The One " Box Theory" Strategy That Works Everyday ( Stupid Simple And Proven) — Transcript

Full transcript

1. 0:00Hello, my name is Doug and I've been a
2. 0:01day trader now for more than 25 years.
3. 0:03And if there is one thing that I have
4. 0:05ever learned about trading, it's that
5. 0:07stupid simple always wins. The more
6. 0:10simplistic and basic our trading
7. 0:11strategies are, the more decisive we
8. 0:13become. And of course, the more decisive
9. 0:15we are, the more money we're going to
10. 0:17make. It's that simple. And that's why
11. 0:19for a lot of us, the harder that we try
12. 0:21to make trading work or the more we
13. 0:23immerse ourselves into complex theories
14. 0:25and strategies, the worse we get. And if
15. 0:27you're not consistent or confident in
16. 0:29your trading decisions right now,
17. 0:31chances are your trading strategy just
18. 0:33isn't simple stupid enough. So today,
19. 0:35I'm going to show you one of the most
20. 0:36simplistic and primitive trading
21. 0:38strategies you have ever seen. It's
22. 0:40called the box theory. And this has been
23. 0:42my go-to trading strategy over the last
24. 0:44two decades. And it's helped me
25. 0:46consistently make five figure trading
26. 0:48profits like this, this, and this almost
27. 0:52on a daily basis. And I'm just going to
28. 0:53give it to you. I'm going to give you
29. 0:55the entire strategy framework that you
30. 0:57need to get started right now. And just
31. 0:59so you know this works, everything I
32. 1:01show and tell you today, I'm going to
33. 1:03back it up with a series of live trades.
34. 1:05And by the time the video is over, you
35. 1:07will see in real time why stupid simple
36. 1:10always works. All right, so I did
37. 1:12promise you stupid simple and primitive.
38. 1:14I guess I better get to work and deliver
39. 1:15on that promise, right? So here's what
40. 1:17we're going to do. And it doesn't matter
41. 1:18what asset or market you're trading.
42. 1:20It's all going to be the same. It is
43. 1:22just a chart. And here's what we're
44. 1:24going to do when we begin our trading
45. 1:26session. The first thing we want to do
46. 1:28is box in the previous day's high and
47. 1:31low price. Now, this is very easy to do.
48. 1:34You can look at a daily chart and just
49. 1:35mark the high and low of that candle. Or
50. 1:37you can do what I'm going to do right
51. 1:39now, which is take the chart I'm looking
52. 1:40at, move my eyes to the left, and box
53. 1:42those two prices in. So, if you take a
54. 1:44look at my chart, this black shaded area
55. 1:47represents the previous day's action.
56. 1:49And all I'm going to do is I'm going to
57. 1:51grab any kind of drawing tool that my
58. 1:53software may have and I'm going to
59. 1:55connect that high price with the low
60. 1:57price that I see. And that creates my
61. 1:59box. Now, what we need to know about
62. 2:01this box is that the very top range of
63. 2:04that box, the very top part of that
64. 2:06represents the largest collective of
65. 2:09selling that took place that day. And
66. 2:12that's why the instrument reversed. And
67. 2:14down at the bottom, we have the inverse
68. 2:16relationship. is where the largest
69. 2:18collective of buyers took control of the
70. 2:20chart and it bounced its way up there.
