 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, good morning everybody. Welcome to another edition of the AccessToTrader.com weekend update show. Hope everybody is great. Hope everybody is alive. Hope everybody is healthy and happy and all that good things will come with life. The prosperity aspect of life, of course, is important. But again, if you don't have a smile on your face, if you're not waking up in the morning looking forward to something more than, well, making money, right? If that is your prime objective in life, then again, no matter how much money you will make, you will never be wealthy inside. So you have to really appreciate life for what it is, not what you want it to be. So let's talk about the market. If you look at the internals of the market, you're not going to see anything that's going to stand out on you. You had pretty much a holding pattern in the indexes pretty much the whole week. The NASDAQ composite was pretty much flat on the week, squeaked out a little bit of gain. S&P 500, again, squeaked out a little bit of game. The Dow did pretty well. But I think the moral of the story is for the indexes, you can make a very, very good argument that people are kind of tired. I think that's the best way. Investors and traders are tired. No matter how high this market gets, no matter how great the action is, it starts putting people into a situation of complacency. And I think that's kind of where the market is. I think a lot of traders or investors, both, I want to kind of use both of them as an example. I think we're getting at that point, we've been at the point that people are expecting a complete euphoria for the rest of their careers. For example, if you go back to 2007, home prices just kept on rising and rising and rising. And it was expected. We were taught from a very, very early age that, okay, if you buy real estate, no matter where you buy it, no matter when you buy it, at any time real estate will always go up. And we found out the hard way of 2007 because I built my first house in 2007. I literally closed my first house December of 2007. So I bought at the high. And we've always been taught that no matter where you bought real estate, you're always going to survive, you're always going to make money. Obviously, it's not the case. Stock markets exactly the same thing. And although we can't predict where the market will be a day from now, let alone 10 years from now, we've been programmed for years and years and years to kind of say to yourselves, no matter where you buy a stock, if it's a good company like an Apple or a Walmart, whatever the case may be, 10 years from now, 15 years from now, 20 years from now, it's going to be higher. That's been the fact. If you look at a 100-year chart, for example, on the Dow Jones Industrial, that's kind of been proven. Unfortunately, we don't have a 100-year horizon. As investors, again, you're only as good as your fundamentals. As traders, we're only as good as momentum. We're only as good as market structure. And we're kind of getting to the point that we're in this kind of holding pattern. And even though we keep on creeping higher, a lot of traders, if you speak, if you have a lot of friends, I'm not talking about people on social media, but if you have a lot of friends who do trade the equity markets on a daily basis and are active participants, they'll kind of tell you the same thing. As great as the market has been, there's going to be periods of time that you're going to see a pretty noticeable rotation. And once a year, the airlines will wake up. Or twice a year, the banks will wake up. And again, that's why when people ask me, what do I think of banks? I'm not a big bank trader. I don't like them. I don't like the Goldmans of the world. I don't like the Bank of America's of the world. Because by the time these stocks hit your radar, they're already 80% on the move that they only make once or twice a year. So I'm not really there. So the reason, again, why I trade beta is because, again, every single day, no matter how bad or good the market is, because these are the most aggressive stocks, they're going to give you the biggest ranges. So even though macro-wise, they might not be in a sweet spot, they're still able to trade those ranges intraday or throughout the week and still get yourself from point A to point B. However, where you are right now in the market is kind of this really wait-and-see activity. We're waiting for the second stimulus. We're just waiting to see what happens when kids, when all the kids, I know some states already started with school, but we're waiting to see what happens with kids going into school. Right now, there's some reports that kids make up, I think 7% of all infected COVID cases. We're also in a holding pattern to kind of wait and see what happens if there is a true second wave. Again, I'm probably one of the ones who believe that, well, we're still on the first wave. So how the hell can we get to the second wave if we're still on the first wave? So there's a lot of wait-and-see things, but at the same time, the