 Hello everyone again and welcome. Floor Trader, you typed yes PJ. I don't understand maybe you're responding to a private message. You need to respond directly to a private message because everyone can see what you typed your response to PJ. But in any case, we're here today with Melissa Armo from thestockswish.com. We are about to begin. We do want to thank each and every one of you for your time and your participation here today. This is Online Trader Central. I want to welcome the new folks who've just joined us, the Victor, Scott and others. This is Online Trader Central. Let me see if I can round up the percussion section musicians and all of that. And so we can get started here very soon. And without any gentlemen, the sound of the trumpets means it is time to begin. Please put your hands together and welcome the CEO and head trader from thestockswish.com. Please welcome the stockswish. And I'm here today to talk to you actually about the strategy that I personally trade. As Kevin said, I trade. I'm the head trader. I'm the owner of my own company. And I also run a live trading room every day where I trade my strategy in the market. I'm actually a day trader. And I'm going to talk about the strategy that I trade every day. It's a simple 26 point strategy that I use to make money trading. And it's actually something that I personally created. If you're interested in more information, you can email me at Melissa at thestockswish.com. And you can go follow me on YouTube, Facebook, LinkedIn or Twitter. If you go to my YouTube site and subscribe to that, you will get any videos or webinar replays or market reviews that I do there as well. So what we're going to talk about today really is this idea of not just having a strategy, but also the idea of having something to focus on to make money consistently in the market. That is simple. Okay, so how does simplicity really help you in reference to trading? Well, trading can be very overwhelming for many people in the market. And when I started out seven years ago, it was overwhelming for me because there were so many things that I saw every day, so many stocks to trade and so many different things that I could do. I was never focused enough on what I was supposed to do every day. And that's how then I end up coming to the conclusion that I needed to create my own system because there are a lot of stocks to look at each day. So I'm talking about the US stock market, the equity market right now. How do you know what to train or not only that, what direction to trade it and what? Well, you have to know because it's too late if the stock already makes the move and then you see it after the fact. The way to make money is to know what somebody's going to do ahead of time and to in fact actually predict it. The idea of having one simple strategy to follow each day is the structure that is really very necessary in order to make it. And it's one of those things that unfortunately the many traders lack. And again, when I started out, I lack this too. So I kind of figured out very quickly that I needed to have a focus and really that only one trade is all I needed in any given day in order to make money because it was about finding the quality, not really the quantity. So here I'm just showing you an example of how simplicity helps you one focus. If you know what you're looking for and you go into the day and you have it set before the open, the market opens at 9.30 Eastern time, and you know that you're going to short ABC stock, whatever it is on the day, you'll get in the stock and you will take the trade and you will follow it through to its logical conclusion. Now what if for some reason it doesn't work and it fails as a short ends up being a long, then you just stop and then you have one loss. So it's simple. What many traders do though is keep fighting with stocks, meaning keep going after it in the original direction. Even if it doesn't work right as a short, they'll keep shorting it, shorting it, shorting it, not understanding that it's not a short, then that it's really a long or vice versa. Okay. So the way simplicity helps you is to have the focus, which does two things. One, it helps you make money with ease and not being stressed, knowing what to do. And two, if for some reason the trade doesn't work, which sometimes there are trades that don't work. And in any system, that's the case. It shouldn't be that often. It should be really only like twice a month of that. But either way, you only lose one, one trade. So again, the idea of simplicity, because many traders, if they take a trade, want to keep trading after they're up money, all you need is one though in the day to be profitable. And we're going to go over this here in some of the examples today. And again, if one doesn't work, then you're down one risk unit. And that's it. And then if you have five trading days in a week, and let's say for you make money and one you lose, you're up and you're profitable. Okay. So having common sense actually helps you make money consistently. It's the idea of looking for quality. So it's common sense, looking for quality, having the focus, not over trading, and having a system to follow so that you know what to do when it's planned out ahead of time. It's really about just common sense, don't over trade, know what you're supposed to be doing going long or short the stock ahead of time. Fancy really is not better in reference to trading. It's like if you had a job where you worked in a very professional environment, say a high end law firm. And, you know, you had a very high level job. It's really you could be under a lot of pressure, you have to do well. It's about the focus. Okay, you have to be very smart. You have to be intellectual, bright. There's a lot of competition. It's not always the right decision to do too much to get too fancy. My charts are very clean. You'll see this when we go over the examples today. I don't have any specific indicators that I use, that I rely on. I have a very few things on my charts. I don't use Fibonacci's. I don't use any kind of crazy lines or graphs or things. I use simple period moving averages, and that's it. And I could forgo those two. Okay, because there's nothing to do with my system. So this idea of complexity really doesn't necessarily work right in reference to trading. It's about common sense and focus and keeping it simple. So as I was saying, what is your plan of action? If you really want to do this and make money, which should be your objective, and if you're not focused on making money, then you will most likely not be profitable. Okay, I think a lot of people don't necessarily take trading seriously enough. I was very serious about trading when I started. I really wanted to do it for a career, not for side money. I wanted to quit my mortgage job when I started it. And I really was serious about money. Okay, you've got to be serious about what you're doing. You have to have a plan of action before you take risk in the market. That means even risk like tomorrow morning, like immediately, not even for the bigger picture, but like even tomorrow for the short term in the long term, you need a plan of action. And it really comes down