Transcript for:
Key Strategies for Day Trading E-Mini Futures

All right, welcome everyone. Thanks for tuning in to this 2024 edition of the Day Trading the E-Mini Futures Masterclass. We're going to go over a lot of good stuff today and we'll be covering three strategies. The retracements, we're also called the halfway back, the one minute hammers and inverted hammers, as well as the 15 minute opening range breakout.

So lots of good stuff to go over and we're just going to dive right in. I'm going to go through... We'll go through a quick outline.

We'll go through some of the basics fairly quickly. Because I'm recording it, I'm not going to spend too much time slowing down for some of the basics. For most of you, you're familiar with the strategies or have a general idea. You've been trading for a while. You have a general idea of how you want to trade or some of the things that resonate with you.

But if you're a total beginner and this is the first time you're seeing this material or these types of strategies, you at least have all the information and then we can kind of quickly get into the more advanced topics and things like that. So we are going to go over basically a detailed plan for trading the E-mini S&P. And I say E-mini S&P because all the examples and things will be pulled from the S&P, but you can certainly transpose these strategies to different markets, different time frames. You could use, you know, different day trading time frames all the way up to doing these approaches on stocks or ETFs, swing trading. You can even make some tweaks for, you know, Forex and even options.

But we're going to talk about the E-mini S&P as far as trading strategies go. So we'll talk about the trading strategy, everything from the entry, how to manage the trade, and then where you're going to be exiting. and how you'll set your exits and things like that. I'll pull up some examples and screenshots from my chart setup and whatnot. You don't have to trade on the same charts or platforms that I use.

I'm using Thinkorswim and then Tradevate, but you could be on Ninja, you could be on TradeStation. There's plenty of platforms. Nothing is really proprietary or specific to the Thinkorswim platform.

So we're going to talk about where to get into these trades and kind of how that starts with identifying the trend to give us those opportunities on where to place trades and how to set your charts up as well as place those trades where you're going to put them, order execution, some helpful guidelines and things that I've picked up over the years, as well as some examples and Q&A. I'll do my best for those that are with us here live. If you have questions, you can type them in the chat box and then I'll try to answer those as we go.

So the first strategy we're going to go into is the retracements, the halfway back. And that's really where I got my start day trading. So I began swing trading for a couple of years and I was just buying strong stocks on pullbacks and shorting.

weak stocks when they would bounce. And that really gave me a good framework for how to think about trading and gave me some of the patience and those kinds of tools to, you know, I'm only looking at daily bars. So you got to wait for an entire day to complete before you're going to be managing your trade. And so once I started day trading, I began with this concept of trading halfway backs or waiting for pullbacks in the same way that I was.

swing trading. So instead of looking at a bunch of different stocks, I just focused in on the S&P. And instead of looking for strong stocks per se, I was looking for bull moves or strong trends.

And so uptrend, downtrend, and buying on pullbacks and selling on bounces. And with futures markets, it's certainly very easy or very, it's easier to do. pinpoint those entries because of the way that the ticks are structured, the contracts are structured in such a way where we have four ticks per point and the spreads are, for the ES, you're talking 1250 a tick and it's very easy to manage those trades right on the trade ladder. So if you're completely new to trading and you've never, or at least the futures trading, and you've never...

Place the trade on a dome, a dom, trade ladder. order execution, all those are referring to the same thing, a kind of a vertical bank of prices to where you're clicking and placing your order without submitting a price and then doing a confirmation like you might when placing a stock trade. So we're going to talk about first the retracements and some of the basics around identifying the various trends, and then we'll get into trade entry, management, and exiting the trade. So the core idea with retracements and with this style of trading is we're looking to enter on a pullback, a 50% retracement, after we have a very small break in trend and then try to stay in that trade as long as possible. So because we're trading intraday, we have different levels or different tiers of...

time frames or trends that occur. And so we have everything down to the 5-12 tick chart that we're going to talk about going up from there, one minute chart, five minute chart, 15 hourly. And when you're placing a day trade, looking for those very small early trend changes, help us get into a trade before it's more visible to the masses or to those larger time frames that might get other people on board.

So just looking for a simple pullback to a 50% level is kind of the core idea. And we'll talk about how to kind of optimize for the best placement of those trades. So the process that I like to follow is first identifying the trend or lack thereof, it could be a sideways trend, meaning we're not really making any headway up or down, but otherwise we've got up, down, and sideways.

And then when we have a trend established, that allows us to do two things. It shows us the continuation, if it's an uptrend and we're making higher highs and higher lows, or we can identify where the trend might break or the trend might change. And we switch from, in the case of an uptrend, higher highs and higher lows to lower highs and lower lows and change that trend.

So the process of getting to placing a trade starts with identifying, is this a good environment to place trades? Identifying the trend, locating if we're in a strong trend in general, or we have continuation. or if we should be looking for a break-in trend, and then we can start to identify the entry.

We can actually draw the trade setup and then place the trade. So that process is kind of what you can take across whatever time frame or whatever strategy you're trading. You can follow that same formula. And once you get in the trade, then the actual entry, managing the trade. putting a stop in, trailing your stop, exiting the trade.

Those last three points are kind of the easy part. And it seems a little bit counterintuitive, but a lot of people like to spend or put a lot of emphasis on the entry itself. And the actual execution of the trade is kind of a very minor point.

I mean, you could take any retracement. on the chart and draw up a 50% retracement. You can take any two points, if you will, and draw up a 50% retracement and at least stand a chance of getting the trade to hit your target or to get some momentum and go your way.

But without the first part of identifying the trend and identifying the good entry points, you know, the trade entry. itself loses a lot of gusto, if you will, or some optimization. So we'll talk about how we can do that to kind of optimize our entry.

I like to start with, so in terms of getting back to the basics before we get to the timeframes, the uptrend of higher highs and higher lows. a good exercise you can do is going to just print out a five minute chart of the S and P. and just go through and mark the highs and the lows and mark how they relate to the prior high and low. And so an uptrend will give you a series of higher highs and higher lows, looking at each swing high and each swing low.

And then if you turn it over or print out a downtrend of the chart of the S&P and look for lower highs and lower lows, that downtrend exercise is going to help really clarify that series of lower highs and lower lows. and what that larger downtrend looks like. And so when you mark up your chart with a highlighter or something like that, and you can just use a couple different colors, what we're going to be looking for is that low-risk entry point.

And you say, okay, well, we have two options. We can enter on a pullback, so if it's an uptrend, enter on a pullback at a 50%. and continue or go with the trend for a continuation.

And then we also have situations where we're changing trends. So we're going from higher highs and higher lows, breaking a swing low and then starting a new trend. So we go from an uptrend to a downtrend.

So those are kind of the two types of entry points, a continuation or almost a counter trend or a change in trend. And when you're trading intraday or you're drawing up these charts intraday, so I said, you know, a five minute chart is a good one to do this exercise on. Realistically, 15 minutes is about the largest time frame that I look at intraday. You know, if we're talking about trading, putting most of our emphasis on the first 90 minutes of the day, so from the New York open at 930 Eastern time to about 11 Eastern time, if that's our trade window, then a half hour or an hourly chart, you know, by the time those candles form, we're going to be almost over with the session.

So a 15 minute chart is good. Five minutes, probably my preferred. Sometimes I'll, you know, toggle between the five and the 15, but that's about as large as I'll go for kind of bigger picture timeframe.

So when we talk about larger timeframe, we're talking about like a five or a 15 minute and a smaller timeframe is going to be a 512 tick chart or a one minute chart. So A lot of you have probably seen this chart before where you have a series of lower highs and lower lows, the downtrend on the left side of the chart, and then the series of higher highs and higher lows on the right side of the chart. And when you are kind of in the middle and you begin to take out the lower high and put in the higher low, that's where you start to begin the new trend.

And anytime you're in a trend, you want to pay attention to where is the most recent swing high and swing low. I will always have this up on my daily chart, marked on the daily chart on just a separate workspace, as well as things like the unfilled gaps. I keep those on a separate workspace. And so when I start the week, I take a look at those and say, where is our most recent swing low?

Because if in the case of our current market environment, we're in kind of a strong uptrend, breaking into all-time highs. And if we were to take out the swing low, that would indicate that we're potentially breaking the trend. So from a day trading perspective, if we're in a downtrend and we take out a swing high, the most recent swing high, now we're starting to initiate or break that downtrend and initiate a new uptrend.

And so that's the critical point for identifying the trend change is when we take out the prior swing high or swing low. So the basics of the 50% retracement method, buying those pullbacks in the trend, and if there's no trend, so if we're just kind of moving sideways or if we're in a range, then we can utilize fading or selling highs and buying lows. as far as kind of those reversal points. And so I'm always starting my day from the 9.30 Eastern time when I'm going to start my trend drawing or trend identification, if you will.

It's okay to pull up the overnight session and kind of take a look at where was the overnight high and low just to get an idea of how big that range was. Did we trade above? yesterday's regular trading hour session in the overnight? Or were we kind of contained within yesterday's regular trading hour session?

So like for tomorrow morning, I usually open up my charts, you know, half hour before the bell. If I'm up really early or just at my computer earlier, I might pull them up early. But you know, half hour is really plenty of time. I'll look at yesterday, so today's regular trading hours candle, and then just turn on the glow backs or the overnight hours and just get an idea of where did we trade after hours.

Did we trade above today's range? Did we trade below today's range? Or were we just kind of right in the middle? And so the tools that we'll use to execute the trades is just a basic Fib retracement tool.

