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The Fractal Exchange Florida Meetup | Russell & The Quantitative Fractals System — Transcript

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0:00been splicing
0:02and
0:05to get these wild moves. Let me bring it
0:08up.
0:17So on our on our graph, I don't know
0:20when I send these out if this makes a
0:22freaking any sense at all. This probably
0:25just probably looks like garbage and
0:26it's like what are all the things and
0:30says monthly expiration up there and
0:33like what does all that mean?
0:36So
0:38this is showing us the relative position
0:41of each session on expiration day
0:46if if that makes any sense. So if we go
0:49back this is 5 years.
0:52So if we look at all the monthly
0:53expiration days, Fridays over five
0:57years,
0:59and again we're using data normalization
1:02cuz we want to we want to get an edge on
1:04the market.
1:06You know, you take 99.99959s
1:09of the traders out there. They can't
1:11find that $7 to $128 trade, but we
1:15could. [clears throat and cough] So that
1:17puts us at the pinnacle of traders.
1:21And the way the way we can do that is
1:23through this system.
1:26So every expiration on Friday is
1:30represented by a candle that is that
1:32daily session on that expiration day.
1:38And we are again dividing them into bull
1:41and bare moves.
1:46So, I'm not sure if that's making any
1:48sense, but we're taking our data and
1:51we're creating a nonlinear graph out of
1:53it and we're seeing our relative
1:55positioning of every session on that
1:58Friday for expiration.
2:02Now, and this gives us one type of trade
2:05setup.
2:08So, we're seeing, you know, whatever
2:11Friday this was that we were a 5H. And
2:14that just means we were 1 2 3 4 five
2:18sessions above the pivot. That means if
2:22we go back in history and look
2:25consecutively
2:26those sessions on that Friday for each
2:30of those month was ending higher and
2:32higher and higher than the previous. So,
2:34it was stair stepping up.
2:40So that means
2:42last what are we now? September. So that
2:46means October
2:48or excuse me August
2:51um at that monthly expiration
2:55in August we were right here. Now
2:59because we're uh keeping track of the
3:02odds,
3:03right? So if we want to
3:07let me pull this up. So have the thing
3:09called the OA the option analyzer.
3:15So it's tracking you know the H's
3:20consecutively.
3:22So in August we were here 1H.
3:27Now, the odds changed a little bit
3:29yesterday, but yesterday the predominant
3:32direction was long up. So, to make a lot
3:36of money yesterday, I was at Animal
3:39Kingdom checking my phone for my trades.
3:43To make a lot of money yesterday was the
3:45Vout and up. That wasn't the short side.
3:50The short side was just kind of like the
3:53precursor to the long
3:56just to wash it out. And the reason was
4:00if you go back on Discord, I said the
4:03odds on Friday were 60%
4:07that we would have an H2 because it was
4:1060% historically. And what we want to do
4:14is we want to be the casino
4:16and we want to bet with the house. We
4:19don't want to bet against it. So
4:21yesterday the odds now it's again
4:24changed but the odds are 60% for an H2.
4:28That meant yesterday
4:30patiently watching for the long side
4:32signal line generation
4:39as we're seeing here. So, we start to
4:42see the long side because you could see
4:45the long side was much more powerful
4:47than the uh the short side because the
4:50short side started down here and we
4:53hadclipsed it to the long side. So, um,
4:58before I went to the theme park
4:59yesterday, I was putting in my trades,
5:01getting everything ready, and I, you
5:03know, set up these graphs. And this was
5:06one of the high leverages I put in cuz I
5:09know if we can get 724, close to 724,
5:14this guy freaking make us a boatload of
5:16money and then we'd all be rich today.
5:21So,
5:21>> what do you mean? I am.
5:25Then it worked
5:27and then so that meant ES.
5:31So I put ES over here. ES comes down,
5:34washes out, goes up.
5:37And these dotted lines are the key
5:39lines. This dotted line in the NASDAQ.
5:42So the entire market really is moving
5:44around to NASDAQ.
5:46And uh once we could break through the
5:48dotted line, then it would kind of rock
5:50it up. And here's our theif 15 minute.
5:53And then down here's the five minute.
5:57So
6:02if I go back over here,
6:08so again, this is showing where our end
6:11points are. So we always get an L and an
6:16H, right? Because the way the system's
6:18working, we're always oscillating
6:20between those.
6:22So that means
6:24um yesterday was 60% to an H2. So we
6:29subtract 60% from 100 giving 40% odds
6:33for an L1.
6:37And um so prominent direction long. Now
6:42this is kind of showing standard
6:44deviation,
6:45right? Because it here's the tails. The
6:49tails are over here.
6:51So it's showing us how the institutions
6:53are moving price around
6:56and then over here we see it as a
6:58histogram.
7:00So we can see that when the moves are
7:03long
7:05on the splicing for monthly
7:08that they're ending at twos a lot of
7:11ones.
7:13And if they can by get, you know, get
7:15past the two,
7:17then it seems like, you know, you can
7:19have up to five, six or four
7:21consecutive.
7:23One of them went seven where the monthly
7:27expiration is ratcheting up.
7:33So again,
7:36now
7:38here, here's another thing. It's a
7:40little hard to go backwards, but
7:43this is another thing I'm looking at on
7:45the histogram. See how high the um bars
7:49are?
7:51So, this one and you can see these ones
7:54when it's defined to one H. If we have
7:58a compressed level, like if we drew a
8:02line across here, there's a minimum bar
8:05that's usually achieved.
8:08And
8:11I look for the underperformers if it's
8:14underperforming.
8:22So I can set that there. So our last 1H
8:24was underperforming
8:26from August. It was down in here
8:30somewhere.
8:33That meant also to me, this is a
8:35secondary indicator that
8:40we haven't even since we were down lower
8:43here Thursday.
8:46Unfortunately, I didn't paste this into
8:48the Discord, but um we were
8:50underperforming all the other ones. That
8:53meant to me there was still uh dry
8:56powder in the market for us to head
8:58higher on Friday. also as a secondary
9:02indicator that we could move up and have
9:07a big move like that and make a lot of
9:10money
9:12as we did. So, we hit a two and we
9:15didn't quite get to this two and and
9:18this is a I have this problem too. When
9:21I look at the data, I want it to hit my
9:24past points and go higher. So for me,
9:27I'm like, you know, I started getting
9:29all drooy like, "Oh boy, I want to hit
9:32that, too." You know, and um but
9:37uh it underperformed a little bit than
9:38what I was expecting. But at any rate,
9:41the thing was we can still craft the
9:43plays to make plenty of money off those
9:45moves. We don't have to get a perfect
9:48move. So when you're looking across here
9:51and you're looking at prior ones on the
9:53histogram,
9:55you know, and I know some of these, you
9:57know, like these are almost symmetrical.
9:59These are almost symmetrical. I know
10:02there's a lot of, you know, you look at
10:03that, there's a lot of evidence, okay,
10:05we may have a symmetrical, too, so we
10:07could perform and get way up here and it
10:10could be the case. But at any rate, if
10:13you know, you see with our vector line
10:15and our coloration,
10:17we just if if we have an idea kind of
10:20playing horseshoes, have an idea of
10:22where we're going to, you know, we can
10:23still craft plays to make plenty of
10:26money off the moves.
10:29Um,
10:36so to figure out see like how can we
10:40figure out 724?
10:45So I'm going to back up.
10:49>> Quick question, Russell.
10:50>> Yeah,
10:51>> I always notice on you I always have the
10:54percent bands on on the side and
10:58And most times than not, well, I don't
11:02ever really recall you using them much.
11:05>> Um, I'll toss them on sometimes.
11:08>> Yeah.
11:09>> So, I won't always like sometimes in the
11:11background I'm doing stuff and then when
11:14I post it in Discord, I show like some
11:17more simplified. But
11:21here what I tend to do is I tend to look
11:24at these imprint things over here
11:27>> and maybe the open states too. Is that
11:30>> Yeah, I use those a lot
11:32>> because by definition
11:35bulls want to go to the most recent high
11:37and then the next recent high and the
11:39next. That's why open states work.
11:42>> And another important thing all these
11:44open states here. So people will come in
11:48and the first thing is oh well how do I
11:50back test I could care less about back
11:53testing cuz I don't that's great
11:56whatever happened
11:58you know like people use RSI and MACD
12:01CCI and all these things to back test
12:04that's great but that doesn't tell me
12:07about the future [clears throat] I know
12:10bulls want to seek out because when
12:13you're trading you're seeking out levels
12:15you want to seek out the most recent
12:16recent highs and go higher. If you're a
12:18bear, you want to seek out the most
12:19recent lows and go lower. And the proof
12:23is on the graph.
12:25These are all forward tested cuz this
12:28close line existed before this price
12:30action got here. This close line existed
12:33before this price action got here and
12:35above.
12:37You know, it existed before here and
12:39above. That's existing before price
12:42action has ever test uh hit it. And also
12:46this
12:48is solving another problem. When we're
12:50at all-time highs, we're actually
12:52projecting and calculating amount in
12:54front of us. And other people are using
12:57like Fibonacci or they're using Elliot
13:00wave or
13:02whatever fib uh spirals and
13:07you know rays
13:09on 90° 45° whatever to figure out this.
13:15We're actually taking the data, the
13:18market moves, and forward projecting
13:20them because all we care about is what
13:24these clowns at the institutions are
13:26doing to take their money. So, if we're
13:30seeing that they're moving something 6%
13:33time and time again,
13:35I mean, that's golden.
13:38You know we can see over here for
13:41monthly expiration
13:44like these imprints these are marking
13:47where we had you know the counter trend.
13:50So I can take this imprint I can go
13:51across and I can be like oh it matches
13:54this one H
13:58right here and then I see oh on the next
14:01expiration you know it was like way down
14:04in here. So since that occurred it mark
14:08that top so that we know it pulled back.
14:12Now what I'll do too in the discord is
14:15an exercise I'll label these. I'll go
14:18like oh it's 1 2 3 4 5 6 7 8 9 10 11 12
14:2313.
14:25So if you label them and you say okay
14:26there's 13 counter trends you can take
14:30that and divide them in half. To your
14:33point, George, it's like I'm doing it in
14:36my head mathematically.
14:38>> Those bands, those cluster bands, that
14:40little indicator, it's just doing the
14:43math for us.
14:45But a lot of the times like I want to uh
14:49do a mental exercise and count them up
14:52and be just really aware of this because
14:56if you
14:57>> Mhm.
14:58>> if you break these into components,
15:01you know, you have three here, three
15:03here,
15:04you know, then you have a center
15:06component.
15:08And I'm just doing it visually, just
15:10looking at it. I just uh those other
15:12ones are just aids to help
15:14>> Yeah.
15:15>> people to figure because when you first
15:18when I first put this on Discord, I got
15:20into that boiler room trading during CO
15:23cuz we had that lockdown. It was just
15:25boring at home. So, I happened to I
15:28watched a lot of music videos or listen
15:30to them. And there was an ad in there
15:33for boiler room trading or Discord,
15:35something like that. So, I clicked into
15:37it
15:38and uh I saw people posting on Neo and
15:42Tesla and all this stuff and they were
15:45just posting regular graphs and I was
15:47like, "Oh, that's kind of interesting."
15:49So, from time to time I would post some
15:51of these graphs and then I'd have people
15:53start to ask for them and so I'd post
15:56them and I started to have more and more
15:58people ask for them. And then I had this
16:00guy, Greg, he goes, "Oh, can you join
16:04our Discord with Brad who does stock
16:07analysis for hedge funds and stuff?" So
16:10I was like, "Okay." So I got in there
16:13and Brad was always asking for certain
16:16graphs to see it in this format.
16:19>> And then eventually I put up a server so
16:22people could do them themselves cuz it's
16:24kind of hard just to keep pulling graphs
16:26through the day. And uh but uh so that's
16:30kind of how I got all this up there.
16:33And uh
16:35I didn't really know people would care
16:38too much for him, but Oh yeah, I have a
16:41question. Russell, so in this particular
16:43scenario with the slicing, so obviously
16:46we're looking at the fractor graph and
16:47you had your thesis. So let's say you
16:49pull up spread monster and you saw that
16:51retail was slamming calls for that day.
16:55Would that change your outlook or would
16:56you just say, "Hey, I think because I
16:58have the chance that the H2
17:00>> did that play into your thesis?
17:03>> Yeah. So, there's competing interests.
17:05>> Yeah.
17:06>> So, one interest is like, okay, there's
17:10uh the call side's heavy and then the
17:13other thing is, oh, there's this
17:15oscillation that's occurring.
17:18So, it's two different bets you have.
17:23I always break it down like that. If I'm
17:26using this, I'm betting this. If I go
17:29into Spread Monster and I'm using like
17:31Net Dealer or something, I'm using that.
17:35But to your point, yesterday
17:38knowing that,
17:39so
17:42um
17:43I went into Spread Monster to see where
17:46the block is. So, I'm not sure if
17:48everybody's aware of what's going on in
17:50there, but you have this thing called
17:54net dealer
17:56right
17:58here. And it's uh done by this uh center
18:01point.
18:03There's a block that surrounds it of
18:06numbers.
18:08And it's nonlinear in fashion. That's
18:11why the C won't sometimes be in the
18:14center.
18:16And everybody needs to be aware that you
18:18know the writers as I always mention uh
18:22Mil will mention it they're always
18:25trying to crush premium.
18:29Now
18:30that means there's a zone of premium
18:32crush and that's the block. So yesterday
18:37I mentioned we're starting to get into
18:38the block.