to needing and having a system. Okay. And if you have any questions, you can write it in the room here. I'll see as we go along. So what is the golden gap system? This is the system that I created, that I created myself to trade the market. It is a very simple system that pinpoints through the right direction to trade the stock every day. And you're looking for it. And if you find it, you train. And if one day you get up for some reason, it's not there. It's a holiday weekend, July 4th or something, then you take the day off, you don't trade. This is a 26 point professional bearish gap rating system. So I like to focus on the shorts. And we're going to mostly talk about that today, although you can flip the points and use the system to go long. The purpose of the system is to help you evaluate which gap to trade each morning. So what is a gap? For those of you that don't know what a gap is, I'm going to show you here in a chart in a minute, but a stock gaps with the opening price today. So today the market's closed. It's 448. So whatever the opening price is tomorrow morning, for example, on Tuesday at 930, whatever that opening price is, it has to be different from the closing price of today at four o'clock when the market closed. That's what is a gap. Gaps can happen up or down. A gap is a price break. Okay, it is a break that happens in price action from one day to the next from Monday, for example, the Tuesday or Tuesday to Wednesday. Okay. Now let's show you example. This is a chart of CVA. This was last week, the stock closed to around $20 and 40 some cents at four o'clock. And then the next morning when you got up, the stock was not at that price. It was at a different price. It was down here at around $19 and 70 some cents, whatever. Okay. So the stock gap, you would see this gap in the morning on a scanner to find it before this whole thing happens. And you would use my 26 point rating system to rate the gap in the morning at 8am or 830 or 9am anytime before 930 before the market opens and then determine if you want to buy the stock or short it. And then when the open happens, you take the trade. Now in this case here of CVA was a short. So my method looks at 26 points. You don't have to actually have all 26 points to be able to trade it. You've got to have 20. So in other words, you're looking for not perfection as far as getting every single solitary point. You are looking for 20 of the 26. Okay. And again, you follow the system. You just go through the checklist. So why should you learn in my system, which is called the golden gap system, because there are so many stocks each day that gap. So not only are there a lot of stocks actually in the U.S. market on every given day, there's a lot that gap that change price from one day to the next. So using a system is very significant to your success. And having a detailed way to find which stock to trade will make it easier for you to achieve success. And anything that you can do to help you achieve success and make it easier for your success you want to do. And this is just common sense too. It doesn't matter if it's trading or if it's some business that you have, anything that you do in life that you want to be successful, you want to try to make it as easy for yourself as possible. It's not to say that you don't have to do hard work. Of course you have to do the hard work that's necessary. But if you can make your path a little bit easier by taking a class or having a mentor from someone like me, instead of just trying to throw yourself into the market, losing money to figure it out or wasting months or weeks or years of your life, you want to do it. You want to be focused on this thing and have a goal. Like you are going to start making money trading by such and such a time frame and this is how you're going to do it. When I look back at the things that I did seven years ago, if I had to do it all over, I don't want to say I made mistakes, I did make mistakes, you know, I'm happy that I figured out how to trade and I'm glad that I'm at where I am at today. But if I had it all to do over again, I would say that when I started out, I did not really have a good plan of action. I just wanted to trade and make money. I didn't know how to do it. I didn't have a plan of action to do it. And I didn't even give myself an amount of money that I was willing to risk, you know, to do it. And I didn't give myself a time frame. And these are parameters really that people need to give themselves. Again, that's part of the plan of action. The idea that many, which was just really where many people are at because I talked to a lot of people, they just throw themselves into it and they have no deadline. They're just like, well, I'm just going to go to webinar after webinar or paper trade or just try to figure out myself and all of a sudden five, six, seven years have gone by and they've lost tons of money in the market. You really have to have a plan, what you're going to do, and then a time frame to achieve that plan. Otherwise, you don't really have a set firm enough goal and you will just be kind of hanging out in no man's land while you're trying to figure it out and wavering back and forth, back and forth with different systems and even different methodologies and not really ever putting your foot down and planning yourself firmly into doing something, having conviction in something and believing in something. And we're going to talk about that a little bit too. So, here is another gap. I just want to show you an example. This was QCon. Again, a stock gaps when it closes at a certain price and opens at a different price. So, here you have coupon. It closed up here around $64 in some sense and gap down here at around $62.50. So, the stock gap down when from four o'clock to 9.30, you get up in the morning and you would find this QCon gap and then you would rate it for the 26-point system to determine if you should buy this or short it. And again, this is a short. I prefer to short. Many people ask me this, but I prefer to short because actually downside momentum in stocks comes in really fast and much faster than upside momentum. It's not to say that you can't make money going long. Of course, you can make money going long as much as you can going short. But I like to trade as a day trader very quickly. And usually the moves that happen in stocks happen in the morning fast to the downside, faster than getting in longs. So, the system is really designed for one purpose to find a stock that will have a high odds of working in the correct direction on bias on the day and with a strong momentum move. And as you saw in that QCon that had a nice big drop in move and so did the CVA. The strong momentum move is the way to make money trading effortlessly because if the stock's just dropping and you're in it short, you don't have to do anything but just hang on and have your target and look to get out when it gets to the target. When you are waiting, and I call it sweating a bullet, when you're waiting for something, like you get in it and you're down before it goes or you're waiting it hasn't gone or you're actually down money in the trade waiting for it to go before it even goes, that's