The 50% is not a Fib number. The tool is handy to be able to pull that up. We'll talk about a couple other actual Fib retracements like the 61.8 and 23.6. But really, we're just using that tool as sort of a filter or a lens for executing our trades, for giving us a price level to place our trades. So we'll be using the 512 tick chart, which we'll get into here in a minute.

Hakonashi Candlestick. Neither of these are... really required, the Hakanashi or the 512 tick chart.

You could certainly do this on a one-minute chart. That's just as well. I prefer to use the 512 tick chart, and we'll get into that here just in a minute. Same with the NICT tick. It's also not required, but it's kind of a helpful addition.

You'll see or notice, come to find that I don't use a whole lot of indicators or, you know, stochastics, moving averages, those kinds of things on my chart. And so when we're just looking at the price action, the cleaner you can keep your chart, the easier it will be to interpret, make decisions, and actually pull the trigger. If you have too much stuff on your chart, there's too much to filter out and too many decisions that you're more likely subconsciously putting yourself in a position to make.

And so if you can strip away a lot of that excess, it becomes a lot easier to trade. You know, another great exercise is to just go through your current chart setup and go, you know, box by box, chart by chart, and say, okay, do I use this chart to either enter, manage, or exit the trade? Do I use this time and sales window to enter, manage, or exit the trade? Do I use this market profile histogram? Do I use...

this NASDAQ chart, this Tesla chart, whatever you have on your chart or on your screen, if you've got five monitors or if you've got two monitors, kind of go through and look at and ask yourself that question. Am I using it to enter, manage, or exit the trade? And if not, then it's kind of just there as either a crutch or just a nice to have, and getting rid of it will really help clear up that decision-making process.

And so if we're going to be trading the ES, you could really just be looking at the ES and that's it. I have a small watch list on the left side of my chart that just has the S&P, NASDAQ, Dow, and Russell, but I'm not comparing my entries on the ES to something that's happening over on the NASDAQ. So in a trend, we want to be looking at that five or 15 minute chart to kind of kick things off.

When we are trending, the five minute, we'll just for references here, just be saying the five minute chart is a great place to begin to get a bigger picture of the day. You know, if you get four, five, six, five minute candles, all of a sudden you've got 20 or 30 minutes of price action put together. And so that, while it might not seem like a very big time frame, it actually is a very good kind of starting point for that larger time frame to kick us off with identifying the trend.

So entering at 50%, we mentioned that already. If we're range bound, and so going back to that five-minute chart, if we don't have higher highs and higher lows, if we're just kind of stuck moving sideways, then we want to be looking for places where we're going from kind of a short-term uptrend, like from the bottom of the range to the top of the range, and then rolling over and going back to the bottom of the range. So even in a range-bound market, you're going to have short-term uptrends and short-term downtrends. It's just that in a range-bound market, you don't get the breakout follow-through. You don't bust into new highs above the range and keep going.

You kind of lose steam, roll over, and then start a downtrend. And so looking for the tops and bottoms of those ranges, such as the 30-minute high and low, so from the nicey open going 30 minutes beyond, so 10 o'clock Eastern time, that is a place where I will put a horizontal line at the top of the 30 minutes, bottom of the first 30 minutes. And if we cannot break out of that range, well, then by definition, we're range bound.

So that's a really easy way to determine are we range bound or are we trending? If we get through the first 30 minutes of trade and then keep going, so we mark those highs and lows of the first 30, and then we keep going, well, then by definition, we're in a trend. A lot of times, the 30-minute high, let's say, if we're in an uptrend, if we break out of that and pull back to it, That's a good place to look for a continuation or a 50% on a pullback at a 30-minute high.

When you're looking at your chart and you're starting with a time frame like the 5-minute, it helps filter out a lot of the noise from the smaller 512 tick chart. that we're going to talk about here. So while you could just have the 512 tick chart up and nothing else, sometimes it's easy to become lost in, you know, oh, here we had two long retracements on the 512 and then, oh, now we're starting to trend lower and we have a couple of retracements to the downside.

And all of a sudden it's like, well, are we in an uptrend, downtrend, no trend? And so keeping an eye on that five minute chart. And starting there helps us determine, okay, the five minute is in an uptrend.

So when I shift my gaze or switch my chart over to the 512, I want to be looking for long setups. And at least right there, it helps us filter out half of the trade setups that you're going to see. And then when we pair that with places like the 30 minute high and low, other places to look for setups would be the prior days, high, low, and close.

That can help. Give us at least a half dozen locations to be looking for to place trades. So the way that I set up my chart, we use that five-minute chart with just a traditional candlestick.

We mentioned the Hakanashi. I'm only using that in the 512 tick chart. So for the 512, essentially it's just a chart that's based on number of transactions. as opposed to time.

So instead of five minutes of time, and then the bar closes, we have 512 transactions take place, and then the bar closes. So you're going to see a lot more 512 candles forming when we're like right at the nicey open compared to this time of day, you know, after the market's closed, it's going to take a lot more time for those 512. tick chart candles to close because there's not as much volume. There's not as many transactions. So it can give you an indication of the volume without having the traditional volume chart visible on your chart. The NYSE tick chart, we won't get too much into that, but that's essentially the makeup of my chart.

So as you see it here, on the right is my 512 tick chart. In the middle, is my five minute or 15 minute. I'll toggle between the two of them. But I just have the two charts on my grid.

And I like to just toggle that time of five minute or 15 minute versus having yet another chart open. The bottom left is the NICT. Again, we'll get into a little bit of that, but it's not required. And then just a watch list of the indices and then the futures below that. Pretty simple chart setup.

The only reason I keep the volume on my chart on the bottom is so that when I toggle to Globex session, It's very easy for me to see where yesterday's trading range was because if you turn on the overnight session and put on like a 30 minute chart or an hourly chart, the overnight, there's hardly any volume because most of the volume is just traded in the regular trading hours. And you can kind of see this U shape every day where the open is a higher volume node. And then the middle of the day, lunch hour is... lower volume node and then picks up into the end of the day.

So the middle chart is also the chart where I will toggle to the one minute time frame when we're, once we get to the hammers and inverted hammers, I use this middle chart as kind of my toggle chart because the right chart I have set up with the Hakanashi and the middle chart is set up to just the traditional candlestick. So a Hakanashi candlestick. will give you a similar look and feel, but it will help smooth out the trend. So this is a traditional candlestick, and then this is the same chart window, only with the Hakanashi, and all it's doing is instead of taking the open of the candle, so you have an open high low close, candle A closes, Candle B continues where the last candle closed.

Well, with the Hakanashi variation, it just puts the opening price at the midpoint of the prior bar. And so now you kind of get these strings of green and red where the trend is a little bit more clear and pronounced. And it just, it's easier on the eyes. But again, you don't have to use that Hakanashi candlestick chart.

And don't ask me why we've got these weird numbers like 144, 512, 1044 for the tick values. There's various speculation from the early computer days and some fib numbers kind of match in there. But there's, you know, if you're using a 500 tick chart or a 512 or a 520, they're all kind of doing the same thing in that general area.

transaction number. So it's not super critical. I've done some digging over the years and I haven't really found a clear answer as to why 512, but 512 is kind of the standard for day trading.

There's not a whole lot of people that trade it, but it is a good way to kind of get a small enough timeframe without just complete chaos and noise. If you first look at the chart, it's going to look like a whole lot of noise. And if you look at it for six months or a year and you're still just seeing a bunch of noise, it's okay to move to a one minute chart and just trade your retracements off there.

But in time, if you practice looking for retracements on the 512 tick chart at specific places, that kind of match up with a 50% retracement on a five-minute chart, and all you're doing is zooming to the 512 to place your order, or you start to identify a downtrend on the five-minute chart, and then you looked at the 512 tick chart for a short, that can kind of give you, set you up in a better... visual to where you're already looking with the trend, and then your eyes can kind of filter out some of that noise. So places like the top and bottom of the 30-minute range, those are great places to look for 50% retracements.

We mentioned the prior day's high-low close. Those are also really good places. Breaking a swing low. So if you're in a downtrend already, lower highs, lower lows, and you take out a swing low, the trend is continuing.

So looking for a short in that continuation of the downtrend. If you're in an uptrend, like in this chart on the screen, and you're making higher highs and higher lows, and then you take out another swing high, then getting ready to take a long on the next pullback. would be a continuation to the upside.

So kind of starting from the bigger timeframe, starting from those very, very basic... Swing high and swing low identification, higher highs, higher lows, stuff like that. Just all the basics that you would go back to if you were, you know, playing in the NFL.

You know, going back to the basics every offseason and really drilling those home so that when you get into those high pressure situations, you don't even have to think about it. Your eyes know exactly where you're going to go. And even if you're not looking, like, you know, you're Tom Brady and you're not looking where you're throwing.

your arm knows exactly where you're going to throw. And so as you get proficient with your trading screen and the setup, and it's a very clean, you know, clean up your charts, then you get very good at just kind of knowing exactly where you're looking and where you're going to be clicking. So when it comes to drawing the fib retracements, we talked about using the fib tool, you always want to be drawing from left to right.

So if you're... very new to fib retracements and you're like, well, I don't even know where to click. You always want to start from the left side of your chart and make your first anchor point and then move to the right side of the chart. So in the example here, the left side of the chart, the highest point is where you're going to start. And then moving to the right, all of a sudden, You start to have these candles breaking the prior candles low, making lower lows, and going from left to right is going to give you a retracement short to the downside.

And so entering a short at a 50% means the market has to bounce or come up to your price, to your entry. And that's probably one of the hardest things for people to really get a... get comfortable with in this type of trading. For the most part, trading with the trend is probably one of the more common approaches to trading. But when you have a limit order out there at a 50% to sell and the market's coming up, that can be a little bit scary because here's your order and you're not sure if the market's going to stop there or not.

