Trading Breakouts

Question 1

Bull BO - Strong Bull, SO BUY!

The probability Favors the Bulls (60% or more due to the context telling me so)

This 60% gives the Bulls a favorable traders equation

Answer 1

Bull BO - Strong Bull, SO BUY!

The probability Favors the Bulls (60% or more due to the context telling me so)

This 60% gives the Bulls a favorable traders equation

Question 2

When there is a Bull BO always look for signs that we may have a strong Bull BO / Strong Trend

Answer 2

When there is a Bull BO always look for signs that we may have a strong Bull BO / Strong Trend

Question 3

It is always important to decide early the always in direction

(as soon as you tell yourself OMG I want a pullback that means you should be going long/ BUY for any reason as the market is in AIL)

Answer 3

It is always important to decide early the always in direction

(as soon as you tell yourself OMG I want a pullback that means you should be going long/ BUY for any reason as the market is in AIL)

Question 4

Many ways to Buy - All good so choose one

Answer 4

Many ways to Buy - All good so choose one

Question 5

Setups never look good enough

Answer 5

Setups never look good enough

Question 6

Stop - Decide where it belongs

Reasonable stop is below BO or below bull leg

Once you know where your stop is, trade a small enough size so risk is acceptable

Answer 6

Stop - Decide where it belongs

Reasonable stop is below BO or below bull leg

Once you know where your stop is, trade a small enough size so risk is acceptable

Question 7

Stop, they’re always several good choices

Answer 7

Stop, they’re always several good choices

Question 8

Any Reasonable Stop is good

Answer 8

Any Reasonable Stop is good

Question 9

No matter where you buy the stop location is always the same

TRUE OR FALSE?

Answer 9

True

No matter where you enter the stop placement is always the same because it is to do with what took place to the left(the context) not the time you entered.

Question 10

After each new BO while in a trade what should I do with my stop?

Answer 10

After each new strong BO, especially if a new high, trail stop to just below bottom of bull leg (major HL)

Question 11

What is the simplest approach to buying the close of a strong bull trend?

Answer 11

The simplest approach is to buy at the market as soon as the bar closes

Some place a limit order to Buy the Close as soon as the next bar begins, but sometimes to not get filled

Question 12

Beginning traders should mostly enter every trade with a stop order

As long as strong bull trend is in effect, buy 1 tick above the high of bulls bars that close near their highs

Answer 12

Beginning traders should mostly enter every trade with a stop order

As long as strong bull trend is in effect, buy 1 tick above the high of bulls bars that close near their highs

Question 13

Buy The Close Bulls sometimes buy more as the Rally continues

Answer 13

Buy The Close Bulls sometimes buy more as the Rally continues

Question 14

When the market is in a Strong Bull Trend there is a lot of profit potential

As a trader waits for a PB for smaller risk they most of the time you will miss the best part of the trend

Answer 14

When the market is in a Strong Bull Trend there is a lot of profit potential

As a trader waits for a PB for smaller risk they most of the time you will miss the best part of the trend

Question 15

The market is always in a Cycle

Either in a BO , a Channel or TR.

a BO and Always in Long is a great time to Buy (at least a small position)

Answer 15

The market is always in a Cycle

Either in a BO , a Channel or TR.

a BO and Always in Long is a great time to Buy (at least a small position)

Question 16

After a Bull BO when I am looking to go long in a Bull Flag choose either the High 1 or High 2 to enter the market long

As trends mature (add more bars) I will start to get more High 2 and High 3 (not just a High 1 because the trend was so strong initially)

Answer 16

After a Bull BO when I am looking to go long in a Bull Flag choose either the High 1 or High 2 to enter the market long

As trends mature (add more bars) I will start to get more High 2 and High 3 (not just a High 1 because the trend was so strong initially)

Question 17

In a Strong strong should I bet on failed Reversals?

Answer 17

Yes, expect reversals to be minor and to create PBs, not bear swings

Question 18

When the Bull Trend is Strong ALWAYS Swing at Least part of it

How long should I hold this swing for?

