The ONLY INDICATOR That Predicts Monster Moves (Most Traders Use It Wrong) — Transcript

Full transcript

1. 0:00In today's video, I am going to show you
2. 0:01this amazing trading indicator that is
3. 0:03specifically designed to take advantage
4. 0:05of short-term explosive moves in the
5. 0:08market. It's called the nine exponential
6. 0:10moving average, also known as the 9 EMA.
7. 0:13This is the most widely used indicator
8. 0:15amongst institutions, banks, and
9. 0:17elite-level traders, and there's good
10. 0:19reason for this. Because when used
11. 0:21correctly, there isn't a more accurate,
12. 0:24on-point indicator a trader can use than
13. 0:27the 9 EMA. There's just nothing like it.
14. 0:29But here's the thing. If it's used
15. 0:31incorrectly, it's just another piece of
16. 0:34noise cluttering up your charts, and you
17. 0:36don't need that. What you need is
18. 0:38something that's fast and concise. Now,
19. 0:41my name is Doug, and I've been a
20. 0:42professional trader now for 26 years.
21. 0:44And one of the biggest things I've
22. 0:45learned throughout that time is money
23. 0:47moves fast in markets. And if you want
24. 0:50to make money, you've got to be able to
25. 0:51react fast. But you're never going to be
26. 0:53able to react fast if you're wasting
27. 0:55your time with complex theories,
28. 0:57systems, and multiple points of
29. 0:59confirmation. Because if that's what
30. 1:01you're doing, you're always going to be
31. 1:03steps behind the market. And traders who
32. 1:05are step behind the market, they always
33. 1:07end up losing, and I know you don't want
34. 1:09that. So, in today's video, I'm going to
35. 1:11show you everything I've ever learned
36. 1:12about trading this 9 EMA. I'm going to
37. 1:14show you to you the same way I've shown
38. 1:16every member of our live trading
39. 1:18community who are using the 9 EMA on a
40. 1:20day-to-day basis to manufacture quality
41. 1:22trade opportunities. I'm also going to
42. 1:25show you two of the most simplistic 9
43. 1:27EMA trading strategies you will ever
44. 1:29see, and I'm going to show you how they
45. 1:31work in a live market. That way, by the
46. 1:33time this video is over, you will be
47. 1:35smarter, you will be faster, and you
48. 1:38will be positioned better to take the
49. 1:39next step in your trading evolution. So,
50. 1:42let's get started.
51. 1:44All right, my friends, I got to tell you
52. 1:45something. I am very excited about doing
53. 1:48today's video, and very excited to share
54. 1:51with you two amazing day trading
55. 1:52strategies using nothing else but the 9
56. 1:55EMA. And I feel that by the time this
57. 1:57video is over, you're going to see the
58. 1:59true power of the 9-EMA. And I hope that
59. 2:02helps you take the next step in your
60. 2:04trading evolution. But before we get
61. 2:06involved in all of that, there's
62. 2:07something very important we must do
63. 2:09first. And that is make sure that the
64. 2:11charts we are using are properly set up
65. 2:14to get the most out of this 9-EMA. If we
66. 2:16want to trade it like the banks, the
67. 2:18institutions, and the elite level
68. 2:19traders, we have to have the exact same
69. 2:22settings that they are using. So at this
70. 2:25time, I want you to just pull up
71. 2:26whatever chart you're trading. Now just
72. 2:28for reference, I'm going to be starting
73. 2:29out today's video by using the NASDAQ NQ
74. 2:32futures. Now later on in this video, I'm
75. 2:34going to go through like a dozen
76. 2:35different asset classes, just so you can
77. 2:37see how valuable this 9-EMA is. But I'm
78. 2:40going to be starting out with the NASDAQ
79. 2:42here. What is important about this
80. 2:44section, the first thing we should
81. 2:46really discuss here, is the time frame
82. 2:48that you choose to chart with. Because
83. 2:51the 9-EMA is specifically designed for
84. 2:54short-term trading, like scalping and
85. 2:56day trading, you're going to get your
86. 2:57very best results and your very best
87. 2:59reading on sub 1-hour chart frames. So 1
88. 3:03hour or less. Now the indicator
89. 3:05definitely will work for time frames
90. 3:07above 1 hour, but because it's
91. 3:09specifically designed for short-term
92. 3:11trading, you're going to want to use or
93. 3:13you're going to get your best results
94. 3:14from those smaller time frames. So make
95. 3:16sure you're using a 1-hour or less, and
96. 3:17as you can see, I've got the 5 minutes.