But what we're doing To use my clever train analogy, is we're trying to identify on the map where are the train stations. And there's lots of clues where the train station could be. Various intersections and parking lots.

You've got the train crossing gates as we approach the intersection. And so if we can identify various support and resistance levels throughout the morning, we can identify where the train station is. Those support and resistance levels kind of act as the train stations.

And not every train is going to stop at each station, but you have a better chance of the market stopping at a train station if there's actually a station there. There's a real good chance that the train ain't going to stop if you're just in the middle of a field. So if we can identify some general support and resistance areas, the first 30-minute high and low, the prior highs of yesterday, the lows of yesterday.

Maybe we have a daily swing low from last week, and that's kind of the major swing low for the daily chart. And so if we start to come down to that price level, we might bounce off of that level, kind of get a double bottom. Double tops and double bottoms are also very good support and resistance areas.

And so you Even just a straight up 50% retracement is, by definition, a potential, in this case of a short, resistance area. So looking at the 50% retracement for the entry point, the halfway back, not a fib number, but the 61.8 is. And so you'll see on here a 50% and a 61.8. The 61 is sort of used as the failure point to where. You know, if we are retracing the move, so 100% retracement would be from the top of the move to the bottom and retracing all the way back to the top.

Well, if we go 61.8, that's about two-thirds. And so if we go beyond that, there's a good chance that we're going to go all the way back and make the full retracement. So the 61.8 is...

kind of a general failure point when it comes to, uh, retracement style of trading. So we want to watch for a break of the 61.8 anytime we're in a trend. And so those two pieces, a swing high or low and a 61.8 failure, they signal a very strong likelihood of a trend change. So the other number that we have on here, two numbers actually, the 23.6, or it could be...

viewed as 123.6. That's also a fib number. And that's essentially looking at roughly 23% beyond the low anchor point.

So 20% beyond lows as kind of a target out there. And you don't have to take your trade off at that point. It just kind of gives you a visual of, okay, here's a halfway back point and here's a move 20%. 20%. beyond where we were, where our prior low was.

And so the concept of drawing up the 50% retracement and then letting it trade down in this case, because we're drawing up shorts, letting it trade down to that negative 23, and then looking to draw the next retracement from the prior entry down to the lows. And you kind of get in this series or this rhythm of you get lower lows and lower highs on the chart. And you're drawing up each subsequential retracement on the retracements as well.

So I'm always going to start from the 9.30 Eastern time to draw my retracements. So if you start on the five-minute chart. And it's also good to wait 15 minutes before you trade, just to kind of give the market some time to establish some anchor points.

So if the first three bars on the five-minute chart, that makes up your first 15 minutes. If the first three bars are red, then you're drawing from left to right. That's going to give you a down move and a 50% retracement short right out of the gate.

So you can just kind of... repeat that process until you break a swing high or break the 60-win eight. And kind of jumping ahead to a little bit more advanced concept here, I just want to highlight this second retracement here.

You've got this red hammer and the green bar, so we've got the big red bar down, two green bars, a red hammer, and then a green bar that... breaks above the red hammer's high. Well, the swing high, the most important swing high, is still up here at the anchor point.

So this kind of inverted hammer, so one, two, three, four, five bars from the left, that's still kind of the major swing high because this hammer and the kind of... inverted hammer, doji, if you will. And then this green bar, all of these bars following the big red bar down, they're all inside of that big red bar. And so anytime you have a series of inside bars, you kind of have to revert back to the bar that poked above the prior bar. And so anytime we have a day where we open up and we're inside the prior day's range.

We want to be on the lookout for more range bound activity. It's okay to open up inside of yesterday's range and then kind of get some legs underneath us and then break out whether it's above or below yesterday's range. But if we're trading inside, whether it's the prior bar or the prior day, we want to be on the lookout for range bound activity and know where that prior swing high and swing low are at. So this is in thinkorswim, or it doesn't matter what platform you use, every platform is going to have a fib tool. But these are the numbers that I have turned on, the minus 618, minus 236, the 50% and the 618. So when it comes to executing your trades, we talked about we want to wait for a break of that swing high or swing low.

So if we're in a trend up, higher high, higher low, higher high, higher low. You're breaking a swing high, you're buying the pullback. Breaking the swing high, buying the pullback.

You can turn your chart upside down for shorts and just be doing the exact opposite. So in this example here, we're drawing up the 50% retracement after we've broke the swing high. And the important thing to remember is, I purposely hid the left side of the chart, so we don't exactly know if we were in an uptrend already, or if we were in a downtrend and we just changed to an uptrend.

But if we have... Some kind of support level down at lows on the current lows here could be from the five-minute chart. This could match up with yesterday's low of the day.

We could be coming up from an uptrend, higher high, higher low, higher high, higher low. And this low on the current chart could be the 30-minute high. So we may have broken out of the 30-minute range and pulled back to the 30-minute high. And then, you know, continuing by breaking out of another swing high.

So the swing highs and swing lows are super, super important. Drawing the 50% retracement, you know, give it a couple of weeks and you can become very proficient at drawing the retracements pretty quickly. But if you don't start with the larger time frame, you know, that five minute chart or a way to identify some larger support and resistance levels, then Like I said earlier, it can be easy to get lost in the smaller time frame. So I'm always using limit orders when I place these trades. And that's one of the really nice things about retracements.

You can place your order before price even gets to your order. It's a lot more, it's a slower paced. You have more time to put your order out there.

You know that you're going to get your price or better because you're using a limit order. And when you're buying a pullback, you're getting in at a point that's not super obvious to everyone else because you have a long order resting there and price is coming down into your order. So if you think about any of these, you know, cryptocurrency craze.

any kind of housing bubble or run up in any kind of price of a good. Buying when we're at highs where the trend is super clear, everyone wants in, just like the last couple of years with the housing market. Everyone wants to buy a house and they're fighting for that one house, and so they're going to bid it you're not buying at the most optimal price.

You want to be buying that house when we're coming out of 2008-2009 Great Recession and you're buying when nobody else is interested and it might not be as sexy and as exciting but you're not fighting for that house and if you have the patience to sit on it then you're going to reap the benefits when everyone else starts jumping in. you already have your house and you're gaining the benefit of riding that wave. And so with the pullbacks, it's the exact same thing. You're getting in on the pullback. It may be a little bit scary to place that limit order, but by the time things start to become very clear that, yep, this trade has turned around, we kind of made this V, and we start trending up again, and now we have all these green 512 Hakonashi bars and...

everybody else starts chasing and jumping in, you're already in the trade. If I put my order out there, so I'm always going to put the limit order one tick in front of, or if I'm long above the 50%. So just round up if it's an odd number, which most of the time it will be.

So if it's not even quarter, half, three quarters, you got to round up to the nearest even half. quarter, three quarter, and then add a tick. So that will ensure that if price comes down and touches the 50 exactly that you get filled. If it comes down and it doesn't fill me, I won't chase it. It could be a bad habit to be micromanaging the trade and kind of dragging your order in because half the time you'll get the price to come close to your order and you'll get antsy and you'll drag it in and then it will keep coming lower and would have filled you at the original price.

And as we're going to talk about in a second, using a two-point stop is fairly tight. It's not super tight, but it's fairly tight for this kind of trading, or for day trading in general, not necessarily for this type of trading. But if you start moving your orders, dragging them up, now your stop is in a much worse spot. So next point here, two point stop. And that is important on every trade.

So just set a bracket order and you can have your 50% retracement with your two point stop go out there. You don't have to have a target on the trade. And so you just have your stop and then we're going to be trailing our stop. trailing that stop that we put out there, we can drag it up.

Whether you're dragging it up on your trade ladder, your price ladder, or on the chart itself. Like if you're executing on thinkorswim, you can put the lines, put your orders, order lines on the chart and you can just manage your trade right off the chart. I use trade of eight for my order execution.

So the charts and the trade ladder aren't necessarily linked, but I could. trade, drag it up on the trade of eight chart if I wanted to. The reason I use trade of eight is just for a little smaller intraday margin.

I've traded on Thinkorswim for years and years. I've used Infinity Futures for years and years. For a long time, Thinkorswim had smaller intraday margins, you know, five, six grand.

But now they're not really interested in futures traders for good reason. They don't need to be in that market. And so, you know, you're stuck with a $18,000, $19,000 intraday margin per contract. So you basically need $18,000.

It kind of changes a little bit, but we'll just say $18,000 to trade one ES contract. And it's not a huge deal. You know, if you've got a $100,000 account and you want to trade five, six contracts, you can do that, no problem. But the opportunity cost of leaving all that cash sitting there is what was getting to me.

So. Using a smaller discount broker, if you want to call it that, Trade of Eight was bought up by Ninja, just like Infinity. So $500 intraday margins, you can trade one contract with $500 in your account.

And so you put $5,000 into an account, you could be trading five, six contracts the same way as Thinkorswim with 18 per contract. So stops and targets, this is where things get fun. When it comes to, well, for the ES especially, your biggest detriment is going to be exiting the trade too early.

And it's easy to get antsy or to say, ooh, I can't let this trade turn into a loser. I'm up two ticks. I need to move my stock to break even.

Well, you won't lose a lot of money, but you won't make any money doing it that way. So it's very important. to know how you're going to exit the trade so that you can know exactly what you're going to do when you get into a winning trade.

Otherwise, you know, it's easy to just kind of close out or get afraid and hit the flatten button and then you get out for a point and the thing ends up ripping. So you can use an eight point target. I put that in there because There's a lot of traders that are using like a top step or an apex, one of these kind of new age prop firms.