18:40So yesterday regarding spread monster I
18:44can't remember where it started. 716 or
18:47something like that went down to
18:48whatever. So the price came down into
18:51this zone. It did not hit the net dealer
18:54and then it veed back out.
18:58What's happening is when it's coming
19:00into this 80% block,
19:04they're able to start to escape
19:05positions and collect on premium.
19:09and then the other suckers that are
19:11buying them don't realize that they're,
19:14you know, giving them the money that
19:17they're making money off that move. So,
19:21it did hold even yesterday. It did hold
19:25true to what would be in the spread
19:27monster thing because we got into the
19:30block cuz the premiums,
19:33you know, you'll see in spread monster
19:35they'll be I don't know something like
19:39this. So this is the call side and then
19:43here's the put side
19:46and
19:48and then and then we have to net all
19:50that out. That's why there's a net
19:52dealer over here to see more precisely
19:57um where we're going.
20:00So over here, if you look carefully,
20:02there's the set of numbers.
20:05If you guys kind of know what I'm
20:07talking about. Yeah. So this is where
20:1280%
20:14greater than 80% crush starts occurring
20:17is when we get into this zone.
20:21The best move is when we get into that
20:23zone
20:25is to drop to the bottom of it.
20:28But just to get into the zone starts to
20:30let us know that they can start profit
20:33taking on the calls written out
20:38or the puts written out. It goes both
20:40sides
20:44now to get to the 724.
20:50So [clears throat] this is relative
20:51positioning of all the monthly
20:55sessions.
20:57So what I did was
21:00[sighs]
21:02knowing the imprints or marking our
21:05highs before we get back underneath the
21:07pivot. I on Thursday came over here and
21:12I started approaching the first
21:15imprint right here price memory.
21:19So I went up
21:21and I got within
21:24again this is kind of horseshoes just
21:26went with within a comfortable margin of
21:29it as I moved up to it. So you can see
21:31the imprint right here the bottom one.
21:34So this is August. So now I need to
21:37figure out September. So I'm like, if we
21:40get an H2 in September,
21:43let's have an assumption that we're
21:45moving towards the past imprint at a
21:47minimum as the lowhanging fruit. So all
21:49I did was I moved the cursor up towards
21:51that imprint on the right, the price
21:53memory, and I started seeing, oh, we're
21:56in the 723.
21:58As we approach it, we're starting to get
22:00to 724. So I'm like, okay, we have a
22:03good shot at getting at 724.
22:06Now with that said, I'm also
22:13there's a rhyme and reason to a lot of
22:15the times these bodies. You see how this
22:18body here is the same as the body there.
22:22So I'll also look at that. I'll look at
22:25are we approaching because this becomes
22:27resistance.
22:30You can see that as our um
22:34line starts approaching,
22:36we start hitting the bottom
22:40of prior sessions, the lows, the bodies
22:43of them, and those become resistance
22:45points. So, we have to pop up through
22:47those.
22:49So, it's just it's just this is an
22:52experience thing.
22:55So all you do is you just watch your
22:57imprints, move the crosshairs
23:02heading up to the next imprint, and
23:03you'll see these gaps.
23:06So sometimes what I'll do is I'll take a
23:08gap. So that distance here, I'll use
23:13that as the distance underneath
23:16just if I want to do lowhanging fruit
23:19and be more.
23:22So that's almost where the dotted line
23:23was. This dotted line which marked the
23:26high yesterday
23:28almost has the same gap as this here to
23:32that gap.
23:35So I'll do that too.
23:40>> Yeah. I like the idea of treating them
23:42as a zone.
23:44>> That's all they are.
23:45>> Yeah.
23:46>> It makes it real simple. It's like, so
23:49here's yesterday's session relative to
23:52August's
23:54session.
23:56And again, this is one trade. The reason
23:58I'm picking this is because on Friday,
24:00we had that monthly expiration.
24:03So,
24:05you can use the system to find other
24:07trades, too. But this is just one I was
24:09looking at yesterday.
24:11Yeah. So, we're looking we're looking at
24:14these zones. I know
24:16because this is giving us a really good
24:18idea of what's happening. I know that
24:21probably getting 800 956 yesterday
24:25probably not going to happen cuz I'm
24:27looking back over here and I'm seeing
24:29all these other sessions. So I'm looking
24:31at again I'm looking at the prior 1h's
24:35and then I'm looking at the prior two
24:36hes and I'm just for lowhanging fruit.
24:41I'm just going up to the last imprint,
24:45you know, and just finding what that
24:47value is.
24:50So,
24:52I hope this is making some sense at all,
24:58you know. And then again, coming over
25:00here and just
25:02crafting plays. So that means if
25:06I'm at if I'm using a 724 as a target,
25:10all my strikes for derivatives have to
25:12be underneath there
25:14that I did. So you know 720 cuz
25:17technically at 724 this 720 gives me a
25:20$4 profit range
25:26now. So that's all I'm
25:29doing on that.
25:33So now I can go to the uh
25:37Okay, so switching gears.
25:40[snorts]
25:41Stocky jockeyy's been showing
25:44this cycle analysis.
25:48So I did the video on making, you know,
25:502,000% 3,000%.
25:55And uh that video was not to say, you
25:58know, to try to make 2 or 3,000% off
26:00those. It was just that this is what can
26:03happen. And some of those have been like
26:055,000% some 1500 some 100%.
26:12Now
26:14what we're doing here is he calls it the
26:17H1 L1 move.
26:22the market, it tends to trend
26:26for a while and then eventually there's
26:29a breakout long or short. And this is
26:32showing us the trend,
26:34you know, so it's like a confined
26:37and you can see like this low was
26:40eclipsed,
26:42you know, but you can see here that
26:45there it's kind of stupidly repetitive
26:50up and down.
26:54Now,
26:55so what that means is we can exploit
26:57that.
26:59And there's a thing called gamblers
27:01fallacy, you know, where you're playing
27:03roulette, red or green, and people are
27:05like, "Oh, you can't have more than
27:07three greens in or three reds in a row
27:09or four blacks in a row or whatever, you
27:11know, and they bet the opposite."
27:16So that's what this is about. Gamblers's
27:18fallacy. It's that when we get to this
27:21level up here,
27:24you can see across you bet opposite for
27:28the next day. Now, what I'll see people
27:30do is, and I'll try to be like, don't do
27:33it that way, but what I'll see people do
27:35is
27:37if we're green, let's say here
27:39somebody's going to bet opposite for the
27:42next session, they'll go in early. Well,
27:45if your daily sessions green, that means
27:50heading to 4 pm you were green. The
27:53price action was elevated. So, your best
27:55bet is to put the contract on near the
27:58close, not intraday because if the
28:02trend's long, but you're trying to bet
28:04with a put or short, whatever,
28:07>> chasing.
28:08>> Yeah. So, you're better off waiting.
28:11So
28:12you know on and
28:15you know these are crazy because
28:18depending upon how deep the pullback or
28:21how high the extension those contracts
28:24will move you know hundreds or thousands
28:26of a percent overnight
28:29>> it's easier for the traders to move the
28:31market overnight than it is in the day
28:34because the liquidity is less.
28:37Have you even waited until the a.m.
28:40>> to see
28:41>> Yeah.
28:42>> which way it's moving and then you know
28:44you'll lose a little bit.
28:46>> Yeah.
28:46>> You'll be more time.
28:48>> Yeah.
28:51>> Yeah. Yeah. Everybody's trying to get
28:53one up on another.
28:56So, um
28:58you know, like stocky jockey is saying,
29:00"Oh my god, I did I think 10 trades." He
29:03goes, "I only lost two."
29:04>> Yeah. you know, for example. So would
29:08you say a good tell would be too is if
29:10you so that one daily would it always
29:12oscillates very quickly maybe 760
29:17maybe the 105 and then the 25
29:22intraday to see
29:24>> as a maybe a cluster to see which way
29:26we're kind of going
29:28>> you to
29:29>> yeah you can you can do that if if it's
29:33heavily clustered there's a lot of
29:34density
29:36>> then It's signifying that they've been
29:38rejecting there and okay
29:39>> sending the trade the opposite way.
29:45>> Yeah. And what I do here is which for me
29:47is key. I look at where the halfway mark
29:51is and here it's like H2 is the halfway
29:55mark. So I know
29:58let's say I'm betting counter trend
30:00here.
30:02And everybody realizes this represents
30:04the pivot. So, from this pivot,
30:09from the L's
30:11coming around, 100% of the time we're
30:13going to get an H1 sooner or later. We
30:16don't know when, but we will get one.
30:19From the pivot to an H2 is happening 52%
30:23of the time. So, there's 12
30:27trades
30:28that have occurred
30:32on the H2.
30:34There's seven that have occurred on the
30:37H3, three for H4, you know, one the
30:41stragglers, it's the tell.
30:45So when betting the opposite,
30:50these first two trades are the ones that
30:52pay and then after you get past the
30:55first two here, it gets really dirty and
30:59messy.
31:01So, when betting this, you almost have
31:04to be like I'll set up for three bets
31:07and then I'll try my first, second, and
31:10third bet and stop and don't keep going
31:14down the rabbit hole cuz what happens
31:17when we go here? If we end up here and
31:20you're betting every single one and you
31:22hit 13, that's like a mess. So on this
31:26strategy,
31:28it's just about being consistent and
31:30then you just keep putting on the trades
31:34at the day end. And then I mean you can
31:37bet the first two and stop since it's 27
31:40here. I, you know, bet the first three,
31:44but that's me. And then so the market's
31:48always skewed long over time. And you
31:52can see that's true here because there's
31:54a 13H
31:56consecutively
31:58and here we only went six.
32:01So when betting H and L
32:05your more favorable bet is to wait yeah
32:09is to bet this side a bet on this side.
32:12So when we're over here to bet for an H.
32:17>> I just been selling premium on the long
32:19side. Yeah,
32:23>> you know, I'm not going to get a huge
32:26move, but
32:27>> I I don't know if you remember the AVGO
32:30trade I showed. Those made 700 per
32:34contract, per lot on the spread
32:37>> cuz I did a $10. Yeah. And that was like
32:41almost 100% guaranteed to work.
32:43>> Yeah.
32:44>> And the reason was on that one,
32:48so I pick on Aviggo a lot. it showed up
32:50in that uh Periscope thing and um
32:56so this is something to be aware of.
32:58Somebody was asking me, "Oh, should I
33:00buy a bunch of calls for the AGO
33:02earnings?"
33:06[sighs]
33:07So AVGO, you know how I do the floor and
33:10ceiling?
33:11It looked kind of like this
33:15for earnings.
33:17So the ceiling
33:20had adjusted way up.
33:23So, he was asking me, "Oh, should I buy
33:25calls in here so I can make money when
33:28they report?" And he goes, "I'm like,
33:30[clears throat] dude, they've already
33:31accounted for all that cuz they've
33:33raised the ceiling, the premium, so
33:35they're ready to crush that down." So,
33:38I'm like, "Your best bet given this
33:39structure is the put credit spreads
33:43here."
33:44So, I did a 10 width
33:48right underneath the floor.
33:51They peaked at seven and then they went
33:54to zero. So, it was a 100% capture of
33:58$700 per contract overnight in 6.5
34:01hours.
34:03So,
34:04>> that is on the put side or
34:05>> uh the put side. So, you're selling put
34:08side premium
34:09>> draw down after.
34:10>> Yeah, the option. So on the chart in
34:15there somewhere um the data looked like
34:20this. So the premium was seven here on
34:23the put and then it dropped to zero by 4
34:28p.m.
34:31>> I had took a trade. You know I'm I'm
34:34very much consistent on air go taking
34:37the calls of puts that day when during
34:40the earnings it's already it was a $500
34:43stock and it went down to like 300 370
34:46from last three earnings is a draw down
34:49and all the chips are leading and this
34:51the chip stock only in the draw most
34:54draw down so
34:57so I was skeptical I don't have the
34:59system and I don't have the data what
35:00you have
35:03So 370 I was I got failing in the spaces
35:07also we were talking the day Mel said
35:10I'm not sure the the the dealer position
35:14on the long side is 400 and the downside
35:16is 340 but our system shows after the
35:19earnings mostly it should go down by 340
35:21or 345 he said
35:24so I was in the once he said I was in
35:27the longs for 400 strike calls for that
35:31week
35:32immediately last minute at 359 I sold it
35:35my gut feel whatever he said I followed
35:37it
35:38>> I don't have system it saved me like 3
35:423k or something
35:43>> so it kind of worked I guess
35:45>> kind of worked in the morning I cross
35:47checked it went to 350 and it went all
35:51the way to 340 the good side was good as
35:54you said
35:55>> but does your system shows before the
35:57earnings
35:58>> the more on put side or call side.
36:03>> Uh yeah. So the question you're asking
36:07is like on our floor and ceiling and the
36:09PML values like first off mechanically
36:14how does that how is it even working?
36:16And why aren't we using Greeks and
36:18copying what everybody else does in the
36:20market creating Gex and Gam charm and
36:22blah blah blah blah don't care about all
36:25that. um the Greeks
36:29so you know it's a big calculus form you
36:32know and they try to reverse solve for
36:35things but the Greeks assumes volatility
36:38is normal
36:40and which is stupid cuz why would you
36:42ever assume that
36:44because us like we thrive in high
36:47volatility when it just kills other
36:50people but like yesterday like on that
36:52call that went from you know like $7 to
36:55128 8 at the peak, you know, that
36:58volatility is what we want. So,
37:02in order to figure all this out, we're
37:04doing the synthetic trading.