market continues to discount a lot of bad news. So again, can the market continue to go up? Sure, absolutely. Again, we say this all the time. I'm not trying to predict what's going to happen Tuesday and Thursday and Friday or three weeks from now. I'm trying to take it day by day. And if you look at last week, you'll notice that there was a really heavy rotation out of technology. Now again, if you look at the cues, you're not going to see that. You're really not, because if you look at the cues activities, again, this was the week. It was a steady rise in the middle of the holding pattern. But again, if you do trade the market on a day-to-day basis, you'll see the majority names, not named Tesla, we'll get to that in a second, not named Apple, we'll get to that in a second, that were really in kind of holding patterns, up and down, up and down, up and down. So when you're, for example, and before I say this, let me just kind of reiterate this. I am the biggest novice trader when it comes to options. I'm not an options trader. I know very, very basic things, but I do know when stocks are in a holding pattern and we are close to stone-throws highs pretty much every day. And if you go through charts this weekend, you'll kind of see that. You're not going to see 35 different long setups. You're not going to see that five-star setup that you're dying to trade. So when you're in this kind of level of complacency and you start seeing the market, not really give you any buy or sell signal, techno-macro-wise, we're just kind of floating and levitating that direction, you start to start losing your patience. And again, patience is not just a word that we use. Patience is something that we need to practice not only as traders, but as human beings. Again, life is a series of ups and downs. So you have to be very, very patient to capitalize on whatever genre of life you decide to live. And the market is no different. So we're kind of in a place that you're going to get chopped up. And you're going to get chopped up because, again, a lot of names are sitting in the middle of the ranges. And the reason why I bring up the option stuff, I notice a lot of new traders. And again, in my opinion, I see two routes a lot of new traders take. Just because, again, most of their accounts are very, very small, they take the route, the natural gravitation of the small accounts, which I think is a major, major no-no. Okay, that's just my opinion. Or they take it to the option route, which again, you can leverage your account X amount of times. Have a max pain, okay. But the problem is when you're trading a distribution market and there is no measure potential, you are going to get chopped up. You're going to lose a lot of premiums. So what I hear a lot of times over and over again is, yeah, I hit that one trade, you know, once in a while, but then I keep on losing it through the series of next couple of weeks. The problem is a lot of you guys don't realize when the stock market goes into distribution. You guys don't realize when stocks are in the middle of the channel. So if you are an option player, I don't care if you're a novice or you're an experienced option trader, okay, you need major expansion in channels, okay, you need measure potential. You know, if Netflix is trading in a $4 range the whole week, your premium is going to burn. If, you know, and the video is trading in a $5 channel the whole week, your premium is going to burn. So a market like this, you have to really understand times that you get really great measure potential. And again, that measure potential always comes when they're above supply. You can call it the Bollinger Bands, whatever studies you use. But where we're in the middle of the channels are, this is when your time to really figure out how to really sell premium and do it very, very effectively. There's a time to buy premium and buy very, very aggressively. When Amazon goes, he goes nuts. When Amazon, an Apple goes, it goes nuts. When Facebook goes, it goes nuts. But there's times that they'll sit there for weeks and weeks and weeks. You're going to be pulling hair out of your head. You're going to be burning through your premium and you're going to die. And the same thing goes for a lot of day traders as well. You're going to try to squeeze water out of a rock, try to swing these stocks, and you're going to get absolutely nowhere. So when you have a distribution market or a potential distribution market, again, the only, there's two ways to figure that out. Number one, you have to watch the price action in the afternoons. If nothing is setting up for the next day and your research is going to confirm that the night before, it's very, very important to go into scalp mode or just get the hell out of the way, especially if you are trading on the option side. The last thing you want to do is buy premium on anticipation in a distribution channel. You will lose, again, I'm not an options trader, okay, but you will lose 99% of the time because there is no measure potential because things are standing in a holding pattern in the middle