97. 3:19Now the next thing that we need to do,
98. 3:21which is even more important, is make
99. 3:23sure that whatever chart we are trading
100. 3:25has 24-hour data enabled on it. Now for
101. 3:28a lot of you that are watching, you're
102. 3:30currently trading a 24-hour market, like
103. 3:32foreign currencies, cryptocurrencies,
104. 3:34commodities, futures, and the like. You
105. 3:37don't have to do anything in this part.
106. 3:38But if there are any stock traders who
107. 3:40are watching this video right now, most
108. 3:42likely you will have to take the extra
109. 3:44step within your brokerage platform. Go
110. 3:47into the settings menu and make sure you
111. 3:49click 24-hour data or extended hours
112. 3:53trading. It'll be listed under one of
113. 3:54those two. It should be right under the
114. 3:55general settings tab, but you're going
115. 3:57to have to go through the extra step to
116. 3:58make sure because the way it's used best
117. 4:01and the way it's used right is have a
118. 4:03compilation of uninterrupted 24-hour
119. 4:05data and we'll talk a little bit more
120. 4:07about that. Now, once we've done that,
121. 4:09we can go ahead and set the indicator on
122. 4:11the screen, which is really easy to do.
123. 4:13Just find your indicator menu, which
124. 4:15most of you know where it is. Come down
125. 4:17and find moving average X exponential.
126. 4:20Just make sure it's exponential, not
127. 4:22weighted, not simple moving average
128. 4:26exponential. Click on that and it will
129. 4:29overlay a line onto your chart. Now,
130. 4:31what you want to do at this point is
131. 4:33just kind of double click on that line,
132. 4:35go into your settings of that EMA and
133. 4:37just double check to make sure that the
134. 4:39input length is set to nine. No other
135. 4:43filters will be necessary. Just click on
136. 4:46nine. Now, I'm going to take a quick
137. 4:47second here just to go ahead and add a
138. 4:49little bit more thickness to the line so
139. 4:51everybody can see it here in today's
140. 4:53video.
141. 4:54And it will put the line right here on
142. 4:55your chart just like that. So, now that
143. 4:58we've got this EMA set up correctly on
144. 5:00our charts, I want to spend a brief
145. 5:01moment talking to you about why are we
146. 5:03choosing the nine EMA and why should you
147. 5:06trust the nine EMA? I know you've heard
148. 5:08me throughout this video just
149. 5:09continually talking about, "Hey, it's
150. 5:11the most widely used indicator amongst
151. 5:13the banks, the institutions, and the
152. 5:14professionals." But, how do you really
153. 5:16know you can trust the nine EMA? And
154. 5:19here's why. Most specifically, the nine
155. 5:21EMA relates to high-frequency trading
156. 5:25firms, algorithm programs. The
157. 5:28algorithms need something to just kind
158. 5:30of program into the machine. There has
159. 5:33to be a division line between what is
160. 5:36considered bullish and what is
161. 5:37considered bearish. What is considered
162. 5:39to be a buy, what is considered to be a
163. 5:41sell. Somebody has to program that into
164. 5:44the computer system. And what they have
165. 5:46chosen and what has worked the most with
166. 5:48the most accuracy over the last two
167. 5:50decades has been the 9 EMA. And most
168. 5:54professional traders that have been
169. 5:55around for a while, they know that's
170. 5:58what they are using. So, I hope that
171. 6:00helps you as we progress through this
172. 6:01video to truly understand what we're
173. 6:02talking about here. Now, having said
174. 6:04that, we can start to talk about the two
175. 6:06strategies we're going to share with you
176. 6:08today using nothing but the 9 EMA. And
177. 6:11the first is I want to talk to you,
178. 6:13which is the easiest, most simplistic
179. 6:15one that requires nothing but the 9 EMA,
180. 6:17and that is the buy cross sell method,
181. 6:22or its alter ego, the sell cross buy
182. 6:25method. Now, let me show you exactly
183. 6:27what I'm talking about right here on the
184. 6:28screen. So, let's say for example, this
185. 6:30line I'm drawing right here on the
186. 6:31screen represents the 9 EMA.
