Welcome to the Rapid Recap. It’s March 26 2015 and I have a wonderful Rapid Recap planned for you this week, at least I believe it’s wonderful. We’re going to talk about the Diving Board Concept now we will also talk about the some stock.
I’ve broken it down into three categories, we’ll talk about the ABCD patterns, we’ll talk about gaps and we’ll talk about break out, some stocks that are breaking out and I’ve done it this way due to a lot of people getting the course and the technical analysis course and I think it’ll help.
Now I won’t touch base into every little detail about these stocks that we would if we were in the course but It’ll give you some ideas in the current market conditions what’s going on and what’s happening if you have the course and if you don’t have the course it’ll give me some insight in general because I’ll try to keep things as simple as possible.
This week I do want to give me some news and updates about everything first and first things first is we do have the Technical Analysis Course coming in in another box we have another order we shipped out one major to a lot of customers but at the moment running about two and a half to three weeks behind.
For that I apologize and most people understand I had a couple people email me asking me when it was getting shipped out but I just wanted to let you know that we’re running about to and half to three weeks behind on orders.
Just because we never know the demand during these pre-launches or how the manufacturing will go so there’s a lot of components that go with that and that’s one of the reasons that we’re also able to offer such a large course for a discount.
With this in mind today is the last day and once that day is passed on the pre-launch that’s it there’s no discounts in the future as far as I can see for the moment at least not until the end of the year or who knows how long because I don’t play with the price too much on the training. It’s just I don’t have the time for it.
Again I apologize for the delays on the shipments but they will get there even if I have to personally walk that course to your door so it will get there. So we should have that next shipment coming in Tuesday Wednesday and the box is the size of me it’s like 4 to 5 foot box with all that a lot of material.
If you ordered about two to three weeks ago then it’ll be shipped out with two day shipping and you’ll get that very soon.
Again most people have been understanding, just because it’s a pre-launch stage and it’ll get there soon. Also I do have some insight on some future training that I am working on. So if you go to the website you can see here is actually where you can get the technical analysis course if you still haven’t got it that’s up to you.
I’m working on a couple of projects and a few people ask me about the Options Course. So I’m working on a major Options Course so I started putting this on the right side just because sometimes I like writing or you know as the stocks are moving or I’m watching the stock market I’ll work on a book.
I’ll look at charts, I’ll work on the other screens and these are just some of the projects I’m working on and I’d like to knock out the Options Mastery Course sometime this year. I’ve been planning it and the planning process just takes hours upon hours.
That’s kind of my last big projects for the year and i want to make it intense and it’ll only be available to people that have purchased the foundation options course because it’ll just go into too much detail where I can’t have people mix and match some of the discs and section,
So planning on that working on that and just a few books, books for me are relaxing to create because I can just put on some music and work on the books as I’m watching the stocks move and just quickly go back and forth.
We do have that section and with the website as well I did take down the free 20-minute chat. So there’s no more free 20-minute chat just because I found that not a lot of people were that enthusiastic about it.
I did talk to a lot of great people so if you do want to still chat or you want to get in touch and you need a hand I’d be happy to help you or do what I can do just you know go ahead and you can contact me from the contact page and I’ll do my best to cater to you and we’ll just chat and discuss some stocks.
Finally it’s quite possible that next week we won’t have a Rapid Recap and that is because I’ll actually be in Florida for vacation after doing the launch of the course and working on some things. I need a break and looking at the markets the way they are it’s quite possible that a sell-off may be coming so it’s a good opportunity for me to take a break.
Since Christmas time I never took a day off basically and that includes pretty much Saturday’s as well. Normally I take Friday’s off but then I do some work on Saturdays or even Sunday evening so I try and do a lot and it’s time consuming and I need a break. We’ll see if I can get a few minutes away from the family then I’ll try and do a recap.
Otherwise you know I have to go to the beach. I have to take a breather. I have to take a break and that’s just part of life you have to enjoy the things that you do. I really love it, I love connecting with every single one of you. I love listening to you that send me an email that say I got it, or I got this concept and that to me is remarkable.
For some people they love skydiving, for me I love connecting with people, I love helping people and teaching people because I love to see the light bulbs going off. That’s just a personal thing and that’s what I enjoy so you got to stick to what you enjoy.
With this in mind let’s move to some stocks and the Diving Board Principle. Before we actually get into some stocks, I do want to mention the Diving Board Principle and this Diving Board Principle you can apply to life, you can apply to stocks. You can apply it to your health, you can apply to your wealth and you can apply it in so many aspects.
Let’s draw a couple things here. I’m going to use this little empty space on this notepad program and we’ll just draw a few things. If you look at a Diving Board and you structure your life like a diving board it’s going to look something like this.
This is how a lot of people set up their life is something like this it has one solid foundation and you have a diving board.
With a diving board you walk across this board, you come up, you jump then you bounce and you can sink and fall. It’s one structure, it is one thing that’s holding you up, it is the one thing that’s your saving grace.
Now for many people these areas right here this, this is their job, this is their work, this is their one marketing technique in their business. This is their one channel and if you think of it in stocks this is one stock, you invest in one stock and in theory this is why people talk about diversification is because of this.
If you only have one thing then there’s only one supporting concept that’s supporting you it’s this one thing. If something goes wrong if this diving board breaks all of a sudden everything goes down the toilet and you’re missing things.
That is the same thing as if you only have one stock trading strategy which is really what we’re going to base the lesson on. Now if we do this and we go to a different concept, let’s start looking at the structure of a house, pillar, so this is the ground.
