations every basically quarter to six months. And if either of those companies announces big news are big changes, are big things happening at those presentations. That can be an opportunity for the stock to go up or go down. And you can trade that in the after hours. You can also do the same thing when the company releases earnings. The idea here is that we use after hours data usually to trade on catalysts. The other thing here is that if something happens around the world, for instance, if a war breaks out on the other side of the world and a bunch of pipelines get destroyed at 04:30 P.M. Eastern time, all the markets are closed, but you can treat based on that information and the after hours and you can take advantage of it before everybody else. So here's an example of after hours trading. Here is FedEx over a two day time period with five-minute candles. You can see the stock basically traded sideways for about two days here, not a whole lot going on here with some support around $203. What was really interesting here though is that in after hours and shortly after the closing bell, FedEx released their guidance. That guidance was much, much lower. They also released their earnings and it didn't go so well, they didn't have a ton of earnings. And because of that, the stock fell by 24% in after hours. And so if you had to trade those ready to go to short the stock when it fell below $203, you could have made all whole lot of money here in a very short time period. It opened even lower than next day and it continued to trade lower on because there was basically negative news and negative earnings of the company. So you can take advantage of that in after hours. Now, in summary, our strategy here is we want to use pre-market data to analyze the stock direction and identify key areas of support and resistance after hours data and after hours trading is used to take advantage of catalysts or a major events that can impact the share price. That's how we look at these two sessions. One is giving us information for the real trading day and the second one is giving us an opportunity to take advantage of major events that are happening around the world. That's how I personally use them and that's what I would recommend for you. We'll see you in the next video. 54. Pre-Market Game Plan: All right. Good morning, everybody. It is currently 07:00 A.M. right now. And I'm about to walk you through my entire morning routine and how I put together my pre-market game plan so that when the market opens, I'm ready to go now. First things first, you got to go through your morning routine, get ready in the morning. I've already done that. I've got my orange juice ready to go. That is my personal morning routines. So now I'm sitting down at the computer half an hour before the market opens and it's time to put together my strategy, okay, So one of the first places that I usually like to start with is my discord chat. As you can see here, I have a daily update that happens in here every single day in one of the things on here is the economic calendar actually show you what is happening in the world of the global economy and especially the US economy. It will show you what's happening on a day-to-day basis. As we can see here, we're looking at Wednesday, October 5. That is today's date. We've gotten employment report coming out. We've done international trade balance coming out both this morning. Snp's services, PMI, ISM service index, and Atlanta Fed president Rafael, both stick is going to speak at 04:00 P.M. Eastern Standard Time. So a couple of small reports, no major events today. This one is actually going to be right at the market close, so we don't have to worry about that too much. What you will find a lot of the time is that major economic events will usually happen 8-10 am. When you find that one of those events is happening, you want to be very careful trading because those events can change the direction of the market depending on what is happening. So if you're into a position that you think is bullish, one of those events happens right at 10:00. It can very easily change the direction, so you gotta be very careful of that. Today it doesn't look like there's anything big happenings such good for us. Next thing I usually like to check out as just see how the markets are doing. And so I'm going to open a new tab here. We're gonna go to Yahoo Finance. We're gonna go to CNBC. I'm just going to see if there's anything big happening. I want to see how the indices are doing. I want to see how the S&P 500, nasdaq and the Dow Jones or chewing in the pre-market. And as of right now, everything is down by 1%. So that is not good to see. Oil is up right now and the 10-year US bond is up right now. But the markets are down in the pre-market before we get started opening here. So that is not a great sign. Well, I mean, it's not a terrible sign. We can trade on the downside. So it's just something that we need to be aware of is that so far in the pre-market, things down by about 1%. Okay, Now one other thing that I usually like to check and usually do this on a Sunday, but I'll just show you here is burning whispers. This is a company that kinda keeps track of all of the earnings that is happening each week and how companies do. I usually like to go to their Twitter because they will post this basically picture here every single week and it will show you what companies are reporting earnings every single day. So you can see that today we have these companies reporting earnings. Tomorrow we've got Constellation Brands and Levi's and then Tilray on Friday. And this is a good thing to know about because if you're going to try to stop, you better know if they're having earnings coming out that day or the next day. I'm going to talk to that. This can give you a shortlist of companies that might have catalysts coming this week. So if you're looking to trade individual stocks and especially individual earnings, this can be a great place for you to start. As of right now, there are not many companies reporting earnings this week. It is not an earnings week. There are no major companies that I really liked to follow reporting earnings this week, constellation and Levi's are probably the two biggest that I follow. But as of right now, not a whole lot of reason to be trading earnings, not a whole lot of reasons trading any of these companies because it's just not a big earnings week. There's not a lot of big companies and none of them are companies that I'm very excited about. Okay, so now that we have looked at earnings, we've looked at the pre-market data and we know what direction things are going in. Let's minimize our internet here and we're gonna go to an actual watch this, this shows us our sectors. So I've talked about this a couple of times. We can see that the market isn't giving us a whole lot of data here because our indices aren't open in the pre-market. But when we go to sector here, it is open free market. And we can see that pretty much everything is down except for what I believe is energy, yes, energy is skyrocketing right now. One major reasons, and so the reason that energy is going up right now is because opec, which controls about 40 to 50% of the global supply of oil and gas, has actually come out and said that they're probably going to cut production and think about supply and demand again, this is super important. If one of the largest producers cuts production, that reduces supplier. If demand stays the exact same though, what is going to happen to the price? You have a lower supply, you have the same level of demand. What does that do to the price? Well, it is going to send it up and that is exactly what we're seeing right now. As opec gets closer and closer, or talks more and more about cutting production, the price of oil is gonna go up and up because the demand is going to stay roughly the same, especially unless we go into a major recession, but it's going to stay roughly the same here. And then the supply is going to dwindle. That's going to drive the price up. So right now, energy industry is looking pretty good. This might be an area that I want to focus on. There couldn't be a couple of stocks in here that are going to do well, especially as oil goes up. So that could be a catalyst that I am looking at for today. That's probably one of the major things that I'm gonna be looking at today because we have a direction in the market. We know why it's going up. And we have a couple of companies that we can take advantage. So for instance, this is the energy sector. And if I go to my watch list here, I actually have an entire watch this as dedicated. To energy companies, we can see that Canadian natural resources and a looks like TC Energy Corporation or down a little bit just in the pre-market here. But some core and supernovas are two oil and gas producers that I expect should do well, especially if oil prices continue to go up. So these are two stocks that are gonna be kinda on my shortlist as we go into market open here. Okay, So now since I'm interested in trading with supernovas as well as Suncorp because there are two oil and gas producers. They're both in Canada here, so they are not going to give me any pre-market data. So what I'm gonna do is I'm actually going to add the US version of supernovas here. I'm going to add it to my watch. This, we're going to click on it. And as you can see, it's actually up in the pre-market trading today, which is really, really nice if we had zoomed into it, we can see it actually gap down this morning and now it is starting to rally. So that is a very good sign to see. This could be a great opportunity for us. As we go into the day. We're going to have to definitely see if we have enough volume and where this opens, but it is a good option for us. Okay, So now the other thing to consider now that we've got a catalyst going with regards to energy is all of our indices are trading in the bearish direction, which does give us confirmation of a kind of bearish day. And it kinda shows us that things are probably not gonna go well, I can also look at this. If I open up my tech watch list here, pretty much everything in the technology space is going to be downright. Now, if we go to our ETFs here, S Q, Q is up 4%, T QQQ is down by 4% and spies down by 1.2%. So we do have some options to trade in the ETFs here as well. Because all the markets are showing us good confirmation of going in the exact same direction. That gives us an advantage because if we trade into that direction and we see one or two of the other indices start to turn around. And that can be the first sign that we need to exit that trade. Trading with the market or training into energy today seem like the best options for me now, before we get started in the actual trading, what we need to think about is our risk management plan. Currently I'm trading with a really small accounts just to kinda show you how you can get started and trading my account size right now is $4,203, which means if I want to have a maximum 2% drawdown, that means that my maximum loss here is gonna be about $84. I wanna lose 2% of my entire portfolio if the trade does not go my way, which means my maximum loss on one trait can be $84. So if I set my stop-loss $2 below my entry point, that means that I can buy 42 shares, because if I multiply 42 times two, that brings me to my maximum loss. So by, by 42 shares and each share loses $2 on my trade. If it just doesn't go my way, means I'm gonna lose $84 on that, on that trade. And that fits within my risk management plan. So that is how I'm going to calculate my position size. It's going to be based on an $84 maximum loss. And wherever I set my stop-loss. Now, very interesting, just as I was saying, that's Novus actually had a little bit of a pullback here. It looks like somebody sold off some pretty significant shares. So that is very interesting to see. You will have to wait and be patient with synovial. I don t think this is one that I'm going to trade as soon as the bell opens, I think we're going to give us some time, this one and Suncorp, we're going to give them some time and see how the day proceeds and processes. And then we'll jump in once we have established some key levels of support and resistance, usually I would like to see a lot more volume and the pre-market here so we can establish more clearly identifiable levels of support and resistance. But to know is just doesn't have it today. Like for instance, if we go to Apple, whereas Apple, Let's go apple and we go to the pre-market here you can see that Apple has a lot of data in the pre-market. All of the, all of the candles here are pretty close together because there's good volume. There's a lot of transactions and it's very, very clean. If we look at Apple here, we can very easily establish some pretty key levels of support and resistance. For instance, we've got a price line here. We will draw out our resistance right here. It looks like we've got a new level of support right here at 145. We might have some more resistance or support right here at 01:44. It acted as support rate in here and then we got rejected after breaking down through. It looks like we're bouncing off right here. So it will be interesting to see if we can make it back up to this 144 level. But we're going to watch this one closely. Apple could be a play throughout the day here we do have some pretty clear levels of resistance throughout the last little while. So let's just go to the 10-minute chart here. We're going to zoom in a little bit and see, as you can see, we can fall. Boom. Oh, we're going to go to drawings price line. We've got some key levels right here, kilos here, in kilos here. So as the price of apple falls through here, if it continues to fall through level, level, level, that's gonna give us more and more confidence of a bearish move in the day. And we would be looking for some key levels of support right around 13650. I'd be surprised if it dropped down that low. That looks like it's probably going to be three or 4%. But we are probably going to find some support in one of these levels today would be my guess. Again, I'm just scrolling over to our ETFs here. We do know that almost all of our indices are downright now, so we have some good market confirmation and because they're going down, we want to buy into an inverse ETF so that we can buy in and the price will go up. We're gonna be using S QQQ. This is a three times leveraged version of the Nasdaq 100's. And it's really interesting right now if you look at this, we've got a very clear trend line coming to the downwards direction. We have now broken out of that, which is very nice to see. It looks like we're probably going to run into a little bit of resistance rate around this level at $54 here. So if we can break through 54, which it looks like we're doing right now, That's going to be a very good sign. Looks like our next key level here is probably going to be around 56. So this is what I would be watching for training the ETFs right now is the bounce 53-56, put a stop-loss at 52 and you would be all set. That is something that I'm going to write down right now as something to consider as the market opens. Usually I don't like to trade in the first couple of minutes of the day, but this does look like it could be an opportunity here. So today we're going to focus on S QQQ. We may consider going short on Apple just because it looks like we have some key support levels. We're going to look at supernovas and Suncorp because we have a major catalysts with regards to oil and opec cutting back production that reduces the supply at drives the price up because demand stays the same when the price goes higher. So Novus and Suncorp are going to make more profit, making their company more valuable. So that's how I look at it. As we sit down at the computer here, we've got confirmation from our indices. Everything's moving in the same direction. So that means S QQQ is going to be in play for us. We also have Apple with some key levels of support and resistance. And then like I said, the energy companies were starting to put together a bit of a game plan here, starting to like what we're doing. 55. Trade Alerts: All right everybody, welcome back. In this video we're going to start talking about trade alerts and how you can use them to manage multiple opportunities and improve your trading. Let's jump right in. Okay, so I'm gonna be looking at my top screen here because we're gonna do an example in question and just a couple of minutes here. But trade alerts are very simple. They are notifications that alert you when the price moves beyond a specific level. Here is an example. I am looking at Shopify stock listed on the Toronto Stock Exchange. I have this white line right here, which is a trade alert. You know that, because it's got a little bell located on the left-hand side here instead of the order or the stop loss and take profit is literally just a bell that is going to notify us when the price crosses above this level. You can also set it to below the level you can set it bearish, they are bullish that you can move this price anywhere you want. And it's really, really nice because it is a notification. And when that price moves beyond that level, it will alert you. It will send you a pop-up in question. It will give you an audio cue. It's basically like a bell is ringing, and it will let you know that the price has moved beyond this specific level. Now, how do we use them as data as well? It's very simple when we think there is an opportunity to trade a stock, but we do not want to constantly watch the chart. We will use a trailer. What I mean by that is let's say that you're going through your pre-market watch list or your pre-market game plan, you find a couple of different trading opportunities, but you also wanna do some more research. So you're not going to constantly watch that chart. You might have it open on your screen and you might have it on a different window or close down tab. But you don't want to be constantly watching that stock because you might have other opportunities that you're exploring. What you can do here is you can set a trade alert so that when the best opportunity or when that training setup plays out and you have an opportunity to buy or sell short, it will send you a notification. You can get ready, prepare your order, and decide if you want to execute that trade. Trade alerts allow us to get notified if the price gets close to a certain level. The idea here is that we do not want to set a trailer when the price breaks out or breaks down through support. We want to set the trade alert when the price gets close because this is super important, you need to give yourself enough time to set up the order once you receive the alert. So if we are looking for a stock price to just break out of, let's call it the 100 dollar level. We do not want to set our alert at $101 when the price is broken out because it's gonna be too late. It's gonna be at 01:03 or 104. By the time we place our order, we want to set our alert 97 or $98 so that we get our alert. We can pull up the chart, we can get our order ready, then we can decide to execute on the spot when it gets time. We do not want to be late and we do not want to be rushing through our order because that's how we make mistakes. Okay, now let's walk through an actual demonstration here on questions. I'm going to minimize this screen here and we're going to pull up straight. And there you go. I actually just got an alert as we pulled this up, the bid price of Shopify has gone above $42. You can see it right here. So my alert from that screenshot that I just took is gone. The price is breaking above $42 here, and it gives you all the information that you need about it. My alert literally just went off. Now, let's say that we want to set a new alert at $42.21. We want to set an alert for the breakout. Well, realistically we will actually want to set it lower. Let's just say we're going to set it at $42.11 right here. We're going to right-click on this and we're going to click on Create New, and then go to alert entry. I'll move this screen up here. We're going to leave it on price. We're going to set it at the bid price, and we're going to set it equal to or above 