of their ranges. So going into this week, and again, I did find some good value, okay, at first glance I looked and I go, ah, you know what, I'm not crazy what's going on. I did find some good value this week, at least for Monday, okay, I don't want to use the word week. I'm really taking it day by day. But again, it's not areas that you want to really concentrate, okay, really, you know, really look at because, again, they're not emotionally tied stocks. So for example, I'll give you, I'll give you a perfect example. So look at Dollar Tree, right? And, you know, again, if you ever watched any of my broadcasts, if this is your first time, a stock like Dollar Tree would never hit my radar. Okay, I'm talking about never. When the market is really, really good, when I mean good, it doesn't mean bull market. It means, you know, to the downside as well. But when you have expansion channels, whether to the upside to the downside, I would never look at a Dollar Tree, okay, it would never hit my radar. But when you're going through kind of the stall out potential distribution channel, not going up, not going out to kind of the wait and see scenario, you have to see, you have to start going to, you know, Plan B, Plan C, Plan D, Plan F, right? And when you look at a stock like this, although it looks really, really good, right? And you can see the top of the range here and it's been distributing since June and if it takes it out, it should go higher, okay? But the problem with a stock like a Dollar Tree or a Lowe's or a Procter and Gamble, as much as, you know, you can look at a really, really great setup and really find those setups that are diamond in the roughs while the indexes are going through a holding pattern. The problem is, and I say this in the nicest way, nobody cares about Dollar Tree, right? And I'm not saying that from a long-term perspective. If you're an investor in Dollar Tree, I'm not talking about you, okay? If you're, you know, if you have a five, 10-year horizon and you love Dollar Tree and you love their business model, whatever their business model is, okay? I'm not talking to you, I'm talking about the trader side. The reason why stocks like Tesla, like Amazon, like Facebook, like Boeing, right? Like Apple are very, very significant in the trading world because there's an emotional tie-up to them, okay? People are really going to love Tesla or really going to hate Tesla and emotion drives stock prices because if people are hating a stock, right? For example, like Tesla and the stock, you know, gets really, really going, it's going to crush shorts. If the stock market is going to the other way and taking the stock down and people are loving Tesla and they love the company, they love the car and they love the capabilities and what could happen in the future, it's an emotionally driven stock. That's why the average range is always, always going to expand. Same thing with Amazon, same thing with Facebook, same thing with Apple. When you have a stock like Dollar Tree, it's Dollar Tree, okay? No matter how good it looks, you're not going to get that $12 move in one day. You're not going to get that $20 move in two days. It's Dollar Tree. So when you have a series of setups like this going into the new week, although you, of course, you can make money on them and you can prosper on them, but you're not going to get that euphoric Tesla type of move. You're not going to get euphoric Zoom or Netflix type of move and you have to kind of adjust your expectations for measured potential and especially when I'm, you know, and again, and I like this setup and I will trade this setup if it confirms this week just because it's a whole number, three month distribution and hell, this is the best setup I find. Again, I'm not going to sit there cry about, you know, cry about, for example, Microsoft within the range if I have a tangible setup. But again, if you are an options trader or if you are an aggressive intraday trader, you have to kind of focus on these type of setups until everything plays out. And when there's no emotional carnage, right? When there's no emotional attachment to stocks, they're not going to give you that measured potential. So although again, I like Dollar Tree, right? I like a name like this. I think it looks great. Okay. And if this is, if this was like, for example, Netflix, I'd be in this trade with two hands, two feet, two eyes, two ears, everything, right? I'd be all in, but it's not. Okay. And the reason why most traders are not getting to where they want their career. Number one, they're putting too much pressure on their development. A lot of new traders again, think that they need to figure everything out in the first three weeks of their trading career. They're trying to put their expectations on some random avatar on social media. Okay. And they're not letting their progression develop organically. And they're trading Dollar Tree the same way they would trade Tesla. They're trading, for example, Home Depot the same way they would trade, you know, trade Apple. So although these stocks are good, the reason