37:07So, [snorts] we have servers in the
37:08background that are constantly trading.
37:13It takes about 3 minutes for the
37:15logorithm to run. It trades the market
37:18up and down. It trades the option chains
37:21up and down and it finds out the crush
37:24areas. It figures out where the
37:28institutions
37:30are creating their,
37:33you know, ceiling and floor where they
37:35think the edges of the market are for
37:39that
37:40period you're doing. So on spread
37:44monster when he ran AVGO th I don't know
37:49what day it was but like Thursday and
37:52the ER was Friday it had already showed
37:54us they made this adjustment in the
37:56market. So it already adjusted the floor
37:59and the ceiling. So we by
38:03trying to derive these values we already
38:05figured out that they had done all this
38:08ahead of time.
38:10Now,
38:12which makes
38:14another interesting question. Why when
38:17you go into toos and every other retail
38:20system on the planet,
38:22you look at the moves they have for the
38:24options market and they're like, add
38:27that move to the current price up and
38:30down.
38:32But that's not how the market's truly
38:34moving. So that information they're
38:37feeding out everybody on the retail
38:39world is wrong. It's a lie because
38:43they're saying, "Oh, the move is plus
38:46minus like six points." When our system
38:50is saying, "No, they adjusted this up
38:54and left that flat."
38:57And then yet you go into toos
39:00and you know trader workstation, IBKR
39:03and everybody else. Even I see on uh
39:09all these other things on CNBC or
39:12investing.com,
39:14they're like, "Oh, the move is plus and
39:16minus whatever." Like, no, it's not. You
39:18guys are just lying to everyone because
39:20they don't even know.
39:22They were like on AGO I remember reading
39:25some guy's like oh it's I can't remember
39:28the numbers he used the move is down
39:30here and it's to up here and we're over
39:32here saying no you sell the put credit
39:35spread cuz the moves
39:39on the upside. So
39:42and um so I have to be real careful
39:46about the information that's out there.
39:47a lot of it's like misleading and it's
39:50not even known
39:52to other people. So again,
39:56it's a really complicated process for
39:58this cuz it's trading up and down. It's
40:01finding where the edges of the premiums
40:05are at and it's just continuously doing
40:07it. And um so yesterday
40:12I mentioned Target.
40:15Target was like a guaranteed win again.
40:18And the reason was
40:20Target, this is something to watch too
40:25for.
40:26So when we have a ceiling
40:31like this
40:34and and I think the ceiling I can't
40:36remember. I'm going to use a fictitious
40:38number. say it's 160 is the ceiling and
40:41target pre-market
40:44let's say it's at 160.
40:48It's already at the ceiling.
40:50So in the thing I showed the put side
40:53because what happens is when the market
40:55starts up it just goes
40:59because everybody else the institutional
41:03guys and stuff already know where
41:04they're at.
41:06Another thing is yesterday, I forget
41:09which stock this was. I didn't put it in
41:12there, but it was one I was using. Here
41:15was the ceiling
41:17and the pre-market was way up here.
41:21So, as soon as the market starts up, it
41:24just goes
41:26crash back down. because when we're up
41:29at the ceiling or above it, you know,
41:33they're going to fade that price action
41:35down. So, when you're looking pre-market
41:38and when we get the new thing built out,
41:44some of these processes will start to
41:45automate. So, it'll just feed us so we
41:47don't have to sit there and look at it.
41:51But when you're looking at things like
41:53if the floor is here
41:56and pre-market something's down here,
41:59it'll
42:02seek back above the floor.
42:05>> Have a question with that, Russell. When
42:06you talk about the ceiling like that,
42:08especially on your bottom example, so
42:11say we open up pre-market above the
42:12ceiling, we come back, we test it and
42:14bounce. Would you say that the market
42:17participation would they be off sides at
42:20that point
42:21>> for so for it to bounce if like let's
42:23say the market starts up and the ceiling
42:25stays solid right there it'll fade
42:28underneath of it. I've never I'm not
42:30saying it can bounce off the ceiling.
42:33>> Maybe it has and I've just never
42:35witnessed it. But usually if the ceiling
42:40stays solid steady there. So the only
42:44exceptions are
42:46you know when you talk about the um
42:49uh positive exposure there's positive
42:52and negative exposure just call them
42:53positive exposure both sides. So, I
42:56don't know if you notice sometimes in
42:57the stream
42:59I'll be like, okay, I'll start to mark
43:02out the positive exposure events on QQQ
43:05and then I'll mark out plus two and plus
43:09one
43:10and then here will be the ceiling.
43:14So, those are the only exceptions
43:19is on a positive exposure event.
43:22Otherwise, we should always fade back
43:26underneath.
43:27When that positive exposure event sets
43:30up, that's like big money because for
43:34me, I look up here and I'm like, "Oh,
43:35I've got a strike up here and a strike
43:38up here that I can use."
43:42Now,
43:44uh I can't remember when it was couple
43:46years ago when they started doing zero
43:48DTE on the QQQ spy and IWM.
43:52We were getting positive exposure events
43:56throughout the week from time to time.
43:59And then I noticed it seems like they
44:00changed their models a little bit. And
44:03then cuz normally it's just always
44:05Friday if we did get one where we could
44:08get above the ceiling and get that plus
44:10one plus two point move above ceiling.
44:13So normally it's only Fridays but when
44:15they started doing the zero DTE we were
44:17getting some during the week and now
44:19that's kind of stopped more or less. I
44:22think very rarely
44:24am I seeing that. And you can go out to
44:26the internet and read on positive
44:28exposure negative exposure events too.
44:32But um yeah, so again the ceiling and
44:37floor we should behave between them
44:41less that event which is not very often
44:46and mostly on Fridays.
44:53Let's see.
44:57>> Russell
44:59mentioned if you could cover
45:03>> the dealer inventory and splicing
45:05earnings for calls for next week with
45:07Thursday and with Friday's contract.
45:11>> Okay. Costco.
45:12>> Yeah, he put it in that chat.
45:31You know, I've been having some splicing
45:33issues with earnings. Been looking at
45:36not sure what's been happening there.
45:43Let me look at something here with cost.
45:59So
46:01just over 200 days. I mean it looks like
46:06>> definitely the it's been having a bounce
46:08point here except for I guess one time
46:13which would take it to 839.
46:19So statistically right now it's more in
46:22a bounce area than not to go long.
46:28And then let's see here.
46:34My laptop screen's little baby screen
46:37here.
46:40925
46:47doesn't work. He wants to see the
46:51>> Hopefully it'll show up. The screen on
46:54this laptop's smaller.
47:02Let's see. Where is it? So, it's up
47:03here.
47:05It's off the screen. It's up above
47:10which is matching the fractal graph with
47:14us being at the lows there.
47:17>> Yeah.
47:21>> And
47:22also if we look at the put side which is
47:25the right. So the right's put side
47:27representing short. The left is of
47:29course call side representing long.
47:36And then here's the net the net out. So
47:40the net dealer is up here somewhere. I'd
47:44have to open up more volatility
47:47so everybody understands this stuff
47:48right here is historical volatility. So
47:51we're looking at volatility
47:53at this point in time. We don't care
47:55which way it is. It's like we just need
47:58to see the range. So we're taking all
48:02the other data, right? And then we're
48:04creating um syosodial waveforms. terms.
48:06I just call them spaghetti lines and
48:08we're mapping them here because we're
48:11trying to exploit these Yahoos over at
48:14the exchange using Black Scholes, Merin,
48:17Black Scholes and other combinations of
48:19logorithms for pricing.
48:22So, we want to exploit that. So, the
48:24first thing we want to do is we want to
48:26see where volatility lies for the market
48:29in our measured time frame, which is
48:31this right here.
48:34Now, one thing to note, this doesn't
48:37mean when the market opens that it went
48:40down first and then up. This just means
48:43that there was lows and highs.
48:47So, it's just showing us the lows and
48:49highs for our measured data set for our
48:53normalized data.
48:55And then it's mapping the premiums. I
48:58don't much care for IV, so I kind of
49:01don't really pay attention to that. It's
49:02on the screen, but it's I'm looking at
49:05these S-waves.
49:08So, premium
49:11does not truly have an S-wave. Premium
49:14is uh flat.
49:17So, we're using some math magic here.
49:20And what we're doing is we're bending
49:21premium. We're applying a factor to it
49:25to create a bend in it.
49:28And the reason is like you see with the
49:30Ivy walls people do how effective they
49:34are and we get that because we bend the
49:37premium. So while the rest of retail and
49:40even a lot of institutions
49:42they'll just be looking premium as a
49:44flat thing. We're actually looking at it
49:47as a a function
49:50uh sine wave somewhat an S-wave on both
49:55sides. that let us figure out where the
49:58walls at in it by examining that.
50:03So the blue is open interest.
50:07This yellow is the delta
50:10the change that's incoming volume
50:13because the open interest is always the
50:15previous day. They for us it changes
50:20about 8:50 a.m. heading to 9:00 a.m.
50:22every morning. the open interest, the
50:24blues.
50:27Um, so we have a server in the
50:29background that's collecting the data.
50:32However, it doesn't start running till
50:339:30. So when you're pulling open
50:36interest until a few minutes, a minute
50:39or two after 9:30,
50:41you're going to see the prior days, the
50:44prior prior days open interest. And then
50:46right around 9:30 when we're starting
50:49our collection process, then it starts
50:52updating,
50:53you know, and again when we get the new
50:55data center up and running, we'll make
50:57some adjustments on that.
51:00So here we're seeing the deltas
51:03of the yellow.
51:05And it's pretty clear here, nobody's
51:08betting on the call side.
51:10People are writing contracts on the put
51:13side.
51:14So institutions again they uh don't
51:18really like to call out direction they
51:21just want to collect on premium.
51:24So, knowing that, we know that they're
51:27selling putside premium, short side
51:30premium to collect cuz they're
51:31anticipating
51:33that uh Costco
51:36will not fall further, that it's
51:40probably
51:41basing here. And with the net dealer,
51:44it's anticipating that the price action
51:47is going to be long now in 200 days. and
51:50the net dealers.
51:52Our block starts here at 91250. It's
51:56kind of hard to see because the screen
51:58size. So it's 91250, 915, 9175
52:02on up.
52:05So when we have a long move with this
52:07picture right now, this 9125
52:11would be the first area of interest.
52:16Now,
52:17okay. So, these purple X's, I try to
52:21explain this several times. These are
52:23the 9:30 a.m. opens. So, what we're
52:26doing is in historical volatility, we're
52:28looking at where were the opening prices
52:33all along that data set at 9:30 and we
52:37score an X. So you can see that there's
52:40a density of them here and right in
52:43here.
52:46That means if you're trying to crush
52:49premium overnight
52:51or you want to buy the next morning
52:56where the price is coming in at.
53:00So if you're like, oh, I want to try to
53:03crush
53:05call side. I want to try to crush put
53:07side,
53:09you know, to be underneath here and be,
53:12you know, I I would kind of disregard
53:15these two strikes here. I would look
53:17more like the meat of it here. And then
53:19I would sell, you know, call side
53:24of that range.
53:26And then these X's are the 400 p.m.
53:30close prices. So, it's looking at all
53:33those days and it's saying, "Okay,
53:34here's where we've been closing." It's
53:37funny, the opening has more consistency
53:40at 9:30 a.m. than the 400 p.m. because
53:44it's more spread out.
53:48So, if
53:50let's say the night before
53:52I'm looking to sell or to buy a put and
53:56I'm looking at to being down here on
53:58these X's, I know already I've got a
54:00really bad shot at losing because every
54:04one of those X's represents that 4 p.m.
54:07close and I only see like 1, two, three,
54:09four down in there.
54:12Now, the payout on that would be
54:14probably massive. it'd be thousands and
54:16thousands of a percent.
54:19So over 200 days,
54:22if there's only, let's say, these metric
54:24statistics held true over 200 days, I
54:28could only expect four of those trades
54:30to work out. If I put one on every day,
54:34but let's say cumulatively they make
54:365,000%.
54:38Maybe it's worth putting [laughter] one
54:40on every day and being like, "Okay,
54:43>> you know, I finally hit one.
54:46So, but so you make sure your bankroll
54:51works for that.
54:53>> I don't know, man.
54:54>> Got to have a Russell bank roll.
54:56>> Yeah. I don't know.
54:58>> Have to go to Jamie Diamond or
55:01something.
55:03>> So, again, you can take this block.
55:07So, I think a couple times over the
55:09years, I've marked a standard deviation
55:12curve. So here's the tails
55:15and then as you kind of move down you
55:17get more into the meat of it
55:20and you can see that on the short side
55:23it's more congested and the long side
55:26again is more open. So again it's
55:28evidence that the market skewed more
55:30long than it is short because the short
55:33side's more confined.
55:35Now, [cough] these outsized moves
55:39[snorts]
55:40here, that's defining the meat of where
55:45the volatility lies.
55:47Sometimes, like I'll show it
55:50occasionally, but I'll put these lines
55:52on. Sometimes you go right up to this
55:54line and just reject or we go right down
55:57to this red line and then find support
55:59and then V up.
56:02So, but that lets you know where the
56:05volatility is within the session as well
56:08as the coloration. You can see how it's
56:12more darkly colored. That's showing us
56:15where it's finding the price actions at
56:18during the day, during the session.
56:24these percent numbers, they're telling
56:27you how much
56:29of the uh volume of the contracts is at
56:35those strikes at those locations.