42.11. We're going to click on activate, and that is going to set our new entry in here. So if the price breaks above here, that gives us enough time before it breaks above the daily high rate here to place our order. Now, what's interesting about this is let's say that you want to move your alerts. You have to do is go to drawing and make sure you're selected on pointer. And then it will allow you to move this alert anywhere you want. So it's going to bring up confirmation tab right here. You click on Accept and it will now move that alert. Now, let's say that you wanted to move it to the downside. If you just drop this down here, that is going to set the alert to above this price. And that means that it's going to automatically trigger right away because the price is already above where this alert is. And so in order to move it below and go to the bearish side, what we actually need to do is we need to edit it or we need to cancel it. Yeah, a couple of different options there for us. We're just going to click on Cancel alert. We're going to click on create new alert, alert entry here and we're going to set the bid price. I wanna get triggered if the price comes back down to the support level here. So we'll set it at 41.40 and we'll go less than or equal to 0. I'm going to move this up. We'll go less than or equal to 41.40. Click on Activate here, and now it is going to put bid price less than or equal to 0 types of right and wrong, okay? My bad less than or equal to 41, 40, that's what I meant to do, 41.40. And then it will activate. And now we have our price alert alert here. So if the price comes back down to this 41.40 level is going to send this alert. Hopefully, we can place our order for the breakdown of the basically daily low right here you can see this blue line right here is where it started. So actually we dipped a little bit lower in the first few minutes of the day, but this is basically the second low of the day. If we break below this and then bring it below the low of the Open, now it'd be a very bearish indication and that'll be a great opportunity for us to short the stock. Now, in summary, here's my strategy number one, I go through my pre-market game plan. I just explained that in the last video and I try to look for two to three opportunities. Once I find those opportunities, are starting to do my technical analysis on those charts, I set alerts for when the stock breaks any key level that presents a good trait. Obviously, I'm setting that alert before the stock breaks, do that key level so that I have enough time to place my order and get set up. Lastly, I'm evaluating and choosing the best trade. The idea here is that you have the entire market to trade. You could choose any of the thousands and thousands of stocks that are out there. What you want to try and do is find a stock where you have an edge, you have an idea of what you think is going to happen for x, y zed reason, then you want to try and shake the best risk reward trade that you can find based on technical analysis. And you want to find a couple of those so that you can evaluate different opportunities for the best one that's going to make you the most money. That is, the idea here is we're starting with the entire stock market, trying to narrow it down to a few opportunities and then identify which one is hopefully going to make us the most money and execute on that tree. That's what we're trying to do here. And by using trade alerts, you can hopefully manage a couple of opportunities more easily without having to just constantly look at that chart, you can evaluate more and more opportunities. You can dive into one opportunity while one is kind of cooking and progressing, you can just manage your trades a little bit more easily and be a little bit more relaxed that you're not going to miss a trade if you don't get an alert. That's the idea here. Hope you got some value, will see you in the next one. 56. Penny Stocks and Pump and Dumps: All right, everybody, welcome back to another video. In this one we're gonna talk about penny stocks and pump and dumps and what you need to know as a day trader. Let's jump right in. First of all, what is a penny stock? A penny stock is very simple. It's any stock or the price below $5, and they usually do not trade on major exchanges like the nasdaq, the TSX in the New York Stock Exchange. Those exchanges have extremely high reporting requirements. And so smaller companies with low share prices cannot meet those reporting requirements and so they list on smaller exchanges. So if you ever see a company that's listed on an exchange or an OTC exchange stands for over-the-counter exchange. And they are much smaller exchanges with much, much lower reporting requirements, making it easier for companies to list their shares on those exchanges. It also makes it easier to pump and dump those shares. That is when somebody will hype up or promote the stock in order to get attention and raise the price. They will then sell their shares when the price has risen. They're basically trying to get other people to buy the stock on the idea that it is a good investment or it's going to make them a bunch of money, or it's gone up really soon. And then those people will buy in, sending the price higher because the demand is increasing. And then once the price has risen, whoever was pumping it will then sell their shares and take their profits. That's the idea behind a pump and dump. Now, who can pump the stock? This is really important because it can actually happen from a variety of different sources. Number one is influencers. Number two is the actual management of that company. Number three is new stations. Number four is online articles or websites. And there's also a variety of other places that you can actually find. Things like this, for instance, is a lot of companies that will put out reports that will either say, this company is amazing or this company is absolutely terrible and they will already have a position in that company. Don't make money based on the reaction to that report. And so this kind of thing happens in the marketplace and he just needs to be aware of it and hopefully you can spot it using this technique here. So how do you know when a stock or company is being pumped and dumped? Well, number one, the price is moving up dramatically. When I say dramatically, I'm talking about more than five to 10% per day. If a stock is bumping up by 15, 20, 25% a day over day over a course of two or three days. That is your first sign. If the volume is increasing at the same time, that is your second sign. And then third, this is the most important one because obviously right here, this is the pump. But here's how you really tell. Number three here is that there's no actual news that will fundamentally improve the business. For instance, if the stock goes up by 25% or even 50 per cent over a couple of day period. That means that the company is worth 50% more. There is no news that came out that made that company worth 50% more like a new partnership and new products and new development, a new contract, a new, something that made that company worth dramatically more than you basically got to start thinking this is probably going to be a pump and dump because the price is skyrocketing here and nothing has changed with the company. That means that some outside force here is influencing the supply and demand factors behind that stock. Now, this usually happens to smaller penny stocks on smaller exchanges. Number one, because the reporting requirements are very, very low, there's less regulations, is less people looking at it, and it's very easy to get a small company listed on to exchange. Secondly, because if it's a small company with penny stocks, if a bunch of people go into that company and buy those shares, that price is going to move exponentially. However, if they did the exact same thing with like US company, the size of Apple or Tesla or Microsoft. The price isn't going to move it all that kind of size isn't really going to change the markets because there's so many shares being transacted. But in a tiny little penny stock company with a couple of hundred million dollar market cap, a couple of traits can really move the price. And for somebody that is pumping the stock, look in a cell it, they can make a ton of money. So you have to be very careful here anytime you're trading penny stocks on smaller exchanges and when you see large price movements, especially in the upwards direction. No news. That is how you know, you're probably looking at a pump and dump. Now, here's just one example of what a pump and dump it looks like this was a big eagle aerial systems, their drone company. And a few years ago I was falling on fairly closely and their stock went parabolic. You went from $2 here up to $17 in just a matter of a couple of months here. And now it is trading at $0.45. It has come down like 95%. It's absolutely ridiculous. And it's because the company released a bunch of press releases and they let a couple of rumors get loose that they were partnering with Amazon that drove the stock absolutely sky-high and they never put those rumors to rest and said they weren't true. Then all of a sudden a couple of reports started to surface that the company was lying. They didn't have a partnership with Amazon and the drones that they were making weren't actually working in the stock, then eventually basically began to plummet and the management team was selling the whole way through. So very, very interesting to see what happens here. And this is just a pure example of what a pump and dump can look like. A bunch of fake news. Cent the price higher or report came out saying that, hey, that news isn't real and this isn't actually going to happen. And a lot of people lost a lot of money with this company. And so in summary, what I'm trying to say here is that pump and dumps and penny stocks are very risky. The best way to protect yourself here is with a trailing stop-loss. Secondly, you can take advantage of these pumps and dumps when you recognize them, but make sure that you are not promoting them. Make sure that you're not pumping them up any higher. Makes sure that you are not encouraging this behavior because it is manipulative, it is destructive, and a lot of people lose a lot of money with this. So you need to be very, very careful. You do not want an investigation from the regulators coming at you and saying, Hey, what's the story here? Why are you talking about this stock at this time, as the price is moving up, you might want to be really careful about how you handle that. So for me personally, especially because I'm making content, I try to avoid the pump and dumps. Too risky. They're unpredictable. It's very difficult to perform technical analysis on them. And because I have a bit of a social media following, I don't ever want to be accused of pumping and dumping any stock. So I'm very careful with this. I usually avoid them. And because I like to do technical analysis, it's much easier to do that on the larger cap, especially technology stocks. So that's usually where I tend to focus a lot of my time. A lot of people specialize in these small companies when it comes to day trading and they look for volatility like this. Personally, it is not my style, but a lot of the principles that I've taught you from the, throughout this course will apply to everything that you see here. Now, the big thing to keep in mind, and I have said this from the absolute beginning here is that everything in the market and everything in the stock market especially comes down to supply and demand forces up pump and dump is just a manipulation of supply and demand forces like what we talked about at the beginning of this course. So when you see a new situation, like a stock that's skyrocketing or a pump and dump, or somebody's come up with a short report. Think about the supply and demand forces and how they are being affected based on what you are seeing in the charts, based on what you are reading in the news, based on what is happening with management, try and understand the supply and demand forces because that will usually lead you to the path to profitability when it comes to day trading, that's my best advice for you and that's how I tried to think through every situation. I hope that helps and we'll see you in the next video. 57. Chart Analysis: All right, everybody, welcome back to another video. In this one, we're going to talk about how to actually analyze the chart and perform technical analysis once you have identified a stock that you think you may want to trade. So these are the four steps that I think you should go through. And then I go through when I'm going through my pre-market checklist and then I've identified a stock where I think there's an opportunity, or I think there's a catalyst or there's a reason to trade it. This is what I then go through. Number one here is always start with the big picture for me, that means a six-month timeframe with one day candles. This is my starting point. This is where I like to start out. I can expand it out to a one or two years if I want to. And the goal with this is to try and understand the story behind the stock. Is this a stock that just keeps getting rejected at the same level every single year? Is this a stock that is grown immensely in the past few years or is this a pump and dump that just keeps spiking and coming back down. What is the story behind this stock? The idea here is we want to understand the big picture and then work our way down. Once you know what the big story and the long story is behind the stock chart, then you want to start moving into the actual company. This is where you want to check the news, the earnings, any catalyst or industry updates, or even competitor news that might impact the stock price or what is happening in the marketplace. You want to just be aware of what is happening if the company is reporting earnings today, tomorrow, next week, whatever it is, you want to be aware of that if it is a biotech company that's supposed to be reporting phase II results this week. That is a catalyst that you need to be aware of if the industry is absolutely collapsing because the price of oil is falling off a cliff and all of your oil producing stocks aren't doing so well. That is something that you need to be aware of. You want to understand how this company fits into the big picture in the marketplace and in the economy, and in the competitive landscape outside of the stock chart. That's the idea with this step here. Once you kind of understand what is happening from the big picture on the stock chart and in the marketplace. That's when you start narrowing yourself down. You start to try and identify key levels on the big time frame, and then all the way down to the small timeframe until you get to the daily chart. Once you have identified your key levels on the daily chart, that's when you set alerts so that if the stock price moves in XYZ fashion, you are going to react with XYZ trade. That's the idea here is that we're going to set our key levels, set archaea alerts so that if the price starts to move in that direction, we have a trade idea and a plan ready to go for when that alert goes off. That's the goal here and that's the process. Now, just to focus on step two here real quick, where can you find news and earnings information and catalysts and industry updates? While it's actually fairly simple, there are a ton of different resources and you don't have to go through this entire check, checklist. But if you're looking for just general market news or what's happening in the market, what's happening with the Fed. Yahoo Finance and CNBC are usually good places to go. If you want something specific to the company, I recommend going to the company website or going to the company profile on either of these two websites. If you want detailed information about the statistics of the company, analysts reports and basic, basically any article that gets written about the company at all. You'll be able to find it on Canvas if you like, the analyst information, you can find an amalgamation of a bunch of different analysts reports and how they feel about the company on a website called tip ranks. If you're interested in kind of a high-powered version of CNBC and Yahoo Finance by Bloomberg and your broker, meaning quest trade or interactive brokers or Weibull, whoever you decide to use, they should have a stream where you can find earnings and information and articles about that company. So if you'd go through, and you just go through a couple of these sources you should do to find all of the information that you need, a belt that given company. Now when it comes to actually identifying key levels and setting alerts, we're going to walk through an example right now with so phi. Okay, So this is the pie chart that we're gonna be using as our example. As you can see, we're looking at this over pretty much it 12 to 15 month time-frame. I've taken it all the way back to where if I listed publicly, you can see they basically just started trading right here around 23 or $24, rose up to 24, 95 here, and then came down to 14 before coming right back up to that exact same level. And so first thing I want to draw here is a price line. I'm gonna do that by going to drawings, clicking on price line, and then highlighting this level right here where they both connect. Now, my price line extends to the right here. If you want yours to do that, all you have to do is right-click, go Edit price line, and click this little box right here that says extend price line to the right. Click on Okay, and it will do that same thing for you. I personally like it because then all of my key levels just keep extending as the chart builds out, is just personally a thing that I like to do. So that is our first key level of resistance. Pretty much 24, 95, $25 right here. So next one is gonna be this level right here. This was our key level of support that we bounced off of pretty much at $14 here. And so that is going to be our key level of support on the big picture. Now, obviously we have broken through that key level of support and it looks like we formed a bearish trend for a while. So I'm gonna go to my trend line here. I'm going to basically showcase that trend line right here. And it looks like we broke through that trend line in May of this year. But wow, this was a pretty strong channel for a little while. So that is good. We've identified key levels of resistance, Q levels of support. We then traded in a channel for what looks like. 2022 to May, so about five months here before breaking out. And now it looks like we have a double top right here at $8. So again, I'm gonna go back to my price line. I'm going to showcase this level right here at $8. Now, obviously we've got a couple of points and some wicks here that are kicking through $8. And maybe you could even argue that we didn't touch $8 right here. But the line or the specific price level of $8.16 in this situation is not the exact level of support. The level of support is an area. It's like plus or minus a couple of percent. And so what I am trying to indicate here with this line is that around this area, we're likely to find a level of resistance. That's what I'm trying to identify here. And as we basically slowly zoom in here, we can see more key levels of support and resistance. And as we work our way across here, it's like, okay, this five-dollar level has clearly been an important level for us. And so I'm going to draw another price line right here. Boom, $4.91, $5 anywhere in here because we have bounced off of it once right here and we have bounced off of it again in June, and we were bouncing off that right here in October. And so this is very exciting for us now as we start to zoom in even more, I want to look for more key levels of support or resistance based on the highs and lows on the chart. As you can see right now, we consolidated right around $5 for the last few weeks, but the recent high was right here around, let's call it $6.48. So this is the key level of resistance where I think the price is going to bounce off of $5. And the next key level that I'm going to be watching for is $6.50. So by starting out with the big picture, we can narrow our way in and say that, okay, I think the price is going to bounce off of $5 and it's going to come up, it's going to rise up off of $5, just like it has in the past here. And the next key level where it could get rejected is at $6.50. Now, as you had gone through step number two here and you had checked for the news, earnings and catalysts as well as industry updates, you would have realized that Sophie had earnings coming up, which is very, very exciting. It could be a major catalyst. And if the earnings go well, the company could do extremely well. And so when we look at Quest right here and we actually start to zoom in to the one-day chart. What I want to show you here is very, very exciting because here is our level, this white level right here. This is the line that we just drew, $106.50. When we zoom in here, we can see that earnings came out right here on November actually, they came on aftermarket on October 31st right here. And the price skyrocketed up to our key level right here at $6.50. And so if you had realized this and you had seen, okay, we got the balance, we've got to bounce off of $5. We got up to that key level, that next one right here. Now the price is either going to break out again or it's going to get rejected. You could have seen that we got clearly rejected right here. And you could have sold this stock off all the way back down to the key level, right around $5. That is why we focus, and that is why we start with the big picture and work our way down. 58. 