187. 6:34If the price of the asset that you are
188. 6:36trading is at or above the 9 EMA, you
189. 6:41want to buy that asset. You want to
190. 6:45continue to buy that asset. You want to
191. 6:48remain bought in that asset until the
192. 6:53price of that asset crosses back through
193. 6:57the 9 EMA. And then, and only then, do
194. 7:00you sell it. So, buy,
195. 7:03cross, then you sell. Now, the inverse
196. 7:07relationship to that is this. If the
197. 7:09price of the asset you are trading is
198. 7:12below the 9 EMA, you want to sell that
199. 7:16asset. You want to continue to sell that
200. 7:19asset. You want to remain selling that
201. 7:23asset until the point in time comes when
202. 7:26it crosses back through the 9 EMA. Then,
203. 7:30and only then, should you buy that
204. 7:33asset. Now, what I'm going to do right
205. 7:35now is show you what this looks like in
206. 7:37a real-time market. So, let's go back to
207. 7:39this Nasdaq chart we started this video
208. 7:41out with. And here is the current price
209. 7:44where the NASDAQ is trading. So, I'm
210. 7:46going to give you your first quiz today.
211. 7:47This should be so easy for everyone
212. 7:50listening. Is the current price of the
213. 7:52NASDAQ below the 9 EMA or is it above
214. 7:55the 9 EMA? Easy one, right? It's below.
215. 7:58And what have we learned in this
216. 8:00simplistic trading system? If the asset
217. 8:02we are trading is below the 9 EMA, we do
218. 8:05what? We sell. And then we do what? We
219. 8:08remain selling. We continue to sell and
220. 8:12we only buy when? When it re-crosses the
221. 8:159 EMA. So, what do we do in this
222. 8:18situation? We come right up here and we
223. 8:20go ahead and we hit that sell button
224. 8:23right there, [clears throat] just like
225. 8:24that. Now, what I'm going to do for this
226. 8:26demonstration is just forward into the
227. 8:28very next candlestick. And you'll see
228. 8:31I'm just going to move it right here.
229. 8:32And I ask you this question. Is the
230. 8:34price of the NASDAQ right here, is that
231. 8:37still below the 9 EMA? Of course it is.
232. 8:41So, what do we do? We remain selling.
233. 8:45Now, this is very important cuz I know a
234. 8:46lot of people out there are suffering
235. 8:48what we all go through when we start out
236. 8:50trading. We cut our winners too early,
237. 8:52am I correct? Right, we just never know
238. 8:53when to get out. This is what makes the
239. 8:559 EMA so easy because all we got to do
240. 8:58is wait for what? We just got to wait
241. 8:59for that to cross. So, the answer is do
242. 9:01you hold your short if you're short? Do
243. 9:03you hold your short like did you hold
244. 9:04it? Yes, you hold it until it crosses
245. 9:06back over the 9. Let's move forward to
246. 9:08the next bar and see what we come up
247. 9:10with here. And what does the next bar
248. 9:11do? It continues going lower. We remain
249. 9:14selling, right? Do we continue to remain
250. 9:16selling in that? Yes. And see, this is
251. 9:18again, I'm going to move this up here
252. 9:19cuz this is very important. We need to
253. 9:20pay attention to this.
254. 9:21This is why we use the 9 EMA because so
255. 9:24many people would have covered right
256. 9:27here on this candle, but we didn't
257. 9:30because it didn't cross the 9 EMA. So,
258. 9:32let's just go ahead and just keep moving
259. 9:34forward. I'm going to kind of speed this
260. 9:35part up. Do we keep the short? Yes, we
261. 9:38do. Do we keep the short? Yes, we do. I
262. 9:40got to get more room. This thing is
263. 9:41dropping like a stone. Right? Going to
264. 9:43go all the way down here. Do we continue
265. 9:46to keep this? Yes. Yes, we continue to
266. 9:49keep this. Yes.