56:38So you can see as we go up, they're kind
56:40of hard to see. It's like 154, 166, 224,
56:45246.
56:47So it's visually showing us that
56:5124.6%
56:52of of the contracts reside here,
56:5625 here, 26. So as we go down, there's
57:00more and more put contracts
57:03that are open. And the same way here and
57:07we can see here, I mean, there's they're
57:10not selling hardly any premium over
57:14there. They're selling all the premium
57:17on this side because they're expecting a
57:19directional move long up into this area.
57:24I can open up more data. So,
57:26>> Russell, can you talk to the long
57:29average and short?
57:32>> Uh, yeah.
57:34>> Yeah. So,
57:35>> process at all.
57:38>> It does. So, the long average. So what
57:42we do is
57:46you know how we have so this is break
57:48even.
57:50>> So on a contract
57:56if we buy so here's the close price
58:0039531.
58:04So the break even if paid ask
58:08would be at 17
58:12or excuse me at 19.44.
58:16So it would have to have a 19.44
58:20point move if paid ask
58:24to break even. Mhm.
58:29The long average and the short average
58:31are we take the ass
58:351723.
58:37We add them all up and divide them
58:39because we're trying to see what the
58:41average price of the ask is in the
58:45market.
58:47And the same way with the put side,
58:51our average ask is 22.64.
58:56which becomes the short average.
59:00>> So we're trying to see what the average
59:01put side ask is in the market.
59:04Now it doesn't mean that the price
59:07action is going to move towards that but
59:10what it's doing is giving us another
59:12visual of how expensive the market is.
59:16You can see that the put side from and
59:19it's from this line from the close price
59:22right here. You can see that the long
59:25side is cheaper. The call side is a lot
59:28cheaper than the short side because of
59:32this distance.
59:34Like this is a lot smaller distance from
59:37the close to here than here to here.
59:42You can see it though. So it's it's a
59:44visual thing just to show how expensive
59:48it is and or cheap it is. So we know
59:53here the call side's cheaper
59:58and then we know here that the call side
1:00:02really doesn't have any volatility to it
1:00:04any
1:00:06>> so
1:00:06>> premium
1:00:08>> no said specifically three to four
1:00:10aggregations forward on Friday's
1:00:12contract since Costco reports earnings
1:00:15on Thursday so
1:00:16>> okay
1:00:17>> want you to see an overview of earnings
1:00:21>> while he's pulling that up I wanted to
1:00:23talk about too that I noticed on this
1:00:25chart specifically and BA and it's been
1:00:28happening more so recently is that when
1:00:30you see that there's so many more puts
1:00:32in the money, it's causing accelerated
1:00:35moves cuz that happened with VA where
1:00:37there was so many puts stacked above the
1:00:39price and then it caught fire and it
1:00:41just shot off like
1:00:42>> because people are you have to buy to
1:00:44close causes that cascade. So Costco
1:00:46looks like that set up.
1:00:48>> Yeah, it does. Looks like that structure
1:00:50right there.
1:00:52Yeah.
1:01:13>> Yeah. He said four as Friday's contract
1:01:16was showing the net dealer 941.
1:01:23That's
1:01:24>> Oh, on Friday. This past Friday.
1:01:26>> Yesterday. Friday.
1:01:28>> Friday. No, this
1:01:29>> uh what is this coming Friday?
1:01:31>> Is that the 25th?
1:01:37>> I think the 25th.
1:01:38>> Yeah, the 25th.
1:01:43>> So, it should be this contract.
1:01:49>> Oh.
1:01:50Is this the wrong one?
1:01:53>> It's the 25th. I have no idea.
1:01:56[laughter]
1:01:57>> Me is going to have to figure all this
1:01:59out. It's too complicated. It's over my
1:02:01head.
1:02:03>> You can sit down.
1:02:16>> Okay. Good luck. See you later. Have
1:02:20fun.
1:02:31>> Yeah. Send that to Milk.
1:02:33>> So Milk's next. I got to get a selfie
1:02:35with him, too.
1:02:36>> All right. See you later.
1:02:40>> Oh, yeah. I do, too.
1:02:43>> You can sit down if you'd like.
1:02:46I'm going to call
1:02:50>> it's easier to use now.
1:02:51>> It's also like
1:02:54so
1:02:56like we talked about
1:02:58trade and I'll literally see people
1:03:00target.
1:03:01So, I'll make my trade first and then
1:03:03I'll because I'll miss my my
1:03:14question.
1:03:15>> So, for the generic
1:03:18new starter for the system, should we
1:03:21have a little bit of coding knowledge or
1:03:23something to use the system or just a
1:03:25generic
1:03:26>> um like coding experience? Mhm. So I
1:03:29heard from months when I asked him xaces
1:03:32for well he said yeah you should know a
1:03:34little bit of SQL or some kind of query
1:03:37um
1:03:37>> so how you pulling the chat and all I
1:03:41>> I can I can show you that part of it. So
1:03:43there's we have a database of course
1:03:47behind all this and we have a thing
1:03:50called data warehouse and you can
1:03:52actually type in SQL code and query.
1:03:55>> So who all the subscription members
1:03:58>> they have access to that. Yeah does do
1:04:01the same SQL queries they have to run or
1:04:03>> yeah there's um if they so we have
1:04:06pre-anned queries and then some people
1:04:08create their own queries. So if you want
1:04:11to find out something in specific, you
1:04:14can use SQL code to find it to get it
1:04:17the derived data in the system.
1:04:20>> Um
1:04:22like Heather for example, she runs a
1:04:23query that shows her information that's
1:04:28>> for all the tickers it use being used.
1:04:31>> No, we only so right now we're we have
1:04:34one hosting company over in Minnesota
1:04:36we're using.
1:04:37>> Mhm. and we only have so much of the
1:04:40data contained in there and we're
1:04:43building out a new data center over in
1:04:46um Phoenix
1:04:48and in that one we're going to expand
1:04:51all the data we can the thing so heavy
1:04:53and keeping data to derive all this
1:04:55stuff the database is huge
1:04:57>> you need to collect a lot
1:04:59>> a lot so uh this new one will have more
1:05:02expanded databases and stuff once we get
1:05:05that one online so we'll have more and
1:05:06more tickers Right now there's 120
1:05:09something we track more of the bigger
1:05:11ones like Google and Meta and Amazon
1:05:14stuff like that
1:05:15>> the frequent
1:05:16>> the stuff that's frequent that everybody
1:05:17just likes to look at but sometimes it's
1:05:19nice like I have
1:05:22>> some that you are saying just I I if I
1:05:25subscribe to your system I should be a
1:05:26little bit good at qu using the SQL or
1:05:29query
1:05:30>> yeah you can use like he I'm sure
1:05:32Heather wouldn't mind showing you maybe
1:05:34one of the queries she uses to look at
1:05:37some of the data and stuff using SQL.
1:05:40>> Mhm.
1:05:41>> Cuz some people like to just look at the
1:05:44numbers. They don't really care how a
1:05:45graph looks.
1:05:46>> Look at the graph.
1:05:46>> Yeah. You know, maybe they don't really
1:05:48care about the
1:05:49>> laziness or something.
1:05:50>> Yeah. It's like, you know, so run a
1:05:52query and then they'll see the data
1:05:54points.
1:05:55>> Mhm.
1:05:56>> Is I think one she's using is showing a
1:05:58velocity in one of the changes. So,
1:06:02>> so it it does says like
1:06:06it gives uh the tweaking or the generic
1:06:09queries you have. That's the mind.
1:06:11>> Yeah. That show so on this market maker
1:06:15thing and we can get into that too. It
1:06:18shows who's in control of the market,
1:06:20the bulls or bears and then it shows the
1:06:23bias if the bias is long or short. Well,
1:06:27some people like to pull that graph and
1:06:29then others like to go into the data
1:06:31warehouse and just query the data and
1:06:34see the numbers and not see it through a
1:06:37graph. I like to see it through the
1:06:39graph cuz I just look at my colored
1:06:41lines. I'm always like, "Oh, the red
1:06:42line's above." Whatever.
1:06:43>> Graphs are different. And Mill says as a
1:06:45layman, what the hell this?
1:06:47>> Yeah. It's like, what is all this junky
1:06:49stuff going on here?
1:06:50>> And as a lazy man, he come join SpaceX.
1:06:53Oh, this is this exactly it is working.
1:06:56So the probability of statistics is
1:06:58working. But one day I asked I asked oh
1:07:02you need to be good at even I asked
1:07:04Joker you know
1:07:05>> you need to be good at SQL to figure
1:07:07anything
1:07:07>> out
1:07:09you really don't have to be they're like
1:07:11prean like like I saying Heather over
1:07:13here she has one for the market maker
1:07:16stuff
1:07:16>> and for to use your system also is there
1:07:19any webinars or in YouTube or something?
1:07:21Uh there's a bunch of videos and stuff
1:07:25>> just I want to list out from you or
1:07:26Heather which one to go to.
1:07:28>> Uh maybe Heather Heather does like
1:07:30onboarding and Amoeva and uh I just more
1:07:34of just start babbling at the mechanics
1:07:36of it. Yeah. Not really. I try to do
1:07:39like some short clip videos like on that
1:07:43X.
1:07:44>> Like I'll put together some videos that
1:07:45are like two or three minutes but
1:07:48>> a lot of times it's not enough
1:07:50information. You're like what's going on
1:07:53>> the the information once if a person has
1:07:56done the step one two three like
1:07:58>> if he onboarded and he has done a little
1:08:01bit of knowledge then he can understand
1:08:03your graphs. Oh yeah. Yeah.
1:08:05>> Otherwise, um
1:08:06>> they start to make sense and then after
1:08:07a while you're like, "Oh my god, why
1:08:09didn't I understand all this from day
1:08:11one of
1:08:12>> just I'm flying with the taking numbers
1:08:13for milk or the spaces."
1:08:16>> Um you know, if you go to the bathroom
1:08:17al
1:08:20should not miss anything.
1:08:21>> I I I never join that spaces. I never
1:08:23know what's going on in there. No be
1:08:25like, "Oh, you should come on."
1:08:26Sometimes I'm like, "Yeah, okay. I'll
1:08:28try."
1:08:30>> Yeah. Yeah. especially
1:08:34microns.
1:08:37>> Recently I saw Teslas.
1:08:41>> Oh, pe people will send us things
1:08:43saying, "Oh my god, I just made $20,000
1:08:45off of this. I made 10,000."
1:08:48>> Sometimes you should not be on the wrong
1:08:50side of yesterday. He said 372 was the
1:08:5350 was the Tesla's the market makers end
1:08:58point and the doubt. He touched it
1:09:00touched 7 370. I said okay let it touch
1:09:0337250 to 375 he said in the crash
1:09:08>> and I waited waited from 370 it came all
1:09:10the way 360 I lost it
1:09:12>> I don't have the system access so I
1:09:14>> to change my mind right
1:09:15>> it'll some so when we do this this is a
1:09:20picture at that point in time
1:09:22>> and then as the riders during the
1:09:24trading day as they're closing and
1:09:26opening positions like right now the
1:09:28call side is real thin there's not much
1:09:31content You have to look for this. Uh
1:09:33>> uh yeah. So these can grow out wider
1:09:36>> as traders start to take up positions.
1:09:40>> Your lining says that you should be in
1:09:42this.
1:09:42>> Yeah. It'll show over here
1:09:44mathematically
1:09:46>> cuz um we're driving we're driving data
1:09:51and then we're driving another set of
1:09:52data over there.
1:09:54>> So both sides we have the data that's
1:09:56confusing for a limit. For example, if I
1:09:58take you
1:09:59>> Yeah, it it can be confusing at first.
1:10:01>> I was just thinking the blue block
1:10:04comparing. That's a
1:10:06>> Yeah, it's it's like over here on the
1:10:08far one for like uh what's this? Costco
1:10:11again.
1:10:12>> Um the net dealer block.
1:10:15>> That's where we're looking for price to
1:10:17move into.
1:10:19>> So, this one over here, all this
1:10:22information wraps up into the far right
1:10:25hand side. So it wraps up into 91250
1:10:30on up. And here's the net dealer. Here's
1:10:35>> kind of you can think of it as a center
1:10:37point.
1:10:38>> Mhm.
1:10:38>> So with this information,
1:10:39>> this is the resistance kind of 91
1:10:42>> max on the long side.
1:10:44>> Yeah. So it go to the 91250 on up into
1:10:47the 950.
1:10:49>> Here's the net dealer range
1:10:51>> right in here.
1:10:52>> So what is this red marks and all? What
1:10:55is it? Um, so see the coloration. See
1:10:58how darker red it is?
1:11:01>> Mhm.
1:11:01>> This is where the price action's moving
1:11:03the most historically.
1:11:06See all these lines right here? Squiggly
1:11:08lines.
1:11:10>> This is where the price action. It's
1:11:14showing you how the market's been moving
1:11:16as a waveform. So, it said at one point
1:11:19it started here
1:11:22>> and then it went down here and then it
1:11:25went
1:11:28>> up here and then it finished on one of
1:11:31these purples. So, it's showing us every
1:11:34time how much it went down, how much it
1:11:37went down within this measured period
1:11:40for each one of these
1:11:43instances of movement. So this is
1:11:46>> so you know on the options they talked
1:11:48about volatility
1:11:50>> options
1:11:51>> the options are measuring the underlying
1:11:55>> volatility move how the underlying is
1:11:58moving up and down
1:11:59>> and what is the more on the call side
1:12:02and
1:12:03>> so that's what this is. showing us.