57 Mindset: All right, everybody, welcome back to another video. In this one, we're going to talk about your mindset and your mentality when it comes to day trading. Now, first thing that you need to think about is your morning mindset before you sit down at that computer. First thing you need is a very clear head. You do not want to be fogged, you don't want to be tired, you don't want to be still not waking up mood. You want to be up and ready to go as soon as you sit down at their computer, you need to be fully awake and you need to be not distracted. So if you've got ten text messages on your phone that you need to deal with at some point in the morning after trading or do it before trading. But make sure you are not doing it while you are trying to trade or while you're trying to do your pre-market session is just going to distract you and it is not going to be good. I personally recommend going through a morning routine for me that's like going to the bathroom, doing my kinda get ready stuff, go into the kitchen, having a big glass of orange juice scene. If there's any big things that I need to deal with throughout the day and then sitting down at my computer and getting into that morning pre-market session, I highly recommend building your own personal morning routine. Now once you get into the actual trading here, there's a couple of just kind of rules of thumb that you might want to keep in mind here. Number one, it is better to not make any traits than to lose money. You see that the market is really choppy. You don't have any clear strategy here, you don't have any clear direction, and you're just not really sure about the positions that you're looking at. Don't take any traits, just walk away from the computer, go do something else during the day, stay productive, but do not feel like you need to take a trade every single day. If the market is not presenting you with any opportunities, you do not want to try and create one out of a bad opportunity and lose money. A lot of the time, it's better to just walk away from the computer than to stay there and try and force something that isn't really there. Secondly, never be scared to lock in profits early. Good traders and rich traders are never worried about locking in profits early. It doesn't matter if the stock price runs up afterwards, that is going to happen. That is part of the game, that is part of how trading works. You need to be able to manage that. You need to keep a calm, cool, and collected hat. If you lock in profits early, you need to call it a good trade and move on to the next one. Never be afraid to lock in profits early. It could crash, it could skyrocket. It doesn't matter. But if you can come up with a little bit of profit on the trade, it's a successful trade, and that's all that matters for a secondly, or thirdly here, set a point to walk away from the computer. If you're into your trading already, you need to have a very hard line that says, if this happens, my day is over. You can set it as $1 amount. If you lose $300 in a day, your day is over and you're going to walk away. Or it could be three bad trades in a row, whatever it is, it's really honestly, it's kinda flexible, independent on yourself, but you need to have a limit, whether it's trade, whether it's $1 amount, whether it's something else, you need to have a limit that says if this happens, I'm done for the day. I'm going to go find something else to do today. I will come back with a clear head tomorrow. Now. Lastly, here I've said this a couple of times, but it's just so true. Small, consistent winds based on a repeatable strategy, that is what we're trying to achieve and that is what is going to bring us success. We're not trying to hit home runs, were trying to get onto first base at every at bat. And that is a small consistent when based on the strategy and the trading plan that we're creating throughout this course. Now, when it comes to emotions, emotions are your absolute worst enemy. I know this sounds weird, but you never want to be making any decisions based on emotions. One of the best examples of this is looking at your profit and loss while you were in a trade. If you're trying to get to a big round number of, let's call it 500 or $1,000. And you're getting close there, your emotions are going to want to draw you into holding that position longer than you possibly should. That is going to mess up your trading strategy is going to mess up your plan. It's going to mess up the data in your journal, and it's going to mess up your trading. And so you do not want to have emotions in your trading. If you feel yourself getting emotional, it is time to walk away. And that goes on both the high side and the low side. You feel depressed and discouraged and stressed about your trading. You need to walk away and do something else. Also, if you feel euphoric and you feel like you're on top of the world and you feel like you've got confidence because you just mastered for different traits, you need to step away as well. You're getting way too high. You got on a lucky streak here. You need to walk away. You need to thank God for the luck that you had that day. Take a break, come back tomorrow without clear and level head almost as if it never happened. And just keep trying to repeat the exact same thing that you did before. That's the strategy there. This goes both ways. I've been on the high side and low side, and trust me, everything always comes back to the middle at some point. And lastly here we have a strategy and a trading plan. So we do not rely on emotions. Emotions are your enemy, they will divert you from your strategy and your trading plan. We have a strategy and a training plan and I get you to write it out and actually talk about it so that we're not going to be pulled away when our emotions start to get the best of us. Now to other situations where you need to walk away from the computer. And this has happened to me if you get into a trade and you notice that your heart rate increases, that is because you are getting excited or you're getting stressed, or it is too big of a position and you need to downsize. It is because something is happening that is getting you excited, it's getting your heart pounding. That means that emotions are starting to step in. It also means that you're probably not going to be thinking with as clear of a head as possible. And it probably means that you care too much about that position or you care more than you should. And in that scenario, I highly recommend you downsize your position. You trade with less money, you cool your jets a little bit and make sure that heart rate comes back down so that you are calm, cool, and collected and can analyze the data for what it is that you're not being swayed by any of your emotions. Secondly, here, if you feel worried or stressed about trading at any point, that is a red flag, that is not good. You want to step away from the computer. You want to go do some research. You want to go do your analysis, back to a practice account. Take your time. You do not want to be stressed, you do not want to be worried. You do should not be trading with more money than you can afford to trade right now. And your heart rate should not be increasing. If my positions dropped by ten or 15%, it is not going to materially affect my net worth. It's not going to materially affect anything that I do in my day-to-day life. And you need to make sure that it's the same for you. If your heart rate is increasing every time you make a trade, you need to downsize or you need to change how you are trading. This is a feedback loop. That's what we're trying to establish here. You need to follow your trading plan and execute based on that trading plan. Then you need to upload those traits to your journal so that you can analyze your training and gather data based on what worked and what did not work, then you need to adjust that trading plan based on that data. So this is a feedback loop of trading, analyzing and improving, cycling through it every single day. That's what we're trying to do, and that's how we get better as day traders. That's how we understand our own trading. That's how we realized what we're good at, what we're not good at, we focus on the most profitable aspects of our trading. In summary, here, you do not need to treat every day, do not feel like you need to make a trade every day. You can sit at your computer for 3 h and not make a trade. You should not feel bad about that. There is nothing wrong with that. You're not wasting time is just set. Opportunities did not show up. It's like going out fishing and going out for the entire eight day and doing your absolute best and you don't catch anything. Just part of the industry as part of what happens, you only want to take the best opportunities, especially if you have to deal with the PDT rule. And in a lot of scenarios, I've seen it myself. I've done it myself and watched a lot of people go through this. It can be better to walk away from the computer in a lot of situations. If you're stressed, if you are worried, if your heart rate is increasing, if you don't have a clear head, if you haven't done your morning routine, step away from the computer, take your time, come back in half an hour, take a break, go back the next day. Just be patient with it. Be calm with it and make sure that you're in the right mindset and Headspace to actually make financial decisions for yourself and for your future. And makes sure that it's not going to stress you out along the way. This should be an enjoyable practice. This should be something that you look forward to and this should be a energizing experience without giving you a euphoria or a rush. We do not want to have a rush of trading when we're doing this. If you feel a rush or you feel adrenalin or you feel your heart rate. That is emotion stepping in and we need to take a step back and make sure that we're following our training plan and possibly take a break. So I hope this video helped. We will see you guys in the next video and we'll talk to you soon. 59. 55 Goal Setting: All right, everybody, welcome back to another video. In this one, we're going to talk about goal setting while your day trading. Now, when it comes to day trading, your number one goal and the number one thing that matters the most is building a profitable long-term strategy that you can clearly articulate and you can repeat on a daily basis in the marketplace. Now, how do you do that? How do you build a profitable long-term strategy? Well, I've given you a lot of the tools that you need in order to do that in this course. Now what it comes down to is starting with the practice account. The reason we start with the practice account is because you are most likely to lose money in the beginning. If you're most likely to lose money in the beginning, you might as well loose fake money so that when it's real money, hopefully you have some track record and a little bit of confidence going into it. You've already tested out your strategy. Number one, start with the practice account. Number two is to journal all of your trades. Number three is to look at that journal information and figure out what you're good at and what needs work or what you should cut out of your trading. And then you need to adjust your strategy. And when I say strategy, I am talking about your entry and exit points, your position size, what makes you interested in a certain trading opportunity? How do you manage that trade? How do you go through the process of getting in and out of that stock? You need to adjust that strategy. You are profitable, enter practice account. And then once you're profitable enough practice account for at least two weeks, if not two months, then you can open a small margin account and continuously repeat steps two to four to adjust your strategy to becoming more profitable trader so that all you need to do is just add more money and keep trading for a longer period of time. Now when you're ready to get started with real money, number one thing here is do not start trading with all of your money in the beginning, if you have $10,000 that you're willing to dedicate to day trading. Start with 4,000 or $5,000, proven other a little bit, make sure that you're profitable and then start adding the rest of the money in. You do not need to dump all of your life savings or all of your day trading money into that first account. On day one, it is not necessary. Be patient with it, take your time and build up with a small account. Because if you're profitable with a small account, you can be profitable with a big account. But if you start with a big account and you're not profitable, you are just going to lose more money than is necessary. So I highly recommend do not start with all of your money right in the beginning, focus on the strategy and the risk to reward ratio. That is the entire key here, is getting in and out of stocks with a good risk to reward ratio and being right on a certain number of those stocks that you come up profitable at the end of the day, journaling that information so that you can adjust that strategy and improve it over time. And as a trader, it is the small consecutive wins that are gonna make you a profitable trader. We're not here to hit home runs, were here to get onto first base each and every time that we are up at bat, that is the goal here. And that's how we're going to succeed long term. Now when it comes to your actual goal setting, I see a lot of people talk about trying to set a daily target with $1 amount behind it. I personally do not think that is the right strategy. I do not think you should be setting $1 amount As your daily target or your daily goal. For me personally, how I managed this is my goal is to make one to four good trades per day. That is the goal. If it doesn't happen, that is okay. If I don't make any trades one day, that is completely fine. But if I start making bad trades, that is what I need to step back. I need to reanalyze and I probably need to take a break when things are going well. I'm making one to four good trades per day. And that is a, that is my goal, that is my target because if you try and set $1 amount as your goal, what's going to happen is you're going to get into a trade. Let's say your target is $200 a day. You're going to get into a trade and that trade is gonna get up to $180. And the technical analysis and everything in U is going to tell you the cell, but you're going to look at your daily profit and loss and see that you're only $20 away and you're going to hold on as that stock starts to sell off and it is going to mess with your trading. You're going to divert from your strategy. You're not going to stick to the plan and it is going to mess you up. So you want to set a goal of making good and profitable trades without $1 figure attached to them. The other reason is because you can make as much money as you want. If you have a profitable strategy, you just increase the position sizes and the bank account. But if you are not profitable, you're just going to lose more and more money. So it's super, super crucial. Just focused on making good traits and not trying to set $1 amount each and every day. Because if I am making profitable trades each day, all I need to do is scale up to make more money. So this goal is really only relevant to your actual account size. It's not really relevant to how you're trading is going to definitely think about and consider, and in summary here to boil this all down and to give you everything here, you need to focus on what makes you profitable rather than how much profit you have made. That is the key when it comes to training. So when I'm trading, I'm trying to make one to four profitable and good trades per day and I know if they're good. If I'm kinda sticking to my game plan, I'm adjusting as things come. Doing good analysis. That means that I'm having a good day. And I, personally, I don't even look at my profit and loss until it's like maybe lunchtime or I'm about to wrap up, or if I'm really curious about it in-between traits, but I will never look at my profit and loss during the trade and is going to mess with your head. It's going to mess with your analysis. And it is just a bad, bad habit to get into. Because if you see that you are close to your target, you're going to throw all of your analysis and all of your strategy out the window just to try and hit that target. And nine times out of ten, it is not the right strategy. So that is my personal opinion. That is how I manage my own goal setting. And I hope this video helped you. 60. Hot Keys: All right, everybody, welcome back to another video. In this one, we're going to start talking about hotkeys so that you can get better executions and get faster at placing orders for an entry or for an exit. I don't know if you've ever seen videos of other people day trading and sometimes it looks like they're not even clicking on the screen. It's probably because you're using hotkeys and it's basically keyboard shortcuts that allow you to set up your order form really quickly and really fast. So in this video, we're going to use my practice account on trade and I'm going to walk you through how to set up hotkeys and then how to use them. So to start us off, here, we have a chart right here on the left side, we have an order window at the top and we have basically our account summary on the right in the middle here. To get too hot keys, you're gonna go to File and then you're gonna come down here to user preferences. And you're going to scroll over to hotkeys. You can see it right here. And the idea is, is you have all of these different controls and all you have to do is kinda program them with certain keys. You first have to make sure that you have hotkeys turned on. You can also print out this form and you can restore your defaults here. But as you can see, I have it set so that the buyer market control is set for F2. Then I have this cell Margaret control set for F3. And all you have to do is just click on this and then type in the key that you want it to be. You cannot use letters. So I have basically programmed to all of my function keys at the top of the keyboard. So F12, 12 are all programmed in here to do different functions. What I recommend and how I have it set up is F1, no matter what is your Help button. And then F2, f3, and f4 from me are different order types. F5.6, 7.8 are different quantities, and then F9 and F are stop orders, and f 11 and F2 are changing the price. So I've kind of broken it up by basically what I wanna do. And you can see all of that in here. F5, F6. All of these different basically programs are set in here to increase or decrease the quantity or increase or decrease the price. And so when you click on Okay, it will basically