what I call sweating a bullet. And I don't trade like that. I'm looking for the momentum to come in, in the gap quickly, in the AM period, in the morning. And that's how you make money effortlessly. So, let's talk about the 26 points. The point rating system works because it is such a detailed analysis of the price action and that's really the crux of my system. I'm analyzing the price in the 26 points to determine whether something is going to get bought or sold off. It also works because everything that is being looked at in each point uses the daily chart of the stock and that is the weightiest chart in any stock. The daily chart of a stock is the most powerful and real indication of what the trend is in a stock for any trader of any kind. Now again, I'm looking at what it's going to do in the day because in the long term, I'm not holding trades overnight. Now you can use my gap system to take overnight. Some people have taken my class and used it for options. But for me, I'm in and out. I got to be flat by four o'clock. So, I'm really only looking for what the trend of the stock is doing on that particular day. I've got to get in. If I'm shooting something, it's got to sell off that day and I got to be able to take the profit and get out before four. All right? So, the 26 points pin points what it's going to do on the day. You must get the direction right in the daily chart if you want to make money trading. Again, if Q-coms falling off the planet and dropping and selling off all day, you're not going to make money going long the stock as a day trader. So, this is a very simple and definable method because you're going to use the rating system and then you just take it and you tally up the points 20 or more and if you meet the criteria, you do it and that's it. You don't have to find anything else but one thing. You only need to do Q-com if that's the one that rates well. You don't have to look for 17 other trades and if for some reason Q-com wouldn't work which actually it did, you would just stop with one loss. When I trade, I use stops. I use hard stops or limit orders so that my risk is defined and we'll talk about that too. That's a very important part of having to plan of action as well because you should know how much you're willing to risk in a trade so that you don't lose more than you want to risk if for some reason the trade wouldn't work and you also need to have a goal what you want to make so that when you're up that amount of money, you take it off if it reverses against you. So a system should be easy to follow and not only that easy to comprehend and I do a good job of going through and explaining everything in my class, the class that I teach. It's a two-day course. I go through all of my points. I go through the charts. I explain it in great detail. I'm constantly teaching in the live trading room when I'm trading and I call my trades live in the room and people take them with me. I have a lot of people that ask me about joining my live trading room because I trade every day. You cannot join the room unless you've taken the class and the reason is again people need to be serious about their trading, the money that they're risking in the market. I think it's extremely important for people to be responsible with their choices in order to take risk in the market and so I encourage people and enforce that discipline on people by making them take the class in order to trade with me and that's really how I've developed actually successful traders. I have many traders with me, really the whole room is making money this year so it's one of these things where you really have to decide how serious you want to be about it. It's not something that has to take you weeks and days and months and years to learn how to do but you do have to devote the time to taking the class and learning the 26 points and then being in the room and trading every day. Now I don't run the room all day. Some trading rooms are open at four o'clock. I have the room open from eight thirty to eleven and I usually only trade between nine thirty and ten ten fifteen so I'm not even trading for the whole two and a half hours I have the room open. I'm really only trading for about thirty minutes fifteen minutes five ten minutes some days and then I teach and talk the rest of the time so again I'm very very focused on what I do. I have a plan of action not just for my trading but for how I run my trading room focused on making money and that's it. Now let's talk about some trades that happened here in the last week. Okay all of these were golden gaps and I'm focusing on the shorts because I teach the class on the shorts. Again you could flip the points for bullish if you want to go long. A lot of people ask me about that in reference to the types of accounts that they have but if you are interested in having a proprietary day trading account you can email me about that after the webinar and Kathy can put my email in the in the room there. So let's look at LXK. LXK closed the night before up here up here around forty seven something and gapped down here to forty two dollars so gapped down roughly five dollars. Okay so you get up in the morning and you would rate this gap. You would rate it to determine if it was a longer short in the case of this it was a short. This actually had a huge move in the day. Okay if you took this trade it went to the dream target it also continued and we'll go over this later in a minute but this was a stock that you would have had to watch and be very particular because in the morning initially it didn't have the full volume in it to take the trade then the volume came into the stock still in the opening period and here's where the trade set up in here approximately nine forty three nine forty four. Okay this is a one minute chart this is a daily chart. Okay so you could have shorted LXK why because it was a golden gap and rated 20 points or more per my 26 point rating system as a short so you're looking to short this you look for the entry I teach six entries in my class so you can short it and you could have taken it and gotten out of it whatever I mean this really really got pummeled on the day that it that it fell but if you took the trade and actually got out at what the first target was the first target was thirty nine dollars this was still a two and a half dollar move from the entry now I'm showing you a beginner risk because I wanted people to see that you don't you didn't even need to risk a lot of money to make money in this trade so if you risked a hundred dollars in this LXK entry and gap you would have made twenty five hundred dollars that's phenomenal because the stock went you know two and a half a dollar and a half okay or two and a half dollars now where am I getting this thousand shares and the hundred dollar risk because when you take a position in a stock again I'm on the one minute chart you shorted and as I said earlier I have a stop so I size myself according to the stop so you put the stop in so if you want to risk a hundred bucks you could have taken a thousand shares of this and if you had and gotten out at thirty nine and I just want to point out here here's thirty nine here this is the target