71. 2:22Now, here's the reason we need to know
72. 2:24this information for our trading day
73. 2:27because in most cases, the majority of
74. 2:30activity that we need to know to get the
75. 2:32answers we want to make the biggest
76. 2:34trades we possibly can, they are going
77. 2:36to take place at those levels. Now, once
78. 2:39we've drawn this box to start with,
79. 2:41here's what we want to do when the
80. 2:43market opens that we are trading. Again,
81. 2:45no matter where we are in the world,
82. 2:46whatever market we're trading, this is
83. 2:48what we're going to do with the
84. 2:49information that we've collected from
85. 2:51the box. If whenever you begin your
86. 2:53trading day or the market opens that
87. 2:55you're trading, if prices are close to,
88. 2:59at or above that box, do not buy at that
89. 3:05moment in time. Don't buy yet. If the
90. 3:08prices are there, we want to be sell
91. 3:11side focused. That could be engineering
92. 3:13a short trade or just selling a position
93. 3:15we have. But we definitely do not want
94. 3:17to buy. The inverse relationship is down
95. 3:20towards the bottom. If the prices are
96. 3:22close to, at or below that box, do not
97. 3:28sell. Don't sell a position that you
98. 3:30currently have or don't engineer a short
99. 3:33trade all the way down there. Now, what
100. 3:35I would highly recommend here, one of
101. 3:37the most effective things about the box
102. 3:39theory itself is we want to take a line
103. 3:41and draw right through the center of
104. 3:43that box. And I would highly recommend,
105. 3:46there's something we've been using for a
106. 3:48very long time here, a phrase. It's
107. 3:49called don'tdle in the middle. Now, this
108. 3:52is specific towards the first 10 or 15
109. 3:54minutes of your market open. But try
110. 3:57your very best not to execute trades in
111. 4:01the center of that chart. And that's for
112. 4:03one main reason. Because you're way off
113. 4:07the highest buyer and way off of the
114. 4:10highest seller, your accuracy is going
115. 4:14to be very poor over a long period of
116. 4:16time. This is something I was plagued
117. 4:18with when I started is whatever pattern
118. 4:20I was trading, wherever it developed on
119. 4:22the chart, I just pushed the button.
120. 4:24This is one of the biggest reasons that
121. 4:26we are not consistent is because what
122. 4:28we're doing is we're trading in the
123. 4:30noise away from the premium level. So,
124. 4:32we want to make sure we don't do that.
125. 4:34Now, let's go back to the chart we have.
126. 4:36So, the next thing we want to do is take
127. 4:37our master or monster box and let's just
128. 4:39go ahead and extend this thing all the
129. 4:41way out to the right side of our chart
130. 4:43as far as we can see and start working
131. 4:45within those levels. Now, you can take a
132. 4:47look right here as the market opens. The
133. 4:49very first move is a green candle where
134. 4:52right at the top of that box. So, let's
135. 4:57say your hands are tied behind your back
136. 4:59and you are forced to make a trade right
137. 5:01here. You got to hit the button with
138. 5:03your chin or reach out and hit it with
139. 5:05your chin. Based off of the information
140. 5:08that you've obtained in this video up to
141. 5:11this point, what would be the right
142. 5:14choice to make? Should be obvious. You
143. 5:17should sell, right? So, let's kind of
144. 5:19move this forward a little bit and take
145. 5:21a look at what happens. You'll notice
146. 5:22that the chart starts to fall apart. And
147. 5:25it doesn't mean that it's a bearish
148. 5:27chart or the world is ending. It's just
149. 5:29you have reached that top area also
150. 5:31known as like a liquidity zone or
151. 5:32resistance area. But you have reached an
152. 5:34area where sellside side has been ultra
153. 5:38dominant. And us as traders have to
154. 5:40continue to assume you know until that
155. 5:43seller gives up or that group of sellers
156. 5:45gives up. This thing is never going to
157. 5:47go any higher. It's constantly going to
158. 5:49be suppressed. Now you see that it's
159. 5:50moved down much lower. I want to just
160. 5:53kind of jump ahead here and give you
161. 5:55another quiz. Based off the information
162. 5:57you've obtained in this video, I want
163. 6:00you to tell me where do you think this
164. 6:03thing is going to go? Where do you think
165. 6:05that's headed? I mean, it should be
166. 6:07obvious at this point that you're going
167. 6:09back down to the low pivot of the day.
168. 6:12So, take a look at that. It tested the
169. 6:14high pivot early and immediately made a
170. 6:16beline to the low pivot. Now, let me
171. 6:19give you a little hint here on why this
172. 6:20is so valuable. Because the majority of
173. 6:22trading strategies that we're taught in
174. 6:24the beginning have us doing this ass
175. 6:25backwards. They have us buying up in
176. 6:27here towards the supply into that
177. 6:29resistance to the top of that box and
178. 6:31they have us short selling all the way
179. 6:32down at the bottom. There isn't a lot of
180. 6:34value when you do that. Now let me show
181. 6:37you here again the power of the box. And
182. 6:38I really really want you to see this
183. 6:40because when you see this aggressive
184. 6:42move that was pretty continual. It was
185. 6:44pretty aggressive. You're just moving
186. 6:46one candle after the other. It looks
187. 6:48horrible. People are probably freaking
188. 6:50out. traders are getting stopped. It
189. 6:52doesn't look like a buy. Am I correct?