1:12:06>> So if you're like usually
1:12:09>> oh I want to buy a put for cost co
1:12:14>> and I want to buy it an 840 strike only
1:12:18one time over these 200 days did we get
1:12:23down there. So you know if you're trying
1:12:26this trade over and over in this time
1:12:29frame it only worked one time.
1:12:33So you might make 10,000% down here
1:12:37>> but you know if you're trying to take
1:12:40200 times to get down there
1:12:42>> two is to one 200 times out of 200
1:12:46trades one time the problem that is very
1:12:48rare.
1:12:49>> Yeah. And then if you're like oh I just
1:12:52want if you're crafting your play like
1:12:55let's say you're
1:12:56>> if I go this should be a naked.
1:12:58>> Yeah. It's a wild guess.
1:13:00>> Yeah. That's just Yeah. And the same up
1:13:03here 950.
1:13:05Two times we got near 950
1:13:09because of the waveform shows us two
1:13:11times. And then 1 2 3 4 5 6 times it got
1:13:18into this area.
1:13:20>> Oh this now I'm able to understand how
1:13:22many times we are hitting him. So now I
1:13:24should mainly focus on these numbers.
1:13:27>> So that and
1:13:29>> exactly. So when other guys, retail
1:13:31traders are looking at a graph like
1:13:33this, we're looking at like, oh, we went
1:13:34up here, we went down here.
1:13:36>> So how many times more lines went here?
1:13:39>> Uhhuh.
1:13:40>> That
1:13:40>> so what?
1:13:41>> And you have to compare against that.
1:13:43>> Yeah. 200. So what guys will do is
1:13:45they'll take their graph for the week
1:13:48>> and they'll be like, okay, I'll draw a
1:13:49band up here because I know this is
1:13:51resistance. It couldn't get higher.
1:13:53>> Yeah. And the maximum low resistance.
1:13:57>> Mhm.
1:13:57>> That's fantastic.
1:13:59>> Yeah. So you just
1:14:00>> minutes you explained me everything.
1:14:03>> Yeah, it I know it's like
1:14:05>> it is it's so tough to understand.
1:14:08Luckily we had this meet up to
1:14:11understand for me you know.
1:14:12>> Yeah. Oh I know. Whenever you come out
1:14:15>> suppose if you look at the video also
1:14:16you can't understand until you say the
1:14:18live.
1:14:19>> Yeah. Yeah. It's cuz it's a different
1:14:22way of looking at these areas and the
1:14:26the correlation the
1:14:27>> Exactly. Exactly.
1:14:29>> What does this stand for?
1:14:31>> Yeah. So these lines like this
1:14:36>> these are the blue is open interest.
1:14:40>> Open interest.
1:14:40>> So on
1:14:41>> as you open interest rings [snorts] that
1:14:44people are
1:14:46>> it's on the um so since it's on the put
1:14:48side
1:14:49>> it's the put open interest. So with this
1:14:52strike, if we come across here, it's
1:14:54easier with the mouse, but
1:14:58>> you know, let's say we're here and we
1:15:00come across here. So it's 880
1:15:02>> 880
1:15:03>> strike and this blue is the open
1:15:07interest on it.
1:15:08>> Mhm.
1:15:08>> And this is the delta that
1:15:10>> So this is the the chance of whether we
1:15:12get it or not. No, it's the
1:15:16>> So the con um on derivatives
1:15:21>> when you buy
1:15:23>> a put at $880, it gives you the right to
1:15:29get Costco
1:15:32at $880.
1:15:35>> Okay.
1:15:37>> 100 shares.
1:15:37>> 100 shares. One contract.
1:15:39>> Yeah. One contract. So, if you own a 100
1:15:41shares of Costco and I go to you and I
1:15:43say, "Hey, will you give me the right to
1:15:45buy 880
1:15:47um Costco at 880?"
1:15:52>> If we fall below, so like let's say
1:15:55Costco goes down to 840.
1:15:58>> Yes. Or well, it's going to be the ask
1:16:01will be 2735.
1:16:03>> So, I give you $2,735.
1:16:07you have to hold your 100 shares or give
1:16:09me 100 shares at$80.
1:16:12>> If the price falls to$840,
1:16:14>> you still have to give it to me at 880,
1:16:17>> then I can sell it and make $4,000
1:16:20because I get the spread.
1:16:22>> Spread. Yeah.
1:16:23>> So, the blue shows how many of those
1:16:25contracts are outstanding
1:16:28>> like me?
1:16:30>> Yeah. Cuz you got to you got to hold I
1:16:32got that contract
1:16:33>> and it's open between us. So when I b
1:16:36bought for the aspest 2735 then 50 I'll
1:16:39be gaining this right.
1:16:41>> Well so I give you $2735
1:16:46>> the contract price.
1:16:47>> Yeah cuz it's times 100.
1:16:50>> Yeah if it's $8.40 you know it'd be
1:16:52worth $5950 almost 6,000
1:16:56>> but that is very rare but mainly focuses
1:16:58here.
1:16:59>> Mhm. Okay.
1:17:00>> Yeah that's the meat of it. Let's
1:17:02>> have a quick question on the crush.
1:17:05I've seen that negative the other day.
1:17:07What What does that mean?
1:17:08>> Uh, you know, it will go negative
1:17:12sometimes. And I think that's how I
1:17:14can't remember. It's how many contracts
1:17:17need to be
1:17:19added
1:17:21to bring it back into the positive. So,
1:17:23it's short contracts.
1:17:27So, some of this code, like when I put
1:17:29it together years ago, I've just been
1:17:32bringing it over. I can't remember. But
1:17:34yeah, occasionally it'll it will show
1:17:36negative. I think that's the deficiency
1:17:38in contracts for them to be in balance,
1:17:41equalized out.
1:17:43>> Yeah.
1:17:48>> Thanks.
1:17:56>> Thanks for the water. Oh, it's
1:18:00>> watch you speak and then
1:18:02>> Oh, gotcha.
1:18:04>> What was what was Milk asking on the
1:18:06question for this one?
1:18:08>> He says specifically
1:18:11>> with the net it was 9:40 um on the 15th.
1:18:16Now it's brought down to 9:30. So he
1:18:18wants you to explain the net on target
1:18:21in terms of the 9:30.
1:18:23>> Oh, why there's an adjustment?
1:18:25>> Yeah. And what's it called? Just since
1:18:28it's earnings, will that 930 be
1:18:30plausible as a target for um earnings?
1:18:34>> Yeah.
1:18:36>> Yeah. I
1:18:38>> Yeah. Gotcha.
1:18:40>> So earnings is next week Thursday. So
1:18:43this will this is showing um next week's
1:18:45data for that our earnings time.
1:18:47>> Yeah.
1:18:48>> So we're going to see if with earnings
1:18:50coming in, will we target that either or
1:18:53not?
1:18:53>> Oh, gotcha. Yeah.
1:19:04I told Janelle to I'm like, "Oh, do you
1:19:06want I said Heather said to come down
1:19:08for lunch."
1:19:09>> Okay. She was Maybe I think I can text
1:19:14I'll text her and see if uh
1:19:19she was going to come down.
1:19:36questions.
1:19:44So there was a few
1:19:53he mentioned can 4 hours be added in the
1:19:55aggregation settings for future release.
1:19:58Right now we have 60 15 minute and 1
1:20:01minute. So he's asking if a 4 hour time
1:20:04hyperp.
1:20:05>> Oh yeah. I mean, we could put on a four
1:20:09hour, too.
1:20:10>> Is there a reason why you don't?
1:20:12>> Um,
1:20:14it's it's technically just less work not
1:20:18having [laughter] it because when I
1:20:19originally put broadspread monster over
1:20:23into this,
1:20:25you know how there was no blue and
1:20:27yellow and numbers, there was just holes
1:20:29there. It was just because it's a lot of
1:20:32work to bring over the code. So, I just
1:20:35kind of threw the first part over and
1:20:38then after I got my wind back, I brought
1:20:43>> the rest of the code over. There's a
1:20:45little more code that goes in there,
1:20:46too. It does some more stuff. It does a
1:20:49lot more stuff, but
1:20:53>> I think too, I mean, would this be a
1:20:55good way to look at it? If you're using
1:20:56the hourly change in weight, you almost
1:21:01>> on a normal average cycle. Yeah. You
1:21:04have your 4 hour.
1:21:06>> Yeah. True. The 4 hour hits the one:00
1:21:09magic hour cuz that's where aggregation
1:21:12cycles break and cuz sometimes you'll
1:21:15see a lot of times, you know how at the
1:21:17end of the day
1:21:19>> numbers if you go on around the 1:00 and
1:21:22do all that,
1:21:25>> they'll [snorts]
1:21:26a lot of times hold solid through sports
1:21:29because
1:21:30>> yeah when we're running into day it's
1:21:32like it hits that 13
1:21:37in the afternoon unless something comes
1:21:38up. So that's the ideal time to start
1:21:41looking
1:21:44>> exactly there's stuff that goes on
1:21:46during that time in the market. Someone
1:21:48else has a question from 440. He said,
1:21:52"I would ask how would someone trading
1:21:55this system since there's so much data.
1:21:56I don't even know where to start."
1:21:59>> Yeah, it's kind of what we were talking
1:22:01about a second ago. It's like what's
1:22:03important, what to look at. Yeah,
1:22:09>> I'm still learning
1:22:15three months, four months, but I've
1:22:18already had before that
1:22:24indicator. I don't use any because they
1:22:27were disrupting me. So I have had all
1:22:30the top indicators but like once once
1:22:31you switch over
1:22:33your screen just
1:22:41>> Oh okay.
1:22:47All right. So on Costco the net dealer
1:22:52I think Amoeva was mentioning it was a
1:22:54little bit higher. We're around 9:30 now
1:22:57and I think Amiva was mentioning uh milk
1:23:00had seen it around 940.
1:23:03So what's important is whenever you pull
1:23:07these graphs
1:23:09they're the state of the market at that
1:23:12point in time
1:23:14because these options you know there's
1:23:16going to be more or less open interest
1:23:18come in on both sides every minute.
1:23:23The open interest though only gets
1:23:26updated by the exchange
1:23:28every morning before the market opens.
1:23:31So you won't see the blue change. These
1:23:34kind of yellowish oranges, they'll
1:23:36change. So we can see
1:23:40uh mapped against open interest. We can
1:23:42see if there's more volume coming in on
1:23:44those contracts. But so as far as Costco
1:23:49goes, the beginning of the net dealer
1:23:51block is at 91250.
1:23:54And it's like, why does it get mapped
1:23:56down at 91250?
1:23:59It's because you can see over here it's
1:24:00at 19.9%.
1:24:04So that means that typically,
1:24:09it's hard to see down here. There's it
1:24:11keeps track of the crushes going on. So
1:24:14institutions you know trying to collect
1:24:16on the premiums
1:24:19are expecting crush to occur
1:24:22and what we do is we blanket statements
1:24:25say everything in the 80% zone gets
1:24:29crushed
1:24:31leaving
1:24:3320% zone
1:24:36which is going to be in here that can
1:24:38succeed
1:24:40which puts it at 91250 roughly.
1:24:44cuz it starts about the 20% zone here.
1:24:47So when looking at the upside on Costco,
1:24:51the first area I'd look at is 91250
1:24:54and then if we get to 930 the net
1:24:56dealer, that's all the better. If we get
1:24:59up to 950, that's even all the much
1:25:02better.
1:25:04But um once we get to the net dealer, we
1:25:06know getting up here becomes more
1:25:08difficult. So 91250 would be the uh
1:25:14minimum upside
1:25:16I'd be looking at for Costco. And then I
1:25:19check this every day to make sure that
1:25:22there's no changes to it.
1:25:28So again, this is a net dealer block.
1:25:30This is the range we're expected to be
1:25:32in with the ideal outcome right at our
1:25:36center point 93041.
1:25:41And um
1:25:44so we were talking about open interest a
1:25:47minute ago. And I don't know for those
1:25:50that don't trade derivatives, uh
1:25:53derivatives are a contract between
1:25:57um a writer, somebody that has
1:26:02the stock in their account or can
1:26:05deliver on the stock. It can sell naked.
1:26:08so they can deliver on it even though
1:26:10they don't own it. So institutions
1:26:14because they have money in the bank,
1:26:15they make free money. All they have to
1:26:18do is show they have money and they
1:26:20start writing out all these contracts
1:26:22making money off all of us for nothing
1:26:25other than they have money in the bank
1:26:28because they're like, "Oh,
1:26:31we'll write all these contracts out and
1:26:33collect millions of dollars in premium
1:26:35and all we have to show is we have the
1:26:37potential to buy the stock." They don't
1:26:40have to put up anything or do anything
1:26:42for that money is get gets handed to
1:26:45them.
1:26:47So, uh, their only risk is like if
1:26:51they're writing all these contracts,
1:26:52collecting a lot of money,
1:26:55if the price action gets down in there,
1:26:58and then they actually have to go to the
1:26:59market and buy stock. That's where you
1:27:02get those crazy adjustments because they
1:27:03got to buy stock to meet obligations.
1:27:06So, open interest is showing us how much
1:27:09of those contracts are outstanding.
1:27:12So most people like retail,
1:27:16like when I first started, I was doing
1:27:19covered calls. I had to have the stock
1:27:22in my account to to write and collect
1:27:26and once you meet a certain threshold,
1:27:29then you don't have to do that anymore.
