 Obviously, scale down your tier size. Scale down your ambition of how big your trade potentially could be. Just go into cash flow mode. Go into cash flow mode. Make sure these ranges are confirming. Welcome to Access to Trader, the number one community for those who are committed to taking control of their trading in order to achieve success, profitability, and longevity. Thank you for joining us. Here's Dan Shapiro to help you find your edge, master your process, and own your future. Hey, guys, getting everybody welcome to another edition of the access to trade.com nightly wrap up show. Hope everybody is doing well. Hope everybody survived today. Pretty rough, ugly day in the equities market today. Now, when I recorded, I use the word week, when I recorded the weekend update, we talked about the ramifications of the spies closing below the 50 day moving average. We talked about also the reality of the cues having one more day to really start getting potentially getting hit and going down to the 50 day moving average. And we were prepared. We had a pretty good solid list today. Google I liked short, and a video I liked short, and a whole bunch of other names, right? All the other tech names that I really, really liked. And when I woke up this morning, like you guys did, I saw the Dow down 500 points. I was like, wow, what the hell is the news? I mean, why is the Dow down 500 points? I get follow through to the downside. I got that, we were all prepared for that. But why 500 points? And I started looking through the news and apparently one of China's largest, I guess commercial real estate, whatever the case may be, was really at the point of fears of default. Now, when I first saw the Dow futures down 500 points, I was like, is this really enough for the futures to be really overreacting of a 500 point move? And then it clicked on me, okay? The world is still recovering. If you really think about it, despite the stock market doing incredibly well, if you guys remember, the mortgage crisis is only what? 12 years old, right? And nobody, and people when they still hear the word default or possible default, that's a very, very ugly word. If anybody who traded during the mortgage crisis, this is a word you heard all the time. Default, default, default, whether it's homeowner's defaulting, whether it's insurance companies, reinsurance companies defaulting, mortgage lenders defaulting, right? Toxic, toxic, toxic. And today was a perfect example of how Wall Street sometimes when you look at the news that at first you're like, wait a minute, why is this such a big deal? And you realize people still have scars going back to 2007, 2008. Remember, people lost their jobs, people lost their homes, people, it looked like the brink of extinction, right? Of our economic kind of global landscape. Yeah, we could talk about it and maybe you'll laugh about it years later, but it was real. People lost their homes, their jobs, their livelihoods. And when you start hearing the word default, it really starts bringing back a lot of bad memories. And again, here's the first person, here's a perfect example, shoot first, ask questions later and everything got sold. Literally everything got sold. Nothing got, nothing was held back. They sold equities, right? They sold crypto and crypto got sold, right? So you look at crypto all across the board, 5%, 10%, 20% all across the board, equities got hit. And if you look back at the weekly chart on the cues, and this is kind of pretty aggressive here. When you look back at the weekly chart on the cues and you turn around and say, well, what's wrong? There's nothing really wrong. Look at the monster uptrend that it's in and you're absolutely right, right? If you're a longer term investor and kind of a longer term outlook for your capital, there's nothing really, really wrong. But when you start breaking it down from, on a daily chart, you'll notice that this was the first close on the 50 day moving average below, right? The first close below on the 50 day moving average all the way back since January of 2021, right? So you're talking about a good sample size. We held it nine times, literally nine times on the way up, right? You could see all the areas of where the futures held, right? The cues held and the hair, you know, so, but more important, this is the first time, first close below the 50 day moving average. And now the question is what happens next, right? You could turn around and, you know, again, this is a cool thing on social media and people turn around and say, wow, you know, bears never learn by the dip. You buy the dip, right? Buy the dip is only good if you're a longer term investor. If you're an investor that you have a five to 10 year horizon, you really don't care about the day-to-day, the month-to-month, you're looking at a big picture and you get a lot of fun value, value fund managers do that as well. But again, you also have to be conscious of what potentially could happen. And for all the people, you know, during, you know, 2007, 2008, that were caught in the spin cycle of what potentially could happen. The last thing you wanna hear are headlines that are going to really remind people back then of what the market potentially go. Now again, by no means, guys, by absolutely no means, I wanna repeat this again, by absolutely no means, am I comparing this one headline, right? This isolated one headline to what happened during the mortgage mess, but it starts somewhere, right? It starts somewhere. You heard back in 2007, 2000, well, late 2006 about all these predatory lenders, right? Nobody cared what a predatory lender was. All you cared about, your appreciation of stock price. You heard about all these companies, all these companies, all financial instruments that nobody knew what they were, right? Credit default swaps, all these, all this toxic paper that later was the demise of Bear Stearns, of Lehman Brothers that basically forced Merrill Lynch to sell themselves to Bank of America just to kind of stay sovereign. Think about this, Merrill Lynch, the bull, right? Can't stand by itself. So you started hearing these little things about this. You