confirm all of those hotkeys. And the big thing that you have to remember, and this actually messed me up early on here is that when you use hotkeys, first of all, always start this off in a practice account and test it out first. But when you use hotkeys, you have to be selected in the order window. So you can see that here, I have selected the order window and it's slightly lighter than the other windows. When I click on the Summary window, it lightens up. You got to make sure that you're selected on the order window. And then for instance, as you can see right now, the order type is stopped and we've got a quantity of 40. If I'm selected on this window and I click my shortcut for buy at market. It changes the order type to, first of all, select the buy button here, but it changes the order type to mark it as well. So that if I wanted to buy 40 shares, all I have to do is click the Enter button twice. It's going to give me that confirmation page. And then the second time that I press the Enter button, it's going to confirm that trade. And now as you can see, we have an open quantum need for 40 shares of Apple. We have a position in Apple and we just executed that trade with basically three button clicks. We clicked the Biot market and then we click Enter twice, and it executed that trade. If we want to get out of this, we can click sell at market. And now we didn't change the order type here because it's still a market order. You can see it as highlighted, the red cell button, if I click on Enter twice, just like that, it is going to exit our trade and yet we're recording. I just wanted to make sure you can see that on film. And so that's really cool. And so now let's say that we actually wanted to increase or decrease the quantity. Well, that's really simple. And what I've done here is I've actually created a little bit of a cheat sheet. Hopefully you can kinda see this. But basically what it is, is it tells me exactly what each one of these buttons is gonna do. So if I press F5, it is going to increase the quantity of shares by ten. If I press F6, it's going to increase it by 100. Same thing with F7 and F8, but going in the opposite direction, decreasing by ten and then decreasing by 100. Really, really nice, really, really simple. And it just allows me to control this order with just a couple of clicks of the button. Now, let's say that I want to get back into it. So we're gonna go buy at market for 50 shares, Enter, Enter. And now I want to place a stop-loss. Really, really simple for me. I have it programmed as FTN. As you can see there. It is now going to set us to the cell button right here with a stop order. All we have to do is make sure that we have the price set for what we want. Let's go 145.2. For this example here, we'll click on Enter twice here, and now it has entered a stop-loss into our chart here and into our order feet. And so this is really, really nice because you can program these keys to do whatever you want them to do once you get used to them and you kind of understand how they work, you can get really, really good at placing your orders, canceling your orders, getting in and out really quickly, and it can overall improve your execution. And when I say execution, what I'm referring to is your actual ability to get in and out at the prices and the levels that you want to get in and out at. So if you find that you're trading a breakout and you're always still placing the order as the stock is breaking out, so you're rushing through it and sometimes making mistakes. This is probably your holy grail. This is what you need and you need to get really good at it and you need to practice it in a demo account, in a paper account and a practice count, whatever you want to call it, sign up for the trade one, you get 90 days of free use and it is absolutely fantastic. It's really, really good. Then once you're ready to go with it, you can use any of the links in the resource file for this course, and it will give you $50 in free commissions if you decide to go with trade, go with Interactive Brokers or Weibull or new moon, whichever one works best for you. But you need to get used to hotkeys because it can really help you improve your execution and it can help you improve your profitability as a trader. So that's it for this video. Hope you got some value out of this video. Make sure that you understand how these hotkeys work. I am probably going to be doing a mix of just clicking on the orders here so that you can see how everything is happening on the screen. And then for some of the videos or the live trade recordings, I'll use hotkeys as well. So hopefully you can kinda see both strategies, but that's it for this one. We'll see you in the next video. 61. Trade Recordings : All right everybody, welcome back. In this video, we're just going to have a quick discussion about what you're going to see in the next section of the course, which is my trade recordings. Now, what is a trade recording? Basically what I've done here is I've set up a video recording of my pre-market session, basically my pre-market game plan for how I get ready for the market. And then a separate video when the market opens of my real trades and how I'm actually managing the money, analyzing the market and actually making the trades are recorded, the whole thing, edited them into shorter videos so they're easier to digest that basically just set everything up so that you can see how I'm actually trading. Now the goal here is to give you the ability to see how I apply the lessons in this course to my actual trading. The goal here is to teach you everything and then show you exactly how I'm applying, what I've just taught you through real-life examples. This is real money, this is my real account. However, it is a small account. I don't want to show you how to trade with 100,000 dollar account when 99% of people are going to start out with somewhere $1000-5 thousand. So what I've done here is I'm using just a small margin account. It usually has about $4,000 Canadian in it. I am trading in Canada, so there's no PDT rule for me. It is a margin account and I am using Quest trade for pretty much all of these recordings. You have any questions about any of that? Leave a comment down below and I will answer them as much as I can. Now, the key here is what to focus on. Do not focus on the profit and loss. You should be focusing on the strategy and how I'm getting in and out of these trades and the mindset that I have during the trade and during the entry and during the exit. I'm going to try and talk to you as much as I can about what I'm thinking as I'm thinking it, as I'm doing the day trade. So obviously some of the ideas are gonna be wrong. I'm gonna be kind of a little wishy-washy on some topics until I make a final decision. This is just my actual mindset and my actual process that I'm going through as I'm making these traits. What I really want you to focus on, especially in some of these examples, is how I manage the trades. Once I'm in them, do I stick to my original plan or do I just and correct as I get new information, super, super important. I also want you to look at how I use different timeframes to analyze the security and how I use the different tools that I've talked about in this course to hopefully make a better trade, I'm going to compare a lot of stock charts to the index e.g. and I want you to understand why I'm doing it, how I'm doing it, and what kind of information I'm trying to gather from it that is the goal of these trade recordings. Now, if you don't make it to the end of the trade recordings, please remember that there is a bunch of resources for this course. There's also a course project for this course. So please go through the project, take a photo of it, uploaded it, it would mean the world to me. I've also put together a document with trading resources and links. This is all of the links and websites and pretty much everything that I use for day trading. So you can download that document, you can go to all of those links and a lot of them will even give you bonuses. Now, if you get any value out of this course, please remember to leave a review. I sincerely appreciate it. I read all of them and I try to use that information to correct and make better content in the future. Also have several other courses, such as options trading. So if you're interested in moving on from day trading stocks to day trading options. Check out some of my other courses and some other content right here on the platform. And that's it for this video without any further ado, let's get into some of these real traits. 62. SQQQ Pre Market Game Plan: All right. Good morning, everybody. It is 07:07 A.M. on Friday morning, we're just sitting down at the computer getting ready to go. I got my OJ, have gone through my morning routine now it's time to start to put together our pre-market game plan so that we can get ready for the day. It is very early for me. I did not sleep super great. I do feel ready to go, but I did not seek great, So I do feel a little bit tired. But regardless, we're going to get into it today. We're going to make the best of it and we're going to try and make some money today. So let's jump right in. Okay, First things first, I usually like to look at the economic calendar today is Friday, October 7th. And we have actually a lot of stuff going on. Nonfarm payrolls, unemployment rate, average hourly earnings, labor force participation. So we have a couple of different metrics all coming out this morning at 08:30 A.M. so again, in about 20 min, actually 1 h ago it would have come out. So we'll take a look at those reports. And then 10:00 A.M. we've got a couple of Speaks. New New York Fed president John Williams speaks. We got consumer credit coming out at 3PM. And Fed Governor Christopher Walker speaks. So lots going on today actually from the federal government in the United States. Let's just see. Earnings. Friday, we've got Tilray, a cannabis company cannabis companies actually popped off yesterday because Biden announced that simple possession charges from the federal government would all be pardoned and cannabis stock skyrocketed. Probably because people are thinking this could be the first indication of legalization. Maybe they're clear enough these little things before they come out with new new laws. But who knows? We'll have to see cannabis could be something to watch though today because it had just a major catalysts yesterday. We also have a lot going on in oil and gas right now. Opec is cutting production and that is kinda messing with everybody. So that is what it looks like with regards to the economy. Now when it comes down to, let's just take a look at this sectors here, sector. I think everything is gonna be down. Everything is down except for energy, which is to be expected. As you can see, energy is skyrocketing over the last few days on the news of the oil or the opec cutback. So that is another catalyst. So as of right now we've got kind of two catalysts that we're looking at cannabis as well as energy. Let's just take a look at how the markets are doing though real quick. We'll go to Yahoo Finance and CNBC. Just give me a second here to open this up. Yahoo Finance here, okay, S&P futures. What the heck happened here? We just took a big dip on everything. S&p futures down, dow Jones features down Nasdaq futures down 1.68%. And southern just happened and listed, just got some news that came out or something because we just plummeted. Oh, it was the news. So this is super important here. So like I just showed you, there's a bunch of reports that are coming out literally just like 40 min ago. And here's the impact it had. It took the Nasdaq from a positive day down to a negative day. It dropped it down by literally 200 points and a matter of minutes just because of a couple of economic reports that came out. So you need to be very well aware of this to be very careful with this. And if these reports come out during 930 or ten o'clock or 11 o'clock while we are actually trading. You need to be very aware of this because if it's a bad report is going to crush the market. And if you have no idea what's going on, you're going to be totally lost and you're going to take a major hit. So you always need to check the economic events. Here is a perfect example of why we need to check those economic events. No one they're happening and be ready for them in case the report is bad. Okay, so that's what the nasdaq looks like, pretty much. Everything looks like that. Now, let's figure out why the report or why everything, okay, US payroll grew by 263 k. Unemployment rate falls to 3.5. Very, very interesting. Future sink as Job's keeping dovish pivot bets at bay. So basically that jobs report kinda St. the market, that's basically what we're seeing here. Soft futures fell and bond yields climbed after data showing a still solid US labor market through cold water on expectations, the Federal Reserve would soon moderate it's pace of rate hikes to prevent a more significant economic slowdown. So basically this report is showing that the US labor market is still extremely solid, even in the face of rising interest rates, which they are doing to combat inflation. And because the US labor market is so tight and so solid right now, companies cannot find employees, therefore, they're having to increase their wages, contribute to the problem of inflation. And it means that interest rates are probably going to continue to go higher until we see some easing of employment or we see some major easing of inflation. So very, very interesting dynamic here. It's almost like the report was a good thing because unemployment is really low. But it also means that we're probably going to continuously seeing more and more rate hikes because of unemployment being so low and because people need to hire people at better wages. So very, very interesting dynamic that is happening right now in the marketplace. Again, it pretty much sunk everything now, when we go into trade here and we actually look at. Our sectors, you can see that is very clearly happening. Everything is down right now except for energy because it has major catalyst. We look at our markets. Sqs queue is up by 4.6%, t qs is down by 4%. So very, very interesting day that we're going to have ahead of us here. Okay, Now when it comes to my game plan here, we had economic news that affects the entire country and all of our indices are down and pretty much the entire market is down. So what I'm thinking today is I'm probably going to start with some ETFs. Then we're going to take a look at cannabis, then we're going to take a look at energy. Those are the three plays that I'm going to focus on today. One is ETFs to trade the entire market because the entire market fell based on full market economic news. And then two is based off the cannabis catalysts that we had yesterday in the United States. Thanks. Thanks to Joe Biden. And three is the catalyst that we have for oil and gas because opec is cutting supplies that is increasing or decreasing, the supply, demand is staying the same, therefore, prices going up and these oil and gas energy companies are doing well. So those are the three catalysts that I'm going to focus on today. Personally, I think the market is going to drop with the news that we saw today. So that is going to be my bias going into the market. We are also in a very long-term bearish trend. So if you just look, the Nasdaq 100's right here, we are very clearly in a bearish trend, finding some support around $11,000 draining basically sideways for the last three days. So what do we very interesting to see what happens today? But as of right now, I'm kind of leaning towards the bearish side. Okay. Now when we take a look at the actual ETF itself, we're looking at S QQQ. This is an inverse leveraged ETF, meaning that when the nasdaq 100 jobs by 1%, this is gonna go up by 3%, which is really, really nice for us. Currently you can see it's up by 4.63% in the pre-market session. So first thing I wanna do is just draw out a couple of key levels of support and resistance. First, you can see that we got rejected right here at $50. We came down to $40, broke back up above $50 all the way to $60, and then came down and basically tested $51 for the last couple of days here. So $50 here. Very interesting and important key level for us. We have got highs at $61 right here. We've got support around $33 right here. And it looks like we've got a bit of a trend line kind of forming here. Something along those lines. So it'll be interesting to see what happens around $50 here. If we do test 50, that is probably going to be a key level of support that I want to either treat it to bounce or trade the breakdown of. So let's start to zoom into this a little bit. Let's go to the 15-minute chart and see what this really looks like here. So here's that 50 dollar level. You can see that we actually bounced off $51.03 times right here. So that is very, very interesting. We're also breaking out of yesterday's high or two days ago high right now. So that again, is another interesting factor, will draw a line across there. And let's just see if there's any other key levels that we really need to point out here. You could say that there's maybe one right here. We will just draw a line there so that we can be aware of it and we can understand it. There. We got rejected rate in here. We got bounced off right in here, and we bounced off again on October 3rd right here. So very, very interesting levels that we're at right now with regards to S QQQ, we will zoom in a little bit more again, multiple timeframe analysis. We're starting with the daily chart. We're going to the 15-minute chart, five-minute chart, one-minute chart. We are working our way down. Very key principle to this course. Make sure you remember that. So we'll go five-minute now. Take a look at what the five-minute chart looks like. Okay, we've got some very clear resistance at $56. It looks like we've got some good support around 51. 