And with some of their rules and parameters, taking a profit is going to get you into the funded account much quicker. So you don't have to use a profit target, but eight points with a two point stop. is very good reward to risk. So I'm okay if you want to have an eight-point target out there.

I do not recommend getting out for a point or two. In years past, I have played around with a three-point profit target on half the position to get a small winner, but I've since done away with that just because the retracement trades run so well that by trailing your stop, There's going to be a lot of trades where you start to trail your stop and you get taken out for two points or four points. It's not really a big runner.

And so those trades end up kind of taking the place of that small profit target. So the trail stop is what we're going to be looking to do. And so the first place you want to start trailing your stop is fairly obvious, drawing the next retracement. So you get into a retracement and if it starts to move in your favor, you can draw up the next retracement and just put your stop underneath.

If you're talking about longs here, two ticks below the next retracement. The next place you can look for tightening your stop is just those basic swing lows and swing highs. So if the market makes a little move up and pulls back and makes another move up, we can put our stop one tick below the next swing low for a long.

And then the third and more aggressive approach, if the market really starts taking off, they're kind of in order here of more conservative, a little less conservative, and then... very aggressive, you can trail each 512 tick chart. And the reason that is good is because if the market starts to move very quickly, you could all of a sudden be sitting on, you know, 8, 9, 10 points of unrealized gain with your stop, you know, 8, 9, 10 points away. And rather than just panic, this gives you an approach to tighten your stop very quickly and kind of lock in profit.

So if you can get to multiple contracts, then you can do a mix of both of these. Either you could have an eight point profit target and then you could trail at the same time. I try not to get super fancy with my trailing stop.

Like I wouldn't want to trade three contracts and trail one of them behind the 61.8, one of them below a swing low, and then one of them trailing each candle. I will typically start. Trailing the 61.8, and then if we start kind of getting some momentum, and we get a nice series of higher highs and higher lows going, I can bring it up underneath the swing lows. Then if all of a sudden we start to shoot up really fast, then I can go in and trail each candle.

Just as an example, splitting the position in two. So if you're doing even numbers, then you can do two contracts. off at eight points if you wanted to, and then trail two. That can be a helpful way to kind of lock in some profit and still catch that bigger move. We'll talk more about that with the one-minute chart as well.

All in, all out is the most profitable way to trade. You just have to have the wherewithal to give it room and stay in the trade without panicking and just hitting, you know, flatten or exit, cancel all and be getting out of the trade for two points or three points. You want to just methodically follow your trail stop approach and a good chunk of trades will just get you out for, you know, those two, three, four points and not be very exciting.

But then you'll start to get those trades where they run for eight, 10, 12 points. And, um, You'll obviously have plain old stopouts in there as well, but knowing that, okay, my two-point stopout is my worst-case scenario, but getting a four- or five-point move is not super difficult. That's not like a monster move.

Even an eight- or a ten-point move is not an obscene, huge move. So it only takes one winning trade to, quote-unquote, make up for a couple of losing trades. And so you can be patient. and wait for those winning trades versus kind of taking a scalping approach and feeling like you have to get in every single trade and just make 10 or 20 trades in the session. Or even if you're not making a lot of trades, one losing trade can wipe out three or four winning trades if your reward to risk is kind of flip-flopped.

So this is the trade of eight bracket order. settings. You can have it set up so that you just do a stop loss.

So on the right would be just a stop and no profit target, or you can have a stop and a profit target. So in this particular screenshot, I've got it for my one minute chart. So it's a three point stop and then no profit target on the right. And then on the left, you've got a three-point stop and a six-point target. So pretty easy to set up a bracket order so that you don't have to worry about putting your stop order in there and managing kind of the mechanics of the trade.

And it just goes out there when you get filled. So some ideal places to enter. We talked about with the trend, you know, at the 50% retracement.

This is kind of an example of looking at... the larger 15 minute timeframe on the left. And you come up to the 50% retracement on the left chart on the 15-minute time frame.

Zooming over to the 512 and placing your trade on the 512 tick chart in that same direction. So the 15-minute chart is going down. The trend is down overall on the 15-minute chart.

But you have this short-term bounce up to the 50% retracement. Entering the 512 gives you a much smaller drawing so that you can get away with that two-point stop. The distance between the 50 and the 61.8 on a 512 tick chart is going to be much smaller compared to on a 15-minute chart.

And so when looking for placing a trade, not only do you have the 15-minute 50% retracement as a potential resistance point, but then on the 512 tick chart, You kind of have this double top. Then you have the swing low in the middle that was broke. And then you come up to the 50%.

This one traded a little bit beyond that, but it's not a huge deal. You've got two points of wiggle room with your two-point stop. When we get a break-in trend, we violate swing high or swing low. So this could be an example of a range bound day where we're trading up and maybe this is the prior highs.

And we've traded at this point earlier in the morning, kind of come up, make this double top, and then you break the swing low in the middle. And so now you've got the prior highs as, hey, we might have a resistance point here. You get a double top at the same time. And in taking the first short, that... Appears after that, we break the swing low, and then just trailing your stop above the next 61.8, trailing it above the swing high, and then when you get these big strings of red, where it's like you're not even getting any bounces, you can just come in and trail each candle as best you can.

Sometimes those candles form really quickly, but you're going to end up with a lot more profit if you're just... kind of trailing each candle as best you can versus trying to just get out or come up with some other arbitrary profit target. So we mentioned this already, the 30-minute range. On trending days, we're going to break out of that 30-minute range very quickly. So if you print out a 30-minute chart of the ES on a day where we trend, that first 30-minute bar is going to be a long ways away.

On a range bound day, that first 30 minute bar might encompass most of the day. And so here's an example of that. We've got the first two, this is a 15 minute chart. So the 30 minute range is made up of the first two bars. And we break out of that 30 minute range very quickly.

And then we don't look back. So a pullback to the 30 minute high after we've just broke out of the 30 minute high. is a good place to look for long entries and flip the chart upside down to look for short entries. If you're on Thinkorswim, you can put a minus sign in front of your chart, whatever ticker symbol you've got, and that will magically turn it upside down if you just want to look at that same chart upside down for some reason.

When we're talking about, so this is what it might look like. We've got the 15-minute chart breaking above. the 30 minute high. So kind of the larger timeframe is your hypothesis chart. It looks like there might be support or resistance here.

When we go to the smaller timeframe, now we can place our entry on that 512 tick chart by drawing up, you know, just that the most recent 50% retracement. So if we're range bound, conversely, we're kind of looking to do a similar approach, but Yeah. Instead of buying at the top of the 30-minute range on a breakout, or in this case, selling below the 30-minute range on a breakdown, we can be buying.

So this one, first two bars make up the first 30-minute range. We poke below it, but then immediately we go back into the 30-minute range. And it's like, hmm, okay, well, price was rejected right away. And let's see if we stay in. the 30 minute range and lo and behold we do.

And so if we zoom into the five 12 check chart, this is what we see a little double bottom at the bottom of the 30 minute range. And you know, sometimes the, the retracements are pretty tiny, but, um, Drawing up that retracement that corresponds with the bottom edge of the 30-minute range gives you the potential to move from the bottom of the range to the top of the range. And even if it's 10 points, you're entering on such a small entry with a two-point stop that even if you only caught six of those 10 points, that's still a three-to-one reward to risk.

The reward to risk is really in your favor. Low risk entry points make for this type of trading pretty optimal. So optimal location, nice segue here, optimal locations for placing those trades, kind of some of the things we've talked about.

The halfway backs that occur on a 15-minute or a 5-minute chart. high-low close in the prior day, things like the unfilled gaps. So the 415 close is what I consider the settlement close.

And there's lots of times where we open up and we trade above or below that price and we don't actually fill it. We don't actually trade there for a few days or a few weeks. And those unfilled gaps can be good places to look for retracements. When we get a High NICI tick, looking for a short. And when we get a low NICI tick, looking for a long.

That's the simplest way to kind of begin incorporating the NICI tick into your trading. Selling in NICI high ticks and buying in NICI low ticks. Entering one tick above that 50% retracement.

And then the stop being just two points. And I first started early, in the early days, I used a point and a half. So two points is plenty generous at this juncture. One thing I will say, if we go from a situation where we have low volatility to high volatility, it's best to sit on your hands for a day or two.

If the VIX spikes and we have some massive... Jump in volatility, kind of like the COVID sell-off. Sit on your hands for a day or two.

And then what you can do is double your stop, cut your position size in half, and you'll end up with the same risk profile. And then because volatility is higher, you can expect you doubled your stop. You're going to be doubling your potential profit target as well. From a drawdown perspective, I like to give myself two full stopouts as my cutoff for the day.

And so that will help you be patient. That ensures that if the market's just not trading, being real conducive to your trade setups, that you don't just take four or five stops on a day where it was just a lousy day to begin with. And then the next day, if it's a nice, easy day to trade. and you have a couple of winners, all you're doing is kind of digging a hole and filling it back in. So we want to limit those drawdown days and drawdowns in general so that we can have a very profitable outcome on those winning days.

On a weekly basis, essentially having two daily full stops makes up my weekly stop out. Back-to-back stopouts Monday and back-to-back stopouts Tuesday. I'll typically just call it a week. It might seem a little bit harsh, but you'll find that if you know that you have a two-stopout limit, like if you're shooting a target and you know that you only have two bullets, you're going to steady and take aim a little bit more careful than if you've got a full magazine where you're just firing off rounds left and right. Having that two-stop out limit really, really helped me be more patient and kind of ease into my day once I enacted that.

And I started that very early on, probably almost 15 years ago. So some helpful tips. Waiting those first 15 minutes is just a good way to, one, get some anchor points. You know, let the market get some momentum or get some movement where you can start drawing up retracements.