why I trade beta, you know, in the first place and have been trading them for years is because of the average syringe. It's because of the emotional attachment. It's because some guy on stocks would say, you're wrong, Dan. You're wrong. Okay. I'm wrong. Okay. I love that, right? I love that. Again, that's, that drives emotion, that drives price action, that drives short covering, that drives, you know, that drives everything that we need to take advantage on the other side of our trade. When you have a trade, for example, like Dollar Tree, this is Dollar Tree. Maybe Morgan Stanley is buying it. Maybe, you know, maybe, you know, Fidelity is buying it. Who knows? But again, you have to kind of, you know, put yourself in a situation to adjust your trading levels into names while there's a distribution channel. And although, you know, I do like some names this week. Dollar Tree looks pretty good. The whole, you know, the whole, you know, electric car revolution is obviously still very, very strong. NKLA was a really good trader this week. Even NIO is waking up again. You know, needs to confirm this channel. Obviously Tesla's leading price is higher. But again, going into this week, you have to be very, very diligent. If you are an options trader, again, majority of your bets should be selling premium, not buying premium until we kind of get above channels. And if you are an intraday trader, okay, you really have to start looking at alternative things. Trade cash flow, okay. Be more quality than quantity. Because again, if you keep on trading the market one speed and treat stock like Dollar Tree, like you treat Tesla, you're going to do it all wrong. And you can completely mess up a tangible setup because your expectations are completely blown out of proportion. So if you look at where we are going to the week, again, nothing settled, nothing up, nothing down. We're in the middle of the channel of the Qs. If you look at the IWM and again, it's kind of the same thing. You know, we're drifting a little bit lower. We're drifting a little bit lower. You know, can they kind of back test the 10-day moving average? It could, but again, you're not going to feel it. You know, you're not going to feel it in market sentiment. You're going to feel it more on distribution. So when you look at a lot of names, although again, Amazon is not, you know, putting in a buy or sell signal. It's just there on the video. And again, they're coming out with earnings. You know, had a really, really big move. It's getting a little tired. People are waiting for earnings. Again, it's just not there until you're going to see earnings. Just nothing there. Shop again, you know, you know, a little bit of a sell signal a couple of weeks ago. It's kind of straddling. But again, it's not going up. It's not going down. Again, you go through chart after chart after chart. Even a Facebook that had some really, really aggressive bets this week out of the money, especially towards December and January. We saw 295s, 300s, 310s, 325s. So there are betters. They are positioned themselves for four or five months from now. But again, you're not getting an area that Facebook is going to be tradable until it starts taking out this range here, or it takes the range there. So you have to be very, very patient with it. And again, if you are a beta trader, again, like I said, sell premium this week, don't buy it until these things really make a definitive stance one way or another. If you're trying to trade these things for more than cash flow, you're going to burn out your premium very, very quickly. Again, just kind of my two cents. I'm not an options trader. I am probably the biggest novice when it comes to options, but I do understand measured potential and I do understand what happens when stocks are stuck in between channels. It's only going to burn your premium. It's not going to make it appreciate. So very solid trading week Friday was very, very slow. There were some pockets of pivots that you could take advantage of and we'll get to the pivots in a second. But it really kind of opened up my eyes before I even started even doing a pretty, pretty thorough charting, couple of charting sessions over the weekend that what we're kind of in store for this week. So again, think of the word distribution. Think of the word, think of the word kind of chop, right? I think that's the best way to describe it, especially if you're new traders. But a distribution lasts about three or four days. I thought Friday was day one. Again, you are going to get some opportunities, of course, but don't think for a second you'll be trading seven to 10 times in a day with that much value going through this week. So I do like some names. I definitely like some names going through this week. Obviously Dollar Tree, and again, I'm not going to focus this whole session on Dollar Tree, but again, how many times are you going to find a stock going through a three-month distribution that looks this good, right? So you have to wait for the top of the channel. But I saw a lot of names that look like they're about to