267. 9:50Right? And do we continue to keep this?
268. 9:53Yes. Next bar? Yes. Right? See, it's
269. 9:55right there, real close. Okay, right
270. 9:57there
271. 9:58would be the part where you would buy.
272. 10:01So, at this case, at this moment, we
273. 10:03will go ahead and we will cover up that
274. 10:06position. Now, right before we move on
275. 10:08to the next example, I want to show you
276. 10:09something right here. This is going to
277. 10:11help so many people that are watching
278. 10:13because when you saw that example, you
279. 10:15were like,
280. 10:16"I don't know if I can trust the 9 EMA
281. 10:18like that. I'm getting That's moving
282. 10:19really fast." And let's face it, when
283. 10:21we're brand new, we have a lot of
284. 10:22information to process. It takes us a
285. 10:24while to trust indicators, right? So,
286. 10:26when things move fast, we just hesitate
287. 10:28for a second, and then what happens? We
288. 10:30miss stuff. I mean, that that's that's
289. 10:31that's normal. But, here's how you can
290. 10:33fix that. I'm going to give you a little
291. 10:35trick right here that you can use the 9
292. 10:37EMA for. Again, showing you just how
293. 10:39powerful this thing is. On the screen,
294. 10:41I'm going back to the second bar right
295. 10:44here. Let's say when the first bar
296. 10:46dropped, it was just too fast. You
297. 10:48didn't quite know if you could really
298. 10:50trust that 9 EMA. It's right from the
299. 10:53open, lots of volume. I get it, okay?
300. 10:55So, here's another tactic. It's called
301. 10:57the retest. Notice on the second bar
302. 11:00right here, it tries to come back
303. 11:03immediately,
304. 11:05but it gets rejected. The rejection wick
305. 11:08right here, once this went red,
306. 11:12that candle went red, it was once green,
307. 11:14came short of the 9 EMA, you could have
308. 11:18entered there and made that trade a
309. 11:21little less risky and a little more
310. 11:23comfortable. So, for example, the entry
311. 11:26would have been right about there, and
312. 11:29you could could placed the stop loss
313. 11:31just right above the 9 EMA instead of
314. 11:33that high of the day as to where I would
315. 11:35have put it. So, there was a secondary
316. 11:37entry. So, you can see even in
317. 11:38fast-moving markets, again, this is why
318. 11:40we're talking about the 9 EMA, why it's
319. 11:42so widely used for scalpers and day
320. 11:44traders, it's accurate, but it's fast,
321. 11:47too. So, in fast-moving markets, you get
322. 11:49an accurate reading. Now, let's say that
323. 11:52isn't even good enough. You're really,
324. 11:54really slow. Maybe you got a little bit
325. 11:55of a headache, you didn't get enough
326. 11:57sleep last night. If I move it to the
327. 11:59next bar, I want to show you something.
328. 12:01It does the same thing. You have another
329. 12:04attempt at trying to go green. Now, this
330. 12:06one didn't quite get close as that one,
331. 12:08but there still was another entry there,
332. 12:12and using that 9 EMA as a trailing
333. 12:15guide. So, you can see just how valuable
334. 12:18something like that is in helping you,
335. 12:20let's say, cover up for some of your
336. 12:21mistakes. So, not only did you see in
337. 12:24that specific example that the 9 EMA can
338. 12:27cure those targeting problems we all
339. 12:30have, like, "Gee, I I shouldn't have got
340. 12:32out of that. I didn't know it was going
341. 12:33to go that far." Right? That's a
342. 12:34problem. You're leaving all this money
343. 12:35on the table. 9 EMA is a solution for
344. 12:37that. You can see that if you just not
345. 12:40fast enough, which is understandable
346. 12:41when you first start out trading, the 9
347. 12:43EMA can cover for a lot of your
348. 12:45mistakes. That's why so many people use
349. 12:47it. Now, let me show you what it looks
350. 12:48like on the other side if you're doing a
351. 12:50buy side trade, the buy cross method.