started hearing about the rise of student loans, right? Again, that's not anything new, but you heard the rise of new loans and then you heard one day, David Einhorn come around and say, hey, by the way, this is all a big problem. People are buying two, three properties with no proof of verified income. There's no proof of earnings. They're just basically handed all these keys to all these homes and all these predatory lenders are making a killing of it. And nobody talked about it because everybody was making so much in that industry, but it started from somewhere. The difference between now and 2007, number one, everybody is deleveraged, right? Anybody buy a house in the last 10 years, right? Anybody buy a house? What used to be a mortgage application now is this big, right? The mortgage application came my newest house that I bought in 2016. I felt like I was literally filling out the yellow pages. It was this big. You needed two, three years of income. You needed six to eight months of mortgage payments in your bank. You needed at least the 750, 770, whatever it was, credit score, right? You needed at least 20, 25% down. You had to have got on your side to get a lender. So again, I think we've come a long way since then, right? A long way since then. And I don't think it's the same thing. Again, as far as we know, again, we have to trust, there's no toxic paper floating around. There are no creative loans being bunched up together. There's no predatory lenders that are giving people with no verified income, no money down loans. As far as I know, maybe I'm wrong, right? But the point is we've come a long way. So it's very, very tough to turn around and say, what's happening in this isolated incident on this ever grade, whatever the hell it's called in China to kind out what potentially could happen, it's apples to hand grenades, right? But again, at least we've learned from the past. So if this thing has any legs, right? Because everything is a trickle-down effect. Remember, it's dominoes. We can't just turn around and say, ah, it doesn't affect us. Now we're woke, right? Anybody who's been trading from 2006 to 2009, we're woke. We kind of know the signals. We kind of know the language. We kind of know what to look for. This time around, at least we know if things start to get louder and louder and sellers come in and headlines get more and more abrasive. At least I know who got hit first. At least we know where was the collateral damage. And back then, right, in 2007, 2008, guess who got hit, guys? It was the lenders. It was the mortgage brokers. It was the insurance companies. It was the reinsurance companies. It was the title holders. Again, is that play out? God forbid, right? The last thing we wanna see is that type of environment again. But remember, we learn from our past. We don't wanna repeat it, okay? And nobody talking about, we're gonna go back to in test 2000s. Whoa, easy, hold your horses. I just wanna remind the newer traders that again, everything that you learn on your journey, you're storing in your mental rolodex. So if you start seeing whispers, or you start hearing language that you've heard before in your trading history, at least you know how to react. You know how to proceed and you understand how to make sure that your money is safe. And at the end of the day, it's all about leading with your shield and not with your chin. Is this environment good? Of course not, right? Who the hell wants a 900 point decline, right? Who's gonna turn around and say, you know what, I really like that short of Amazon down 170 on the day. I think I can make five bucks on it. Who the hell's gonna say that, right? Who's gonna turn around and say, you know what, I wanna start shorting Tesla down 37 points in the day with a half hour of the day. Again, there's no value there, okay? There's no value. So this type of environment is challenging because the volatility, especially on the overnight market becomes really, really aggressive. So for example, we were down 900 points when I logged off around quarter to three and all I kept saying to myself, Lord, market guys, okay, if anybody's listening, please, please, gap up the market tomorrow. So everything can get stuffed into supply. We can go green to red. And if we take down today's channels, tomorrow will be an epic potential setup on the short side. Guess what? That didn't happen. I come back, I look at my screen, the Dow rallies back 300 points off the lows and now what looked as a phenomenal day two potential for a possible destruction of very equity prices. Not that I want to, it's just kind of reality where we are. Now everything's in the middle of the range. So if you look at Tesla, right? If you look at Tesla, look at the rally on Tesla from the bottom. This thing rallied back 10 from the bottom. Look at Netflix, right? Look at Netflix. Netflix rallied back six from the bottom. Look at NVIDIA, right? NVIDIA, look at a rally on NVIDIA. NVIDIA rallied six off the bottom. So, and this is kind of where we are right now. So it's not that it's, oh my God, this market's so hard. It's, oh my God, the market's so irrational that you need a perfect open, right? You need a perfect open and a perfect close to kind of implement your A plus setup. And the hardest part, the hardest part, especially for new traders, a lot of new traders are trading today. Like it's all, it's Disney world. Like it's a day at the beach. Like you're trading breakouts. Guys, there is no breakouts, okay? Anybody who's looking for breakouts with technical damage, I don't know what market you're trading, but I would love to kind of get what you're, right? Allegedly, allegedly, okay? It's a kid friendly show, allegedly. So most important, okay? Every single day when you're trading a market like this, number one, again, when we say this in bull markets, let alone in a scenario like this, number one, you don't need to trade every single day, okay? The point of trading is getting the biggest value for your book, right? The absolute biggest value for your book with the safest possible scenario. So even if things don't go right, you're putting yourself at least in a position