break down. Look at Roku, right? Roku came out with earnings, and you can see here pretty much for the last one, let's say one, two, three, four, five, six, seven, eight. You had six out of the last eight days that either closed lower closes than opens or just red on the day. And that's a sell signal, okay? That really is. And when you're going through distribution, you're looking for cleaner moves. And you can see here three times it held its bottom support in the daily. And again, if this thing starts cracking, it'll go lower. If you look at, for example, BY&E, same thing, right? It held its bottom chart level here, and it's kind of the same thing as Roku. You had one, two, three, four, five, six, seven. So the last six out of seven days were either lower closes than opens or just the red days. So if this thing starts taking down the bottom of the channel, it's going to give you a trade lower. So again, there are some trades that look like value. Even a trade like NKLA, some pretty aggressive call buying earlier this week. I forgot what month, but if you do your own dediligence, you kind of see, we saw the 70 calls. I think they were either August or September. I could be wrong. Please double check. It was so far earlier in the week, but we started seeing $70 calls. And NKLA had a nice run here. Again, it's going through a pretty distribution. I'd like to see maybe one or two more days going sideways, but if it starts confirming this top of the channel here, it could make a run to the 50-day moving average. So that looks good. Even a name like SFIX that I, you know, I scalp this week. Again, it's had a big, big run through the spring, consolidating, trying to get above this level here. Again, we started seeing some 25-and-a-half calls coming in earlier this week. If it can just, you know, take out this distribution, maybe it could start running to the 50-day moving average. Even Boeing that gave us, you know, a couple of pivots this week, nothing big. Okay, nothing big, just cash flow. You could see here, right? You could see a couple of things are happening here. It's going very, very tight here. So either Boeing is going to start losing this bottom channel here, or it's going to reclaim the 50-day for a possible move back into the 190s or a possible move back into the 160 level. So again, very, very tight, but something has to give. Obviously the biggest move of the week and the biggest talk of the week was Tesla, right? Tesla was, and again, guys, when I tell you, I was disappointed, okay? So this was the setup come Tuesday night, right? This was the setup. It held 1365 twice, right? 1365, 1365 twice. I was sitting there, and as I was recording, if you were watching this, you know, webinar, excuse me, if you were watching this broadcast every day, you kind of saw this. This was 100-star short setup, 100-star. And, you know, it held this 13th, and it closed within $8 to $10 of the breakdown level. And this could have been 100 points at the downside. Tesla comes out with a 5 for 1 stock split. Obviously the stock has this monster, monster run, igniting obviously a lot of the electric vehicle plays as well. And now the question becomes, for example, what happens after the 2 for 1 split? I really didn't want to kind of go into it, but people throughout the week have been asking me, like, what do you think is going to happen with the split? Well, number one, let's talk about what a split is. So, you know, so Tesla announced a 5 for 1 stock split, which is basically towards the end of the month. If you have 100 shares of the stock, you're going to have 500 shares when splits. The post-split price is going to be somewhere around $400 a share. What a split does is usually attract more retail investors, because again, retail investors, not everybody can allocate funds for a $1,600 stock. Hell, not most retail investors could allocate funds to a $400 stock. But again, it does make the price very, very much more attractive to kind of reel in more investors, more traders. It does kind of bring in more liquidity because of those things. The spreads will be tighter. And it sounds all great on paper. But what happens after a stock split is the structural balance of the trading vehicle kind of gets distorted. So for example, a lot of you guys don't know this, but when we started trading beta, I was trading Apple pre-split, right? And they did a 7 for 1 split. And Apple was an amazing trader, just absolutely amazing. And the stock started trading really bad for like a year. And it took about two years for Apple to really start trading well again. And the idea of a lower price, more liquidity, tighter spreads, sounds good. And it's probably great for a longer term investor. But it kind of really distorts the normal price action. And if you've did trade Apple the first pre-split, and obviously they just announced another one, you kind of know what I'm talking about. So the idea that, hell, we can do more size and get a smaller move, and everything will be great. It sounds great on paper. But if the distortion of market structure really prohibits Tesla