352. 12:52So, let's take a look at what a buy
353. 12:53cross sell would look like. Again, same
354. 12:55asset here in Q, just a different day.
355. 12:59So, this is almost a carbon copy of what
356. 13:01we just talked about, but just inverse,
357. 13:03right? That's how simple this can be.
358. 13:05So, here's the current price of the
359. 13:07Nasdaq. Again, this should be very easy
360. 13:08for everyone who's watching. Is the
361. 13:10current price above the 9 EMA or is the
362. 13:13current price below the 9 EMA? It is
363. 13:16above the 9 EMA, and that means what? We
364. 13:18want to buy, remain buy, continue
365. 13:21buying, never think about selling until
366. 13:24that asset has crossed the 9 EMA again.
367. 13:28So, what I'm going to do like I did the
368. 13:29last time is we would just buy this
369. 13:31right here. Now, in this case the stop
370. 13:34loss would move to the low of the day,
371. 13:35but I just want you to watch the candles
372. 13:37first and foremost. So, if I move the
373. 13:39next candle forward, what happens? It
374. 13:41remains above the 9 EMA. If I fast
375. 13:44forward to the next couple of candles,
376. 13:46it remains above the 9 EMA. So, as long
377. 13:49as this remains above the 9 EMA, what is
378. 13:51it we do? Are we selling this position?
379. 13:53No, why would we sell it? Because it's
380. 13:55above the 9 EMA. We got to keep it. This
381. 13:57could be a very big trade and we just
382. 13:59don't want to be giving money back.
383. 14:00We're doing all the donkey work trying
384. 14:01to get into this thing. We want to make
385. 14:03the most we can. That's what you came to
386. 14:05this video for. So, let's kind of move
387. 14:06forward here and I'm just going to kind
388. 14:07of speed this part through cuz I think
389. 14:09most of you got it. So, we start to get
390. 14:10a little bit of a pullback and again
391. 14:12just like the last video. I really,
392. 14:15really want to highlight this stuff
393. 14:17right here because when you're in a
394. 14:20trade, how many times have you been
395. 14:23shaken out by just one bar? It's
396. 14:26probably happened a lot. Used to happen
397. 14:27to me a lot. The 9 EMA again covering
398. 14:31for your insecurities and mistakes.
399. 14:32That's what helped me. So, I'm just
400. 14:34going to move this forward here just a
401. 14:36few more. Let's just kind of speed this
402. 14:37process along. I think most of you know
403. 14:40and look at this one. It's not even
404. 14:41underneath that. We're going to have to
405. 14:42make some more room. Let's put it all
406. 14:43the way down here. Going to continue to
407. 14:45move this forward. Do we remain in the
408. 14:47trade? We remain in the trade. Yes, we
409. 14:48remain in the trade. Do we remain in the
410. 14:50trade? Yes, yes, yes. No. There would be
411. 14:53a good selling point right there. is as
412. 14:56at the cross of that 9 EMA. Now, what I
413. 14:59want to do here is just like I said the
414. 15:01last time. Just re-verifying just how
415. 15:04powerful this moving average is. I'm
416. 15:06going to go back and I'm going to select
417. 15:08the second bar and open this up. Just
418. 15:12like the last trade. This is what's so
419. 15:15beautiful.
420. 15:16Maybe at that time just like the other
421. 15:18one, it was too fast. You're a little
422. 15:20confused. Maybe you didn't get enough
423. 15:22sleep. Things happen. There was another
424. 15:24entry. Notice that wick right there came
425. 15:28close. Buyers stepped in confirming that
426. 15:32the 9 EMA was going to hold. And I
427. 15:35believe if I saw it correctly, it did
428. 15:37that as well on the second bar.
429. 15:39Let's take a look. Just a little tiny
430. 15:42tiny one. Not too much there. So, you
431. 15:44can see that the 9 EMA can also give you
432. 15:47some very good second and even third
433. 15:49entries. So, as you can see, you can go
434. 15:51a long way and make some really great
435. 15:53trades and just get on the right side of
436. 15:55the market by using something so simple
437. 15:57as the buy cross sell sell cross buy
438. 15:59method. Just by following that 9 EMA.