190. 6:55Like that's not something you probably
191. 6:57have ever been trained in your mind to
192. 6:59buy because the technical patterns that
193. 7:01you've been taught aren't teaching it
194. 7:02you this way. So you're like, "That's a
195. 7:04falling knife. Don't do that." You
196. 7:06you're probably told that. But take a
197. 7:08look at what happens, right? You get to
198. 7:10the bottom of the range and what
199. 7:12happens? You bounce, right? Now, the
200. 7:14reason that you bounce is simple. It's
201. 7:17because the collective of buyers were
202. 7:20still there. And what did I say earlier?
203. 7:22You have to assume that those buyers and
204. 7:25sellers are going to continue to show
205. 7:27up. And it won't be until one of those
206. 7:30sides are dispatched can this thing
207. 7:32truly aggressively move to the upside or
208. 7:35downside. It's going to stay inside of
209. 7:36that range. And you're playing that
210. 7:38range. Now, let's take a look at another
211. 7:39chart. All right. So, here we have
212. 7:41another chart. What do we do first? We
213. 7:43go to the previous day's high, which is
214. 7:45right here, and we connect it with the
215. 7:47previous day's low. We take that box,
216. 7:50and we extend it out as far as we can
217. 7:52see to the right. So again, based off
218. 7:55the knowledge you've collected up into
219. 7:57this video, you see where the asset is
220. 7:59trading now. And again, it doesn't
221. 8:00matter what asset we're talking about.
222. 8:02It's just a chart. And charts are
223. 8:03reflections of people and emotions. And
224. 8:05that's why they're so universal and can
225. 8:07work in anything that you trade. But
226. 8:09let's get back to the point. What do you
227. 8:11do? Hands tied behind your back, chin
228. 8:13out. You got to push a button. I hope
229. 8:16you said sell. So, let's kind of move
230. 8:18this forward here a little bit. What
231. 8:20happens? No surprise. And where do you
232. 8:23end up going? Let's take a look at this
233. 8:26one more time. You went straight into
234. 8:29where? Into the low pivot at the base of
235. 8:33the box. And again, this does not look
236. 8:35like something you should have bought.
237. 8:38That's the thing, right? Traders look at
238. 8:39that and go, "Oh my god." But think
239. 8:41about it in an inverse relationship. Why
240. 8:43would you buy that? That looked like it
241. 8:45was going to keep on going forever,
242. 8:46right? And that's what we don't want to
243. 8:47do. We don't want to chase in to those
244. 8:50prices. And that's why we use that box
245. 8:52because it tells us the closer we get to
246. 8:54the box. We have to assume that the
247. 8:56buyers that were back here at these two
248. 8:58points over here are going to return.
249. 9:01And you see there is an actual pivot
250. 9:03again. Right now, I want to move forward
251. 9:05here and I want to show you something
252. 9:07and move on to alternative boxes because
253. 9:10I mentioned when the market opens, we
254. 9:13want to construct this large box. But,
255. 9:15you know, as I know that trading is
256. 9:17unique. Sometimes you're going to open
257. 9:19up above that box, down below that box,
258. 9:21and as the day progresses, there's going
259. 9:23to be secondary boxes that we need to
260. 9:26draw. So you can take any sort of pivot
261. 9:29from any type of chart frame you're
262. 9:32looking at and create yourself a new
263. 9:35box. Now I personally use the box
264. 9:38effective enough that within the first
265. 9:4020 to 30 minutes of the day, I can find
266. 9:43myself a very big winning trade and I
267. 9:46don't need to trade the rest of the day.