so that's where you would have gotten out and plus you're up twenty five hundred dollars but I just want to show you if you stayed in it and carried it on down the stock ended up going all the most to thirty six so you actually could have made another three thousand dollars you could have risked a hundred dollars on this trade and if you had the guts which I don't know if you would have to stay into the dream target you actually could have made five thousand five hundred dollars risking a hundred bucks on this trade of the day the stock got pummeled it was a good gap the entry was precise okay and that's what you could have gotten out of it now let's just say you wanted to do this for a swing trade the stock actually dropped in five days it dropped ten dollars this is this is not that abnormal lots of times gaps have continuation moves from the day of the gap this is the first day of the gap this is one two three four five the low today was thirty two something and then it bounced but the stock actually if you'd shorter this is a swing trade dropped ten dollars I mean that's crazy but it can happen so here's a good example where you could have done a swing trade or a long-term trade or even an option in LXK again I like to day trade an in and out flap before four o'clock but this is a great other way that you can use my system to do options and swing trades and overnight because if you don't have the time to day trade every day you can still look for the gap find the gap get in the train and then you don't have to monitor it you know every minute like I do okay beautiful move okay now oops hold on I wanted to go over the advanced risk in this I showed you the beginner risk in this if you just took a thousand shares if you took an advanced risk what would be an advanced risk a thousand bucks okay if you risk a thousand dollars if you could afford to and took five thousand shares of LXK short and did the exact same trade as a beginner person the new trader you could have made again two and a half bucks but if you had five thousand shares you would have made twelve thousand five hundred dollars in one trade that's not even holding the stock down to thirty six something which if you had done that you would have made another three dollars which would have been another fifteen grand if you want to trade into stock right and I didn't you know hold this anywhere near or go anywhere near thirty six dollars I mean but I'm just telling you if you had there's times where I will hold something to a dream target but I don't do that every trade either mostly because I have my goal in for the day when I'm trading and I like to stop early but if you had traded this correctly and this is the power of really my system and pinpointing something if you had wanted to hold this through into the late morning period early afternoon and you risk a thousand dollars which my R is more than that you actually could have made in the stock you know almost thirty grand you would have had to risk a thousand bucks you wouldn't have had to take any other trades this week okay it's a gutsy thing to do though to hold this to such a bigger number but you're up a lot anyways this again is what I'm talking about in reference to the simplicity of just finding the right thing and then letting it fall into its normal momentum but if you don't know to look for this you won't do it if you don't know to how to find this that that this is something that you would even want to do or in what direction to do it you'll never get this trade you'll never be able to risk a hundred bucks and make a thousand or two thousand you'll never be able to risk a thousand and make you know ten thousand you'll never be able to do that and you certainly won't because you won't know the entries which again is a big piece of my class because I teach where to get in these stocks okay and they all set up differently day training is one of these things where you really have to be very precise otherwise you don't know where to put the stop you don't know where to get in and you don't know where to get out okay and all of that plays a big factor besides just finding the right stop now let's talk about the next one Verizon didn't very similar to LXK this was the gap in Verizon I did this this day but it actually had a really nice follow through too so you could have done Verizon and held it through for a few days as well again this doesn't happen with everyone but in the case of this it had a small move the day of the gap and then the momentum came in overnight so you're watching Verizon you like it as a short you rate it for the 26 point rating system and it tells you you can short the stock you get in the stock short and it goes to the target and you're out so this move in here is a period of time for just 20 minutes 20 minutes you're literally in the stock and out within 20 minutes and your day is done your day is done by 10 o'clock eastern time how you find the right stock to trade you know exactly where to take it you know where to put the stop you know how to size yourself you hit it you do it you you're very exact like this is the plan of action the plan of action is I like Verizon I have conviction I want to do it I'm in the trade I get in I short it I'm out okay focus focus focus in the case of Verizon you would have shorted the stock at 46.95 this is the entry risk is 15 cents if you risk about a thousand dollars for an r 900 bucks with 6,000 shares and you exit okay this is one of the targets 46.60 you get out nice profit here if you have an advanced risk unit and again you're looking for the targets in these things I teach the targets in the class too this is how you know where or when to get out of the stock but you've got to know that it's a short and you have to be able to watch it and how would you do that before the open is when you prepare again the plan of action is you prepare before 9 30 eastern time that you like this stock and this stock and you're watching two or one or three or however many that you that you rate that rate per the system that you want to do okay now a lot of people ask me this how much money do you need and what does it cost to trade gaps well I'll go over this at the end my class is $3,500 is it worth it yes why you can make more than that in one trade and you certainly even if you don't take an advanced risk can make that in a week trading with me in the room so it's definitely worth it and you also learn my system to use for the rest of your life because my system is applicable for something that you can use for your whole life that you trade because gaps will always exist in the U.S. stock market because the U.S. stock market will always have a closed time and it will always have an open time as long as the market exists okay so that's a good thing and it's a very important thing and it's a huge benefit to people that learn my system now how much money do you really need to trade though okay well there's different types of trading accounts sometimes people want to do options because they think that it's cheaper but really you have more control when you day trade when you're in and out you're controlled with the risk and you also can take the trade