52. We will see where that opens, not really telling us a whole lot different information as we zoom in right now. And then let's just go down to a one day one-minute charts just to see what this really looks like on the inside. So here is our after hours trading, here is our pre-market trading. We've got some resistance rate around this level right here. We've got major resistance at the top, trading in a bit of a channel here it looks like we could be falling through this level at 55 here. We'll have to see what happens before the market opens. We have about 10 min till market opens. So we've got some key levels here on S, QQQ, Q, we're not gonna do anything right at the opening bell. We're gonna give this a little bit of time to unfold and see what happens here. Then we will make our trade and we'll be patient with it. Now, let's just take a look at energy real quick, see if there's any companies here that we are interested in. This is Canadian natural resources. Very interesting, not a whole lot of volume in the pre-market session right now, actually. Yeah, not a whole lot. They're not a whole lot going on. To take a look at some novice. Novice looks like it's seeing a little bit of action today. Yesterday, so anovas pretty doing pretty well yesterday. We'll have to see how that one kind of unfolds. One company I am interested in right now is true if they were up massively yesterday, I think 37, 38%. So we'll take a look at these guys and see how they are doing. So yeah, look at that, look at that movement right there on the news of Biden stepping in and saying, Hey, we were going to forgive some of this. So again, starting with the big picture here, we're looking at daily candlesticks. We're going to draw some levels of key support and resistance looks like we're starting to approach our level of resistance right there. We'll go to the one-minute or one month, 15 minute candlestick. Wow, look at that right at the end of the day there that thing just skyrocketed. Unfortunately, not a whole lot of volume on this throughout the day in order to day trade, that would be kind of tricky on thinking. Let's zoom in a little bit to the one-minute chart. I think this is gonna be Yeah. See like that is not really something that you want to spend a whole lot of time day trading. It's tough to do analysis on this. It's gapping up so much There's not a whole lot of volume only trading. Frick, I mean, 100 shares of minute. If we're lucky not a whole lot, they're very low volume. Probably going to see some big spreads here. And look at the gaps here as the price is moving up, you'll get these major gaps here. So you gotta be careful with a company like this. This might be better for swing trading. I didn't realize it was quite as low volume might be better for swing trading. Let's take a look at Tilray. They are reporting earnings today. So let's see how they are doing. Oh, wow, big day yesterday again, for Biden's report and the change in stance there, 2.8, almost $4. Wow, this one, this one really skyrocketed. We'll see what pretty much flat though before this. So we'll see how this opens. Let's just draw, let's draw a couple of key levels here. So we can just stay on top of it. We'll go to the 10-minute chart and we'll draw a couple of price lines here so that we're all on the same page here. We know where these key levels are, we know what to look for, and we can just keep an eye on that in case we see an opportunity. Now, one thing I always like to do is I am a huge fan of these big tech companies. These are probably the number one place that I like to trade. Apple, Amazon, Google, Shopify, Alibaba sometimes. But these are, these are, this is kind of my home base. So I always like to just take a look at these stocks, see if there's any opportunities that really stand out to me. See if there's any key levels that I want to be watching and just make sure that I'm aware of what is going on now, sometimes when you perform technical analysis on a daily chart and then you zoom out to the six-month chart. You get all these lines here and you got to just kinda remove them and clear things out and organize, organize your chart's a little bit better, so that's what we're gonna do. I'm gonna cancel these alerts, cancel some of these lines, and just clear out this chart a little bit. And so as you can see, we were at 176, we dip down to 140. We've had a nice little bounce to start the week yesterday, a bit of a red day, and we'll see how today goes so far, we're trading down 2% in the pre-market session, which is not great to see. We'll just zoom in here, see if there's anything that stands out to us. Again, apple dropping on that report this morning right at 08:30. You can see that red at the bottom, 830 comes out. That report went, everything crashes. Not a great start to the day. Not the way you like to wake up in the morning. So we'll keep that in mind. I'm going to zoom out a little bit from the one-minute candles to the five-minute candle's. Just so we can get a little bit more information on our charts here and really trying to understand what is happening. Okay? So this is good, this is better. We've got Boom, Priceline 136 here, that is the low. We've got some support there. It looks like we've probably got some resistance right here around this 147 level and now it kind of feels like we're trading and had been a no man's land. We will see what what, what kinda happens here. 14143 could be Q levels of support, but as of right now, I don't have a whole lot of information going into Apple and going into the open here in 5 min. So very interesting, we're probably going to have to be patient with apple. Let's take a look at Google or Google hovering out $100. I like Google. I like Google at $100. This is a key level for us. We got rejected right here. We found it a little bit of support over here. I like Google at $100. That is, that is a trade that I am interested in. Is Google either breaking down below 100 or bouncing off of 100. I'm gonna get rid of this alert here, cancel alert. And I like Google, we're definitely going to come back to Google. We will add that to our list. Either very simply for the breakout of these highs right here, or the breakdown of $100. I am looking for either of those options. We will set an alert here, create new alert entry. I want to know when it drops below $100. Oh, sorry, it's on the wrong screen. I'll just move this up real quick days and see it. So I'm going to set a bid price floor below or equal to $101 so that if the price drops, well, it's probably going to open there, but at least we'll be ready. We'll watch this one closely. Now, let's see. Nothing is up in tech right now, which is kinda disappointing meters down 1.7% and continues to move lower after that report. Looks like it could have a key level of support right here on 135. So we will take a look at that one. We'll keep an eye on it. But for right now it looks like Google. Google is one that I'm going to be watching very closely. I like Google at that 100 dollar level. It is a key level that usually Google is either bouncing off over findings support on. So that is good news. It looks like this is a fairly key level for Amazon as well. So we're going to keep an eye on Amazon and Google today. We're going to take a look at the cannabis space, focus on energy and probably start our day off with the ETFs just to see how things go as QQQ is probably what we're going to start our day with, but we will be patient. We're gonna, we're gonna take it nice and easy and we will see what happens as we get into the market. We have 3 min off to the market. So I'm going to go use the washroom line and get ready to go when you meet patient probably not taking too many traits for the first couple of minutes in the market. And then hopefully we can get into one here. And that's our pre-game checklists. So basically went through economic events. We went through earnings, went through what the indices and what the market is doing. We saw if there was any major news we read through. Well, we didn't read through the whole report, but we've got the summary of the report and why the market is reacting the way it is. And we took a look at a couple of stocks that we think could be opportunities for us today. We also looked at cannabis as well as energy. So we've got a couple of different options today. We've got a game plan. I'm gonna get my screen ready to go on. We will use the washroom and we'll be ready to go for market open. 63. SQQQ Trade: All right, everybody, welcome back. It is a couple of minutes into trading right now it's 7 min into trading. And I'm looking at SQ cues here. And we have an interesting setup forming. We have a double top right here around $56. And it also goes back to a little bit of resistance previously if we zoom all the way out. So this 56 30 level is pretty important. What I'm thinking is the market's going to continue to sell off on this report. So if the price goes above this, because it's s QQQ, which means it's an inverse ETF. The price goes up when the nasdaq goes down. I want to get in on the breakout here. And so we're going to look to get in at 56.40. We're going to look to take profits at 57.40, 57.40, and we're going to look to exit this trade if it loses $0.50. So that puts us at 55.90. And now we've got a trade that is ready to go. So I want to enter this when we break this double top here, I want to get out of it if we lose $0.50 per share and I want to try and make $1 per share. That gives me a risk to reward ratio of two to one. And I'm going in the direction of the market. The market is going down. So the inverse ETFs are going up above both of our moving averages. And we've got some resistance that I think we're going to break through. So for me, that is my game plan, that is my training plan. That is where I'm going to get out, That's where I'm looking to take profit. Let's enter this trade here. I'll give you, I'll show you this confirmation window so that you can see everything here. We'll click on Send order and now you can see my levels are in there. So we've got the entry F5.6 40 on the breakout, the stop-loss at 55, 90, so at $0.50 difference there, then we are trying to take profit when each share goes up by $1. So that is the setup we are looking at right now. We will see how this plays out. We'll give it some time here and see what happens. Now, what's nice about this setup is that we're not in the trade yet. And so if this doesn't go my way or if we get rejected at these levels, then it's no harm to me. I may have wasted a little bit of time, but it's not going to enter me into the trade. I'm not going to lose any money and it's not going to execute anything. So this kind of setup where I am patiently waiting for the price to finish the setup before it gets to the breakout of the breakdown. That is the best-case scenario you can be in as a trader because you've got patients on your side, you've got time to set up your trade. You just need to wait and let it develop without getting too eager or excited. Now, as you can see, this trade as of right now it looks like it might not even get filled, it might not even get triggered. We will see what happens. I'm going to leave this and let it go for a little while. We'll see what direction things move in. But we got to be patient with it. We have our setup, we have identified our opportunity here, we have a good risk to reward ratio. We're still trading in the direction of the market. So things are still in our favor. We just need to be patient and if the changes doesn't happen, that is totally fine. I'm okay with that. I'm comfortable with that. If the outrageous doesn't work out and the opportunity doesn't present itself, we have to be confident enough in ourselves, patient enough with our own control that we're not going to get worked up. We're not going to get excited. It shouldn't even affect our mental thinking right now, if this trade doesn't execute, we should just be looking for other opportunities in the market. That's how you need to think about day trading, is that one opportunity you should be prepared for it. And if it doesn't come to fruition, just move on to the next one. You were like a soldier just moving on to the next one, trying to find the best opportunity to trade. Alright, we're seeing high volume on this move down and the Moon. Oh, there we go. So now our order is triggered. We are moving higher. And now that is nice to see we are in the position stop-loss at 5598, take profit at 57, 40, we're now at 56, 48. We're moving higher, which is nice to see this trade so far is working out well and kinda going according to plan. So that is great. 56, 55, we're slowly moving higher and we are in the trade, we're ready to go. We got the breakout. So now let's just see if this continues. Alright, so we're getting closer to our stop-loss or to our take profit level here, I am considering moving up our stop-loss to at least our entry point so we can at least lock in what we came with. I don't wanna do it too early though, but it does look like we've got some good momentum, some good volume. We are definitely going in the market direction right now, which is very nice to see everything is selling off. The VIX is going substantially higher, so we do have good market confirmation right now. Now, we just have to be a little bit patient here. All right. A little bit of a pull back right now, definitely healthy. We saw a breakout. We're seeing a little bit of a pull back. Hopefully this is a retest where it's going to retest this 563-05-0640 level. So that's why I haven't moved up the stop-loss yet. Because if I moved it up to our original entry point and we saw breakout and then a retest or stop-loss, we get hit. And I don't want that yet because I want to be able to allow a retest of the key level of support before moving higher. Once we get that retest and we start to move higher again, that's when I would incrementally move up my stop-loss. Okay. So we're at the point now where we're at 56.91. By $0.50 on a trade that we risk $0.50 on. So we're pretty much where we've made as much as we wrist, which is really, really good at, is nice to see now to protect my money and protect what we have invested in here, I am going to move to stop loss up to the previous level here, it was 55.33, pretty much where we bought in. As you can see, we've got the confirmation or two here I'm going to click on Send order and now it has moved our stop-loss up. So now I have the opportunity of making $1 for a risk of $0.07. That is my new risk reward ratio is that if my take profit gets hit at $57.40, the maximum I could possibly lose on this trade at this point, It's only $0.07. And so that is how the risk to reward ratio changes with a trade as you are in the trade and as it evolves over time, this trade clearly is going in our direction, it's going in our favor and it's doing exactly what we want. So that is very, very nice to see, but now I have a risk of only $0.07. We're actually going to move this up again so I can lock in. Now, I'm guaranteed to make at least $0.05 per share, which is really, really nice. Obviously, you still have to deal with commissions. But at least now we have locked in a profitable trade. It looks like as long as this continues, we're going to hit our take profit here. And it's gonna be a nice, beautiful trade, which is absolutely fantastic. And now I have locked in at my initial investment, I've locked in everything that was in here. I don't want to give that back. So now I'm slowly going to move this up. And I might even convert this to a trailing stop-loss so that if this continues to break out, we can continue to take advantage of it. Okay, we're starting to see some green candles and our indices and possibly a little bit of a pull back. So I just want to tighten up this stop-loss just a little bit. 56.80. We will click on cell, we'll send that order and we're going to move. Our stop-loss might get hit here and that would be totally fine if it does get hit. Because at this point we've already locked in $0.40 worth of profit, which is very nice to see, and we still have our upside here. So hopefully this continues to bounce and we get all the way up to our take profit level. But regardless, it is a profitable trade. We've already locked in the same amount of money that we received on the traits. We have a minimum one-to-one risk reward ratio. We are profitable on the trade. Overall, this is already a good trade. Hopefully it just continues to get better. Now, on the other side here though, I'm just going to get my stop-loss order already. So we're going to take off bracket order. We're going to go to trailing stop. Sorry, that's what I meant to say was a trailing stop. We're looking for a percentage of 5% and we're going to leave it at that. So now, if I feel confident in this, I can exit both of these orders. I can cancel both of these orders. I can place my new trailing stop-loss. And as soon as this price corrects by 5% will be out of the trade, we'll make our money and we will be set to go. I usually like to use trailing stop losses on breakouts because they take profit point usually isn't based on a key level of support or resistance. It's usually based off a factor of your stop-loss and your risk to reward ratio. So in those scenarios, I find that the trailing stop-loss is a great method and a great way to exit your trade and lock in profits while allowing the price to go higher on the breakout. These are the scenarios where I really like to use the trailing stop-loss, but I usually enter the position with the bracket order so that I can clearly define my risk and reward and might take profit levels. Okay, I'm going to change this from a percentage amount on my trailing stop to a dollar amount and we're going to keep it at $0.15. That is going to be the maximum amount that I'd be willing to lose on this. As you can see, we're getting very close to our take profit level, which is great to see. It gets hit surprisingly, that's totally fine. It just locks in our trade, which is absolutely fantastic. And if not, we're going to put this trailing stop-loss on it. I'm not even time this, I'll leave it at maintain it up to $0.12. 0.1 to 0.12. There we go. Okay. Now, generally stop-loss, boom, $0.12 a day auto. That looks good. Our indices continue to sell off. I'll just show you what they look like right now. This is the v6 chart. The VIX is continuing to move higher even breaking out past that previous high, which is a great sign. This means that there is fear in the market and people are worried, which means they're going to sell their shares, which means the inverse ETF that we're trading is likely going to go up in price, which is absolutely fantastic and great to see now this inverse ETF is based off the nasdaq 100. This is the nasdaq Composite which has all the same companies in it and it is clearly going in the various direction. Let's just see if we can pull up the actual Nasdaq 100's. Here it is right here and the x-dot IN is the index. And as you can see, it continues to trade lower. So we're going in the direction of the market, which is exactly what I've been talking about for a very long time and things are looking great. We're at 372-05-0735. Okay. I'm going to exit both of these orders right now. We're going to place our trailing stop-loss in air. Exit both of those, exit both of those. We're going to click on cell using a trailing stop-loss. Boom, we got to give this a confirmation. We got to give this a confirmation as well. We're going to sell it at $0.12. And there we go. We have exited our original trade. We have entered in a trailing stop-loss. On S QQQ. We're at 57, 38, so we're $0.02 away from our original profit target. We have converted that profit target into a trailing stop-loss so that if the price continues to run, we can continue to keep that trailing stop-loss on there and let it just continue to rack up profits for us. So we're at 57, 40, we just hit our original take profit level, which is absolutely fantastic. We could have just exited the trade and called it a beautiful trade, but we're gonna go for just a little bit more. Remember, you don't want to get greedy here, but you do want to try and make just a little bit more money. So we're at currently a $0.12 difference right here. I'm going to tighten this up to $0.08 just so that we can make sure that we're getting the most money out of this as possible. We're going to edit that. Click on confirm here. It's going to tighten that up just a little bit. We're at 57, 41 on the actual trait, which is pretty good. That was too high. So so far, so good. Markets continue to sell off. We're still seeing red on most of our indices here and it is going higher. Okay? We just got out of our order. We sold 20 shares of S QQQ. It looks like it came back down. And that was a beautiful tray. That was good. We made what did we get in here for 56 40 we got out at 573-05-0740. So we made a nice, beautiful two-to-one risk to reward ratio on this trade. Obviously, the trailing stop-loss didn't work out quite the way we wanted to. We could have just locked in at 57, 40, but overall, we still did extremely well. And if that stock did continue to run, we would've made even more money. So that is part of the game, that is how the atrium goes. It is eight o'clock in the morning, so it would be an ad or computer for only 30 min. We had a nice, beautiful two-to-one risk to reward ratio trade. And so far so good. Now the price is pulling back. So we probably did get out at a good level, which is actually we definitely got out at a good level because now dropped down a 57 15 there. We did extremely well on this trade. I'm very happy that is a good way to start the day. And if you can just find a couple of those and then start to scale up the dollar amount. That is literally the key to this. That is everything that we are trying to do is identify setup before it happens, let that setup play out, try and make as much money and manage that trade throughout that setup. And do that several times a day. That's, that's the golden goose. That's what we're trying to do here. And hopefully you learn something out of this video. Thank you guys so much for watching to the end. And I got to go find a couple of more traits will see you later. 64. AAPL Trade: All right, everybody, welcome back. It is 929. The market opens in thirty-seconds. Pacific time, not Calgary time, but we're about to get underway here. It looks like Apple. Apple had a major run-up to 148. It's seeing a little bit of a pullback right now. I am interested on the breakout of this stock at 01:48 mark. It opens in 15 s, so we're gonna see what happens here. 148.5. I want to get in for 50 shares. 