Answer 18

Hold it until there is at least a decent Sell Signal or at least until the end of the day

Question 19

a Perfect Trade cannot Exist

Answer 19

a Perfect Trade cannot Exist

Question 20

Never worry about perfection

Any trade that has a positive Trader’s Equation is as good as any other

Answer 20

Never worry about perfection

Any trade that has a positive Trader’s Equation is as good as any other

Question 21

Let’s say you buy the reversal up from yesterday’s low, your risk is small and your reward is great.

This type of trade most of the your stop will get hit, but sometimes you will have a huge swing up for a huge profit.

Answer 21

Let’s say you buy the reversal up from yesterday’s low, your risk is small and your reward is great.

This type of trade most of the your stop will get hit, but sometimes you will have a huge swing up for a huge profit.

Question 22

Gap Open Bars - Can Signal Weakness or Strength

Answer 22

Gap Open Bars - Can Signal Weakness or Strength

Question 23

When the market has consecutive strong bear bars what should I do?

Answer 23

As long as the Context is good for the bears, Sell the Close of Bear Bars

Simplest approach is to sell at the market as soon as the bar closes

Some traders place a limit order to sell at the close (sometimes if the bear trend is strong I will not get filled short)

Question 24

Sell The Close - Likely Bear Trend or TR

Most Traders sell once and then swing trade once they see the PB fails and the once potential TR is now a Bear Swing

Answer 24

Sell The Close - Likely Bear Trend or TR

Most Traders sell once and then swing trade once they see the PB fails and the once potential TR is now a Bear Swing

Question 25

Scale into a Winning Trade - Most Traders however Sell inly Once or Twice Use the appropriate stop and just hold for a swing

Answer 25

Scale into a Winning Trade - Most Traders however Sell inly Once or Twice Use the appropriate stop and just hold for a swing

Question 26

What does a Sell The Close BO eventually evolve into?

Answer 26

It eventually evolves into a a Channel (or Sometimes a TR)

Question 27

When Scalping should I use a Tight Stop or a Swing Stop?

Answer 27

When Scalping use a Swing Stop this increases my probability

Question 28

Positive Trader's Equation is ALWAYS NEEDED The problem with taking a profit that is to small is the trade has to be perfect and this is rarely true in the markets

Answer 28

Positive Trader's Equation is ALWAYS NEEDED The problem with taking a profit that is to small is the trade has to be perfect and this is rarely true in the markets

Question 29

Minimum Profit = Rarely the Best Choice

Answer 29

Minimum Profit = Rarely the Best Choice

Question 30

Scalpers can scale in and use swing stops

Answer 30

Scalpers can scale in and use swing stops

Question 31

What can a PB signify other than traders taking profits?

Answer 31

a PB can signify a pause in Trend

Question 32

In the Market Cycle what is the BO usually followed by?

Answer 32

In the market cycle the BO phase it usually followed by the Channel Phase

Question 33

It is important to watch the BO because you want to see when it has ended and entered the channel phase because when it enters the channel phase you want to trade it differently

Answer 33

It is important to watch the BO because you want to see when it has ended and entered the channel phase because when it enters the channel phase you want to trade it differently

Question 34

When market is in a Channel Phase what is an important sign that a channel is transitioning into a TR?

Answer 34

An Important sign that a TR is soon to emerge, is the Bear Scalpers begin to Make Money

Question 35

As a Bull Trend matures it begins to weaken a sign of this is the Bears are able to make money selling with stops A TR is soon likely

Answer 35

As a Bull Trend matures it begins to weaken a sign of this is the Bears are able to make money selling with stops A TR is soon likely

Question 36

a Trap often forms before a BO

Answer 36

a Trap often forms before a BO

Question 37

If the Bulls can create a strong sell signal bar and prevent it from ever triggering in a probable BULL MTR The Bulls Show their strength in the markets by doing this (It is a Bear Trap) The Strong Bear Signal Bar with the weak Bear follow-through triggers signs of a Strong Bulls

Answer 37

If the Bulls can create a strong sell signal bar and prevent it from ever triggering in a probable BULL MTR The Bulls Show their strength in the markets by doing this (It is a Bear Trap) The Strong Bear Signal Bar with the weak Bear follow-through triggers signs of a Strong Bulls

Question 38

Bear BO Below Bull Flag = Sign of Strong Bears

Answer 38

Bear BO Below Bull Flag = Sign of Strong Bears

Question 39

Bear BO Below Bull Flag Does a Later sell in this BO have a Lower or Higher Probability?