268. 9:47But I do know things happen. You work,
269. 9:48you come home. There's there's multiple
270. 9:50reasons you may or may not want to. So
271. 9:52here's what we're going to do. We're
272. 9:53going to take this box and we're going
273. 9:55to move it back and create secondary
274. 9:58boxes. So, I'm going to move forward
275. 9:59just a little bit. And anytime you would
276. 10:02see a pattern like this, you can take
277. 10:04again any high and low pivot, the very
278. 10:06first high and low pivot that you see
279. 10:08with your eyes. We'll grab ourselves
280. 10:10another box tool. And we're just going
281. 10:12to take this high pivot, right? Doesn't
282. 10:14matter what time frame, doesn't matter
283. 10:15what asset, and we're going to box that
284. 10:18in and create a secondary box. Now, the
285. 10:21rule still applies no matter where you
286. 10:23are, where where you are on the chart.
287. 10:25Take a look at where we are. What do we
288. 10:29do down here, right? You're still in
289. 10:32that buy zone, right? Keep keep thinking
290. 10:35about that. And I want to make this
291. 10:37clear because this is what's so
292. 10:38important about it. You have to trust
293. 10:40the process. You have to again assume
294. 10:43the big buyer and big seller are going
295. 10:46to continue to show up. It there could
296. 10:48be millions of reasons why they want to
297. 10:50do it. It doesn't mean it's bullish or
298. 10:51bearish. Get that in your mind. It
299. 10:52doesn't mean that things are going to
300. 10:54collapse. 99% of the time you're going
301. 10:57to have a trade trading something that's
302. 10:58jammed within a range. Okay? So, what
303. 11:02would we again hands tied behind the
304. 11:04back, chin out, you got to push a
305. 11:06button, right? You no setup whatsoever.
306. 11:09You just hit the button based off of the
307. 11:11box. You buy and look what happens. You
308. 11:14bounce off of the box, right? That's a
309. 11:17nice nice bounce. Now, I want to give
310. 11:19you one more tip. Consider this like a
311. 11:22bonus here. One of the things that
312. 11:24traders often misuse, a huge word that's
313. 11:28misused in the world of trading is the
314. 11:30word breakout or breakdown. Just because
315. 11:33something is rallying or moving upward
316. 11:36aggressively does not constitute a
317. 11:38breakout or something flushing doesn't
318. 11:40constitute a breakdown. Again, that's
319. 11:42why this had flushed is because it
320. 11:44stayed within that structure. So unless
321. 11:47this thing actually broke the low of the
322. 11:49box or the high of the box, it it's
323. 11:51going to stay with inside of that
324. 11:52structure. That's how you can trust it.
325. 11:54Now, let's go over here to this micro
326. 11:56box. At some point, no matter what
327. 11:58you're trading, is going to move outside
328. 12:01of that box. And when you do move
329. 12:04outside of that box, this is where the
330. 12:08big moves tend to take place. the
331. 12:11biggest move, the official breakouts are
332. 12:14when ranges have been broken and that's
333. 12:17when things really start to kick into
334. 12:18high gear. But I want to show you this
335. 12:20because it's very very important. What
336. 12:23happened? You broke the range. And once
337. 12:26you broke the range, take a look at the
338. 12:29aggressive move. Now, let's go back and
339. 12:32keep in focus the previous box. Again,
340. 12:37I'm just going to give you another quiz,
341. 12:39right? Where do you
342. 12:43think that's going to go? Where do you
343. 12:46think? Got any ideas where that power
344. 12:49move is going to go? Should be pretty
345. 12:52simple. You should have passed this test
346. 12:53with flying collars. You're going to run
347. 12:56right back up into that top. Now, let me
348. 12:59show you again what has happened. The
349. 13:01effectiveness and the power of the box.
350. 13:03I want you to look at the chart for a
351. 13:04second, and I want you to think of what
352. 13:06you're seeing here and how valuable this
353. 13:08is. Take a look. You come back up to the
354. 13:13box here and revisit the very high. So
355. 13:16if this was your you were in this
356. 13:18scenario, this happens to you. Obviously
357. 13:20once it's rallied up this far, you don't
358. 13:21want to buy it. You know, you want to be
359. 13:23a buyer down here and again sell side up
360. 13:25here. You want to be a sell side up
361. 13:26here. Look, it gave you the trade again,
362. 13:30right? Another trade back down,
363. 13:32rejected. Where does it go? It goes
364. 13:35right back into the base of this box.