148.5. We're going to set a stop-loss at 01:47. 0.5. Boom market, just open market is just open. Stop-loss. Boom. 47.5 and our take profit is going to be 14925. And let's see what happens with that. Here. It looks like this is probably going to go through and away and our order just filled. Apple is pumping higher right now. Good thing we're ready to go when the market opened. Let's see if we end up in our profit target right away. That would be very, very nice. We would make some, make a nice little oh, we're moving up, we're moving up. Again. I'm going to move this higher just a little bit. Oh, we just got hit. There we go. There's our trade just like that. Boom, that's a good way to start the day. We are in it, we're out of it. We made a quick oh, cancel that. We're in it. We're out of it. Oh. What just happened? Oh, no question. Just quit on me. Oh, come on. Come on, man. That is not what I wanted. What just happened there? Were canceled order canceled. I'm checking it on my phone right now or to executed sell Apple at 01:49, 50. So that was great. Boom. You just made a quick 50 bucks on like 25 dollar risks. So that was phenomenal. Now we just gotta get back in to illustrate here. I don't know why. Wait on me like that. That's the first time I've ever seen that. Maybe we had too much stuff going on there. Maybe we had too many charts open, I don't know. Okay. Let's see if we can get back here. The order definitely executed and we were able to get out of it, which is great. Our first trade worked out in less than a minute, so that's absolutely perfect, but I don't know why exited on us like that. Very kinda frustrating. Let's go to Apple, right? Well, it was good trade prices. Price dropped down to 14950 there, so we could have made it a little bit more money on that one, but at least we started off good. We're up $41 to start the day after commissions in less than a minute and we'll only risk $25 there. So a nice little two-to-one risk to reward ratio, or I guess, what did we risk there? I don't even know that happens so fast. We might arrest the same amount of might've been in one-to-one trade. 14750. I think we got in it. Yeah, I think it was a one-to-one trade. Like not the best risk to reward ratio, but when in our favor right away we got exactly what we wanted and we made a nice little trade to start the day, so that was good. We saw the run-up in Apple as it was breaking out that basically just continued into the market open there. And very nice to see. Now, let's see what else we've got going on. Shuffle off. They reset all my charts when it closed like that. So now I got to change everything up. God, That's annoying. I don't know why I did that. Okay. Robin Hood moving up higher this morning. That's nice. Amazon. Amazon actually moving up higher to, Let's take a look at this xBtB. See now Apple's trading sideways. So that was a good trade. We got in and out at a good level there. That's that's totally fine. Yeah. See everything on my charts is messed up now this is frustrating. S&p 500 is R4 and higher this morning, the VIX is crashing down, which is exactly want to see the Dow Jones is also roaring higher, almost gapping up. Look at this chart. This is, oh my gosh, in the Nasdaq, nasdaq is on fire right now, leave this, leave this chart, that's the Dow Jones Industrial Average. That's how we're starting the day. That is very nice to see. I need to get back into a couple of these companies. Let's see what's going on with Apple, like nasdaq is still just motor and motor end up. Okay, we're gonna go with 50. Boom bracket orders. Stop. 150.50 is where I want to get into it. My stop loss. I want to get out one-fifth. And our take profit is going to be one-fifth. One-fifth. We'll see if Apple maintains this momentum. I'd be surprised if we didn't see a pullback, but as of right now the nasdaq, the S&P 500 in the Dow Jones have all done extremely well in the first 5 min of the market session here we've got Google that is crashing right now if you look at Google, skyrocketed up, came all the way back down. It got rejected at the pre-market highs right here. Very, very interesting to see how that kind of unfolded. Apple still doing okay. Amazon saw a nice little skyrocket up and they have completely leveled off in the last 4 min. Robin Hood seems to still be doing okay here, like not terrible from Robin Hood to start the day. Nice little pop that they've got going there right now. We will see if this holds up. It looks like it looks like it's going to though. Okay, we're going to place this order for Apple. There we go. We're in at 01:50. Were out at 01:51. 50. Okay. We're in it. There we go. Let's see how this goes. We've got a $0.50 downside on it. We've got a $1 upside on it. So we're at a two-to-one risk to reward ratio right now. And we'll give Apple a little bit of time here in the Nasdaq and the Dow Jones is still in positive territory. It feels like they're doing well. And Apple continues to move higher here, so this is good to see. So if you look at these charts, looking at the apple chart, and then looking at the nasdaq chart. We should be able to use these to try and understand what direction is this stock going and when is it going to turn around? So we're at 01:51, 18, which is absolutely great. We're actually kind of close to our take profit level here. I'll leave I'll leave this chart here. Okay. I don't I don't have enough room to leave it there to be honest with you. Okay. This is continuing to run. We're going to move our stop-loss up to our break even point here, just to kind of protect our downside risks here. Let's change this up here. 150.50. So I'm going to move that up. Boom, just like that. So now we have protected our downside, we've protected our risk. And if the stock comes back down, we will basically just breakeven and pay for our commissions. But so far, we're seeing seeing all of the right signs. Alright, that is not the sign that I wanted to see. I did not want to see a big red candle with a tall, long Wick. That is not what any day trader wants to see. So we want to see this continuing to move higher with strong green candles. It looks like we could be running into a little bit of resistance here. So we will give this yes. See now, look at this, look at how closely these line up now or nasdaq is starting to turn around here we're seeing a little bit of a slowdown in the Apple stock. This is where, this is where being a trader comes in and you have to decide, are you going to take the profits that you have right now? Or are you going to let this ride out just a little bit longer for us? Oh, there we go. We just got hit again. There we go. That's to trade so far on Apple, both of them have been profitable. We are up another $50 on that trade, risking about $25. And that is how you do it. That is two traits that are both successful to start the day. And as a day trader, this is the best thing you can get into as a couple of small trades that are going your way that you can build momentum on and that you can feel confident and good about going into the market width. You set your risk reward ratios, you set your bracket orders and you let them play out. And then when you're in the trade, you manage that trade accordingly based on what you are seeing in the markets. This is how you day trade. This is how you make money consistently. And you'll look at this. I'm trading with a small account. I'm training with an account that's like $4,000 Canadian right now. I'm making small trades, but just so far in the first 9 min of the market, we've made $85 on Apple stock. You can see that right there. And that is after Commission. So that is after we pay for all the fees and everything, we just made $85 USD in 9 min. So realistically that's like 100 or $105 Canadian for me. And this is, this is where you wanna be as a day trader is just slowly picking off small little trades. See the stock is running higher here. It doesn't bother me. We're here to try and pick off small, consistent traits that are going to give us the best opportunity to make money on a consistent basis. That's what we're trying to do as day traders were not trying to go out there and be very blunt and hit a home run, it's going to make us $100,000. That's not the strategy here. The strategy here identify what direction the stock is going in. Why does it have a catalyst? What direction is the market going in? Place, a responsible trade based on technical analysis and then manage that trade. Alright, and as you can see, Apple continues to run here. Then nasdaq also continues to push higher. We had that little stop right here, which is where we were considering taking profits. We didn't take profits and it's continuing to run. So there could be even a third trade in this Apple stock right now, I'm going to be a little bit patient here and kind of see where things end up. I don't want to get too confident and start overtraining and get too excited. We've already made two traits. Do they usually I'm making somewhere 1-4 trades per day. So I'm gonna be a little bit patient here. I'm going to give it some time and we're going to see what is the next trade that presents itself to our, Our, to our hands here, to our opportunity and to our personal training floor. Because so far this has been quite exciting. Apple starting to slow down a little bit. Wow, look at Amazon Louis, this chart right here. Look at this. It opens up at 97, runs to 100, comes right back down to the opening price and ribs right back up. See, today's gonna be a good day. Today. They're going to be some opportunities for us to trade. And this is going to be looking at this, even Robin Hood. Robin Hood is on fire right now. Any of these stocks, any of these stocks right now have opportunities with them. It just comes down to, are you thinking with a clear head? Do you understand what's happening in the market and do you have the calmness to execute an appropriate and proper tray? That's the idea here and that's all you need to think about. So I'm going to sit around for a little while longer. This video's already been 12 min long, so we're going to stop it here. I'm going to let this sit with you and we'll go from there and we'll see you guys in the next video, talk to you soon. 65. META Pre Market: Good morning, everybody. It is January 31st is 07:17 A.M. so again, started a little bit late, but welcome to another morning recording. Today is a big day and a big week with regards to the market, we have an earnings weeks or in the middle of an earnings week, which means a large number of companies are reporting earnings this week including Apple, Amazon, Microsoft just reported. We had a couple of other big companies today that we're going to look at. So this isn't earnings week. We also have the Federal Reserve in the United States meeting this week to decide on interest rates and that news is going to be coming out tomorrow, going to be also a very important day tomorrow. And we've got a couple of other geopolitical things happening around the world. So let's just kinda dive into it and see where we're at. As you can see on Yahoo Finance, the future have just turned positive, which is a really nice sign yesterday, it was a very strong red day for the market. Not a great end to January, but that's okay. With regards to earnings, We've got a couple of things happening this week or today, sorry, we've got UPS reporting earnings today. General Motors, ExxonMobil, Pfizer, McDonald's, Spotify, caterpillar, marathon, Phillips 66, UBS, and a bunch of other companies. So lots of earnings today we can basically use this list as a catalyst for different stocks. One that we already saw an article on McDonald's, they actually reported this morning. And it looks like they beat earnings. So that is really, really nice. Boosted by higher menu prices and digital sales. So this could be a catalyst for us to look into. This is really nice to see in McDonald's might have to be on our list today. So that is one thing to look into. Like I said, we've got a lot of earnings happened in this week. We also have some economic news coming out. So like I said, today, not really a massive day, but later this week at 02:30 tomorrow federal Chair Jerome Powell news conference. That's probably what we're going to learn about the new federal funds rate. So that is going to be very, very interesting. That's going to happen tomorrow afternoon. We don't really have to worry about that today. We do have some news coming out though at 10:00 A.M. consumer confidence index as well as rental vacancy rate. So we want to keep that in mind because at 10:00 A.M. we could see like it could change the market. It could have a small impact on the market realistically, I don't think it's going to have a major impact because we have such big news coming out tomorrow with regards to this federal funds rate. But it is something to keep an eye on and to be prepared for around that 10:00 A.M. Mark. Now, last couple of things that I just want to take a look at, Bitcoin continues to hover around this 23,000 mark. I've been trading in and out of some of these Bitcoin miners lately, and I've done pretty well here to start the year, but it is starting to consolidate right now, so something to keep in mind there. And CNBC, let's just take a quick look through here. Spotify shares pop after earning, showing strong user's growth. I feel like today might be an earnings day. So we might just focus on the company's earnings and maybe, maybe an index for today, but we will see how things go. So McDonald's and Spotify are two that I definitely want to check out. Ups revenue falls short of expectations despite growth in the US business. Interesting, UPS, Spotify, McDonald's, we've got a couple of year that we were going to want to check out. Norway's gigantic sovereign wealth fund loses a record $164 billion. Setting very unusual year that is pretty wild. That has been the rock and foundation of Norway for a very long time. So to see that lose that much money is a little bit concerning. Dani rises out, rides out, storm as investors rally behind $2.5 billion sheriff sale. So this one is really interesting. I Dani is an Indian based conglomerate that has lots of different companies. And just recently a short seller, which is a basically a group of people in an office that bet against these companies and then release reports about how bad the companies are. That's what a short seller does. A short seller just released a report about the Dani group and the shares tanked because people read the report and they said, oh, maybe there's some good points in here. Maybe this company is lying or defrauding investors are just isn't as good as they say they are. And so the shares really tanked. So to see them turn around and then go to the market and sell $2.5 billion for the shares is actually pretty wild here. So this is definitely something that we may have to look into hairless. I'm wondering if he hasn't. He traded in the US donee enterprises. Okay. So here we go. And then right there you can see that big massive drop right there. That's when the report came out. Over the last month. They're down by 23%. The ticker symbol is a Dani entertainment or Dani and ADA, an EMT. Let's see if I can pull it up on question. It doesn't even look like I can get it. So they must not trade. In Canada. Yeah, they're headquartered in India. Really, really interesting scenario. I don't know if I'm going to trade this one, I guess because I just don't have an expertise on the company at all. I don't have an understanding of the market. I don't even know if I can trade those stocks. So this might be one of those things that I just kinda let pass by. Okay, we got 6 min till the market opens. Let's take a look at what these stocks look like. See if we can find some Q levels that we want to watch out for here, what the heck is there we go. Mcdonald's, okay, boom. Kinda weird trading action here on, on the 24th. Don't really know what happened there. Stock right now though, let's go to five day, Let's go to ten minute. Let's bring out the pre-market and post-market. And let's see what this looks like. So, okay, very interesting. Pre-market for McDonald's has been extremely volatile and it looks like we are starting to come back up, but nothing major there will zoom in just a little bit. Five days, five-minute Spotify. Spotify's the constraint. Little bit of consolidation here, going into the open new we watch for a breakout on that one, but nice, nice pop on Spotify and UPS we were taking a look at possibly going short on UPS. Wow, super volatile for UPS here. Very interesting. We've got some resistance there. We got maybe a bit of support at 176. We'll see what happens at these levels. But as of right now, UPS is kinda trading right in the middle. Now, the VIX in the pre-market right now is up. We've got five-minutes still. The market opens some fixed right now. Pre-market is up. It has been on a bit of a bearish trend as the market rallied for a strong entity January, but yesterday yesterday was a bit of a rough day and now it is up to QQQ, also up just slightly, not by a whole lot, but just slightly we're up on today. Bullish trend over the long term, maybe bouncing off support here. Let's see what this looks like. Yeah, could be a little bit of a balance off support here. You could even probably extend this out. Interest in the TQ looks like nasdaq over the long term, we're basically at this resistance of a rate here around 11,500 when we zoom into it. Yeah, like we broke through it yesterday. We came back or broke through it two days ago, came back down below it yesterday. And now. It's going to be interesting to see where we open up. Let's just take a look. Tiki queues, SQS, queue, where is oh my goodness. There it is. Okay. As QQ. So this is the short leveraged ETF of the nasdaq. This is the long leveraged ETF of the Nasdaq. And yeah, like it does kinda look like where we could be bouncing off this trend. So if we break out, if we end up breaking out above this here, I like it. If we break above $22.20, I like riding the Nasdaq off of this bounce here using this leveraged ETF. But we will see what happens. Well, UPS T breaking out in pre-market here. Now I'm just going through my watch list, see if there's anything that really kinda catches my eye. Metta. Metta is being rally and hard lately I like metal lately. Various trend over these last over these last few days here, but I need that rally. That's pretty good. We'll have to see what kinda happens here. We could see a breakout on Facebook. Facebook would be one to watch here, omega, sorry. Softwares. Schrodinger is popping off today. Interesting. Snowflake, another company I like, even over the longer term here, snowflake is really breaking out right now, but okay, that's it. That's it for the market. We've got a couple of things to watch. Your market opens in 40 s here we will see you for the live trading. 