1:27:30You just do them naked
1:27:33and collect on them, not be too wrong.
1:27:39So, so again, these and we were talking
1:27:42offline here. Um, these curves represent
1:27:48highs and lows in the data set. So,
1:27:52we're seeing the volatility of the
1:27:54market mapped against the options market
1:27:59because if you watch QQQ live, so you
1:28:02know on Milkstream ES, it's just a
1:28:06single instrument.
1:28:09So, on the Vector, it's either red or
1:28:11green. On QQQ Live, I can already tell
1:28:14when the market's going to start to
1:28:16change because I'm watching the
1:28:18derivatives.
1:28:20So,
1:28:21by watching the call and put side, I can
1:28:24tell there's going to be a momentum
1:28:26shift in the market, if that makes
1:28:29sense. So, on that volatility map that's
1:28:32in the center. Let me see.
1:28:40So, you can see here's
1:28:43the call. And this is kind of a bad
1:28:46representation because they're so far
1:28:47out of the money, but here's the call
1:28:50and then here's the put
1:28:53and then over here we have the actual
1:28:56equity on a fivem minute interval and
1:28:59here's a 15minute interval.
1:29:03So when we're
1:29:05over here, here's another call. I can
1:29:09see when we're shifting from red to
1:29:12green that the market is already
1:29:14starting to place bets that it's going
1:29:17to go up.
1:29:19And that can occur before we get a shift
1:29:23over here
1:29:26or a shift over here from red to green
1:29:30because
1:29:31traders are starting to buy into the
1:29:35contracts ahead of time. So, I've seen
1:29:40the QQQ going down like here and then
1:29:45these call sides going up total totally
1:29:48counter to the market and then a few
1:29:51minutes later all of a sudden the QQQ
1:29:53will start to spike up because I'm
1:29:56watching the derivatives
1:29:59over here. So, I put the call on top,
1:30:01the put on the bottom. I'm always
1:30:03consistent about that. the NASDAQ
1:30:06composite over here that I'll show
1:30:08that's in control of the entire market.
1:30:10So, wherever NASDAQ's going, you know,
1:30:12pretty much ES, QQQ, IWM's following.
1:30:16So, that's why it's important to watch
1:30:18that. I don't really the VIX and stuff
1:30:20like that, I don't really watch all
1:30:23that. But um here I watch and then I'm
1:30:27again I'm marking out my levels
1:30:32so I can see where things are at.
1:30:36Um
1:30:38the close lines. So you know when
1:30:42there's highs and lows on the waveforms
1:30:44created we create open and close lines.
1:30:46Opens are just open targets to achieve.
1:30:51So these at one point were all assigned
1:30:54open and they all closed. And this
1:30:57becomes a big resistance area which I
1:31:00knew.
1:31:02And once we can and you can see it just
1:31:04takes forever to chew through that. And
1:31:07you can see like here's the white space
1:31:09area. It's just void of any support or
1:31:11resistance. And you can see once we
1:31:13break through that, it just really flies
1:31:16up to the next one. then it broke
1:31:18through that. So all this volatility
1:31:21here is again
1:31:24measured in all these syosodial
1:31:27waveforms that are in the center. This
1:31:29is historical volatility.
1:31:31So these again
1:31:34are being represented
1:31:40by all these moves up and down that are
1:31:43in the data set.
1:31:45So if you drew
1:31:48all these
1:31:50sine waves through all this up and down,
1:31:53that's what's in the center of spread
1:31:55monster. So [snorts] it's giving us a
1:31:58glimpse of the entire market
1:32:01um
1:32:03inside the center of spread monster.
1:32:07Now
1:32:09when we start to get all these open
1:32:10lines, I'll mention this. these start to
1:32:13get stacked up. And when we start to get
1:32:16a bunch of these open lines stacked like
1:32:18this, that means that there's
1:32:21potentially a huge rally in formation.
1:32:25And it can be freaking vicious. And then
1:32:28on CNBC and Kramer and stuff, they'll be
1:32:31all shocked and be like, I don't know
1:32:33where that rally came from. And then
1:32:34they make up some excuse.
1:32:38So here, to know that I'm not lying, we
1:32:41go back and look at these open lines
1:32:43right here. See how they're all stacked
1:32:46on that frame up?
1:32:52So, it's pretty exciting when we start
1:32:53to see these framing up
1:33:00because that means there can be a really
1:33:02potent rally in the works that'll make a
1:33:05lot of money because if you pick those
1:33:07top open lines and they're hit.
1:33:11Yeah. It can be like stock jockey was
1:33:14showing on one of our put sides months
1:33:16back.
1:33:18$1,000 made$1.6 million.
1:33:22on one of those trades. So, it's just
1:33:26man being diligent
1:33:29and just watching because like when we
1:33:31have like here,
1:33:33this is another thing I call these just
1:33:36pendulum swings. [snorts] See how we
1:33:38move viciously up here and then all of a
1:33:42sudden there's a counter trend down
1:33:46here.
1:33:48So, as this is starting to spike, if you
1:33:52know this price actions down here and
1:33:56you bet on that, it's like
1:34:00crazy percentage gain. They can be tens
1:34:03of thousands of percent on those
1:34:06contracts. So, it's like I'm always
1:34:10watching for that stuff. I'll try to
1:34:11call it out when I see it. Here's like
1:34:14another one. you know, we kind of came
1:34:15way down here and then we kind of swung
1:34:18way back up there.
1:34:21So, you know, real important we want to
1:34:23watch these open states. You know, they
1:34:26grow and grow and grow and then finally
1:34:28there's some catalyst in the market.
1:34:30There's always new information coming
1:34:31in. That information sparks that rally.
1:34:36And since other traders can't exactly
1:34:39see what we're seeing, what they're
1:34:41doing is to to really make the rally
1:34:45potent,
1:34:46they'll be putting on shorts here.
1:34:50And then there starts to be a lot of
1:34:51short covering. So a lot of this can be
1:34:54driven by short covering like where they
1:34:57have to
1:34:58buy back
1:35:01QQQ that they shorted
1:35:05and the indexes they shorted. So you can
1:35:07start to see this here structure that's
1:35:12starting to form over here.
1:35:15So our question is like when
1:35:18because like if we could nail that every
1:35:20time we'd be like unbeatable.
1:35:23So one thing I look at
1:35:27is you see this red band down here.
1:35:33I like to look at a lot of times it's
1:35:36not super
1:35:39perfect but a lot of times these red
1:35:42bands are similar in length.
1:35:46So if I take the length of this band
1:35:50and I overlay it like let's say it's as
1:35:52long as my fingers here I overlay it
1:35:54here. I would expect as we're moving as
1:35:57we're approaching
1:36:00um the end of this one overlaid on this
1:36:03that we'd probably start to see a rally
1:36:05form
1:36:08and then again derivatives usually these
1:36:12contracts
1:36:14I mean they can be a penny and you know
1:36:16they can go to $10 stuff like that you
1:36:20know because like that's 980 at the
1:36:23moment.
1:36:26So again these open states um what it's
1:36:30counting on are bulls you know seeking
1:36:33out higher and higher levels and also
1:36:36short covering
1:36:38these open states
1:36:41since they are not
1:36:43they're always forward testing because
1:36:45they're always generating in front of
1:36:47us. So we know factually when we go back
1:36:50and look at the data that they are being
1:36:52closed
1:36:54that price action does hit. I can go
1:36:56back even farther
1:36:59go back like a thousand days.
1:37:01So we can see factually again that
1:37:04sooner or later we hit those levels up
1:37:08and down.
1:37:10And
1:37:13so we have one, you know, way down here,
1:37:15of course. And that can, of course, the
1:37:18closer they are to the pivot, the open
1:37:21states, the sooner they get closed. You
1:37:24know, the farther, the wider the
1:37:25alligator's mouth, the longer it takes.
1:37:28So, we had an event like couple months
1:37:31back.
1:37:32I don't know. It was one of these, some
1:37:35spike thing where I figured I went back
1:37:38through all the data and over the course
1:37:41of 40 years, we would only have it
1:37:43closed four times. And we had one of
1:37:46them close
1:37:48a few months back. I can't remember
1:37:51which one it was exactly but again we're
1:37:57knowing that
1:37:59and
1:38:01you know so
1:38:05all the not all but a lot of you know
1:38:09the other retail traders out there they
1:38:12don't know that we can hit 991
1:38:16like maybe in Costco
1:38:19out here in the future because
1:38:21you know they're not taking the data
1:38:23like we're doing it normalizing it and
1:38:26then forward projecting it. They might
1:38:29be using Fibonacci or some other
1:38:30technique that doesn't lend to that. And
1:38:35again we can see truthfully that or
1:38:37factually that we do hit these areas. So
1:38:42the institutions,
1:38:44they're basically doing the same thing
1:38:47we are.
1:38:49I guess they're copying us a little bit.
1:38:52And um
1:38:58so it's just and then over here again we
1:39:00can see where our
1:39:03density
1:39:05of the open lines closed lines is at
1:39:09you know so over 1,00 days only four
1:39:13times did we get up here
1:39:16over a thousand days. So that'd be every
1:39:20250 days on average. Could we hit have a
1:39:2410% move in Costco in the course of
1:39:27several days? If we look at the option
1:39:30analyzer,
1:39:32we can see how our curves are at. So
1:39:34right now we're at H2.
1:39:38So only 27% of the time from the pivot
1:39:41line did we go H3
1:39:44implying that Monday we could hit a L1,
1:39:50you know. So, and that can be a setup
1:39:52for the spread monster thing we were
1:39:55looking at a few minutes ago where we
1:39:57can get into the 9
1:40:00something area 930 area approaching that
1:40:07and then on the histogram. So
1:40:12what we can do is too we can sort the
1:40:14histogram which this shows the curve of
1:40:18the market of how it's moving.
1:40:22It's kind of a lot of data so it looks a
1:40:25little
1:40:26weird but here's the mean. So in our
1:40:29mean move it's 2.1%.
1:40:33That means
1:40:35every time we start to move above the
1:40:37pivot,
1:40:40if if you took a trade at the mean move
1:40:42at 2.1,
1:40:45you would hit it over 50% of the time it
1:40:48would work.
1:40:51So over 50% you would uh make money. And
1:40:55then you get and then when you get lucky
1:40:58and you start to get into this deep side
1:41:00of the curve,
1:41:02you know, just all the better.
1:41:07Now
1:41:11show here
1:41:17there's a Discord
1:41:25So, there's
1:41:27I'm going to kind of jump around here.
1:41:30There's a thing called Moosebot.
1:41:37I'll show this during the day in Discord
1:41:39and others will too.
1:41:43So, again, this is using our synthetic
1:41:45trading.
1:41:48Now,
1:41:51what this is showing us in real time, it
1:41:53takes three minutes for this to run in
1:41:55the background. So, when you pull a
1:41:57graph, it could take 3 minutes before it
1:41:59gets updated.
1:42:02[clears throat]
1:42:05So, this is the ceiling. Here's the
1:42:09floor.
1:42:11And then the red line is PML.
1:42:14price
1:42:17will always move away from PML
1:42:20like absolutely and you can see that's
1:42:22true because the green line which is
1:42:24price does eventually move away from the
1:42:27red line which is PML.
1:42:32So uh what PML is kind of representing
1:42:36is
1:42:38when institutions put on trades,
1:42:42they need to put on trades during
1:42:47um premium expansion.
1:42:50So I don't know um sometimes like on the
1:42:53thing I'll show a red line from the peak
1:42:57of a contract price down to zero. So
1:43:01premium expansion is when we're moving
1:43:03to that red line
1:43:06on that angle.
1:43:11So knowing that during premium expansion
1:43:16they need to put on trades
1:43:18that means they can collect when we
1:43:20start to move away from it.
1:43:23So for example here if they put on put
1:43:28side premium they sell putside premium
1:43:33they need the putside premium to cheapen
1:43:35up. So the green line needs to move away
1:43:38from the red line.
1:43:40So if that red line holds
1:43:43guess where that's a good position to go
1:43:45directionally right there long. So I'm
1:43:48always watching this because it can be
1:43:50like if this is later in the day for the
1:43:54options
1:43:56like the percentage change can be huge
1:43:59because you know there's not much time
1:44:02window left. So, I particularly like it
1:44:06when it's doing this or like it when
1:44:09it's doing this, especially like when
1:44:12it's like two o'clock because it's like
1:44:15it can be a,000.
1:44:17So, normally this move is 1,700%.
1:44:22So, if you get down here at the floor a
1:44:25put, it's about a 1,700 to 2,000% move
1:44:29right there. If we can get the floor
1:44:35And the same goes to ceiling. If we can
1:44:38move from
1:44:40uh floor to ceiling, like let's say we
1:44:43get so lucky, very rarely, but if we do,
1:44:46that's about 4,000 to 5 6,000 9,000%
1:44:51move from a floor to ceiling or ceiling
1:44:54to floor.
1:44:57So, here being Friday, yesterday,
1:45:02you can see we came down underneath PML,
1:45:05didn't there's no rule we have to hit
1:45:08the floor. We we didn't hit the floor.
1:45:10The floor is just the downside
1:45:12volatility. So, there's no rule we have
1:45:14to hit it. I Somebody sent me a DM. He
1:45:16goes, "I thought we had to hit the floor
1:45:18in the ceiling every day, one way or the
1:45:20other." I'm like, no, you know, it's
1:45:21just like a volatility envelope
1:45:24that we're uh driving, calculating out.