that you can have a paper cut instead of a separate head. If you're trading, all right, a market like this, like it was three weeks ago that everything's rallying, people are chasing stocks up to 300%, you can have a really, really aggressive reality check very, very fast, okay? The stocks don't break out in a scenario like this. They don't break out in a market that is headline driven. Again, remember, nobody wants to hear the word default and nobody wants to hear the ramifications of the word default. So keep that in the back of your mind. So going into tomorrow, again, I wanna be very, very reactionary to what I'm seeing, okay? If I was 25-year-old Dan or 27-year-old Dan, I would still have last night's erection. I would still be jumping in 9.31. I'm not that guy, I'm 47 years old and doing this for a very, very long time. Now I'm very, very patient, okay? There is no FOMO. There is no I have to, I need to. It's all about let me wait and get the biggest bang that I can. And here's kind of the whole point. If you don't have the market, right? If you don't have the setups that you're looking for and your research is backing, okay? Then you have to switch to plan B. Unfortunately for tomorrow, because of this 300-point move off the bottom in the index is plan B tomorrow and plan C tomorrow is not gonna be as sexy as plan A would have been, but we adjust, right? We adjust in a fly, because that's what a professional is. And I don't care if you're trading for 20 minutes to 22 years, act like a professional. Make sure your money comes back, okay? Make sure your money has friends to come back. And if it doesn't, there absolutely is no reason that you have to sacrifice brain cells or your hard-earned capital because you have to trade like a lunatic. So depending how we open tomorrow, okay? We're gonna need a plan B, okay? We're gonna need a plan C and we need a plan J, but the most important part is let these channels develop organically and make sure that you are comfortable in what you're doing. Obviously, scale down your tier size, right? Scale down your ambition of how big your trade potentially could be. Just go into cash flow mode, right? Go into cash flow mode, make sure these ranges are confirming and make sure you're trading with complete eyes open instead of blinds on a market that you think you had three weeks ago that you have in front of you for tomorrow. So obviously, again, we have to see how the market opens up tomorrow and see what ranges are there. If you look at the indexes right now, you have the spies big, big gap down, reclaim this level, right? Reclaim this rising, what is it? 100-day moving average. We have to see what happens tomorrow. Is it possible we have a dead cat balance tomorrow? Absolutely, but I'm gonna need at least one candle to figure that out, right? I'm gonna need to see at least what happens the first time after the futures get rejected. I'm gonna need to see at least the first time what happens if the futures go down. How do equity prices react to that? Is it possible we have a dead cat balance tomorrow? Absolutely, just because we've got such a big beat down today, but I would not be shocked if a lot of names do not go rally and give us a date to move. So let's talk about some of the pivots today. Again, as you can imagine, not a lot, right? Not a lot, because we just had this aggressive gap down. We were watching for upside ranges. The first move was actually pretty good. I missed that Tesla first opening range move. I know a lot of you guys quoted. It was like for $6, $7, very, very quickly. And then we kind of went into hold and wait, see. And you kind of started seeing slowly, but surely, stocks giving you moves, but not really, really big moves. Roku, if it builds below, can flush 314. Again, keep this in mind. Roku was already down 711 points. Again, it took down that area, got down to 309. It took me literally all day to get there, but it got there, right? It absolutely got there. You look at a name, for example, like Netflix. 575, big support, lack sweet slows, builds below, has some pretty good potential. Netflix, again, it took literally all day to get there, but it took out 75 and traded right to the 68 level that we talked about. Again, if Roku confirms tomorrow, if Netflix confirms tomorrow, of course there's more downside. But again, there's so far off their lows, it's gonna make it very, very tedious to kind of wait for their setups all day tomorrow. But again, what other choice do you have? Again, here's my notes. Sometimes it's very important to let things play out today. If we close week, right? That's the guys on my point, there will be a huge opportunity for more. This is five hours ago. I'm getting obviously the market had to rally back to kind of throw the wrench in that game plan. Tesla for experienced traders, 730, 50s, demand is moving lower. If it gets rejected off that area, it could flush. So it hit that area, went a little higher, reclaimed, went all the way down to 721. If you got some guys, good job there as well. And again, I said, might see lows, it went all the way down to 721. Here comes 568 on deck on Netflix. Roku, there's a buyer sitting there all day, they need to clean them up. They finally cleared them out, went down to 309. And that's about it. So, okay, look, is it tough? Absolutely. Is it tradable? It is, but you have to do a really, really good approach to really understanding that again, you don't need to be in the spin cycle. If it's not a clear, an imminent area that you can take advantage of, there's absolutely no reason to kind of get out the way. Again, it's all about the long game. It's all about putting your position to be a trader for many, many years to come. If you're in this for one day, you're basically taking the hail mail re-approach on the first drive of the game. And again, that never works out. Guys, again, it's not that crazy. It's not that hard, right? It's very difficult, but it's not that hard to be patient, be a professional, and be an adult. Guys, have a great night, everybody. Get some rest. We'll see what happens tomorrow. And God bless, I'll see you all there. Take care.