off that dang you know what you make when you do options you can't always control the timing now I called Amazon to gap up on the earnings last week which is exactly what it did and there were some people that did that option trade that I called in the room before it got you just don't know the timing though of things like that in the case of Amazon it worked out for the people that did it but with my system as far as day training and what I do every day I have full control I'm looking to get in and out on the day so the timing of it doesn't matter to me as long as it happens today whether it happens in 15 minutes or five minutes or 10 minutes or 20 minutes I really have to four o'clock although I'm not usually saying in the trade select okay but there are proprietary day trading accounts that you can trade at where you can open up an account and day trade actively with as little as $2,500 if you go to a retail brokerage house you need $25,000 to actively day trade the leverage and the buy empire that you get at various brokers varies and you have to check with them and find out but it's not like you have to have a million dollars to train the market as a day trader or even thousands of dollars even 25,000 okay you don't have to go to the big brokerage houses to train you can go to a proprietary day trading account and you figure out your risk okay per train based on the size of that account whatever the amount of money that you have all right any questions from anyone so far as I'm going along here look at the cva this was one we looked at earlier again cva was a short okay how did I know you rate the gap you rate the gap per the 26 point rating system to determine it's a short and not a long and then you look for an entry in the stock so cva and again this was last week too now you're on the one minute chart the stock opens and you're waiting for the setup and here it is you could short the stock and it dropped it had two drops one in here and went all the way down here so again the stock actually dropped by the time you were in it actually went to the target within three minutes you could have held it more it went to another target down in here you could have held it a little bit longer but in three minutes here it went to the target and you could have been out so what was the price 1950 was the short entry the stock was 15 cents again if you take an advance risk of a thousand fifty you could have taken seven thousand shares of this exit was 19 again it went lower it all went all the way down to 18 the next target was 1875 below the day was 1876 how's that for exact I gave the second target was 1875 it went to 1876 that's how that's how exact I am with knowing what I'm doing with my gaps anyways 19 was the first number and if you took this trade and got all out you made 3500 bucks some people don't even make 3500 dollars in a week let alone in one trade and again you know this is the cost of the class which you can make in one trade some people don't make 3500 dollars in a month now I'm not saying a lot but there are certain jobs in the United States that don't even pay that much this is a lot of money to make in a day trade this is a lot of money to make in two minutes you took the trade here and you got out in three minutes you were in in two minutes you were out that's phenomenal I mean this is phenomenal people I don't I don't this is the power of the gap this is the power of momentum and trading and this again is why you have to have a plan of action you would never never never never never make 3500 dollars in two minutes without a plan of action sometimes I take a trade I mean these are my favorite days in the world and I will make four five six thousand dollars and literally less than five minutes sometimes I'm so excited I scream in the room because I'm so excited to make that kind of money and I get out and sometimes it goes to bigger number but I'm up so much so fast so quickly because I was so precise had my plan of action knew the stop to trade rated the gap had the entry right size myself correctly and just hit it right before the momentum came in that I get out I mean that is phenomenal and then I have no more risk and then no matter what it does I don't care I have no more risk and really I don't even have to take another trade for the week okay I am extremely good at doing that because I am an expert at gaps my system I've been trading it for seven years this is why I run a successful trading room where people are making money following my calls and teach a successful class but if you don't have a plan of action to pick the right stock or know the entry to do it to hit it at that exact moment before the momentum drops into it if you're shorting or comes into it when you're going long you won't get it you won't get and you'll be looking for crumbs you'll be looking for crumbs to short in here or you're trying to flip it to go long because you missed the short you'll be looking for crumbs don't look for crumbs you're never going to make a lot of money in the market looking for crumbs and this is why people also have a problem taking big size because they they can't risk a thousand dollars because they're so unsure of themselves they feel like fifty fifty so they take three four five trades a day and instead of risking a thousand dollars in one trade they'll still risk a thousand dollars on the table they'll divvy up into four or five trades what's the difference why do not take the real full risk at a quality trade that works we can make a lot of money in one you know it's it's not shooting darts at a board trading it it is very very specified simple if you know what to look for focused and it's all about the common sense you do what you have to do and that's it any questions we'll look at another one here this was true this was friday true again was a short you get up in the morning and you find the true and you rate the gap and then you determine if you want a short true or buy true and if you or do nothing with true you can you can rate a gap and then it doesn't rate well and you don't do anything with it even anyways this was a good gap and it was a short so here's the short and true you short it then it drops and actually i got out of this early because it was a target it kept going the dream target on this was six dollars it almost got there it got within 11 cents of the dream target or 13 cents of the dream target this ended up going way way more but if you'd like to take the short and be done early this was it price of the entry was 735 risk is 20 cents on 5000 shares it's a thousand bucks again your risk units should be the same we're close to the same in all the trades again this is an early exit the stock went down to like 613 so you could have made on this even more but if you risk a thousand dollars and got out here you made about 2750 and sometimes you can piecemeal out you can take it half and let the rest drop on and just keep lowering your stock or you could just take it all out and be done when it gets to the first target again you know really nice amount of money to make in one trade and let's look at the timing of it you're in and you're out so you're in and out in less than 15 minutes