1:45:28So, there's no rule we have to hit it.
1:45:31If we do hit it,
1:45:34we like to look for these bounces. You
1:45:37can see that was just a massive up move.
1:45:40The same way here.
1:45:44Now what I also like to do and I show
1:45:46this you can draw across these PMLs
1:45:52for supporting areas. You can draw a
1:45:54cross for resistance. So I like to draw
1:45:58that out.
1:46:00And then I especially on the bottom part
1:46:03of the graph. So So this top part is
1:46:06bias. When the green line's above red,
1:46:09the bias in the market's long. When the
1:46:12green line's underneath red, the bias in
1:46:13the market short.
1:46:17And you know, we we really we like these
1:46:21switch ups where we're maybe underneath
1:46:24and then we get back through because
1:46:26this shows us where we can init initiate
1:46:28a trade long
1:46:30or short.
1:46:32And again, it's trading. So, the
1:46:34magnitude of the move may not be what we
1:46:37want, but at least we're kind of in tune
1:46:41with the market.
1:46:43And
1:46:45these I term these icicles.
1:46:49There's brief periods of time where
1:46:53um options come in and the market may be
1:46:56skewed one way or another. And that's
1:46:58what that is. It's showing us a skew.
1:47:02Now, this one, this I particularly like
1:47:06down here. This shows us who's in
1:47:09control of the market because it's a lot
1:47:11of the times like the traders like you
1:47:14go to YouTube or in books, they're like,
1:47:16"Oh, use RSI and use this and that."
1:47:19Well, the CCI and stuff, MACD, it
1:47:22doesn't show you who's in control. It
1:47:24just shows you price action is relative.
1:47:28Because to successfully trade, you need
1:47:30to know cuz if you know who's in
1:47:32control, then you know you can break
1:47:35resistance or support. So
1:47:39when this red line
1:47:42is on top of this light green line,
1:47:46that means bulls are in control. When
1:47:49bulls are in control, all those
1:47:52resistances like those open lines, we
1:47:54can seek higher and higher and higher
1:47:57and higher
1:47:59when this is going on. And this green
1:48:02line,
1:48:04so there was I think a couple weeks back
1:48:08um I was like, "Oh my god, the market's
1:48:11gonna just explode."
1:48:14And it's like, "How did I know that?"
1:48:17This green line was down here like this.
1:48:21The red line was pointing up like this
1:48:24might have been the day was down here.
1:48:27So, you know, when we're placing our
1:48:30bets and we're seeing this green line
1:48:33fall off
1:48:35down here
1:48:37and you know, it's kind of like reading
1:48:39a book. We kind of have to, as Mil will
1:48:41say, kind of have to watch it daily to
1:48:44kind of get used to this stuff. But when
1:48:46we have the green come up and we have
1:48:48the green come down and this red line's
1:48:50rising,
1:48:52we know we can have an explosive move up
1:48:58now.
1:48:59And we want this light green line, we
1:49:02want the structure of it to look like
1:49:04this.
1:49:06And then the red line can really take
1:49:08off, meaning bulls are in control and
1:49:10they can start taking out resistances
1:49:12and climbing through those open states.
1:49:17The same way here, this is opposite. The
1:49:20bears were in control.
1:49:23So as long as this light green line is
1:49:25above the red line, the bears are in
1:49:28control. And it can be ugly. It can be
1:49:31choppy short. So it'll be choppy short
1:49:34down. You can see that the red line is
1:49:37tracking
1:49:38and that I already know the underlying
1:49:41price was choppy because when these
1:49:43lines are kind of tracking in parallel
1:49:45like that until it can break away
1:49:49there's not a clean trend not a clean
1:49:52rally and this is a short rally and this
1:49:55is a long rally.
1:49:57Now, another thing I mentioned this one
1:50:00day. I'm like, "Oh, we're going to get a
1:50:02bounce."
1:50:04It's like, "How do I know there's going
1:50:05to be a bounce?"
1:50:07When this red line comes in contact with
1:50:11this green line, see right here? That
1:50:14means that the bulls are going to try to
1:50:16do some bouncing of the long slide. So
1:50:21when this red line's coming down to the
1:50:23green, I can look and be like, okay, we
1:50:25can probably get a bounce out of that a
1:50:27little bit. The predominant trend short.
1:50:30So any bounce is shortlived.
1:50:33On the vector on options, usually it's
1:50:3535% at a minimum you can get out of it.
1:50:3830 to 35%
1:50:41is statistically what happens.
1:50:46So here again
1:50:50for the best trends we want this red
1:50:53line just to shoot off.
1:50:56So if betting the long side betting the
1:51:00horse race you're, you know, you're
1:51:03really betting that this red line breaks
1:51:06away, the light green line just kind of
1:51:08mellows out. this dark green line, you
1:51:11want it to stay low and then the long
1:51:14side can really take off. So, if you
1:51:17come in here and you're like, it's all
1:51:20messed up like that, choppy, you're
1:51:21like, oh,
1:51:23it's going to be choppy until we can get
1:51:26out of this nightmare right here. So,
1:51:30some days,
1:51:32you know, it depends. Some days there's
1:51:33just not much interest and uh
1:51:38you know I come in here and I see it
1:51:40kind of being like this and then there's
1:51:43hope. You're like okay good. This is
1:51:45breaking away and then you're like oh
1:51:47freaking a the green line's kind of
1:51:49falling up and you're like it's not
1:51:52really
1:51:53going much of anywhere. And this is um
1:51:57for those who have never used this, this
1:51:59is in the Moosebot
1:52:02channel
1:52:04right here. And there's just a bunch of
1:52:06commands. So this is the OMM QQQ.
1:52:11Then you can pull up the OM spy.
1:52:20So again,
1:52:22this is using a synthetic trading
1:52:24technique.
1:52:26It's not using Greeks or anything like
1:52:28that. It's just trading the market up
1:52:30and down, finding the results.
1:52:33And if if you're really risk adverse,
1:52:36you're like, "Oh, I only want to try to
1:52:38take quality trades,"
1:52:40then you can watch for crossovers.
1:52:45Like here we crossed underneath for
1:52:46short. Here we crossed over for long.
1:52:49And then ideally if we can get to the
1:52:52ceiling that's the ideal target. You can
1:52:55see once we kind of got to the ceiling
1:52:57here the white line then it started
1:53:00going sideways more than anything else
1:53:02because again we're figuring out where
1:53:05the institutions are expecting the
1:53:07volatility to lie for the day to rest.
1:53:10So it's resting volatility up here long
1:53:13side and resting volatility down here
1:53:16short side.
1:53:18And you can see, you know, we have these
1:53:21expansions that occur
1:53:23in price and the ceiling and the floor.
1:53:27And
1:53:29in my AVGO example,
1:53:32when that was pulled up, it actually
1:53:34discerned between the call side versus
1:53:37the short side because the call side,
1:53:39the long side volatility adjusted up
1:53:42here during the day. This is showing us
1:53:45a reflection of what the writers want us
1:53:49to see, the dealers, the market makers.
1:53:51We're detecting that they're adjusting
1:53:53both sides
1:53:55of the volatility.
1:53:58And that's how it shows up. Like
1:54:02here, they're they're clever. They're
1:54:06adjusting the premium sides on the puts
1:54:09and the calls
1:54:12radically. So we showed a radical
1:54:14adjustment of the premiums on the call
1:54:17sides and a radical adjustment
1:54:21less radical adjustment of the premiums
1:54:23of the put sides is showing up for us.
1:54:28Now,
1:54:30if we didn't have like if I didn't have
1:54:32this tool myself, I didn't have this red
1:54:35line that's showing me PML,
1:54:40I would not know which side to take cuz
1:54:43I like if I if all I had was this and
1:54:45this green line and I saw this
1:54:47adjustment, I'd be like, "Oh my god, it
1:54:50looks like they're, you know, the price
1:54:52action's going to go up because they
1:54:53spiked
1:54:55the uh long slide." But with the PML, I
1:54:59can see, okay, actually we're short
1:55:03because we're underneath our um peak
1:55:06money line.
1:55:08And on the landscape,
1:55:11we try to estimate how much money
1:55:14they're in the hole for. So, you know,
1:55:16when you look at the landscape, it may
1:55:18show
1:55:19like 200 million
1:55:22or I've seen, you know, 700 million, 300
1:55:28million, stuff like that.
1:55:30So, you know, if you're curious what's
1:55:33behind the numbers, like for PML, the
1:55:36pricing action is, you can look at the
1:55:38landscape, it'll guesstimate where
1:55:40they're at.
1:55:43So, the worst ones, Heather and I were
1:55:45talking about this a little bit ago, is
1:55:47when we're here,
1:55:49we just don't break away
1:55:53from the PML.
1:55:57And what I do is I like to draw a line
1:56:00underneath
1:56:01and then I'll try to draw a line above
1:56:06and then that will be my breakout line.
1:56:09So, when we're all gummed up into here,
1:56:13I'll just draw across. I'll use like
1:56:16Microsoft Paint or whatever, or I'll
1:56:18just visually look at it and be like,
1:56:20okay, until I can break significantly
1:56:24like underneath the low like here, we
1:56:28had the down jut, they had the hook
1:56:31down, and then we remained underneath
1:56:35and then came down to the floor. And
1:56:38it's gut-wrenching, too, because when
1:56:39you're putting on trades, you want to
1:56:41see it follow right through. And when it
1:56:44comes down and you're like, "Yippee."
1:56:46And then all of a sudden it reverses,
1:56:47you're like, "Man,
1:56:49>> that kind of screwy." And then you
1:56:52reject and you're like, "Yippee again."
1:56:53And then you go down there, you're like,
1:56:55"Hallelujah." So, I call these like holy
1:56:58grail moves where
1:57:01we're moving beyond what the market was
1:57:04anticipating
1:57:05cuz here it's moved beyond what the
1:57:08market anticipated. You can see how the
1:57:10floor was rising.
1:57:12So, the market itself, the dealers and
1:57:14stuff, they're like, "Ah, it's not going
1:57:16down there. We're calculating out that
1:57:18we're going to hold this level to the
1:57:20low side." And once it starts breaking
1:57:23beneath the premiums just start going
1:57:26berserk because it was unexpected
1:57:30like depending upon the time of day. I
1:57:33don't know when this was but like let's
1:57:34say this is 2:00
1:57:37you know when we're up here to versus
1:57:39here the premiums down here could be 5
1:57:42cents 7 cents 2 cents. You saw on Friday
1:57:46that one call I had, it was at 7 cents,
1:57:485 cents, 4 cents, like nearly free. So,
1:57:53they can be like super washed out. So,
1:57:56the premiums from here to here can
1:57:59skyrocket. You know, you can have a two
1:58:01or three cent contract go to 2,3
1:58:06you know, [snorts] depending upon that
1:58:07point move.
1:58:10And then here's another icicle where the
1:58:14volatility the number of contracts
1:58:17traded on one side kind of overweighed
1:58:20the other side. So it caused a call
1:58:24icicles to occur.
1:58:28So again, you know, we want the idea is
1:58:30when trading and it's annoying, we want
1:58:33clean breaks. You know, if it was a
1:58:37perfect world, we would break here, hit
1:58:39here, come up here, test here, break
1:58:41here, go up there. But, you know, it's
1:58:45it's annoying when we break above like
1:58:48here, and then it kind of just starts
1:58:51following the ceiling. So, a lot of
1:58:55times you'll see Milk on his ES. He's
1:58:57throwing in the ceiling.
1:58:59the ceiling adjusted up, the ceiling
1:59:01adjusted down, letting everybody know
1:59:03where we're inside the volatility
1:59:05envelope because as we're trading
1:59:09um we need to have an idea of our range
1:59:11of course and what's possible.
1:59:14So knowing factually that our drive data
1:59:20and we always need to keep tabs on this
1:59:23just always watching making sure we're
1:59:24generating good data.
1:59:27you know that our floor and ceiling by
1:59:30and large day after day, minute after
1:59:32minute is encapsulating,
1:59:36you know, the market price action. So,
1:59:39um, so milk is showing that in real time
1:59:42and usually I just kind of paste in
1:59:44snippets into Discord, but I'm always
1:59:46referencing back to here. Here's the
1:59:49ceiling value. So if you want to put it
1:59:51in a graph, the floor the green line
1:59:55price action current price action is
1:59:57when this was generated and the PML line
2:00:00759.97
2:00:02of what time that was generated. So
2:00:05[cough and clears throat] I'll get asked
2:00:06I'll have people DM me, oh my god, don't
2:00:09you keep changing it every, you know, 3
2:00:11minutes or four or five minutes the PML
2:00:14and your floor and ceiling. like no not
2:00:18really because it doesn't radically move
2:00:21that much. So a lot of times I'll just
2:00:23put in a PML and whether it I caught it
2:00:26here or maybe up here it might be 20 or
2:00:2930 cent difference or 15 cent
2:00:32difference. So I don't sit there and
2:00:35fret over changing it every few minutes.
2:00:38I'll just put it in a couple times a
2:00:40day. Watch the price action to it. see
2:00:44if we're getting above it or below it.
2:00:47And then I'll see if the uh since I
2:00:49trade derivatives, I'll see if the
2:00:51option trade is coloring up in that
2:00:53direction. So, if we're trying to get
2:00:55underneath PML, I'll watch the put side
2:00:58and I'll see if it starts to color green
2:01:00because it should, if we're above PML,
2:01:03the put side most likely is going to be
2:01:05red. So, I want to see that confluence.