Answer 39

a Later sell has a Higher Probability

Question 40

Strong Bull sometimes has a Weak High 1 Bull Flag

Answer 40

Strong Bull sometimes has a Weak High 1 Bull Flag

Question 41

Strong BO, only Buy if I can use the correct STOP

Answer 41

Strong BO, only Buy if I can use the correct STOP

Question 42

a Strong BO often has a FAR stop When the correct stop placement is so far away (73 points on this chart) most should not trade this Only take the trade if I can use the correct stop

Answer 42

a Strong BO often has a FAR stop When the correct stop placement is so far away (73 points on this chart) most should not trade this Only take the trade if I can use the correct stop

Question 43

When Extremely Big Bars - DO NOT TRADE Only experts should trade when this is occurring An alternative is if my account cannot handle this type of risk is to trade weekly call options

Answer 43

When Extremely Big Bars - DO NOT TRADE Only experts should trade when this is occurring An alternative is if my account cannot handle this type of risk is to trade weekly call options

Question 44

Bull - Stock Replacement Strategies

Answer 44

Bull - Stock Replacement Strategies

Question 45

Buying Early = Less Risk

Answer 45

Buying Early = Less Risk

Question 46

What probabilities exist with a deep pullback versus a small pullback?

Answer 46

a deep PB will probably lead to some kind of TR versus a smaller PB will probability lead to some kind of measured move (In this chart there was a deep pullback of more than 50% that lead to a TR)

Question 47

Weak Bull BO - Deep PB

Answer 47

Weak Bull BO - Deep PB

Question 48

When the market transitions from a BO to a TR how should I trade it?

Answer 48

Once the market evolves into a TR TRADE it like a TR not a Trend BLSHS

Question 49

Bulls and Bears - Buy Low and Sell High

Answer 49

Bulls and Bears - Buy Low and Sell High

Question 50

Bears enter where the Bulls take PROFITS and vice versa

Answer 50

Bears enter where the Bulls take PROFITS and vice versa

Question 51

Reversing a trade position is not for most traders As it is pretty to emotionally exit long and go short simultaneously but if you are able to efficiently do it than do it

Answer 51

Reversing a trade position is not for most traders As it is pretty to emotionally exit long and go short simultaneously but if you are able to efficiently do it than do it

Question 52

Once the market evolves into a TR from a Bull Trend the Bears are much more eager to SELL

Answer 52

Once the market evolves into a TR from a Bull Trend the Bears are much more eager to SELL

Question 53

At the close of this bar, if you had to take one of these 2 choices, which would you choose? Bears Sell the Close or Bulls Buying the Close?

Answer 53

BEARS SELL THOSE as the math with this context is better for the BEARS 60% chance of the bears hitting their target versus a 40% chance of the bulls having their target hit The probability clearly favors the bears, decide early that the market is now AIS In a strong trend, even selling late is good Only ONE thing matters - YOU MUST SELL!

Question 54

Bear BO - Look for Signs of Strength

Answer 54

Bear BO - Look for Signs of Strength

Question 55

Remember it is AWLAYS IMPORTANT to be thinking about the Market Cycle Only 10% of the bars on any chart are in a BO Phase Most BOs are 2-3 bars and part pf a TR or Broad Channel

Answer 55

Remember it is AWLAYS IMPORTANT to be thinking about the Market Cycle Only 10% of the bars on any chart are in a BO Phase Most BOs are 2-3 bars and part pf a TR or Broad Channel

Question 56

It very important to always be ready to draw a conclusion the Always In direction Decide Early; is the market in Always In Long or Always In Short

Answer 56

It very important to always be ready to draw a conclusion the Always In direction Decide Early; is the market in Always In Long or Always In Short

Question 57

There are many good ways to sell so CHOOSE ONE

Answer 57

There are many good ways to sell so CHOOSE ONE

Question 59

The STOP has to do with your Price Action NOOT your Entry Price

Answer 59

The STOP has to do with your Price Action NOOT your Entry Price

Question 60

Setups Never look Good Enough

Answer 60

Setups Never look Good Enough

Question 61

Where does the stop belong in this trade?