that's it it's not even 10 o'clock and you're done for the day see that okay let's look at another one nice fat monster red bar here in cof again a bearish golden gap the stock closed the night before up here at 90 dollars in some sense and gap down here to 83 50 approximately low in the day and this is is insane i mean this stock here got pummeled in the day not quite as much as lksk but still okay ran down and dropped more than five dollars so again you rate the gap and this is a short i have a question please explain risk versus total cost of stock don't you have to cover the stock cost you are not purchasing the stock where you actually get stock shares for it you have to be able to cover the cost of the stock not in the amount that you're risking but in the amount of the share size that you're taking let's look at this train here as an example i'll let's wait till i get to this one then we'll figure it out here's the short in cof okay and it drops so you're in one quick trade in this again you're out in five minutes now e stock was asking a question let's just say e stock wanted to take this train the cost of the short is 83 30 if you took 1500 shares and put in a hard stop you're actually risking 1200 in your account so in your live account you have to have at least 1200 you have to have more than that because you know you don't you never risk your whole amount but you have to be allowed to risk 1200 cash so that's what you're really risking in the cof now i think what he's asking is hey wait a minute it's an 83 dollar 30 cent cost to take the position with 1500 shares how much buying power do i need buying power and leverage is much much different than the cost of the position of the risk this is the risk that's it that's all your risk is 1200 bucks do you understand if you get stopped out of this you won't lose more now you you might have a little slippage but you you really wouldn't you actually wouldn't with this it had plenty of volume and this is only 1500 shares anyways getting back to it that's all you're gonna lose if the trade fails that's your risk do you understand e stock and anybody else that doesn't get it that's it it's defined i would never take a trade if i don't have a defined risk that would be insane and no one would trade in the market if they didn't have to find risk and people to trade in the market without to find risk loose that's why there you know a lot of people will lose in the market you must define your risk and as a day trader you you can very easily do that by using stops while you take things overnight you don't have stops but that's why taking over nights is more risky you really i know what you're doing and again you have to have a system and a plan of action for that too okay anyways i think what you were saying is wait a minute the price of the stock is 83 and 30 cents if you want to take 1500 shares you would need in buying power for this this amount those out there that's how much buying power you would need you would need approximately 125 000 dollars in buying power does that mean you need 125 000 cash no does it mean you're risking 125 000 dollars no no it doesn't mean any of that it means you're risking 1200 to take the position it is utilizing the cost price the cost basis is utilizing from your account 125 000 in buying power every broker gives you buying power or leverage how much retail places give four to one for day trading and prop places can give up to 100 to one you got to decide where you're trading and you do need to know that because you can't take a position unless you can well you wouldn't be able to if you press the button you have enough buying power wouldn't it wouldn't take the trade for you at the broker it would be preset in the platform but there's an example okay so let's just say at a prop account at a prop account you probably could have taken that trade with 10 grand in it maybe even five a prop account would have maybe would have let you take it with five but risking 1200 for the five thousand dollar cash account is too much my opinion okay but let's just say you had 10 000 in a prop account you would have had enough buying power to do it and take the risk if you had a retail account 25 000 only gives you 100 grand in BP but you shouldn't be up against the amount that you need in the place you should really have at least 30 000 with any retail place if you're trading so that's approximately 120 you would have been able to take a little bit less than 1500 and been covered if you had 30 grand in a retail account cash but you're not risking all of that does this make sense you're risking the 1200 but you really could have done it with a prop account with much much much much much less because they give you more buying power and it's just I call it leverage okay you are getting out of this thing at 81 30 that's it you're done you're not getting a stock certificate mailed you in the mail okay so the broker allows you to borrow this 1500 shares for a certain time period of the trade five minutes 10 minutes in the case here my trains let me go back are usually for a few minutes so you borrow it from the broker for five minutes and you give it back and that's it and that's really how you take a short anyway it's because you're borrowing the stock when you're shorting you're borrowing it because you're pre-borrowing it because you're borrowing it because you're betting that the price is going to go down e-stock has asked me another question here before I get to the next trade but you lock out that money until the three days it takes for the transaction to clear absolutely not I have no idea where you're trading you're not locked out of anything at all it takes approximately three to five days for your trains to clear but it doesn't lock out your buying power block out your buying power at all for that amount of time at all you either need to call your broker or find out or I have no idea and it sounds like you're trading at a retail place but you misunderstand how it works there's no way that you take that trade today and can't take that trade and use that buying power tomorrow if you're flat the trade no way it takes three to five days for trades to clear that has nothing to do with anything that we're even talking about here and by the way the broker will let you take out the money that you made today and wire it out of your account even though the trade isn't clear so I don't know where you're trading but you need to call the broker and have that explained they will explain that to you doesn't lock anything out as soon as you're out of the trade the buying powers put back into your account you have access to take another trade immediately in one hour from now or the next business day makes sense now if you lose money it will be taken out of your buying power but you'll be down the money so if you're buying powers four to one and I'm just I'm just saying a number here okay and you lose a thousand you will be have four thousand dollars less in buying power the next day if you're buying powers four to one that's all but you'll only be down the thousand in real cash there's no locking out you really don't understand how this works if you're going to trade I mean