Bootcamp Lesson 6 - Airpockets Flashcards
airpockets?
when you have bullish divergences
you can expect price to go back to trigger line
if there’s daily bullish divergences
once 5 minute crosses above hourly, you can expect price to go back to daily trigger.
Simple as that for every timeframe hourly, daily, weekly, monthly. Once there’s bullish
divergences and the lower timeframe trigger is crossed, even if it’s a 5,000% move to the
trigger, even if it’s a 1,000% move up to the trigger no matter what it is. Once the two lower
timeframe trigger is cross. The divergence is telling you that price is going back to that trigger
whether you like it or not.
Once the two lower
timeframe trigger is crossed, what happens?
lower timeframe trigger is crossed, even if it’s a 5,000% move to the
trigger, even if it’s a 1,000% move up to the trigger no matter what it is, the timeframe is going back to it’s trigger.
all divergence work the same for every time frame
they all go back to the higher timeframe once two lowers pass the higher timeframe
ideally we are hunting ______on velocity first instead of trigger crosses
divergences
if monthly velocity is going down, stronger each and every single month, and the daily crosses the weekly trigger we would _____ expect to move price to to do what?
not, move back to the monthly trigger
hourly velocity is stepping down, 1 minute crosses above the five would we expect to reach the 1 hour trigger?
no
what happened here that allowed the hourly to climb up and potentially surpass the weekly trigger?
weekly velocity reduction is happening
for the next cross in triggers check velocity first or last?
first, velocity from a timeframe above will dictate whether or not a trigger can go up to its higher timeframe trigger.
how many divergences would you be sure that price is definitely moving either way?
3
all velocities work in tandem to change the ______ of where a stock is _______
direction, moving
strategy for finding an entry point
is finding divergences
where did divergence count reset?
what can you tell about divergence reset on this picture?
it caused the weekly velocity to repair and lose steam.
how can the weekly velocity get this way?
MASSIVE BUYING
could you begin to go long here?
yes, massive amount of buying is happening.
why is buying right here bad?
weekly velocity is still bad
3 bullish divergences were made, what would happen after especially with a trigger crossing potentially happening?
price would break past the trigger with the divergence information.
you can do a few things after 3 divergences show
- you can wait till price breaks above hourly
- What James like to is wait till price breaks above Daily trigger
why does James like to is wait till price breaks above Daily trigger?
because he knows price wants to get to the weekly trigger anyway.
When would you enter with 3 bullish divergences
With 3 - you can always enter when price moves above the daily trigger
with 3 monthly divergences - you can always enter when price moves above the weekly trigger
What about entering with 1-2 divergences?
1 - in these scenarios, you use stop losses under the hourly trigger, invalidations under the daily trigger, go long when price is above, but flat below
when there’s 3 bullish divergences what do you do?
You take a long dated position, and you sit on it.
What’s the only way you would sell a long dated contract from a 3 bullish divergence inspiration trade?
It’s if price hits the target, or if we’re talking about weekly trigger airpocket fills or if the hourly trigger crosses down below the daily trigger.
Monthly airpocket fills, you’d do it when the hourly crosses the weekly trigger.
how far would you take the OTM calls for airpocket setups and where would the price be?
half the distance from price and target.
3 trigger clusters is when and when is it not?
all 3 triggers are clustered together for a little bit of time, not 10 minutes
when would be the only stop loss?
when 5 minute trigger moves back below the hourly trigger