Answer 61

Atop of the Sell Climax, as every agrees the market is AIS and the above goes above the BO or above bear leg This is a BIG stop, if your account cannot handle this stop simply do not take the trade

Question 62

After a BO sometimes the market goes straight down because of FOMO, traders Fear there will not be a PB so they SELL

Answer 62

After a BO sometimes the market goes straight down because of FOMO, traders Fear there will not be a PB so they SELL

Question 63

If not sure if the reversal is minor or not, Exit Early for a profit I can sell again after a PB(50% PB is GOLD👌🏾

Answer 63

If not sure if the reversal is minor or not, Exit Early for a profit I can sell again after a PB(50% PB is GOLD👌🏾

Question 64

They're always several different good Stop Choices

Answer 64

They're always several different good Stop Choices

Question 65

Does my Stop vary depending on my entry into the market?

Answer 65

No, the stop is the same no matter where I sell The stop placement has nothing to do with where I entered and everything to do with what occurred in the context

Question 66

After each new BO what should I do with my stop?

Answer 66

After each new BO Lower the Stop, especially to a newer low (vice versa in a bull trade)

Question 67

After each new BO - Lower the Stop

Answer 67

After each new BO - Lower the Stop

Question 68

Sell the Close Bear Trend - a Reason to Sell on Every Bar I have to be very careful off a Sell the Close Trend or Buy the Close Trend that emerges in the final hour of the trading day, I have to be quick to exit

Answer 68

Sell the Close Bear Trend - a Reason to Sell on Every Bar I have to be very careful off a Sell the Close Trend or Buy the Close Trend that emerges in the final hour of the trading day, I have to be quick to exit

Question 69

Sell the Close Bear Trend - Sell Strong Bear Closes The reason why these big bear bars are closing on their lows is that institutions are selling just before the close so Traders must do the same

Answer 69

Sell the Close Bear Trend - Sell Strong Bear Closes The reason why these big bear bars are closing on their lows is that institutions are selling just before the close so Traders must do the same

Question 70

Once Clearly Always in Short Look to SELL NOW! Especially if you see the market cycle has transitioned into a Strong BO If the stop placement is to far do not worry about it, just do not take this trade

Answer 70

Once Clearly Always in Short Look to SELL NOW! Especially if you see the market cycle has transitioned into a Strong BO If the stop placement is to far do not worry about it, just do not take this trade

Question 71

Bear Flags (Low 1 and 2 PBs) - Sell BO Below

Answer 71

Bear Flags (Low 1 and 2 PBs) - Sell BO Below

Question 72

Bet Reversals will FAIL and become Bear Flags Sell Bull Closes Sell BO above Prior High Sell above Bars Sell @ 50% PB

Answer 72

Bet Reversals will FAIL and become Bear Flags Sell Bull Closes Sell BO above Prior High Sell above Bars Sell @ 50% PB

Question 73

When you see the market is clearly AIS and the reversal down is strong, the odds are you're going to get a Swing down It is important to swing at least part of your position If you keep scalping out that is ok but you need to get short again The best approach is to just use the appropriate stop and hold short until there is a major reversal up or a major reversal setup, then look to exit my swing trade

Answer 73

When you see the market is clearly AIS and the reversal down is strong, the odds are you're going to get a Swing down It is important to swing at least part of your position If you keep scalping out that is ok but you need to get short again The best approach is to just use the appropriate stop and hold short until there is a major reversal up or a major reversal setup, then look to exit my swing trade