And really focusing on the first 90 minutes of the day. That way you're not trading through the lunch hour and just kind of treading water through some of those times when the market can be doing nothing. If you're going to look at other futures markets like the NASDAQ, 512 tick is a good place to start. Always be drawing from left to right.

If you come into the day, maybe you can't trade the open. The next best time would be the last 90 minutes of the day. And so if you're going to start drawing your retracements after you've got a lot of price action on the chart, start with the most significant swing high or swing low on your chart. You could certainly trade other things, you know, gold, oil. I traded soybeans for a while, Forex, and various markets.

So it works on any market or time frame. I would suggest starting with the 512 tick chart, but some markets you have to go down to a 233 because there's not as much volume. But I wouldn't go much smaller than that.

Otherwise, there's not enough volume to really make it happen. I used to trade the Euro futures, and I've stopped that. It's been a number of years now. They went from regular pips size to half pips, and then things started to slow up. I used to trade the European Open, but it just, waking up like that, it just wasn't sustainable for the long term.

So now I just focus on the ES at the NYSE Open time frame. So watch out for those inside days. Like we talked about, if we're trading within the prior days, high-low. Just...

kind of have your radar up for, hmm, this might be a range bound day. If you're in a trade, I always wait to be stopped out to hit that two points. I don't just arbitrarily say, oh, it's not looking very good.

I'm going to close out the trade early, or I'm going to move my stop to minus one just because. I just keep my stop at two points. I've accepted that's my full stop out, and I will just use that as my threshold. Some important days that you shouldn't trade, the FOMC meeting announcement Wednesdays, I always take those days off. Anytime we have like a bank holiday or an early close, you know, we just had Black Friday, not worth trading.

Any day where the futures markets are open but the stock markets closed, not worth trading. And I've also stopped trading on expiration Fridays for futures, so the four times a year. futures expiration. And then the week between Christmas and New Year's, I don't trade, as well as the first week of the year. So I kind of put this progression together and modified a little bit over the last year or two.

But a SIM account is really good for getting a feel for your trade ladder, your charts, purposely clicking around on everything to know, okay, what does left click do? What does right click do? Maybe I want to change my settings so that everything is left click.

That kind of stuff is, you don't want to be making those mistakes ever with trading. So getting those cobwebs dusted off is the SIM account is really good for that. And then, you know, just kind of getting familiar with the setup. It's not about keeping a perfect trade log and documenting every trade. It's just kind of getting familiar with the setup and your trade ladder and your charts.

Then now, because there are the micro ES futures, you can trade real money with a smaller account. You could also do something like the Top Step Apex prop firm kind of thing. But a micro ES is such a small dollar amount that you can be trading with real money, but you really don't have that much at risk.

And so the goal is not to get rich trading the micros. It's just to kind of start building that trade log, building some confidence, getting a feel for what it's like to trade with real money. And so spending a month on the micros in kind of like four-week blocks, so where you're giving yourself a month to practice and learn and then assess.

You're not going to be, you know, changing things, jumping to different strategies. It's like, I'm going to commit for four weeks to trading the micros, and then I'm going to assess and determine if I need to trade another four weeks, which most people would. So shooting for things like an R multiple of two to one, 60% win rate, stuff like that.

If you're trading with real money, you'll be able to have a trade log with real trades so that you can... get some of that data. And the micros also allow you to trade multiple contracts quicker. So if you're trading on the MES, you can still use the 512 tick chart. It matches up pretty well with the regular ES.

And occasionally there's times where it might be off by a tick or two, but not the end of the world. Sometimes you get a better fill on the ES than you would the micro ES and vice versa. So the two contracts, getting familiar with trading two and then four contracts is a good... Good way to be able to practice with multiples. Trying to get 100 trades is really helpful because that will give you a bigger data set where you can evaluate your R multiple and your winning percentage.

And if you don't have at least 100 trades, which will probably take you a good three months, sometimes the certain trades will throw off your data or if you have... Even in a three-month period, we could just be in a strong bull trend. You kind of want to have an uptrend, a downtrend, and a sideways trend that help make up your data set so that you can have some bigger, broader market conditions.

You can certainly begin trading one micro contract. You don't have to start with two, but kind of getting to two allows you to do things like break the position in half. More so as we get to the one-minute chart, which we're going to talk about next, it becomes a little bit more applicable. But with retracements, just doing all-in, all-out, no-profit target, you can certainly trade in any number of contract multiples.

And then the goal would be to get to two just regular mini ES contracts, and then you can start working your way up from there. But starting with the micros is a good way to... Build that confidence and understand how you're going to feel and react when real money is on the line, even if it's only $50 at a time.

If we have a news announcement coming out, like at the top of the hour, a lot of times, 10 o'clock Eastern, there will be news. I will not put a trade on for two or three minutes before that. So even if it's a good-looking trade setup, I won't put the trade on because... You can have a whipsaw effect when the news comes out, and it could stop you out and then end up going your way.

That's why I don't trade on those Fed meeting announcement days because things can get real wild at times. So a few examples of the retracements, and then we'll move to the one-minute chart. The one-minute and the 15-minute, those trade strategies will be much shorter.

duration, just because they're, I guess you could say simpler in a way, but there's just, there's not as much, there's not as much involved. And some of the stuff we've talked about with identifying the trend will also carry over to those as well. So a few examples from the retracements, again, looking at the larger timeframe.

So looking at the five minute chart, identifying a retracement on the five minute chart, and then Coming over to the 512 tick chart, drawing up so this longer yellow line is the corresponding five minute retracement. And then the 512 tick retracement that you see drawn is the one that you would be entering on. So your entry is a little bit higher by entering in the 512 tick chart.

So you might say it's a slightly worse entry, but it takes out a lot more risk. because you've seen the market start to bounce. And then you can begin trailing the 61.8 or trailing swing lows.

What I call a micro after a 15-minute, that's what we just looked at, where you have a larger retracement that's visible on a 5 or a 15-minute time frame. And then you come over to the 5.12 tick chart and look at that 50% price level. Look for things like a double top in the case of a short.

break the swing low, and then draw up the next 50% retracement, and then you can start to trail your stop. Sometimes you just have a couple 512 micro setups in a row that start to occur. And so if we're starting to trend on the 512 and we have one, two, three micro setups, just taking one of those micro setups in the trend is fine. In this case, this is kind of what I call a... crossover trade where we have a retracement short on the larger time frame and we break the 61.8.

So the larger time frame is a short, but that fails. So then on the 512 tick chart, what you can do is look for a long as you're failing the 61.8 and the larger time frame. That would be a little bit more of an advanced trade just for a placement.

As far as a placement is concerned, you're doing the same thing execution-wise. But drawing up the retracement long, as soon as the larger time frame short fails, that crossover trade can sometimes get you in to that new trend without having to make a full pullback. The 30-minute range, we mentioned how the 30-minute can be a really helpful place. to look for continuation.

So here I just have a trend line, up trend line, and these are five minute bars. So the horizontal line is the 30 minute high. And so we kind of start the morning, there's a very faint dotted vertical line.

That's the start of the day. And we get a couple of bars and we're kind of undulating, and then we start to move higher. We break above the 30-minute high, and then we pull back to the 30-minute high.

So now what was resistance, this 30-minute high, is now support. And so drawing the 50% retracement as soon as we break the 30-minute high and getting long, and then just trailing swing lows on the way up is an easy way to kind of get in the trend, and let the market break out, but then enter on the pullback. The counter trend trade is it's very important to wait for the swing higher low to break if you're going to go counter to the trend. So here we have a pretty clear strong uptrend. And maybe this inverted hammer here corresponds with a prior high.

And so you might feel like, oh, we're making a double top on the larger time frame. you need to wait for the swing low to break before drawing up your retracement short. Otherwise, you would just still have a continuation to the upside. So that's all I have for examples on the 512. Again, there's a little more subjectivity with drawing the anchor points or drawing up the retracements.

But if you lean on the larger time frame, or whatever support and resistance levels you're currently looking at, use those support and resistance levels to give you a general hypothesis. Hey, there might be support here. And then when you confirm that, or you are confirming that on the 512 tick chart, by zooming in, coming to the 512 tick chart, wait for that swing high or swing low to break, and then placing your order. So you're taking out some of the risk.

by going to the 512 tick chart after you've identified some support or resistance in the larger time frame. All right, so if you need to stand up and stretch, we can do that. We're going to shift gears to the one minute chart.

Okay, so the one minute chart in some ways is a bit simpler. Not necessarily better, but when we talk about the one-minute chart and hammers and inverted hammers, we're going to be looking at the concept of breakouts, whereas a 50% retracement is a pullback with a limit order. Using a one-minute chart, specifically buying above a hammer or selling below an inverted hammer, you're going to be...

buying a breakout or selling a breakout. And there are times where a 50% retracement does not, the price doesn't make it all the way to a 50% retracement. And that's where these hammers and inverted hammers can come in quite handy. There's also times where you might get a hammer that occurs at a 50% retracement long, and that might be a good place to place a trade.

So Let's, we'll just dive right into the hammers and the one minute chart. So the hammer concept is just looking at a candlestick that has a small body and a longer tail or wick. And that tail needs to be kind of pointing down or below the body. So ideally, the body is like a third of the candle, and then the other two thirds makes up the tail.

It doesn't have to be, the body doesn't have to be at the exact top. of the bar. There could be a tail or a wick above it, but it should be close. It should be in that top third. And hammers in an uptrend is one of the things that we're going to be looking for.