66. Meta Trade: All right, everybody, welcome back. Mark, you just opened literally 1 s ago and things are up and running. Okay. I'm going to change my screen around just so that we can get a little better feel for everything. Here we go. Okay. Start doing not too bad here. Where did it go? Meta matters running seat. That is running hard. I like metta. I like metal right now. I agree in to see a really strong day for Meta. S&p 500 is strong, start the day nasdaq is strong and start today. Tau Jones's read to start the day. Very interesting. Ups t is just at 10%. I think I want to put an order in on Medicare. I really like it. We're gonna go with 20 shares with a stop at 01:48, 0.8. Want to put bracket order and I actually want this to be a trailing stop by $0.50. Okay, boom, and just like that, we are hit. So we're already into Facebook. We got 20 shares of Facebook and we move in higher. I got a trailing stop loss on this for $0.50 is where we are currently at. And I'm buying in on basically, we saw a run-up going into pre-market. I liked the long-term pattern on Facebook and we have broke out of major resistance that we established yesterday. We're also kinda breaking through this short-term bearish trend here it looks like that trend is ending and already are stop-loss is moving higher. So that is really, really nice to see. Facebook is taken off. And so far this is a good start to training day. The VIX mixes up three quarters of a percent. It's not terrible. The Dow Jones is actually come in way back down. Not great for our trade. Spy, spy is moving higher and nasdaq is still rolling higher, which is great for our trade. Prices moving up right here on our stop-loss and things are doing okay here. Hopefully this doesn't come down and get us out right away. But she goes here. That composite pretty good start to the day, continuing to rally right now, I expect to see this come through in the Facebook chart as well. There we go. See you in a little bit of a pop here. Very good sign. See what's, I'm trying to point this out to you so that you can see the correlation between these charts to nasdaq. And a lot of technology stocks move very similarly. So what we're trying to do here is watch the Nasdaq and keep an eye on the nasdaq Composite so that if we see a dramatic turnaround here, we can probably expect that in the big name text doc that we're trading, maybe you can get ahead of that turnaround and exit your position early for higher profits. Or you can use it as an entry point on the other side of that trade. If you start to see the nasdaq rally before your big stock does, well, that could be a sign that maybe it's time to get an entry into that stock if the technical is also line up. Broom and again, we continue to move higher. This is good news so far. We've locked in one or 2%. So far. 14988. This is going well. Our average price on this trade was 148.85. That's our average price into it right now. And our stop-loss is currently at 01:49, 0.38. So we've already locked in profits, which is absolutely fantastic. And we're only using a very small amount of money, like two or three grand here, our current position right now is valued at $3,000. So we're using a very small amount of money to make this trade right now, which is excellent. So I'm just taking a look at our level two right now to try and see if there's any major or large orders that there could be holding things up, we're pushing things higher or lower. Then I'm also keeping an eye mostly on the color of this screen here. When, when it's green, it means that people are driving the price up. When it's red, it means people are driving the price down because they're placing their orders at the bid or the ask. Okay, our XR, our trade just got filled. We made was at 11 or $12 on that one. Not too bad for a really small trade like that. We made less than a percent or so, but it covers the commissions. We make a little bit of money to start the day. And for a small account, if you can just keep building those up and repeating that, that is the ultimate strategy here. That is the way to win when it comes to day trading, even if it's just $10, $20.30 dollar wins. If you can repeat that a couple of times every day, all of a sudden, that account starts to doubled really, really quickly and then they're not 1,020.30 dollar wins there, 2050, 80 dollar wins consistently. And all of a sudden you've got two or $300 a day and that's a full-time job. It's very, very easy to get to that point once you can master these small little trades and these small little wins. Because to get to that point, it's the exact same methodology. It's the exact same. Everything that you do. The only difference is that you're treating with more money, but you can't do that unless you can actually make money with a small amount of money. And you can make these 10203040 dollar, small little wins with very little downside, so that you can just slowly build up your account and start stacking wins and start growing that average position size. That's the key to scaling this up, turning it into a full-time job and then starting to make lots of money. 67. SHOP Pre Market Gameplan: All right, everybody, welcome back to another video and it's currently 07:04 A.M. on October 27th. And we're gonna go through our pre-market game plan here. This one is a big one. It's a big week right now because it is earnings week. So we've got a lot of companies that are reporting earnings. A lot of big companies that are reporting earnings. Hopefully it's going to give us a couple of catalysts that we can trade off of. Now, just to give you an idea of what I mean, here is a photo from earnings whispers. This is a website I like to use for earnings and this kinda gives you a visual representation of all the companies that are reporting their earnings this weekend when they're reporting. So you can see Monday, Tuesday, Wednesday, Thursday, Friday, and you can see whether it's before the open or after the close. Today is Thursday, which means yesterday, Facebook or Meta reported their earnings after the close. We also add Ford and Teladoc report their earnings and we have shopped for Amazon, caterpillar and MasterCard, all reporting their earnings pretty much right now or in the next few minutes here before the market opens. So this is very, very exciting. We got a lot of reasons to be training. We got a lot of catalysts coming out and now we need to dive in to try and figure out where's the best opportunity for us. So now before we do that and we really dive in here, Let's just get an idea of where the markets are at. You can see the S&P 500 has fallen from 4,800 all the way down to a low of 34, 91, about 3,500 here, which is very, very close to the pre-pandemic highs that we saw at 3,400. So we basically came down to 3,500, are pre-pandemic highs was 3,400. So we're sitting at a pretty crucial level of support right here. I've got a resistance line drawn. When we break through that resistance line, that would be a first very, very solid indication of a trend change. We're starting to get close to there, but we've still got a ways to go. When it comes to the Dow Jones Industrial, it's a similar story. We did test the pre-pandemic highs prior to COVID, which is really, really nice. We're starting to bounce off of that. Again. We've got a couple of levels that we need to break through before we can say that they should bearish trend is over, but it has been a pretty nice rally we recently. And when we look at the Nasdaq, it's a slightly different story. It's being hit a little bit harder here. That's the, sorry, that's the nasdaq 100. This is the nasdaq. The Nasdaq has not seen as the large of a rally over the last little while. And it has also come down very, very low at, has pretty much touched the pre-pandemic lows. And it is down from 16,200 all the way down to 10,000. So it has lost a significant amount of value at a stern to climb back up off of the sport level. But again, we've got a major earnings week. It did kinda take the market down a little bit yesterday. So we've got a lot of different things going on. Now, when it comes to what is happening in the rest of the marketplace, I usually like to go to CNBC and Yahoo Finance just to see a quick glimpse of what is going on here, we can see the Dow futures, S&P futures, nasdaq, the Dow Jones and the S&P futures. It looks like they're going up. The Nasdaq futures looks like it's going down. This is basically a predictor of what's about to happen for these individual markets. We can see here US GDP accelerated at 2.6% pace in Q3 better than expected as growth turns positive. That is very nice to see. That is actually great. The Dow Jones just turned positive on that news, which is fantastic. And now we've got a couple of articles here that we can kind of read through and see if anything catches our eye. Okay, so right here at McDonald's, earnings beat as customers return despite higher prices. So this is really good. Remember, McDonald's reported this morning, and now we've got a beef little article here telling us what happens. So worldwide, the company is same store sales climb 9.5%, beating street account estimates of 5.8% growth. That is really nice to see. That's doing pretty good. Third quarter earnings and revenue. That's good. What McDonald's top Wall Street's estimates for third quarter earnings and revenue. So they beat expectations from analysts. That means that the stock is likely going to do well, at least in pre-market and after hours. So this is definitely something that we want to put on our watch list. Shares of the company rose about 2% in pre-market trading. We'll take a look at that very shortly. Earnings per share, 2.68 versus 2.58 expected. So this is the number that analysts expected and this is the real number that came out. Again, it was better than the expectations in both scenarios here, which is very, very nice to come in. He reported third-quarter net income of 1.98 billion or 2.68 per share, down from 2.15 billion or 2.86 per share earlier in the year. So a year earlier. So not great, still down a little bit from a year earlier, but the company is doing well and they beat expectations, which is absolutely great to see. Also we add Facebook, coming out with earnings. Let's see what is happening with Facebook. I guess this is meta. Now, there we go. Metta platforms. Oh no, they are taken a big hit. Oh my God, they're down 23%. Holy cow. That is massive. This is gonna give us something to trade for sure today. And that is not very good. Oh my God, at lunch, 20% on downgrades and it missed earnings. I told you, I told you if Facebook is not the place to be putting your money right now, nobody listened to me on YouTube, but that's okay. Oh my God, that is a big move. So this is something we're going to definitely have to check out. We've got. Mcdonald's, we've got Facebook, I believe Shopify, I said also reported earnings. Let's take a look at how they're doing. Shopify up 6.85%. That is pretty good. They are doing extremely well on earnings. Let's see what happened there. I wonder if we can find any just quick articles. Shopify up after strong Q3 results, that is nice to see. Shopify has just beat down for the last six months. I'm glad to see. So company announced revenues of 1.4 billion in the third quarter of 22%. What is going on with these ads? No, I don't want any of this. No, no, no. Man. See, sometimes when you click on these ads, they're gonna make you try and buy stuff and it's just awful. Coming in ahead of consensus estimates by $30 million, that is very good. Adjusted net loss came in at $0.02 versus $0.08 per share in the same period last year. So that is improving as well. And gross merchandise value increased 11% year over year. So very good metrics from Shopify that is very nice to see. So we've got Shopify, McDonald's, and Facebook. There are three stocks we're going to want to trade. We also know that Apple and Amazon are going to be reporting after the close today. So that could be an opportunity for us as well. We also have MasterCard and mercury as well as a couple of other companies. But I'm not going to jump into every single one we want to focus on a few. And for us I think it's going to be Shopify, Microsoft, Facebook. And then if we can't find much there, we're going to dive into Apple and Amazon, but for now, that seems pretty good. We also have Microsoft and alphabet report on Tuesday. I don't think that those reports went very good. Alphabet dropped by about 6%. Microsoft dropped by four or 5%. They didn't do great yesterday. So we'll see how things go. We also have a lot of action happening in the Chinese market. So Alibaba and Tencent are two other companies that are seeing a lot of catalysts right now and could have an opportunity. So that is where we're at with regards to those companies. Now let's take a look at the individual stock charts starting with Meta and oh my God, too down 23% right now let's zoom in here to the five-day chart and wow, yeah, that looks, that looks pretty rough. We'll go 51 month ten minute chart. So here's what it looks like over the last little while. And it dropped from $130 yesterday down to $101 right now. And that looks really, really bad. It is not looking good for Facebook stock at all of that is a really bad day in a bad year for Mark Zuckerberg because this stock Oh my God, this talk was like two or $300 little while ago. Just looking at this $384 down to a $100, right now in aftermarket trading, it is down by over 75%. And this is one of the largest technology stocks out there. So this is, these are pretty big moves here that you need to be prepared for if you plan to invest into any of these companies long-term, because I don t think many people saw this one coming. Now, here's what the stock chart looks like right now. We're going to zoom into this a little bit to the one day one-minute chart, as you can see here. Like that report came out and the stock just immediately trashed and it's been trading almost sideways for the last little while here. So what I'm gonna be looking at here is we've got one level of support at $98.66. I think that level is probably going to break down on the news that we're seeing today. Well, I mean, maybe it gets a massive recovery here, but I'd be surprised if we break down below 98, 66, that could be a good shorting opportunity for when the market opens. That's probably what I'm going to be keeping an eye on here. Or if it breaks above this 100 and let's call it one-on-one level right here, then maybe you can run it up to 10 for that is a possibility and an opportunity. But we'll have to see what happens here personally, I feel like this might go short and it's still coming down here. So we'll see if it finds any support at $98. I am going to set an alert here just above activated Priceline. I'm going to send an alert, create new just above this support level so that it lets me know when that price comes down to that level. So I want to know when it gets equal to or below 98.80. We'll call it 98.809, 8480. And we will click on activate. That should give me a little alert there. And when the price crosses below that, we will get an alert now. So that is what Facebook looks like. Let's just take a quick look at what Shopify looks like. Who own. I got to go to the US version of Shopify. There we go. Okay. Shopify looking pretty good right now. Actually like very clearly, we've got a high level right here at 31, 50. We've got maybe some support right there around 29, 35. Key level around here at $30. Yeah, it looks like right here is also. Pretty key, 28, 60, we found some good support there. I'm going to back this out to one 10-minute candle's, just so that we can move this back just a little bit more and see if there's any key levels that we need to be watching for. Oh yeah, there's 29, maybe 30 level is pretty crucial. Same thing with this, with this level here. So we will see, see where we end up with Shopify stock as the market opens, we're currently about 15 min away from the market opens, so we're definitely starting to get there. And personally, I think Shopify is gonna do well. I think Shopify at $30 is a steal of a deal. If you look at this company going back to six months, this company was worth over $176. Now trading at $30. It again is down by like 80%. I don't know what that percentage is, but it's pretty significant. And so Shopify shopify could be a good opportunity here, especially if this earnings report is the catalyst that starts to turn things around. I think I think there could be a nice opportunity for a day trade here. So we're going to keep our eye on Shopify. I am watching for Shopify to cross above that 31, 50 levels. So we're going to set another alert here at 31, 44. The price to go above or equal to bid price is greater than or equal to 31. No, bid price is greater than or equal to 31.45. 31.45. We're going to click on activate there. And now in the price crosses above that, we should get a nice little alerts, so that'll be good. Let's just see if anything else is happening today. What did we do? We did McDonald's. Mcdonald's. We didn't look into McDonald's shirt. That's where we got it. Let's take a look at this. Okay, McDonald's Corporation, Mc d is the ticker. Let's always look at the six-month chart first so that we can see what is happening in the big picture. As you can see, McDonald's has not had a massive pull back like what we've seen in the technology industry. It looks like we got support 30, we've got some resistance around 260, 8% to 70 in here or on a pretty strong bullish trend over the last few weeks, we've crossed above our two moving averages here. We did have a red day yesterday, but it looks like today should do pretty decent for us. When we go to the one day 10-minute candle chart, you can see that we're definitely up in the after hours, which is very nice to see. We are on a gradual, Wow, very gradual, bullish trend line right here you can see boom, just like that. So we're going into bullish direction. We obviously want to trade McDonald's to the bullish side, which is really nice to see. So I'm going to be probably watching McDonald's, the break of this pre-market high, which is now establishing a bit of a resistance level around to 65. I'm looking for the price to come up above to 65 and hopefully ride this up throughout the day. It looks like we could have some support it to 61. So possibly we're trading in a little bit of a channel right here. We're going to have to wait and see how we open up. But McDonald's to the upside, Shopify to the upside. And metal platforms to the downside is sort of what I am thinking this morning. So what I'm gonna do now is I'm going to open up three charts. One with all of these companies. I'm also going to open up my charts that show me the indices and the VIX. As soon as we see that the market is going up or down. Hopefully that gives me confirmation for one of these stocks to get into them with a good risk return ratio and a good trading opportunity. Now before we do that, I just want to take another quick look at anything else that is happening in the market. So we'll go to Yahoo Finance here just to see if there's anything else that we need to be aware of. Again, Meta stock is crashing GDP rebounds in Q3, which is very nice to see. I do think that's going to have a positive impact on the market. And it looks like Ford was sliding after release and they affirm their low guidance, that is not good for Ford and that's honestly, in my opinion, not good for the car industry. Let's just take a quick look at how Ford is doing. I believe they're just TickerSymbol F and it looks like I was right there. They're down a little bit after hours. Let's again zoom this out to the six month charts, See how the company is doing in general. We've got a high of $25 here, which is pretty high. We got to a low of $10 here, which means this stock, you're literally went from $25 to $10 in a matter of like six or eight months here. That is pretty insane and pretty dramatic here we've got some resistance around $16. We came back down to $11 here. It looks like we're breaking out through our previous high rate here at 12, 60. And it's been a good couple of days for Ford here, but it looks like that could be coming to an end. As we zoom in here to the 10-minute candles, you can see the stock is down in after hours. They didn't have great guidance. So it'll be very interesting to see where this stock goes today. I personally think it could have a bit of a tough time because any of these companies that don't have good guidance are definitely taken a hit. So right here you can see major resistance at $13. We've got possibly some support at 12:39. Here we will see where this doc opens in a few minutes here. We've got about 9 min left. 68. SHOP- Managing a bad trade: All right, everybody, welcome back to the trading floor. It is currently 08:06 A.M. Calgary time. And I've got my first trade here that I want to take advantage of. It is going to be on Shopify and shelf. I had a huge rally to start the day up to 33, 84 came back down, took a break, and now it is starting to rally. And I'm looking for the breakout of this previous high rate here. As you can see, the S&P 500 is going through a bit of a rally right now, coming back to the opening levels, we are also seeing the same thing from the Dow Jones, a nice little rally over the last ten to 15 min here. And