again this is plan of action call them and go over with them over the phone you stop there's many many many many many many many many many days years and years ago when I was trading after I've been losing for umpteen years okay three years it took me to figure all this stuff out that I needed the money that I made on the day I would make the money I would I would ACH it out of my account that day I would make it I'd email the broker right away pay me pay me right away it would be in my account sometimes in the afternoon sometimes by the morning that's what I love about day trading I have the money right away as if I want it now I don't need to do that anymore but there was a time that I had lost so much money that by the time I figured out how to trade and I I needed that money like I needed the money to pay bills and I took it out and I could and I did okay so you have got to understand how this works if you open up an account with someplace you've got to understand how it works all right now there was a second trade here in this price of the entries 81 80 okay beautiful entry in this as well if you took 5000 shares again you need the buying power for this which actually this is a lot okay so you this is a you would have a nice sized account even if you had a prop place for it to take 5000 shares of this risk is the same though 1200 exited 80 it's a dollar 80 move you could make $9000 now let's just look at this if you took it here here's the short beautiful entry this is not even the low of the day the low of the day went even way past this it went to 78 something but $80 was the next target so you took the trade in here and you got the drop into 80 and you got out again time of the day for the exit is around 10 o'clock the stock ended up dropping almost another two dollars but if you did this trade right in here with precision and got in it and got out of it and made a dollar 80 cents because that's what you're making you're making a dollar 80 what are you make how what are you doing here how are you even making this money the stock moved in momentum one dollar and 80 cents you got in it and it dropped one dollar and 80 cents and you shorted it just like if it went up and you bought it it would have to go up one dollar and 80 cents to make a dollar 80 cents that's this is momentum this is this is how you make money you make money on the pennies or the dollars how do you times it by the share size how do you figure out the share size based on the amount of risk you want to take based on the entry which i teach you in the class which you got to know though to watch the cof to know that this thing is even going to do anything that even looks like this okay because you would never make money and get something to move a dollar a dollar 80 two dollars three dollars five dollars if you didn't know to watch this it would be gone and done without you if you waited for your scanner till after 10 o'clock eastern time which many trade day traders do they feel like they have more confidence and conviction if they wait till late you miss it you miss the whole thing okay so the total profits if you took every trade with six trains that i just reviewed there that were all golden gaps now again this is advanced risk this is not holding any of them to the dream targets almost every single one of them went to bigger numbers with the exception of horizon with the exception of horizon every one of those gaps in the exits went farther meaning you could have held it longer and made even more money but if you took an advanced risk and got out at the first target in every trade the last six trades i just reviewed that happened in the last week you could have made thirty two thousand eight hundred fifty dollars that's like almost insane but that's the power of the gap it's the power of the information that i and melissa armo have figured out about day trading to know to pinpoint what stock to watch exactly what it's going to do the number to take it the entry the exit and to see that it's going to have the momentum and you've got to get momentum in stocks or you won't make any money if you just won't and that's why people end up taking three four five trades they can't get the stocks to move so they take the trade and make five cents and eight cents as soon as they take it they're up a little bit if it starts back up against them they kill it they end up making not even one risk unit they risk a thousand dollars and end up making five hundred they risk a thousand dollars and make two fifty because as soon as it backs up they have to take it out why because no momentum comes in it doesn't end up going anywhere selling off they're uncertain of themselves they don't have conviction that they even looked at the right thing it doesn't fall it doesn't drop right away as they get impatient they're sweating a bullet they're nervous and they're in fear about the risk and they don't know what they're doing you can't trade like that so you gotta have a plan of action for what you are supposed to do and then you won't be in fear about the risk that you're taking and you won't be in fear to trade and you will trade effortlessly and simple by with having the focus to do it so it's a simple system which can result in massive profits just with staying focused on one strategy and this is how you make money okay you make money with a system a strategy having the focus and taking trades with size less is more in reference to trading per day and that's what it's about so one strategy is all you need okay which is called the golden gap now can you use a system for bullish stocks yes i do teach a bullish gap class however you can take the bearish class and flip the point some are not exactly the same but most are and this is one of the reasons i've called the market well so well to the upside um is on netflix all the stocks that i've called higher because i do know how to read bullish gaps very well as well but i prefer to short as i said because the momentum that comes in for the timing of shorts and here's a chart of netflix this was a great excuse me this is a great bullish gap that happened um not that long ago even at netflix now of course the price of this is looks very different now because of what they did with the stock this is the current chart of this but it really ended up reaching over uh well almost over 700 it didn't quite get to the target which was 750 before they actually changed the stock price but it was a beautiful bullish call that i called and actually i had called this in the swing trade letter thank you kathy so let's talk about longevity and consistency and trading trading is about consistency and longevity because you want to do this for a long time you don't just want to do it for a day or a week and if you want to have longevity you need to produce consistent results if you want to produce consistent results you must stick to the plan and stay consistent with your trading and strategy if you want to have consistent results you need to have a detailed focus system like the 26 points to help you find the golden gap that will work okay to trade on the net success requires calculated risk you just cannot be successful unless you are willing