439. 16:02Now, this will help me transition into
440. 16:04the second trading strategy I want to
441. 16:05talk to you about, which is my personal
442. 16:07favorite, and it's called the separator.
443. 16:10Now, one thing I haven't mentioned
444. 16:11today, which is another powerful tool by
445. 16:14using the 9 EMA, is the 9 EMA and the
446. 16:17current price of the asset usually find
447. 16:20each other somewhere during the day. So,
448. 16:22remember, on even those aggressive
449. 16:24dropping assets, it eventually crossed
450. 16:27back through the EMA, right? The
451. 16:29high-flyer assets, it eventually come
452. 16:31back and retested the EMA. We are going
453. 16:34to take advantage of that nuance by
454. 16:36taking advantage of the separation
455. 16:38between the price of the asset and where
456. 16:41the 9 EMA sits. Because the further they
457. 16:45expand from each other, one of those
458. 16:48will reconnect and there's an amazing
459. 16:50opportunity. And I'm going to show you
460. 16:51that right now here on the screen. So,
461. 16:54for this one, I'm going to be using the
462. 16:56stock AMD on an intraday 5-minute. Now,
463. 17:01take a look at the size of this candle.
464. 17:03Here's what I want to talk about the
465. 17:04separator. Notice that the 9 EMA is all
466. 17:08the way down here, but the current price
467. 17:10of AMD is all the way up here. Now, I
468. 17:12know most of you who are watching has
469. 17:15figured out, "Hey man, you know, those
470. 17:17inqs you just showed us, they kind of
471. 17:19looked like that, too. But actually,
472. 17:21they didn't. They may have appeared like
473. 17:23that to the eye, but there is one small
474. 17:25difference, which we're going to show.
475. 17:27And that is we're going to talk about
476. 17:29what constitutes separation. Now, a lot
477. 17:33of times your eyes can see the
478. 17:35discrepancy between the two, but this is
479. 17:38a very important factor because this is
480. 17:40not what the previous in queue trades
481. 17:43had. That's why they remained buys and
482. 17:46remained sells and remained trend
483. 17:48trades. And for this, what we are going
484. 17:51to do is use something called the
485. 17:53average true range. So, I'm going to
486. 17:55move to a daily chart time frame. So,
487. 17:58you'll see now I have the daily chart
488. 18:00selected of AMD.
489. 18:02And I'm going to add the average true
490. 18:05range indicator. So, you're going to
491. 18:07come up there into your menu, click the
492. 18:09drop down, and you'll see it's right
493. 18:11there, average true range. You just
494. 18:13click on it, no filters needed, and it
495. 18:16will give you a numerical figure. Now,
496. 18:18I've gone through this in just about
497. 18:19every video. I love using the ATR. And
498. 18:22if you're just brand new to this whole
499. 18:23trading thing, you don't know what I'm
500. 18:24talking about, I'm going to make it very
501. 18:26simple.
502. 18:27The ATR is what something is worth in
503. 18:30any given day. So, if I come down here
504. 18:32and I take a look at where this line
505. 18:34sits with AMD at the ATR, and I move my
506. 18:37eyes over there to the right, you're
507. 18:38going to see it says $11. So, that means
508. 18:42if I'm a trader of AMD, I can expect an
509. 18:45$11 move up or down in any given period
510. 18:49throughout the day. That's my expected
511. 18:51value. Now, it doesn't always do that.
512. 18:53Sometimes it goes up 20, sometimes it
513. 18:55goes up 30, sometimes it goes down five,
514. 18:57but that's what you can expect, and it's
515. 18:59a good guide to use when you're setting
516. 19:01your stops, when you're setting your
517. 19:03risks and your targets and all that good
518. 19:04stuff. But here's what we want to do
519. 19:07when it comes to separation. We want to
520. 19:10take what 20%
521. 19:12of that amount would be. So, 20% of $11,
522. 19:16I'm going to do some mental math. It's
523. 19:17late in the day, so I think it's going
524. 19:19to be around 250 or or three bucks,
525. 19:20somewhere along that line. And that's
526. 19:23going to be a threshold we're going to
527. 19:24use. So, for example, we're going to
528. 19:27take the number 11, which is the daily
529. 19:29ATR.