We have situations where we've got like a double bottom, a halfway back long. The one moving average that I will look at is the 21 exponential moving average. That can be a really helpful one. So those are all places that we want to be looking for hammers.

And the nice thing about hammers and inverted hammers is that that signal, that signal bar, the hammer, if you will, is very clearly identified. It either is a hammer or it's not. There's some cases where it might be right on the edge of the body being in that third of the whole candle.

Out of all the one-minute candles that you get in a 90-minute session, it's pretty easy to pick out as an exercise, print out the one-minute chart, and highlight the hammers and inverted hammers. So we're going to talk about trading with the trend. There's also some times that you might want to trade counter-trend.

So an inverted hammer is just the same thing upside down. You've got a body that's at the bottom of the candle and a long tail above it. And we can look for these to either occur in a downtrend.

We've got a double top. We've got that 21 EMA, which we'll talk about here. And then also at the halfway back short. So while you don't necessarily want to combine a whole bunch of strategies into one and have all of these parameters that need to line up before placing a trade.

You could simply look for hammers and inverted hammers that correspond with 50% retracements. Again, taking that concept of larger support or resistance level on a larger time frame. So these are super powerful because the hammer and the inverted hammer really signals price rejection.

Price went to a level. It made, at one point, this inverted hammer. At one point of this one minute candle, it was a big green bar and then price fell and came all the way back down. And so price was rejected.

It went higher and then it was rejected back to the downside. So it signals the momentum is changing. So on the one minute chart, I like to use kind of a rule of thumb of those hammers. So this hammer or inverted hammer candle.

The whole size of the candle should be four points or less. Just as a rule of thumb, sometimes you'll get real big candles. And if volatility gets very big, all the candles might get bigger.

And so we want the candle to be kind of relatively similar size to the other ones. If you've got three four-point candles, then a hammer that's three points is a good one. to place a trade at. If the candles on the day are two and three points, and then you get an eight point hammer, you know, that's getting to be pretty large. And there's a couple things we can do, but by and large, just using kind of a four points or less as a starting point for those hammers, inverted hammers, is a good place to begin.

I like to use a three point stop on these trades. So we're essentially, um, we're essentially using a entry one tick above the hammer and a, an inverted hammer. Your entry is one tick below that inverted hammer.

So we'll get, we'll pull up some charts here in just a second. Um, if you do have a candle that's larger than four points, you can, uh, use half size. Anytime you want to cut down your risk.

This is another benefit with kind of defaulting to at least two contracts is that if volatility increases or if there's ever a time you want to cut down your risk, you can cut your position size in half and double your stop. And that would keep the same risk. If you wanted to just cut down your risk to half, then you just take your contract size down. So I'm always using a three-point stop. If the candle, if the hammer is only two points, then you can bring that stop up underneath the low of the candle.

So. I used to say, put your stop below, one tick below the hammer. And for simplicity's sake, I've just settled on three points. And if it's only a one point hammer, then your stop is going to be a point and a half.

Because you've got one tick for entry above, one tick for the stop below. So if the candle is four points, the stop is just going to stay at three. If the candle is two points, then... you can bring the stop in to two and a half points because one tick above for entry, one tick below for stop, for the exit to move your stop up.

There's no reason, if your candle's only a point and a half, there's no reason to leave the full three point stop out there. But I was noticing that even on candles that were four points big, you don't want the candle to retrace the full four points. And so, three points was, was plenty for the, uh, for, for the wiggle room of that stop. Um, so putting your stop outside of the candle, if it's, if it tightens it below three points is fine. Um, I, uh, I like to do a couple of things with, with my trail stop on these one minute charts.

Um, the entry here, is always going to be one tick above a hammer or one tick below an inverted hammer. And converse to a limit order, when you put a order one tick above a hammer, you're kind of getting in with the momentum as opposed to getting in on a reversal or a change in momentum with a limit order on the retracements. And so you're essentially using a buy stop, one tick above the hammer, and a sell stop. one tick below the inverted hammer.

And so this chart, I've got a couple of numbers on there, and I want to go back in a second here. Okay, so with the trail stop, the first bar, bar number one, is the signal bar. That is your hammer that's signaling, I want to get long, one tick above this candle. Bar number two is your entry candle. And once that candle closes, I like to trail my stop behind each bar.

So once candle number two closes, you can move your stop up underneath by one tick, one tick underneath that second bar. When number three, candle number three closes, then you can move your stop one tick underneath that candle. Same with candle number four, same with candle number five, and that's the one.

that you get stopped out on because it's not labeled, but candle number six ends up going below the inverted hammer where number five is and it stops you out. So with this, the hammers and inverted hammers, you're going to be trailing each candle and that will lock in profit along the way very quickly and keep you from having to make a lot of decisions when it comes to where to place your stop. Now there's going to be times where you get in a trade and it kind of comes down and ticks you out and then ends up going in your direction that you wanted to anyways.

Not the end of the world. Sometimes you'll get like a hammer and then a couple candles later you'll get another hammer. So if you get taken out, you could get into another trade.

You can reverse a position. So like candle number five happens to be an inverted hammer. I don't do this a lot where I'm getting out of a long and then getting into a short at the same time. In this particular example, this kind of wavy blue line is the 21 EMA. So we're in an uptrend.

So I'm looking for longs. And so I'm not always interested in going counter trend just because there's an inverted hammer. I want to have some kind of resistance level.

If we were at point number five and this was also the high of the day from a prior high, so we're making a double top, then that could be a good opportunity to take a short. So taking a look at this pretend setup here, number five, if you were to short one tick below that inverted hammer, and then this next candle closes, you move your stop one tick above that candle. So even though you started out with a three-point stop, you are now tightening your stop a minute after you got into the trade. Some people find that this style of trading takes away a lot of hesitation because there's not as much fear of sitting in a trade with a full stop out for very long.

As soon as the next candle closes, you have the opportunity to tighten your stop. And since you're using a one minute chart, voila, one minute later, you have the opportunity to tighten your stop. So it's kind of a good place to start.

If you're new to trading, because it's fairly black and white, and the trail stop approach helps take away a lot of that fear of sitting in a trade where, like a lot of times, the ES, especially with retracements, you get in the trade, and you're like, okay, it's been three, four, five minutes, we're not doing anything, but that's the most critical time. Sitting in the trade with, you know, sometimes they rip right away, but if it's just chopping around, giving it that time to gain some... steam, and then once it gets away from your entry by three, four points, then it's easy to manage, but it's not getting impatient and taking the trade off for break-even or just getting out too early.

That gets a lot of people caught off guard. So this trade, I do like to use a target. I like to use a six-point target, and I like to split the position in half. So I've tried a number of different ways over the last couple of years, and I found this to work, really work the best. So if you use a six-point target, that's a two-to-one reward to risk.

So three-point stop, six-point target. Your average loser is going to end up being less than three points because there's going to be a number of trades where you start to tighten your stop, and you might have it at minus two or minus one. And so that brings down the average.

from minus three or brings up the average, however you want to look at it. And so if you have two contracts, you can have a six point target on the first contract and then continue to trail the second contract. So point number one would be the entry above the hammer. And then point number two is your six point first target.

And then point number three is where you just continue to trail. And then eventually you get taken out. And yeah, it ends up going higher, but that's okay. We're not concerned about getting every tick from low to high. We just want to catch a chunk of the move and do something that is in a way that's repeatable.

And so that's really the most important part. How can I repeat this day after day with, you know, a positive expectancy and good R multiple so that I can kind of build week after week? So spot number one is your entry.

Number two is a six-point target. And then number three is that little bit extra, kind of that home run, if you will, for the second half of the position. And same thing. You can set up a bracket order to have a three-point stop go out.

And then if you're going to trade two contracts, you can have it one has a six-point target, one has no target. And so you can start dragging up your stop bar by bar. And then boom, you get that six points hit and one of the stop contracts goes away. And then you just keep dragging up your stop on the next bar and the next bar. Trailing the whole position with no target is okay.

You're just going to have a lot more, you're going to have more trades that kind of walk away as small winners. And then those handful of trades that end up going 10 plus points. with more contracts will have a bigger impact on your data set. But from a real world perspective, you know, sometimes you can't trade a day. And, you know, if that's the day that you end up getting those big home runs for the week, now all of a sudden, you know, you've kind of left a lot on the table.

And so from a realistic, manageable trading approach standpoint, having that two to one target on these types of trades works. works pretty well. You don't want to end up, uh, you don't want to do like a one point target or something super small because the, um, the Reward to risk isn't very good.

You could go up to, you know, we're talking about a one minute chart here. You could go up to a five minute chart or a 15 minute chart and do the same approach. You're going to have a bigger, you're going to likely need a larger stop and your profit target is going to be larger, but you'll need a larger stop. So, you know, the ratios kind of stay the same. The one minute chart is going to give you a lot more hammers and inverted hammers in a 90 minute session.

If you're going to trade a five-minute chart, you might only get one hammer in that 90 minutes. So I don't want to be sitting here all day. And so that's where the one-minute chart is real handy. So double tops, some of the same concepts of support and resistance come into play when we're talking about the hammers and inverted hammers.

So here's an example of a double top where it also happens to be a 30-minute high. And great place for... an inverted hammer to go short because you have a potential, you have two potential resistance points, the 30 minute high and the prior high. And so getting short one tick below lows, three point stop, next candle closes, bring your stop down.

In this case, the next candle that closed was the same high. So there was nothing to, no place to move your stop and that's okay. Next candle goes down by another tick, but it's a bigger red bar. So then the next candle, you move your stop and now you're into profitable territory.

So the worst case scenario is you walk away with a small or modest winner. And then in cases when the market really starts to rip and go down, down, down really fast, that's a great way to exit the position by trailing each bar keeps you in it for as long as the momentum is running really quickly. So this would be an example of a hammer at a halfway back.