if this continues, I want to buy into Shopify for the breakout, the previous resistance. Now that does not mean that it is going to happen for sure. But what I wanna do as a trader is just be prepared in case it doesn't. So as we set up this trade here, I want to enter the trade when the price crosses above 33.95, that's gonna be my entry price is 33.95. And I'm going to set a profit limit of $35 so that we have about $1.05 worth of room there to profit on. And we're gonna get out of it. 133.50. So that if it falls back below that level, is going to exit our trade. Now in order to get into this, I'm going to click on Buy, is going to ask me to confirm the order right here. I'll just move this up for you. We will click on Send order, and now it has got our levels in there. So as you can see, we've got an order to get into the trade right here at 33, 95. We've got an order to get out of the trade as 33, 50 in case it comes back down. And then we've got our take profit here at $35. So we're going to let this sit for a little while. We're going to see how it plays out and we're gonna give it some time. And if the market starts to turn around, I'm actually just going to cancel the trade and get out of it and not let it execute the trade. But we're going to be patient with that. We're going to see what happens. And if this continues to rally, we are now in a position to take advantage of it. So we will see what happens. We're seeing some nice price auction here from Shopify. We're at 33.85, so about $0.10 away from getting into our position right here. Hopefully that happens and hopefully it continues to rally. It'd be absolutely beautiful to see, but if it doesn't, well, that's okay. We only have a $0.45 downside per share on 70 shares. So the maximum we can lose is about $35 here, we're only trained with small numbers right now, so we're doing well, we're playing it safe, and it looks like this is probably going to hit, I expect this to hit, or $0.04 away or $0.01 away from hitting our mark right here. So we'll see what happens. Oh, I guess we were about $0.10 way, not 33, 33, 95. That is going to be our entry point. It looks like we're getting a small little rejection here at 33, 90. So that is very interesting to see like this. This one could go either way. We could get fully rejected here, or we could see the breakout as of right now, the Dow Jones, the nasdaq, things are moving in the bullish direction. We've seen a nice little rally, but they've tapered off here in the last couple of minutes, sort of to be expected. We'll see what happens with Shopify stock here. We're not in a position yet, which is great to see. But if this rally continues, we are well set up to be in position and take advantage of it. So as you can see here, we've got a little bit of consolidation up here around this same level, which is very interesting. We also have two very large volume candles right now. So that is a good sign. It shows that there's a lot of action happening right here. And if all of these sellers get bought out, the stock is going to continue to rally. Our indices are doing okay. The VIX is actually moving down, which is a good sign for us. And I'm pretty okay with this trade at the moment. We will see if it executes. Okay, so our nasdaq index is actually running higher rate now the S&P is also rallying extremely hard right now, which is good to see. And if you look at the Dow Jones, it is also going up. Now it is approaching a little bit of resistance around here. But in the last 2 min, all of our indices have seen a nice little pop. We haven't seen that come through and Shopify stock, which is actually really interesting here, but the VIX also continues to move lower and lower and lower and add a nice little rally at the beginning of the day, but it is moving lower, which should be good for us, should give us some confirmation here and look at this. We're at 303-90-3904 at the highs. It looks like we're probably going to get triggered here any second. We will see what happens. Everything is moving higher rate now though. So this is good. This is exactly what we want to see and this is good confirmation for our position. So it's giving me a lot of confidence to hold this position because I am expecting Shopify to move up with the rest of the market. So here if you look at level two, you can see this is moving up and up. There we go. There is our order right there. And you can see that all of those orders, 3390-99, all got filled in just a couple of minutes there there was a big order that went through there. There's a lot of people getting into it. Now we are into our positions. Stock is at 33, 99, we are out of it at 33, 50, and we're looking for a take profit at $35. That is a pretty high take profit on this one. So I may end up moving that lower. But as of right now, we're doing okay. It looks like we have some good momentum here. Everything is moving up. If you look at the S&P 500, we are moving up right now. If you look at the Dow Jones right now, we are moving up. And if you look at the Nasdaq, it is moving up as well. So that is good to see. We've got good market confirmation on this trade. We have got the v6 moving lower and lower, which is exactly what we want to see. So as of right now, everything is pointing in the right direction for this trait. Damp, if you look at Ford stock to four, doesn't just a massive rally this morning. This is actually kind of impressive, like just looking at this, stock opens at 12, 75, drops down at 12:42, rallies up to almost $13. That is a pretty good rally that we're seeing from Florida right now. So very, very interesting there. And our Shopify trade continues to move higher, which is nice to see wrath 33, 15. Right now. We're going to remove this trend line. And we might even convert this into a trailing stop-loss here soon. And just let it see how far it will write up. We're at 34, 20 right now we're doing okay. We're up a couple of percent on this right now, which is absolutely beautiful. And we're getting closer and closer. So we'll see if we hit our $35 take profit target. That'll be absolutely beautiful. We're actually not too far away from it and the stock just continues to rally here. We're going to let this one play out for a little while. We're going to be patient with it and kinda see where we end up. Alright, here we go. We're starting to move higher a little bit. We've got our indices moving up are currently at 34, 42. So we're up a couple of percent on this trade already so far, which is absolutely great. And we'll see what happens here. I'm considering moving this stop-loss up a little bit, but I don't think we're quite there yet. I'd like to see this break above $34.50 before I move it up and at least lock in a breakeven trade here. I do want to give this room to run though, because Shopify had great earnings, we have positive GDP numbers coming out. So I think that the wind is at the back of this company and I think we could see continued progress throughout the day, but I also don't want to get greedy, so we're going to be patient with it. We're gonna see what happens here. And if we get above 34.50, then I might start to lock in using a trailing stop-loss. Oh, oh, we've seen a little bit of a pull back right now. Because I didn't move that that stop-loss up too early. We may have been hit. Actually, we definitely would have been hit if I had put it back to the breakeven level right here. So that is not a good sign. We're kinda backwards if you started about 20 min later. So this trade is definitely going a little bit slower than I had hoped for and not necessarily to plan that big red candle there kinda screwed us over, but we're going to stay patient with it. We're going to keep giving it some time. We had a game plan going into this. Our game plan has not folded, it has not cracked, it has not being proven wrong as of yet. So we're gonna be patient with this. We're going to hold out and we're going to let this just sit here and wait until we know or we have confidence in what is happening because as of right now, the S&P 500 continues to move up. The nasdaq is doing pretty good and the Dow Jones is also moving hires. So as of right now, we do not have confirmation of the market going against us. So I don't want to get out of this trade too early. I just wanted to be patient with it. I want to let it sit and let it rest. The VIX is going up a little bit, so that's not in our favor, but as of right now, all the other indices, the nasdaq, the S&P 500 in the Dow Jones, are still holding up strong. So I don't want to cut this trade just yet. Okay, So we've been in this trade for a while now and it looks like we've basically just formed a channel rate between 34, 50 and this 33, kinda 85 level, which is sort of where we entered in. So it's been a very slow tray. This is taking much longer than I had hoped that it would take and I'm trying to be as patient as I possibly can with it. I haven't moved our stop-loss up yet because I think we've got a key level of support right here that we've tested recently. And I could see us testing it again. So I don't want to move this up yet, but I also don't want to be in this trade for like 4 h today. So I'm going to be patient with it. I'm going to give us some more time. We're going to let it develop and progress. And so far I hypothesis and our prediction and the reason we got into the trade has not broken down yet. So I don't want to go against my plan. I just got to be patient with this and you know what? Sometimes this is part of the game. Sometimes it's not going to happen in the time period that you're expecting. But if your strategy hasn't broken down yet and your reasoning for getting into that trade has not changed yet. There's no need to rush, there's no need to panic. You can just sit back, relax, do a little bit of market research. Keep your eyes on the stock chart and just be patient with it and we'll see what happens. Okay, So this is kinda cool here. If you look at our indices, they're all starting to just slightly move higher right now so that there was the Dow Jones. Let's just see if I can drag up the nasdaq here doesn't look like it's going to lend me. So that was the Dow Jones. Here's the spine right now, as you can see, just slightly moving higher in the last couple of minutes. And here is the nasdaq. So again, just slightly moving higher in the last couple of minutes, we will see if this continues and if it does, I do expect that to play out well for Shopify here, as you can see, we just said a new high of 34, 60. So we're still moving in the right direction. We're still moving towards our take profit level that we had set in the beginning, our original take profit level, and we've still got good momentum. It is just taken a whole lot longer than, than we had hoped for, but we will see what happens here. Okay, So at this point, we're starting to see all of our indices selling off and the VIX is starting to really move higher. So what I'm gonna do is just protect my downside a little bit. We're going to move this stop-loss up to 34. Let's just go 340-53-0404, something in there just enough so that if it does get hit, it's going to cover are commissions. I'm going to click on Send order here. If it does get hit and we lose on this trade, It's no problem. We're going to cover are commissions and we're going to break even, at least on it. So our absolute worst-case scenario right now is breakeven after commissions. But if we make money on it, it's pretty much 100% upside. We have no risk in this trade right now, and we've protected our downside. And as you can see, Shopify is now selling off and look at our indices right now. So if you look at the Dow Jones right now, it is selling off. We did not get that balance that I was looking for. If you look at the Nasdaq right now, it is selling off pretty substantially. If you look at SPX right now, the S&P or SPY, sorry, at the S&P 500 Index, either one will actually work. It is selling off pretty hard right now. And as you can see, Shopify is now selling off in a couple of minutes. This is why we want to look at the indices. This is why we want to have them open on our charts, our screens, and this is why we want to protect ourselves from the downside. If this trade goes against us now we are completely protected. We will have wasted a bunch of time, which is okay, but we're not going to lose any money we're going to cover are commissions. It's not really going to be a big deal. The problem though, is that if you don't do this and it just continues to sell off, now you've wasted a bunch of time and you've lost money. So something to keep in mind here. And the main reason that I'm doing this is because all of the indices, all at the same time there were starting to just print read. They were showing big red candles and they were selling off hard. In that event, more than likely. And a lot of the times you're going to also see a sell off in whatever stock you are trading. And as you can see, we saw three big red candles right here exactly while that was happening. So as I see that, I'm moving up my stop-loss. I'm protecting my downside risks. And luckily we're seeing a nice little recovery right now. So something to keep in mind, they're definitely something you should be considering and managing while you're in your position. Yeah. We just got hit. There goes our order and there goes almost an hours worth of time. But you know what that is? Okay. We've protected our downside. We got out at pretty much breakeven we probably ought or commissions covered. I'll have to double-check on it. We didn't lose any money and you know what, sometimes that is just how trading goes. We, we ended up buying in and then we sat in a channel here for an hour. Very unfortunate, but you know what? That's how it goes. Sometimes you win, sometimes you lose some. At least we've protected our downside. We were able to manage our money, we were able to manage the trade. And now we've got all of that cash that we can go and deploy into a better opportunity hopefully. So hopefully you learned something out of this video, sorry that it took so long and sorry that it wasn't a nice dramatic finish like we're all hoping for, but you know what? That is? The reality of trading. Sometimes you went to trade, sometimes you lose a trade. And at least in this scenario, we've protected our downside. So we didn't lose anything. We came out pretty much breakeven. And now it's just about keeping our focus, keeping that mentality, and getting ready for the next opportunity. So we'll see you guys there. Hopefully you got something out of this video and we'll talk to you soon. Alright, everybody. So I'm editing this video right now and I've just watched everything back and I've got some thoughts about what I should've done differently with regards to this trait. And I thought I would share it with you in this same video because it just makes sense. So what I should've done differently here is number one, when I identified that the stock was now trading within a channel, you saw me identify the support and resistance levels there. That is when I should have changed my strategy and I should've adjusted what I was doing. I identified the new pattern, but I didn't change what my strategy was and that was my problem when we're trading within a channel, you want to buy it on the bottom and sell it at the top. Well, for us, we had already held a position. We are already in the stock, we are in it before it even got into the channel. So that was good for us and we should have taken advantage of that and sold at the top of the channel, their stock had bounced off the same level a couple of times and got rejected and came back down. Unfortunately, we held it all the way down. What we should've done is realized that we were trading within a channel. And when we got to the top of that channel, we should have either trimmed our position or sold out of the entire position and just locked in a smaller amount of profits. That is the way that I should have handled this trade. And unfortunately, probably because we were filming, maybe I was a little bit flustered and talking to the camera. I decided that I wanted to hold it and try and hit the original profit target. And that just wasn't the right strategy. It wasn't the right way to manage this trade. And what I should've done is said, okay, the strategy has changed because the pattern has changed. Therefore, we need to adjust what we're doing. We've got resistance at this level and when the stock approaches that level, I shouldn't be taking profits. That's how I should have handled it. And I just wanted to jump in here and share that with you. And also, this has been a wonderful exercise for me, recording my own trades and then watching them back. So I highly recommend it because I think it's very helpful to see what you were thinking at the time, how the end result played out and what you could have done differently. This has actually been very helpful for my trading. Highly recommend it for your trading as well. 69. Outro: Alright, everybody, You have made it to the end of the course. I just want to say congratulations and thank you. Thank you for watching my content. Thank you for watching all these videos. Thank you for going through the exercises and putting in the effort. I sincerely appreciate it and seeing the students come to this course truly gives me a real sense of joy. Now to help you out on your next steps and your path moving forward, I've put together a list of trading resources and links. You'll be able to find this in the projects and resources tab of this course. And starting us off here, you can join my discord chat. You can also book a call with me. Those are the first two links. So if you want more access to me, what I do, my training and my philosophy, those are the two links you want to check out. You can also check out more of my content on YouTube and TikTok. And if you want to take anymore of my courses, I'm putting everything on Skillshare and it's completely free under that trial. Otherwise, you just paint a subscription to Skillshare and you get access to everything including my other five courses right now, hopefully more in the future. Now if you're interested in getting opened with the broker, here are my links. Each one of these links will give you a little bonus in terms of free commission or a deposit bonus or free stocks if you're in Canada, I recommend Interactive Brokers request trade. If you're in the United States, I recommend Weibull or Interactive Brokers. Scrolling down here, I have also inputted the two training journals that I recommend. You can also get free access to the Excel sheet trading journal that I will also upload to this course, so everything will be there for you. I highly recommend starting your trading with a practice account. I personally use the Trade Practices count, but you should bid to find a variety of different practices accounts. They will all do pretty much the exact same thing. You need to start with the practice count before you start trading with real money. And if you're interested in any useful websites that I use for my trading, I usually go to Yahoo Finance for market news. I go to earnings whispers for earnings news. And I go to this link right here for any economic events that are happening today or in the future. So that's how I kinda prepare for it. If you need any more links or any more resources, leave a comment on this video and I will upload it. I will make sure you get it and I'll make sure it is accessible to everybody. Thank you so much for watching this course and if you've got any value out of it, if it helped you in any way or if you have feedback for recommendations are improvements, please consider leaving a review. I really do read every single review. I take them to heart and if there's a way that I can improve the course, please let me know. I sincerely appreciate it if you have anything positive to say, I'd really love to see that too at warms my heart. Thank you so much. Thank you for everything. And we'll see you guys in the next video. Hopefully we'll see you in the next course are on my YouTube channel or in the discord chat we'll see you around. Hopefully this won't be the end. Take care and talk to you soon.