2:01:08I want to see it start to color up
2:01:10green. I want to see my PML on my graph
2:01:13on my Q graph. I want to see price
2:01:15action start to dip below it. And then
2:01:18at that point,
2:01:20I'm put on a trade, put in the stop, and
2:01:23then see what happens.
2:01:25So, I'm putting in the stops, letting
2:01:28the market take me out. I'm not like
2:01:30fretting over it, being like, "Oh my
2:01:32god, should I push the button?" You
2:01:34know? So, a lot of times I'll use a 35%
2:01:37on the um calls or puts or 50% usually
2:01:41between 35 and 50% for the stop
2:01:45cuz we're catching it
2:01:48so close to where the trade should work
2:01:53that we shouldn't have much draw down.
2:01:55And if we're starting to get too much
2:01:57draw down in the trade, then it's not
2:01:59working. And occasionally I break the
2:02:02rule. The other day I had in my head
2:02:05that I wanted the market to do a certain
2:02:08thing. So I put the trade in, I stopped
2:02:10out. I'm like screw that. I put it back
2:02:12in again. You know, I wasn't
2:02:15Sometimes I get bullheaded
2:02:17with what I'm seeing. But
2:02:21um for the most part just need to watch
2:02:24our
2:02:26metrics.
2:02:29Now, another thing that occurs is I
2:02:32don't know if you notice the alligator
2:02:34heads that happen. Like here's an
2:02:37alligator head.
2:02:40So, they're a sign of compression.
2:02:43See how the alligator, it's almost like
2:02:45you have an alligator body, alligator
2:02:47head. And then there was a correction
2:02:51here. So, I'll be watching for these
2:02:54compression areas. You know, it's like
2:02:57you get this funnel because typically
2:03:00when we get I'm seeing that compression.
2:03:04Um I think this happened intraday
2:03:07so probably some piece of information
2:03:09came out. Um but typically you'll get
2:03:12some form of cor uh correction
2:03:16and here a counter trend correction like
2:03:19here the counter trend was down here the
2:03:22counter trend was up.
2:03:25So, I'll be watching that, too. These
2:03:27like alligator
2:03:29heads with the mouth.
2:03:42>> Also, that's Wednesday in the middle.
2:03:44That was FC and they floor for more
2:03:48volatility, more expected volatility and
2:03:50they kept it all like all day long.
2:03:53>> Yeah. off.
2:03:56>> Yeah. And then it broke away. Yeah.
2:04:00Yeah, that's right.
2:04:02>> I forgot about that.
2:04:03>> Right there. It's like super expanded.
2:04:05>> Yeah. Yeah. Right there.
2:04:09Yeah. So, you can see the floor
2:04:11>> after 2 o'clock.
2:04:13>> Yeah. After two.
2:04:15>> Yeah.
2:04:15>> I don't think anybody expected him to
2:04:17say he was going to raise again, but the
2:04:20one was priced in. You can see it right
2:04:22there. I when he said he was going to
2:04:23raise again, I don't think anybody
2:04:25expected that.
2:04:26>> Um I I think the market was actually
2:04:28betting on him raising like 25 basis
2:04:31points.
2:04:32>> Yes. 25 but not 50.
2:04:34>> Yeah.
2:04:34>> Again, you think the market was already
2:04:36priced that in? I didn't see that.
2:04:39>> But you know,
2:04:40>> I trade futures. I don't I don't trade
2:04:41options. So here
2:04:43>> Yeah.
2:04:45>> 50. I saw 25 for sure. I was I was
2:04:49hoping they wouldn't raise it at all
2:04:51because like all the inflation's
2:04:52synthetic right now by oil
2:04:55>> but whatever they seem to be able to
2:04:59manage the economy I guess but yeah I
2:05:03don't know
2:05:06I know I was when they were doing it I
2:05:09was looking short at the time but
2:05:13you know we hit the floor
2:05:16>> I
2:05:17Yeah,
2:05:20>> I tried like
2:05:23Milo post stuff about the news. I I'm
2:05:26the worst. I never I never know what er
2:05:29dates are or any. I'm like just I go in
2:05:33and click like on the splicing.
2:05:37So I talk about splicing. I don't know.
2:05:39So when we do when I do the splicing, so
2:05:42like let's say I'm doing on QQQ, this is
2:05:45really important. You want to do it on
2:05:46wave one daily. And the reason is wave
2:05:49one daily, you're just telling the
2:05:51system to use the close price of the
2:05:54session, which is the most important
2:05:55piece of data that comes out of every
2:05:57session is close.
2:05:59So I always use wave 1 daily because
2:06:02it's using just close price. Once you
2:06:04start to change your wave pattern to 2,
2:06:07three, four, there's a learning vector
2:06:10that goes in and then it starts trying
2:06:13to figure out where support and
2:06:15resistance is through the price action.
2:06:18So when I'm doing the splicing, I just
2:06:20want to know for that session,
2:06:24you know, where the close price is at.
2:06:28And
2:06:30here's of course a bunch of different
2:06:32options. So what's today? Saturday. So
2:06:35let's do a Monday splice.
2:06:38So I'll do it for QQQ.
2:06:43And
2:06:45so
2:06:46S minus and S+ that's splice plus and
2:06:50minus. So from it's kind of like a
2:06:53rocket. There's T minus T+.
2:06:58And when you're at uh liftoff, then
2:07:01every minute is um above liftoff post
2:07:07plus and minus up to liftoff. So this
2:07:10you can alter that.
2:07:14But on Monday, let me just do that.
2:07:18Let's see what's up with Monday.
2:07:22There's Monday.
2:07:31So this is the Monday splicing. That's
2:07:33how you set it up.
2:07:36So again, just like that monthly
2:07:38expiration,
2:07:40this is showing us all the Mondays
2:07:42relative to each other.
2:07:46So when we get these downdrafts like
2:07:48this, we know Monday after Monday after
2:07:51Monday session was lower, lower, lower,
2:07:54lower. So we had all these Mondays
2:07:56creeping down.
2:08:00And then what I what I'll do is so
2:08:04historically
2:08:06coming this Monday for QQ
2:08:09only 33% of the time
2:08:13have we gotten a 2L. So that means 67%
2:08:17of the time,
2:08:20you know, better than 50% of the time
2:08:23we've moved back over to H1
2:08:26for this Monday.
2:08:29And symmetrically
2:08:33these 1L's
2:08:37like when I move this,
2:08:40the arrow was last Monday.
2:08:44You can see that the market like these
2:08:48guys institutions
2:08:50they're looking to past
2:08:531L's
2:08:55the lows because here's where we landed
2:08:58last Monday. So we were pretty much
2:09:00symmetrically here
2:09:03and then got beneath those. So,
2:09:07one way I know during the day, like on
2:09:09on a Monday,
2:09:12I know when we get to this level here,
2:09:15price level, I know that we can get
2:09:18deeper cuz a lot of these 1L's are
2:09:21beneath that. So, I know the market has
2:09:24more downward momentum capability to it.
2:09:30I have a question on this. So I see
2:09:32you're looking at like the H1 and L
2:09:36on the left hand side. You're looking at
2:09:37the 33% on the bottom, but above those
2:09:41green bars there's 11%. Can you talk
2:09:43about the different the differential
2:09:45between the 33 and 11%.
2:09:47>> Yeah. So you're talking about
2:09:50here.
2:09:51>> Yeah. And and I'm agreeing the H
2:09:54>> and then over here the 11% where over
2:09:58here. So it's like it's like so it's a
2:10:01one 11% and 33% on the bottom probably a
2:10:05different but there's a the numbers are
2:10:07different.
2:10:08>> So here they're different you're talking
2:10:10about
2:10:10>> and then the ones above are different.
2:10:12>> Yeah. So this is like using Monday
2:10:15splicing
2:10:16>> wave 1 daily.
2:10:18Yeah, because
2:10:22the data I've loaded.
2:10:28So these candles
2:10:31only represent Mondays and the graph
2:10:34you're looking at like what
2:10:36yours probably represents every day.
2:10:40>> I think
2:10:42MondayQ wave one daily, Monday. Oh,
2:10:45you're doing uh do you have like 250
2:10:48days?
2:10:49>> I got 200 days.
2:10:50>> Okay. Yeah, if you do 250,
2:10:52>> it should match. Yeah.
2:10:54>> Is there a difference between those
2:10:55numbers like as far as like what they
2:10:57mean? So,
2:10:58>> uh so it's all in how you want to
2:11:00analyze a data set. So, milk like he'll
2:11:04do like 500 days a lot of the times.
2:11:07I'll do 200 days.
2:11:10the farther you get back in the past,
2:11:12the less meaning the data has. Like if
2:11:15you pull in.com data, probably doesn't
2:11:18really reflect what's going on in
2:11:20today's economy. So that's why I like to
2:11:23keep the data sets just shortterm. Like
2:11:26when you're using a a retail system and
2:11:29you're pulling up, you know, MACD,
2:11:33a lot of times they'll have a 21 period
2:11:35of 14, a seven.
2:11:37So they're just looking at the last, you
2:11:40know, little bit of chunk history. Here
2:11:43we're looking at a more, we're analyzing
2:11:46the full set of data and 200 days is not
2:11:50quite a year, but it's about 9 months.
2:11:54So for me, like the my style, I'm kind
2:11:59of okay with 9 months. Milk likes to
2:12:02cover a bigger expanse. Um, and there's
2:12:06nothing right or wrong to it. I mean,
2:12:08you can do 50 days or whatever. It's
2:12:12just
2:12:13uh volatility is an expression of time.
2:12:17So, the more time you're measuring, the
2:12:20more volatility you have in it because
2:12:21it covers, you know, if you're coming
2:12:23out of 911
2:12:25or COVID, the volatility was like
2:12:27through the roof. Um,
2:12:31but I I tend to just stick with around
2:12:34200 days. This one I just fictitiously
2:12:37did 250
2:12:40and
2:12:42but yeah, 200 also. This should probably
2:12:46match what you're saying.
2:12:47>> Yeah, there is
2:12:48>> 33. 33.
2:12:51Yeah, it's funny how it's 33 on both the
2:12:54long and short side.
2:12:57And here,
2:13:00so the market has been fairly well
2:13:03balanced. It's because over 200 days,
2:13:07the H's are the same as the L's.
2:13:13133 2211.
2:13:16The
2:13:18long side has been more potent because
2:13:21if we look at the histogram here, we
2:13:24have a 28% move that lasted for six and
2:13:29only at 9.1% move. So, this shows if you
2:13:36cut the your losses, if you're trading
2:13:39long, you're better off cutting losses
2:13:41sooner than later because the rundowns
2:13:46in here can be kind of rough.
2:13:52Um, so, so anyways, this if you know if
2:13:59you're trying if like myself, I'll be
2:14:01like, "Okay, what's possibly going to
2:14:03happen on Monday?" I open up the Monday
2:14:05splicing, just look at the odds
2:14:08and
2:14:10kind of keep it that simple. Over here
2:14:12on the right again we have the imprints
2:14:14the price memory. So we see if Monday
2:14:17we're short. It's like let's say Monday
2:14:19we don't go long.
2:14:21Odds right now favor long because only
2:14:2433% of the time we go to two
2:14:282L.
2:14:30So let's say we aren't long on Monday
2:14:33then we know that we've been coming down
2:14:35here.
2:14:37So, if we can get long on Monday, and we
2:14:39know Monday if we do, we should be, you
2:14:43know, we're over 72049 already.
2:14:48So,
2:14:50possibly Mondays in the future, we can
2:14:52hit 763.
2:14:55But right now, it looks like we're on
2:14:58course for a 1H coming Monday because
2:15:01we're already over the 72049.
2:15:05But there is some level resistance here.
2:15:08So,
2:15:10but if we do go up
2:15:13like 7,
2:15:15we'll start approaching that get into
2:15:18the 730s maybe
2:15:26long. So,
2:15:28you want to end it off. You can end it
2:15:29off here um with a final question.
2:15:42Um, with the final question to like end
2:15:44it off the whole event and everything,
2:15:46if you can give anyone watching right
2:15:48now and to the world, what is one advice
2:15:50you'd tell not just yourself right now,
2:15:52but even just your younger you in terms
2:15:54of for trading and for everything in
2:15:56like life aspects? Oh, I have not much
2:16:00idea, but I do know um financially one
2:16:04mistake I made when I was 18, 19, 20. Um
2:16:09we were talking about it last night. So,
2:16:11I bought three stocks. I bought Forest
2:16:14Labs and AMD and um
2:16:18what was the other one? Alberto Civer.
2:16:22And uh I was very impatient at that
2:16:24time. I would look at so before the
2:16:27internet I'd get the newspaper all the
2:16:28time and uh I would see all these stocks
2:16:31that would make you know 200% moves
2:16:34penny stocks 100% moves I'd be like why
2:16:36is Alberto Culver not moving that much
2:16:39you know and they just make hair
2:16:40products shampoos and stuff like that so
2:16:43I became really impatient with that and
2:16:46I should have those stocks I should have
2:16:48continued to hold because right now I
2:16:52had about $30,000 in the
2:16:55and they would have been worth
2:16:56multi-millions right now. So just you
2:16:59know being impatient.
2:17:02So I think patience is a key thing in
2:17:06life
2:17:08that for that and other things.
2:17:11My wife's very patient with me even
2:17:14though I drive her crazy.
2:17:17>> You want to give a good vibe?
2:17:19>> Yep. So all right. So thanks for
2:17:21everybody attending. Was nice. Hope
2:17:24there was

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