from being Tesla, well, that's going to be a problem. So maybe Tesla turns into Roku and that's great. Because again, you have a stock that's going to be lower priced and you could do more size and more volume and tighter spreads. Or Tesla could turn into freaking Chipulti. Who knows, right? Who knows? It's kind of a wait and see. Apple also recently kind of announced a stock split as well. Does that start a domino effect? Does Amazon come out with a split? Does booking.com come out with a split? Does Chipulti come out with a split? Does Google split? Again, sometimes, again, it only takes one spark to really get the flame going. Again, we'll see. So I want to kind of, I will make some sort of follow up, not necessarily video, but follow up on Tesla after a first week or so after trading at post-split to kind of give you a really good sense of where my thinking is after the split. It looks good on paper. Sounds good on paper. Makes it more accessible to the retail investor. But the moral of the story is it's a wait and see. Again, maybe it'll be good. Maybe it'll be bad. We can't see. So let's sum up Friday's pivots very, very quickly. I thought this week was good. I thought this week was actually pretty solid. And I think what happened towards the end of the week, we started seeing a lot of hesitation. And when you have a lot of hesitation, you're starting to see a lot of names just kind of stopping. And I think that's exactly what happened. I think that's exactly what happened to the end of the week, especially Friday. And please excuse me guys, for some reason my internet, I don't know why my internet is slow here. There's a storm outside. But the moral of the story is there's a lot of names that I think this week you have to be extra patient on. So if you look at the pivots throughout Friday, again, you'll notice it wasn't that prototypical gangbusters day on Friday. And just because it illustrated exactly what we talked about through the beginning of this video. But there was some good value. There was definitely some good value there. And let's talk about it. So Amazon 3180 rejected several times, and it never got there. Here was definitely the biggest move of Friday's session. NVIDIA 462 needs to build. Again, a lot of really aggressive call buying coming in ahead of its earnings. So here's the 62. And big, big move. Trade it to 468. This was definitely the biggest move of the day. Very, very thin, but a very, very aggressive move. Nevertheless, Alibaba never got there. Apple never got there. ISRG never got there. SHILL was pretty good. SHILL was a pretty good mover. 2415 needs to build. Here was SHILL. So here was SHILL. Here was the 2415. Trade it to 25. 25 got reclaimed and went to all the way to 2657. So that was good. But again, when you're going from the video, the next thing out of my mouth you're trying to hear is, well, maybe Apple, maybe Tesla. And the point is, again, stocks were very, very slow and it's going to reflect going into at least Monday, in my opinion. Nothing on SFIX, nothing on Halo. Halo opened up lower and continued to go lower and nothing on MRNA, nothing on BEYOND. You kind of get the point here. There's a lot of very, very slow methodical action. NVIDIA take on the way up. SHILL, nice spike there as well. Boeing never got to the downside. Tesla never reclaimed 1674. So it was a very, very slow day. Never got down to the 3100. Never got down to the 451 for a balance. Never got down to support. Boeing had a nice little pop here. Lunchtime pop, 178 needs to reclaim and build. Here was Boeing. So reclaimed at 178, right? Reclaimed at 178, went to 79.57. Why did it get rejected at 79.57? That was exactly where the high was from the previous day. So that's the area that it needs to reclaim. So that was it. I mean, that was basically Friday's session. Letter M never got there as well. Tesla, you know, Tesla ran up a few points and then came right back down. So again, nothing really going on on Friday, which basically, again, mentally needs to put us into a situation that we have to kind of expect the action to kind of re, almost mirror what we saw on Friday afternoon. Well, we get some setups, absolutely, you know, but you have to be an adult about waiting for them. You can't be, you know, a child and just saying, well, the market's open. I need to trade. Yeah, you need to trade, but you need to trade properly. And again, remember, it's not how much, how many trades you put on, it's how many trades you put on properly. So guys, stay patient this week, at least the start of the week. Stay patient, let the trades come to you. Always be something, whether it's option flow, anything, just stay very, very patient. And the key to the game is, again, stay in business. Guys, God bless. Have a great week and I'll see you tomorrow. Congratulations for putting in the time to take control of your trading. You're one step closer to owning your future and achieving the success you desire. Want daily trade ideas directly from Dan? Straight off his personal watch list? 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