Tutorials

Looking to make spare change with low-risk trades in a cheap stock? Here’s an easy one in Uber that netted a $70 gain on 400 shares in under an hour. The stock sells for around $32, making it cheap enough for even a $10,000 account to comfortably handle the margin on four round lots.  We used an rABC pattern with a point ‘C’ high that was established after the session ended. From the time the trade triggered it took exactly 41 minutes to touch the red line where 50%-100% could have been covered. The low went on to touch p2, which would have been worth an additional $70 in profits. One trade like this one every day and you’ll have an extra $35,000 to spend at the end of the year.

We zoomed out on the charts this time, since short-fuse rABC set-ups have been generating more opportunities than we can handle. It turns out that many of them are requiring buy- or sell-stop entries just seconds after a prospective point ‘C’ high or low is in. Be sure to check out the trade in December Silver in the second half of the class. This set-up was meticulously crafted to produce a trade that not only gave us sufficient time to get aboard, but which anyone could have done using the simple rules that govern this entry tactic.

We continued our experimentation with rABC trades on short-interval charts. Some of the trading vehicles we exploited in real time, including AMZN, will appeal only to high rollers who are looking for a quick in-and-out opportunity to bag their daily profit quota. But please note that the same trade set-ups are applicable using any $20 or $30 stock that suits your fancy.

So-called ‘reverse rABC’ patterns have become our workhorse for initiating trades, since they can easily be substituted for all of the other entry tactics we have used in the past. During this lesson, we saw once again that it is possible to initiate an rABC trade in the lesser times frames, but also to adjust them on-the-fly in accordance with one’s preference for risk. See this tactic vividly in action as we zoom in and out of a trade in TLT toward the end of the lesson.

Another session with rABC trades coming fast and furious on the lesser charts. There are two important takeaways: 1) If a nice-looking rABC set-up fails to produce a winner and gets stopped out, prepare immediately to try again, since your odds will actually IMPROVE on the second attempt; and, 2) rABC midpoint pivots can be used the same as conventional ABC midpoints for purposes of determining the likelihood of a D target being reached. This means that if the C-D leg of rABC blows past 'p', the 'D' target is likely to be achieved. You can 'convert' this knowledge into a mechanical set-up if you prefer to initiate the trade with a limit order rather than the stop orders that apply to rABC entries.

Pivoteers who are new to the Wednesday sessions may have felt like they were strapped into the cockpit of an F-22 Raptor at the end of our hour together. The information will come at you fast and furious, but nearly all of it bears directly on tradeable set-ups that you can do all day long with relatively little risk. Most of the trades are rABC’s, but a ‘mechanical’ entry off Amazon’s one-minute chart is worth the price of admission. Enjoy!

We had our hands full executing all of the rABC set-ups that came our way. The focus was on charts of stocks and futures in lesser time frames, with the goal of finding sufficient day-trading opportunities to make a living at it. Turns out there are plenty of them – more, in fact, than we could handle. But lightning-quick execution skills are crucial in many instances, as is the capability of setting up stop-limit entries, even as they keep mutating with changing ‘C’ highs and lows.  We were particularly careful in determining whether these trades would have been stopped out on closer inspection. You can see for yourself that, in fact, most of them worked out, delivering a steady stream of profits. Another important observation: When you get stopped out of a promising rABC trade, pick yourself up and do it again, since the second try turns out to offer even better odds.

 Our focus on charts of small degree confirmed that so-called rABC trades are nearly always available. Executions can be tricky, however, since the time interval between ‘C’ tops/bottoms and the ‘x’ trigger point can be as short as a few seconds. Watch this recording if you remain to be convinced that it’s worth the trouble.

Once again our focus was on so called ‘reverse’ ABC trades, or rABCs. The pickings were slim on a slow day as we attempted to force entry in several vehicles, including futures contracts and some high-priced stocks. Since this type of trade requires the use of a buy- or sell-stop to get long/short, we used the lesser charts to determine whether trades that looked like winners actually would have been stopped out on the first or second try. The rABC pattern continues to show excellent potential for delivering profitable trades on days when there would seem to be little to do.