530. 19:31We're going to multiply that by 20%,
531. 19:35which is going to be about $2.20
532. 19:39per share.
533. 19:41If the distance between the 9 EMA and
534. 19:44the price of the asset is $2.20
535. 19:48or more, then you have adequate
536. 19:52separation. So, if I grab a measuring
537. 19:55tool and I go from where the price is up
538. 19:58to the top, you're going to see that's
539. 20:00$5.49.
540. 20:03$5.49
541. 20:05is almost 50%
542. 20:08of the daily ATR. Now, let me just say
543. 20:10something quickly about this point 20%.
544. 20:14Like the pattern scalp, it's just a
545. 20:16guide to get your eyes drawn to the
546. 20:18trade. I said this before, when it comes
547. 20:20to trading indexes like the NQ, 20% is
548. 20:25fine. And you go back and you look at
549. 20:26the NQ that we just did both directions,
550. 20:29it was less than 20%. That that initial
551. 20:32spike was less than 20% of the Nasdaq's
552. 20:34daily ATR. That's why you stayed with
553. 20:35the trend. However, when it comes to
554. 20:37stocks, I usually like them to be a
555. 20:39little bit more than 20, like 30 or 40
556. 20:41or even 50 in this case. But 20 is at
557. 20:44least enough to get you looking at
558. 20:46taking that trade. So, this meets that
559. 20:49threshold. So, what we want to do is
560. 20:51look for the opportunity to reverse that
561. 20:55and to sell it. But we can't just do it
562. 20:58because you're you're ripping. You know,
563. 20:59that's the one way to blow up your
564. 21:01account. All we need up here is one red
565. 21:05candle. That's all you need is just one
566. 21:07red candle to close
567. 21:09and sell into the red candle with a stop
568. 21:12over the high. Now, let me show you what
569. 21:13I'm talking about. I'm going to move the
570. 21:14tape forward here real quick, right? And
571. 21:17you'll see that the next bar is in fact
572. 21:18red. So, this would become a sell. Now,
573. 21:21because this is a playback, I say this a
574. 21:23lot when I'm using TradingView,
575. 21:26this only represents the entry at the
576. 21:28close. For this kind of trade, this
577. 21:31high, what I normally look for is I want
578. 21:34to look at this big candle, I'm looking
579. 21:36for about 30% of that candle. So, that
580. 21:40would be about from right here to about
581. 21:42right there. If that candle
582. 21:45retraces 30%
583. 21:48like that,
584. 21:49which is about right. It doesn't have to
585. 21:50be perfect, but about 30% right there,
586. 21:53that's going to become my short. So, in
587. 21:56this case, it would have been 257.96
588. 21:59versus 256.23.
589. 22:01Now, I'm showing you that because that's
590. 22:03a hell of a lot of difference. That's a
591. 22:04trade with with within itself. But, that
592. 22:06would be the concept. Stop goes either
593. 22:09above the red bar or for the riskier
594. 22:11traders, above the green bar. Okay,
595. 22:14that's the separator. So, to make sure
596. 22:16that no one is lost at this point, the
597. 22:19separation is this. The 9 EMA and the
598. 22:23price against the ATR, the average true
599. 22:25range of 11, this price is more than 20%
600. 22:28of the daily ATR. It's ATR. It's a
601. 22:30little bit excessive. The red bar
602. 22:32constitutes selling coming in, negating
603. 22:35the power of the first red bar. I mean,
604. 22:38the first green bar, excuse me. And the
605. 22:40target price becomes
606. 22:42a break of the 9 EMA, then a follow of
607. 22:45the 9 EMA. Now, I'm going to walk you
608. 22:47through a little bit more because again,
609. 22:48the separator is a little more complex,
610. 22:51right? Now, if I kind of go down here,
611. 22:52take a look at what's happening. Now,
612. 22:54you have exactly what you had before.