365. 13:39You see how it revisits that box, right?
366. 13:42And where do you end up? And this is
367. 13:45like several days of activity. You've
368. 13:48remained trapped in the box again. High,
369. 13:52test the high, you don't buy. It sells,
370. 13:54tests the low, tests the low again,
371. 13:56trades to the top, trades back down into
372. 13:59the bottom. That right there was enough
373. 14:01trades for you to kick that all day long
374. 14:04and make tons of money. So, enough of
375. 14:06this. Let's move on to some live trades
376. 14:08so you can see exactly how this works in
377. 14:10a real market. Okay, so we're going to
378. 14:12start out here in the pre-market and put
379. 14:15together the premium levels and draw the
380. 14:17box so we can begin to manufacture
381. 14:19quality trade ideas. Now, before I get
382. 14:21involved with that, let's just do a
383. 14:23couple of preliminaries here so we're
384. 14:24all on the same page. I am using the
385. 14:27Think or Swim platform. So those two
386. 14:30gray areas you see is pre and postmarket
387. 14:32and the dark black area is official
388. 14:34market opening. Just wanted to make sure
389. 14:36everybody understood that. Now I'm using
390. 14:38a fiveinut chart. These are five minute
391. 14:40candles. But as I said earlier, I don't
392. 14:43really care what chart frame you're
393. 14:44using. That really is irrelevant. I
394. 14:46don't care what asset you're trading,
395. 14:47whether it's a stock, a commodity, or
396. 14:49crypto. None of that matters. Just
397. 14:51follow this process and good trades will
398. 14:53come your way. Now, during my pre-market
399. 14:56scan, the stock that was the most
400. 14:58attractive to me today was Palunteer,
401. 15:01ticker symbol PLTR. And that is what
402. 15:03here is on this screen. I'll show you
403. 15:05why I like it so much. But let's start
404. 15:07with the basics. We're going to go to
405. 15:10the very previous day and we're going to
406. 15:12mark that high and that low and create
407. 15:15our box. And that constitutes the
408. 15:19premium levels. We have the extreme sell
409. 15:22side way up here and the extreme buy
410. 15:24side. Now, take a look at right where
411. 15:26Palunteer is. Now, I mean, at this point
412. 15:29in the video, you should know exactly
413. 15:31what you're going to do. We are looking
414. 15:33to buy into that level. And I want to
415. 15:37show you about trusting this process. A
416. 15:39lot of people would say right now that
417. 15:41is idiotic. The market is correcting and
418. 15:44it's down. I got the S&P right now at 55
419. 15:47points already. That's huge. NASDAQ down
420. 15:51190. So, you would think no way do you
421. 15:55buy. But we want to look at the very
422. 15:57base of that box to buy. Now, what I'm
423. 15:59going to do here as well is I'm going to
424. 16:01remove this entire box because the
425. 16:04thinker swim platform isn't as stay
426. 16:07aesthetically pleasing as Trading View.
427. 16:09So, I don't want to clutter it up. I
428. 16:10don't like the contrast of those colors.
429. 16:12So, let's just kind of mark the top of
430. 16:13that box and let's mark the bottom of
431. 16:15that box. Now, the reason I like to
432. 16:17palanteer so much, let me kind of show
433. 16:19you something here. I don't know if I
434. 16:20touched on this, but once I draw these
435. 16:23levels, I kind of like to push my eyes
436. 16:25towards the left side of the chart. And
437. 16:28let me show you what I see here with
438. 16:29this based price around this 85 to 8550.