And this was one from the other day, actually, where we opened, we made a small 50% retracement, kind of lined up at the 50%, the 21 EMA, formed a nice hammer, long one tick above the hammer. The red mark here then shows where the inverted hammer. If you're trailing each bar, that inverted hammer was broke just below by the next candle. So that's what takes you out of the trade. So with the one-minute trades, the entry is going to be one tick above a hammer for the long.

You could be looking for like a halfway back, double bottoms, bottom of the 30-minute range. The 21 EMA is really helpful if we're in an uptrend. And we pull back to the 21 EMA, looking for a hammer at that point. Low NICE tick can be a good place as well. NICE tick more as confirmation.

And then from an inverted hammer perspective, looking for a short, just kind of turn those upside down, looking at a halfway back, looking at a double top, looking at a downtrend of the EMA, and a high NICE tick. Stop's going to be three points and outside of the entry candle when the entry candle is smaller than three points. And then the exit, we're going to trail each bar. And the other option, I left this in because it is an option, especially when volatility is very low, you can trail swings. And so what trailing swings will do It will leave more unrealized gain on the table versus trailing each bar.

But on those higher high, higher low, higher high, higher low, those series of higher highs and higher lows, you can stay in a trade longer on those kind of clean, nice, strong, trending situations. So you have a little bit more patience. because you're waiting for it to pull back before you move your stop versus trailing each bar. But it can be a good way to make fewer trades but stay in one trade for more of the trend. And then a little caveat to that is if you are trailing this way, where you're trailing swings, if you get four green bars and you're long, then you can switch to trailing each candle.

That way you are, you know, you're not sitting there with your stop 10 points away from where price is. and you're able to tighten it a little bit quicker. So that's just a little helpful way to kind of combine both, if you will, be a little more conservative with your stop. But if we start to rip, just like on the retracements, it's okay to come in and start trailing each bar on the 512 tick chart. You can do kind of a similar approach with the one-minute trades. All right, so that's the one-minute chart.

Next, we'll go into the 15-minute opening range breakout. So feel free to stand up and stretch. We're kind of getting to the home stretch here. So the 15-minute is an interesting trade.

I guess came up with this or put this idea together. Because I was finding that certain days the market would open up and it would rip and we wouldn't pull back and we wouldn't get really any hammers or inverted hammers to kind of get into a trend. And so I was sat sitting there at the end of the 90 minutes session just saying, oh, well, strong trend.

I didn't have any trades today. What can I do to get in that strong trend early? And kind of how can I identify that there's even going to be a strong trend early?

And so from that, the 15-minute opening range breakout idea was born, if you will. So the 15-minute orb is also how I refer to it. And so what we're going to be doing is looking at the 15-minute chart. And we want to, similar to the one-minute chart, We're looking at a buy stop and a sell stop.

So we need to wait for the first 15-minute bar to close. So that's 9.30 to 9.45 Eastern Time. When that first 15-minute candle closes, you can place an order one tick above and one tick below that first 15-minute bar. And again, it's a buy stop and a sell stop.

And that is going to be the entry. One tick above or one tick below, whichever one trades first. is the direction that you're going to go. And then I use a 20 point target. So that's 20 ES points.

So that might seem like, wow, that's 20 points. That's huge. Well, your stops are going to be larger as well because you're on a 15 minute timeframe. And we're going to talk about a slight variation on the stop placement here as well to kind of cut some of that down.

But the main idea with the 15 minute is. You get a 15-minute candle, the very first 15-minute candle that closes, you're going to be getting in on a breakout above that bar or a breakdown below that bar. And so if we end up trending for the morning very strongly, then I can get into a long on the breakout early enough in the day after that first 15 minutes.

And then, you know, 20 points, that's a modest. Pretty solid move, even if volatility is low. You know, if you look at the daily bars in the ES, you know, 50, 60, 70 points, that's not an outrageous move.

And so to get 20 points of that is a pretty solid, but achievable target. And I've looked at other targets, 10 points, 8 points, 25 points, stuff like that. And 20, that was kind of the sweet spot.

So I also looked at trailing each bar, and you can do that. just like the one minute chart, trail your stop behind each bar. But I kind of like the set it and forget it approach of the 15 minute.

And I just kind of trade it every day. And I have a separate account that I just trade the 15 minute in and it's, it's kind of its own little set it and forget it strategy. And, uh, I like that. And so trying to not be super hands-on and something like trailing each bar, I kind of steer away from that. And there's times where, you know, 20 points is, it's a good, good sweet spot to shoot for.

So I've got my animations a little goofy here, but we'll start with the entry and then we'll work our way down to the exit options here. For the entry, we just said 15 minute bar, wait for that 15 minute bar to close. One tick above or below is where we're going to place the order.

And the target of 20 points, the stop. So we've got two options. So The first option is to use that full candle. So use, if the entry is one tick above the first 15-minute bar, the stop is going to be one tick below the first 15-minute bar.

And if that candle, if that first 15-minute bar is larger than 20 points, then just use half of it. So if it's a 26-point candle, which would be a monster candle, then the stop is then 13 points. If the candle is 9 points, then your stop is essentially nine and a half points because you got one tick above for entry, one tick below for the stop.

So what this does is it brackets that first 15 in a bar in such a way that if we break out and then come back and chop around a little bit, you have room. for the trade to get to that 20 points if your stop is below the low of the candle. At 15 points of profit, I will move my stop to minus 4, so break even minus 4, to kind of tighten my stop.

We're getting awfully close to that 20-point profit. I don't want it to come all the way back down and take me out for a full stop out. So I will move my stop to minus 4. That's one thing that might be able to optimize a little more as far as tightening that stop.

But for simplicity's sake, it doesn't happen very often that we go plus 15 but don't make it all the way to plus 20. So that's why it might happen 8, 10 times a year. And so moving it to minus 4 when we go to plus 15 just kind of helps reduce some of the risk. But there's option two. That kind of got spoiled at the start of the slide here is an interesting one.

So when I first started this, I don't know, six, five, six, seven years ago, I was using a four-point stop. And then I switched to using the full candle, and that's what I've been doing for well before COVID, maybe five years of that, four or five years. And so that works super well. But a four-point stop.

just arbitrary four-point stop on the start of the trade, gives you a lower risk on each trade, and a 20-point target is then 5-to-1 reward to risk. And so if you pair using a four-point stop all the time, if you pair that with using that full candle stop in situations when the VIX is above 25, which hasn't been for a while, but like 2022, we saw a lot of that in 2021. Then you give yourself a little more wiggle room when the market is a little bit more volatile. That's kind of the nice sweet spot of having the lowest drawdown, the lowest risk on a daily basis because you're just using four points, and then still being able to capitalize on those bigger...

um, bigger volatility days when four points might be a little bit too tight. So if you use that four points and then when the VIX is 25 and above, use the full candle, that's a really nice way to limit your drawdowns on a week to week basis because the, the 20 minute approach or the, the 15 minute candle, um, 15 minute orb approach. will yield larger drawdowns because you're using such a large stop. So if you have, you know, you could have three or four days in a row sometimes where you might get a stop out.

And so you have to be able to weather that drawdown. So if you're using a minus four, yes, you're going to get taken out a few more times where the full candle would have kept you in for that 20-point profit. But a five to one is such a good reward to risk.

that you can get by having some more stop outs with using that four point stop. So the most important thing is to stick with one strategy and just use it all the time. So if you want to use the full candle, use it. Use the full candle always.

If you want to use minus four. then stick with minus four unless the VIX is above 25. And use that approach always. If you start bouncing around between the full candle, the minus four, that's where you're going to start to see your strategy and your trade results degrade.

So when I added up all my P&L from using the full candle, and then when I went back and plugged in the minus four, the P&L ended up coming out. eerily identical, very, very close to the same, but the drawdown with the minus four was considerably lower. And so I've always placed a strong value on keeping my drawdown very low.

And so that's a really good way to reduce that drawdown while still capitalizing on most of the same 20 point profit targets. So a couple of minor, but Critical pieces of the 15-minute orb. I guess that's kind of an oxymoron. A few advanced pieces that are quite important, I would say. Times not to trade.

So the most important one is if we fill the gap. So if the first 15 minutes fills the gap from the prior day, then I won't take the trade. So if the first 15 minutes goes by. and we've traded at yesterday's 4.15 close, then there's no trade.

And that kind of helps rule out days where we might not trend as strongly. FOMC meeting announcement, those Wednesdays, I won't trade it. Futures expiration Fridays, we talked about the same reasons for not trading any of the strategies on those days.

uh, federal holidays between Christmas and New Year's. And then that first week of the year, I take off as well. So if you can stay away from those days, the other one that's, uh, happens occasionally is when we have like a, um, a midweek holiday. So like 4th of July, this will happen a lot.

Um, we also have now June, uh, Juneteenth in there in the summer. Sometimes it'll be like a Tuesday or Wednesday, and then I'll just take the whole week off. So, you know, when you have these planned breaks like this, it really helps to, extend the longevity and just the sustainability of your trading. Coming from a sports background and professional cycling background, we have just like a NFL player, NBA player, you're going to have an off season.

And so knowing that that break is coming and being able to recharge in different phases of the year where you're doing different things, you're not competing all the time. That really helps keep the longevity. If you just try to go year-round, that's when you see people get burnt out.

They do their sport for a few years, and then they quit, and they're on to something else. And trading is the exact same way. If I know that, oh, okay, every six weeks I have this Wednesday off, and I go ride my bike all day, it's really nice mentally not trying to trade on federal holidays when there's not much going on between Christmas and New Year's. Using that first week of the year to kind of ease into things.