613. 22:59Once it breaks that 9 EMA, it gets super
614. 23:02aggressive. Now, I kind of want to come
615. 23:04back right here because I think these
616. 23:05types of intraday shifts are super
617. 23:07important. Let's say, which I know for a
618. 23:10lot of you, you're going to say, "Damn,
619. 23:11I just I'm just not ready to short
620. 23:13something like that. That just doesn't
621. 23:14make sense to me. This just seems
622. 23:15insane." I got it. Just like always, you
623. 23:19could have entered down here on a
624. 23:21definitive break with the 9 EMA and
625. 23:25adjusted your stop. Entry would have
626. 23:26been here, adjusted your stop right
627. 23:29there. You could have done that, right?
628. 23:31So, as always, the 9 EMA is like a
629. 23:34bailout. It gives you another
630. 23:35opportunity to get involved in a trade
631. 23:38that you might have missed. So, just
632. 23:39think of how much pressure that relieves
633. 23:42in your day-to-day trading. Now, I want
634. 23:44to show you this here because I think
635. 23:46you're going to love it. Well, now
636. 23:48you're underneath of the 9 EMA, right?
637. 23:52So, what what do you do? You just simply
638. 23:54don't get rid of this position until it
639. 23:56crosses over the 9 EMA, which is about
640. 23:58right there. I want to stop it right
641. 24:00there, okay?
642. 24:02Now,
643. 24:03that's where you would get rid of it
644. 24:04crossing over the 9 EMA. So, I'm just
645. 24:06going to go ahead and cut this out. Now,
646. 24:09I want to just ask you a question.
647. 24:11What would you do right here if someone
648. 24:14forced you to trade AMD?
649. 24:17Well, it's back above the 9. So, could
650. 24:20you actually buy this right here? Let's
651. 24:22just do like an example. Could you like
652. 24:23buy this, stop the low,
653. 24:26and try to trail that 9? Well, the
654. 24:29answer is yes, right? You could continue
655. 24:31to do that, and look what happens.
656. 24:33You get a nice little pop out of AMD.
657. 24:38So, by using the 9 EMA, you have an
658. 24:41infinite amount of possibilities
659. 24:44at your disposal. So, guys, I got to
660. 24:46tell you,
661. 24:47I did really enjoy doing this video. I
662. 24:49feel like I got a little amped up there.
663. 24:52I got really into this whole 9 EMA thing
664. 24:54because I love it. And I do hope that
665. 24:57even though we sped through a couple of
666. 24:59parts that you truly understand how this
667. 25:02can take you to the next level. And once
668. 25:04you really experiment with that, once
669. 25:06you start adding other elements that you
670. 25:08may have learned like support and
671. 25:09resistance and a little bit better
672. 25:10understanding of candlesticks so you can
673. 25:12tweak it, you can really make it good.
674. 25:16But to prove that it's such a fantastic
675. 25:18strategy, is if something can work with
676. 25:21just basic one or two signaling. Like if
677. 25:24you could just buy sell cross sell cross
678. 25:25buy for example.
679. 25:27If you could get away with something so
680. 25:28primitive and so simple, then anything
681. 25:31else you put on top of that later on
682. 25:32another indicator, little bit more
683. 25:34education when it comes to candle,
684. 25:36little bit better support and
685. 25:37resistance,
686. 25:38things are going to get a hell of a lot
687. 25:39better. That's how you start moving to
688. 25:41the next level. So I hope you definitely
689. 25:43enjoyed this nine moving average. Now,
690. 25:45if you guys would love to trade with me
691. 25:47every day, we now have a live room, my
692. 25:49wife and I, we trade every day live on
693. 25:51Zoom much like you see here. If you're
694. 25:53interested in really getting involved in
695. 25:55a community where everybody is sharing
696. 25:58everything and there's a common goal to
697. 26:00grow and become better as a trader and
698. 26:02take advantage of our combined 39 years
699. 26:05of trading experience, there's a link
700. 26:07down in the description box. Click it,
701. 26:09enroll, get in there and start trading
702. 26:12live with us and get your trading to
703. 26:13that next level. On that note, let me
704. 26:15thank you very much for watching today's
705. 26:17video. Until the next one,
706. 26:19cheers.