to take risk how do you go after the cheese without dying or killing yourself in the trap every day in the market you you put your helmet on you plan to get the cheese so that you don't get hurt okay so this is the planning stages here you are ready to go you are planning with the safety protection of the stock you also are going to make the move very quickly as you see his position here to get it out before this slams over him and this is how you trade someone said i'm like a sniper i really am like a sniper when i trade just like this guy getting the cheese very quickly and there's enough cheese to go around and you just have to find the quality cheeses okay i always say this to people how badly do you want it you really have to want want to make money in the market i mean you have to want to make it if you want to make it i can teach you how my class is thirty five hundred dollars okay if you want to learn how to make money i am teaching people okay it's how badly do you want it do you really just want to lolly gag around and i'll take it seriously or do you really want to do it and you really want to make money and you want to get to the point where you can make thirty five hundred dollars in one trade or two thousand dollars in two minutes or five thousand dollars in five minutes it's possible okay it's and i'm not just doing it i mean i'm actually teaching people that are doing this with me alongside of me now in the room that are taking the similar risks that i'm even taking now because they've been trading with me for so long this is an example a great example here showing you a picture depicting here no conviction when you trade with no conviction it's like trading in the dark you don't know what to do you're in fear you're uncertain about everything this is how i trade i get up in the morning the sun is shining right in my face on the 60th floor and i have a hundred percent conviction in any trade that i take and if i don't then i don't take it i believe that i'm going to make money when i take the trade i never look at it like 50 50 there is no 50 50 for me or i don't press the button and if i think that way then i don't press the button so guess what i'm successful a lot okay very very often it's about the power of conviction the difference between trading with conviction and without conviction is night and day it's just completely night and day there is nothing like trading with conviction there's no comparison and you cannot live a successful trading life without it so you've got to have it and how do you do that being focused keeping it simple common sense having a discipline having a system to follow if you do not have conviction in your strategy you just you've got to learn one that teaches you it and something that works so the 26-point checklist is what teaches you what stocks to trade to be successful every day and the class that i teach is called the golden gap course it is a professional bearish gap system the class is this weekend august 1st and 2nd from 90 a.m to 5 p.m eastern time the cost of the class is 34.99 if you're interested you can email me at bliss at the stockswush.com Kathy has my information there the sign up materials have to be emailed to you you can email me if you want to sign up and register space is limited i already have people registered if you want to sign up email me i also teach another class called the trends course this is this week two it's july 29th and 30th from 12 to 4 eastern time this is how to read trends and long-term charts okay this is really for people that are doing options or swing trades overnight this is 999 if you're interested in this class email me at Melissa at the stockswush.com and i'm doing a special if you want to do the trends class this week and the golden gap course you can do both classes for 39.99 and then i'm offering the wealth manifestation class free so it's actually saving us of almost nine hundred dollars so you get three classes for one price and you do them all this week okay so email me if you're interested in signing up at Melissa at the stockswush.com as i said i do have a live trading room it is open to join only for people that have done the golden gap course i do call my trades out live tell you where to take the entry and where to put the stop okay so you can do it live with me every single day i trade only my system i trade only gaps i look at maybe one to three symbols a day one is my main one i have a top watch every day i may call for trades but i usually do one a day okay there's a lot of focus losses are kept to a minimum there's it would be like you would have to be almost like a crazy person to actually lose money with me if you were even with me for a week because i don't i don't i don't i don't even call that many trades that lose i don't even call them any trades i mean some trading rooms call like one guy told me in another room they called 65 trades a day 65 trades a day now they were open to four o'clock but i don't even call them any trades okay it would be impossible to even lose with me so this is why again people are making money with me besides the fact i'm very very focused on what i do which is how you make money the hours of the room are 8 30 to 11 a.m eastern time the class is online each stop it is an online course you can be anywhere in the world and take the class 9 a.m to 5 p.m eastern time to saturday and sunday and it's a good time to trade because it's earning season even though it's summer it's third quarter earnings season in the market there's tons of gaps every day now stocks gaps for many many reasons some stocks gap for downgrades and upgrades and news or ceo quitting or an earnings report or a sector gap or with the market but it is earning season right now in summer so there is actually quite a few things to look at every day to trade and so you could actually do more than one if you really really want to and every once in a while i call more than one at the same time but for me personally i like to do one a day because that's really all that i need to do and of course obviously i am taking sides and a lot of risk and i have to focus if i have you know five thousand six thousand position size and something i got to pay attention to what i'm doing does anyone have any questions about anything at all anything at all we have a few more minutes here good questions from east stock please call your broker to get the full explanation of those things you like what i do in my style thanks for my patience you're welcome i can't believe you just said it was patient i think you're the first person on the planet that ever said that that's funny i'm gonna have to tell my mom that one am i patient tonight i have to tell the room that tomorrow and maybe i'm growing uh maybe i'm a chairing i think it's possible you're welcome well if you'd like more information you can email me at balissa at the stockswush.com thanks everyone for coming go to my youtube page and subscribe there at the stockswush you can get market updates i do i know the market got done today and i know it fell but the market is still gonna make a new high the market's still very very bullish all right everybody have a great night thanks caffeine