439. 16:32Notice that the previous day there was a
440. 16:35pivot there and there also was a a
441. 16:37little bit of support before you had
442. 16:39this very nice sized rally. If you move
443. 16:41it over here that price was right within
444. 16:43this range where there was a previous
445. 16:45pivot and if you come all the way out
446. 16:47here you're going to see it was once a
447. 16:49pivot again. So there's a lot of
448. 16:50activity. You see how that like see how
449. 16:52the visualization if you draw that
450. 16:54rectangle across there or the box
451. 16:56there's a lot of activity at 85. That's
452. 17:00where I want to buy. So let's say it
453. 17:02doesn't get down to 85. I'm not sure I
454. 17:05want to buy this. If it goes way below
455. 17:0785, I'm still not sure I want it. We
456. 17:10want to see number one, does it get to
457. 17:1285? Number two, does somebody buy it at
458. 17:1585? Also, if it goes parabolic and
459. 17:17starts shooting straight up out of the
460. 17:19air here, do we buy it? No, we do not.
461. 17:21It has to be at 85. I want to make that
462. 17:23clear because if it doesn't follow the
463. 17:26order of the box, the answer is very
464. 17:28simple. We don't take the trade. So,
465. 17:30let's let the market open. Let's see if
466. 17:32this gives us an opportunity or if
467. 17:34there's another stock or the market,
468. 17:36whatever may give us another
469. 17:37opportunity. Okay. I want to show you
470. 17:39something right here that's pretty
471. 17:41important. And for those followers of
472. 17:43the channel, I'm sure you see this as
473. 17:45well. Take a look at what happened. you
474. 17:48kind of got a little bit under the box.
475. 17:50This rectangle right here represents the
476. 17:52bottom of that box, by the way. And we
477. 17:54are down here at that 85 level. But look
478. 17:56what happened. Even though you kind of
479. 17:58pushed through that a little bit, take a
480. 18:01look at that wick right there. This is
481. 18:03one of my favorite signals. I'm going to
482. 18:05put it up here because we potentially
483. 18:07have a John Wick. Now, a John Wick would
484. 18:09be an inverted I mean a regular hammer
485. 18:11followed by a break. So, if we kind of
486. 18:13break through this on the next candle,
487. 18:17that's the kind of setup I'm looking
488. 18:18for. And I'm looking to stop below just
489. 18:21in case it gets real ugly. Okay, so
490. 18:24coming back. As I said, look, a very
491. 18:26good high probability it comes back. We
492. 18:29are in this trade. Entry price right
493. 18:31here is
494. 18:328541. Just a little bit late right
495. 18:34there, but 8541 is the price entry of
496. 18:38this trade. That is the John Wick. And
497. 18:40I'll put that up there again for
498. 18:42everyone to see. Now, let's talk about
499. 18:43using the box here. Stop is going to be
500. 18:46below the low of the day there just so
501. 18:48we're all on the same page with that.
502. 18:49But let's kind of back this chart out
503. 18:50just a little bit. So, when it comes to
504. 18:52the targets, we're going to use the box
505. 18:54theory on the way back. So, we got the
506. 18:56very tippy top part of this box that
507. 18:58we're thinking as the ultimate target,
508. 19:01but that's quite a distance away. And
509. 19:02there's a lot of things that can happen
510. 19:04from where it sits now to getting up
511. 19:06there. This is where the alternative
512. 19:08boxes are going to come in. Now, I'm not
513. 19:09going to completely draw the boxes
514. 19:11because the contrasting of colors. So,
515. 19:13let's just kind of put a line in there.
516. 19:14Somewhere about in this area here is a
517. 19:18good target. Getting right back up to
518. 19:20the pre-market pivot. And then we kind
519. 19:23of want to work our way back up the
520. 19:25scale here with each one of those levels
521. 19:28and see if we can kind of make it up
522. 19:29there. So the first target is getting us
523. 19:32back in towards the top which is 87 at
524. 19:35least and then looking for somewhere
525. 19:38between 8850 which is let's say this
526. 19:41level over here. You see how you just
527. 19:43kind of backtrack that a little bit.