I'll sit there and watch, but I won't place a trade. Just to kind of get some momentum into the year. And so those are the days not to place a trade.

We talked about entering on the first break of the 15 minute. Now we're going to talk about the opposite, the reversal, if you will. So if we get into the first trade.

and it hits our plus 20, great, one and done. If we get into the first trade and it stops us out, and we're still within the morning session, that first 90 minutes, if I get stopped out in the first 90 minutes, I will take the trade in the other direction. So I'll take the trade, so like in this example, the first break was to the downside, and then stop me out. And so 45 minutes later, we broke to the upside.

And so I took the trade in that direction because it was in the first 90 minutes. If I get stopped out, you know, three hours into the day, then okay, it's a stop out. I'm done. One and done. But if I get stopped out and then we change directions, then I will re-enter the trade on the other end of the candle.

And the key here. is we're only going to take this trade, again, on gap days when we don't fill the gap, only in that first 15 minutes. So if the first 15-minute candle fills the gap, then there's no trade.

If we fill the gap elsewhere throughout the day, that's okay. But the first 15 minutes, what's important. And then using a minus four point stop is something I've been doing for a while, as opposed to using the other end of the candle.

Because even when I was even using the full candle as my initial stop on the first trade, if it's a 10 point candle, Then I'm at risk of having a 10-point stop out on the first break and a 10-point stop out on the second break. So this way, using a minus 4 always on the second, on the reversal side, regardless of how you choose to trade and put your stop on the first breakout, always use a minus 4 on the second one, and then don't even bother trading it when the VIX is above 25. Because... If you get stopped out on the first one, there's a good chance that we're just going to be whipsaw and range bound anyways.

And if you take the second break, you just end up getting stopped out again for no reason. So you don't have to take the reversal. It's only in the last maybe two and a half, three years that I started adding in that as a second trade.

It is very profitable as far as year after year making good returns just in that. reversal trade in itself, but I do keep the risk a little smaller. And again, I'm only trading it on gap days.

You could trade every single day. You're going to end up with a lot more trades. You'll end up with some more plus 20s, but you also have a lot more stopouts in the mix. So I've found that just doing the gap days is a simpler way to kind of keep this very simple, fairly hands-off.

not having to micromanage it and futz with it all day long. So the 15 minute trade, the entry is going to be one tick above or below that first 15 minute bar. The stop is going to be the opposite end of the candle or four points. So pick one and do it that way all year long.

The exit is going to be a 20-point target, just straight up 20 points. So there are a lot of days where we get to that 90-minute mark, and I'm still in that trade, and I'll just, I'm fine walking away and having my profit target out there and just let it go. I will come back at the last hour of the day, and if I have not got my profit target hit, then you can close it out, or you can trail each 15-minute candle. You can get fancy with it if you want since you're sitting there. But basically, if we haven't made it to the plus 20, I'm fine just closing it out at the hour mark, an hour before the close and just taking whatever profit that I have.

And then the only kind of micromanagement that I will do, if you're going to use the full stop, then you can go to break even minus four with your stop when you get to a plus 15 point. unrealized gain. Otherwise, if you're going to use a minus four stop all the time, then that movement doesn't come into play.

So if you're stopped out, take the opposite setup, only if you're stopped out in the first 90 minutes. That way you're not having to sit there longer throughout the day. And again, it's just kind of a way to keep your wrist contained using that four point stop.

All of this you really starts from the risk side first, and then you branch into the reward. And so limiting your drawdown, limiting your daily loss limit, and then the cumulative of multiple days, limiting all that so that you can be there to trade another day, you can be there to potentially see those bigger winners is the most important thing. If you have these...

Big profit swings where you have these huge up days and then they're followed by huge down days or you're blowing up accounts and things like that. Like it's not only is it emotionally, I imagine, emotionally draining. I've actually been in the fortunate position where I never, early on I had that stop parameters and things drilled into my head so strongly by a couple of mentors that, you know. Yeah, I didn't take as much risk early on, but I was able to kind of methodically grow my account and then stair-step my way up in contract size and just never have like a major blow-up and never have a...

catastrophic profit swing. So yes, while there are times where I could make more, that comes with the potential of losing more. And so I choose to kind of keep it a little more even, bring down the trough and raise up the valley so that I can kind of keep my P&L a little bit more just chugging along, if you will, versus having major drawdowns that can really derail you. So that's the 15 minute trade. That's really all three of the strategies, the retracements, the one minute and the 15 minute.

The couple of, I guess, final takeaways, you can do one of the three, you can do all three, you can do two of the three. You don't have to take every trade. I will trade the retracements and the one minutes in one account. And then I trade the 15 minute in a completely separate account.

That way, like if I'm, you can do them all in one account, but then what you're going to have happen is you're long the 15 minute and you might trade different contracts, different contract size with the 15 minute. A lot of people trade smaller because it's a bigger stop. Minus four, obviously wouldn't be as quite as big, but it's still larger than two points. So let's say you traded.

four contracts with the retracements in the one minute and two contracts with the 15 minute. Well, if you're long a 15 and then you get short a retracement, now you're kind of minus two. And so it can look a little funny. So I trade those in separate accounts.

And so the retracements in the one minutes will be in one account. So I'm not taking a 50% retracement at the same time as I'm taking a hammer. And the 15-minute can kind of just chug along in the background.

Some people will trade the micros on the 15-minute opening range breakout with a couple of contracts and then trade the minis with the retracements and the hammers and inverted hammers. But that's essentially just a preference thing. Really, the chart setup that I use, that right chart always stays the 512, and then the left chart, the middle chart, is my five minute, my one minute.

If I want to toggle up to the daily, then I can do that. But otherwise, that middle chart is the one I can toggle. The right one stays the 512 because I'm always using the Hakanashi with it.

And again, you don't have to trade retracements. You can just trade the hammers. You could really just trade one of the three strategies solely. The 15 minute is going to be a slower, steadier, not steadier, but just like you're only having potentially two trades at most a day. And there's going to be times where you can go a whole month where it's just kind of a slow, drab, quiet month.

But if we're talking long-term, bigger picture. then having, you know, a slow, simple approach is totally fine. So the retracements, that's, you know, that's how I got my start and still near and dear to my heart.

But having the hammers and inverted hammers along with a 15-minute just allows for a really good any-environment-opportunity approach, kind of having that toolbox with, you know, a hammer. a screwdriver, and a pair of pliers, you can pretty much get any type of fastener out of the wall, if you will. So having a couple of different approaches is good, especially when you're focused on one market in one timeframe. I've always used Thinkorswim from day one. Growing up in the Chicagoland area, I had access to those firms, Thinkorswim, Infinity Futures.

And so the I'm just used to thinkorswim charts. NinjaTrader, totally fine. Any platform is fine that you're comfortable with.

Most of the smaller platforms have all been bought up by NinjaTrader, so that's a fine one to use. If I was to start completely fresh from right here, I would start with the one-minute chart. the hammers, the inverted hammers, and I would trail each bar. And that's it. And that's how I would, you know, kind of...

build the skills and the patience and, you know, the approach is extremely simple, but being able to execute it and follow that plan and trail each bar and to manage your stop and become comfortable with, you know, sometimes getting ticked out of a trade, then having it run 10 points or getting taken out of the trade for six point profit. And then, you know, It takes you out and then it keeps running for 10 points. Like just taking those kind of moderate profits and then moving on to the next trade in a repeatable way, that's really where the value in trading is. You know, if you're just going to catch one home run and call it quits, you have to have such a big amount of money invested. You know, it's like for the people that are kicking themselves that they didn't buy Bitcoin.

It's like, well, if you had bought one token years ago and you had one token now, it'd be $100,000. Well, it's probably not very life-changing for most people. Bitcoin's not the greatest example because to go from $200,000 to $100,000, even if you only had 10 Bitcoins, that would be an enormous return.

But the... piece that people aren't considering is who in their right mind is still holding Bitcoin from a dollar to $100,000. You have to be able to take profits along the way and keeping some on the table is good.

That's why I like to trail my stop, but we don't want our stop to be so far away that our unrealized gain you is like 10 points, 20 points, and we let it come all the way back and turn it around and stop us out. So the people that are still holding their Bitcoin that they bought at $10 and they're still holding it now at $100,000, those would be the same people holding it if it were to come back down and be worth $500. So the concepts of trading can carry over to your other investing approaches. And that mindset of trading can really do a lot. There's a lot of parallels between sports and trading and life in general.

But as with anything, being very diligent and focused with your efforts and not becoming distracted is a large part of where success is formed. You know, you can... Go on a diet and be distracted and jump to 50 different diets and never lose any weight.

Different workout routines, different sports, different this, different that. You have to be able to stick with one approach for long enough to get through the ups and downs and to come out the other side successful. And so give yourself a block of time to pick a strategy and stick with it for six months and commit to it. And then decide, okay, I'm going to keep doing this or I'm not going to do this. Or I'm going to change directions or things like that.

But you've got to be able to stick with something for long enough. Otherwise, if you just bounce around month after month, then as soon as something gives you a hard time, you jump ship. And then you look back a couple weeks later and it's like, oh, man, that strategy was working really well. And I'm doing something totally different over here.

So a few parting words as far as. strategy and sticking with things goes, but all in all, it's, I think, most important to be patient and stay disciplined. And if you can do those two things, then the trading strategy can become the easy part and the emotion, the mindset side is what you'll find that you need the most work on.

So if you have questions, you can always shoot me an email, tim at eminemind.com. I hope you have a great rest of your night, and I will talk to you all soon.