528. 19:44We'll leave him right there. I don't
529. 19:45want to make too much a mess of the
530. 19:47chart and see if we can get to this one
531. 19:49or this one ultimately or if we even
532. 19:52stand a chance of of getting back to
533. 19:53that one. But again, we got the buy we
534. 19:56needed. You can see it's still holding
535. 19:58up after about four or five minutes
536. 20:00later. So, all systems ago, the box
537. 20:02theory has helped us with a quality
538. 20:04entry. If we don't win on this trade,
539. 20:07that's fine. It doesn't cost a lot, but
540. 20:09we have very little invested and we can
541. 20:11get two, three, maybe four bucks. Let's
542. 20:13go ahead and see what happens. All
543. 20:15right, so the first check back here with
544. 20:17Palunteer exactly what we wanted. Now,
545. 20:21here's what I want to highlight. Now
546. 20:22that we've reached that first boxed
547. 20:25area, we have to pay close attention to
548. 20:27this trade to make sure it doesn't get
549. 20:29sold off. Okay, this is not the upper
550. 20:31part of the box. So, there's still a
551. 20:33chance we can get way up there towards
552. 20:34the top. This is just the first, let's
553. 20:36say, intermediary line. So, if there's
554. 20:39too much rejection here, then we're
555. 20:42going to have to just get out of the
556. 20:43trade. At this point, the stop has been
557. 20:45moved to a break even area. So, we're in
558. 20:48the money one way or the other and we're
559. 20:50doing really well here with it. So,
560. 20:52let's just kind of see if you know we
561. 20:54can get a little bit more on this trade.
562. 20:56So, I went ahead and jumped forward and
563. 20:58obviously no words are needed. There you
564. 21:02see it. The box theory at its finest.
565. 21:05Look at that bounce. Notice that when
566. 21:07you come up to this first box, I hope I
567. 21:09don't make too much of a mess here, but
568. 21:11notice it just clustered into that box.
569. 21:14So, if you didn't get an entry down
570. 21:15towards the bottom, there was another
571. 21:17one right there. And the thing is, it
572. 21:19never really sunk back down into the
573. 21:21middle of that box or rechallenged the
574. 21:23low. Then what happened is it repeated
575. 21:25that same pattern, kind of reflged again
576. 21:28and broke right back up to the upside.
577. 21:30And notice it was almost the identical
578. 21:32formation here as it was here. You got
579. 21:35really aggressive. See what happens when
580. 21:37you break the box or the smaller boxes?
581. 21:39You get right aggressive. You
582. 21:40immediately run to the very top piece of
583. 21:42that resistance. Then you kind of hold
584. 21:44that framework of the box. Then you run
585. 21:47right back up to the top. You repeat
586. 21:49holding that framework. And now you're
587. 21:51just floating here towards the end. Now
588. 21:53the day is almost over here. We're
589. 21:55pushing much later. So I'm going to wrap
590. 21:57that up. But that's what I wanted you to
591. 21:59see about the box. All right. I'm sure
592. 22:01you've got it. But just for the people
593. 22:03in the back, let's do a real quick recap
594. 22:05on what we have learned today and how
595. 22:08we're going to use it going forward. For
596. 22:10the box, we want to begin by marking the
597. 22:12previous day's high and the previous
598. 22:15day's low. If prices are moving up at
599. 22:18the open towards, at or above, we do not
600. 22:22want to make the first trade out of the
601. 22:24gate a long. We want to wait for at
602. 22:26least a pullback before we think about
603. 22:28doing something like that. Inverse
604. 22:30relationship. If we are heading towards
605. 22:33at or below the previous day's low, we
606. 22:36do not want to sell that position right
607. 22:39away or worse, we do not want to short
608. 22:42sell it. We want to try to do our best
609. 22:45very early on until structure has been
610. 22:47developed in our charts of trading in
611. 22:49the center. And if we can just follow
612. 22:52that, in most cases, as you will see, as
613. 22:55you did see, you will be on the right
614. 22:57side of the market. Don't forget each
615. 23:00week my wife and I put together a free
616. 23:02gains guide. In that gains guide it
617. 23:04talks about stocks like Palunteer. It
618. 23:07has setups, chart patterns, and gives an
619. 23:09overall market review. And as I said, it
620. 23:11is free. So if you're interested in
621. 23:13that, down in the description box,
622. 23:15you're going to find a link. Now, if you
623. 23:17have any questions, feel free to put
624. 23:19those down into the comments section.
625. 23:21And on that note, thank you very much
626. 23:23for watching. Cheers.