We start building out our structure. We start building it out so here now, let’s pretend this is our house. we have supporting pillars and we have a few different things in a house structure. Let’s say you have a few right here that are supporting and they’re holding up this this roof, this house, and the structure.
Now you have all these things supporting your structure and when you have this structure coming in if one of this let’s just say this one right here all of a sudden is gone you still have all these other things supporting you whereas with a diving board concept all of a sudden it breaks and you have nothing.
With this building structure with this Parthenon, with this pillar structures you have a lot of pillars. Uou have a lot of things that can support you and the more things that you can support, the more things that you have supporting you the better of you are.
If you apply this to diversification, in theory the more stocks that you have the better off you are because you have a lot of diversification.
Now I’m not saying just stocks you can apply this to life. In theory if you have one thing that’s real estate. You have one thing that are stocks. You have a one thing that’s coins and one thing that’s antique car.
If you have different thing supporting your structure you are going to be much better off, you’re going to have a lot of things supporting your lifestyle. If we go to individual trading so let’s just say you’re taking a stock to enter the stock.
If you have ABCD patterns, if you know and understand support and resistance, if you know and understand about gaps, if you know and understand about volume all these things now, all of these things, each one of these things now help you and support your decision, your decisions, your percentage of success becomes higher and the higher you can get that the more solid you are, the more comfortable you are and the more confident.
The higher and the more things that you can create that are in your favor the better off you are. Whereas with this diving board concept if all you have is this diving board you only have one thing to make your success.
If all you know about is the MacD and the price then that’s all you have, you have one thing and you have one thing as your saving grace. If all you know about is moving averages then again one thing is your saving grace.
If you have only just the news and you’re always following the news and that’s all you’re following and you’re making decisions based on the news then that’s all you got.
You have one thing in your favor but if you have all those things working together in your favor then you are better off, you have a higher probability, and higher probability of success with confidence, everything working together allows you to create some big returns.
Keep this in mind as we go through the lesson because it’s a very important thing and it applies to everything in life, everything. It applies to your health, it applies to your wealth, it applies to your personal behavior dealing with Jerks.
It applies to just in general anything you’re trying to do. The more things that you can create that are supporting what you want to do that are supporting what it is that you’re trying to accomplish the better your chance of success.
The same thing with school education first you finish high school then you finish college. If you mess up in college you can drop down back to your high school. Then you have your first job, your second job, your third job.
You build the skill set and as you build the skill set you start creating more and more of these things in your favor and the more things that you have in your favor the better off you are.
Here if one thing fails you drop down to the next thing, if the next thing fails you drop down the next thing and so on.
Its building that supports structure and the more pillars that you have just rotate that is basically what you have is this house the structure this building.
Let’s talk some stocks so here looking at the overall market looking at the overall picture of the market you can see that we are, if we take a look at the monthly we are at the highs and I don’t like being at the highs we have some volume that’s increasing above the average I don’t like that.
This means that I’m ready for a pullback always and I’ve at been, we’ve been at the highs for a while and I’ve talked to some you that you know watching the markets been with me on the recaps that have never missed a recap yet know that I’m just watching for it that Itchy-trigger finger to go short on this market.
You know any opportunity that’s what people are watching out for so. Looking at this upward pattern if we break this upward pattern we could have trouble another critical line right here is another one thats could spell trouble.
You’re watching this level and you know if these stocks they don’t hold up right here you could see things going down further and you can see right here on the daily we’re testing it here, we tested it here and we’re breaking it now and we’re increasing in volume this could be troublesome.
If we get down here it would be no issues, no issues that we can get down here if it continues the sell-off. You’re basically watching the health. A 50 percent retracement in a market would still allow it to be healthy.
If we look at the long-term picture you can see that this market here going up a slight retracement and then it continued going higher right here nothing was wrong with that retracement. The same thing here if we retrace to the fifty percent and I just want to show you something interesting that from this market where the fifty percent level is.
If you take the Fibonacci, those of you that learn Fibonacci in the technical analysis course, look at this we take that Fibonacci, we drew it out, Fibonacci retracement 50 percent right here. Look at where it’s coming it’s coming right to this level right to this level right here.
The stocks can go down to about 13,000 and nothing would be wrong with that move you can see that it’s hitting it over here. Let me just draw it out for you little bit. So we have a little hit right here, we have another few points of support and resistance right there.
We have the points right here that’s our fifty percent level. That’s a fifty percent level and nothing would be wrong with that stock. Looking at the overall market we are a little high and if we have a pullback it would be fantastic.
It would be fantastic because they create new charting opportunities, they create new chart patterns and it allows you to get into the stocks at a lower price.
That’s what I’m watching for and you can do this analysis on the SPIDERS, same concept. If all of these things are in alignment meaning multiple things like we talked about with the house, with the pillars. Now we have the SPIDERS, we have the Dow Jones.
If we do the SPX the same thing, if we take a look at the QQQ you can take a look at it and it is the same concept. You have the concept the more things in your favor the better your percentage. So we take a look at all these things then you start looking at the stocks individually, what’s going on with the stocks are they powering higher or they just isolating.
If you look at the Apple we’re just isolating we’re not powering higher. We did a retracement popped a little higher and then doing another little pull back so in theory again for those of you that are looking at the ABCD pattern here could be you’re A, here could be your B, B to C, then C to D would be down here.
If you draw it out, we will go right here A to B, B to C and C to D but this is a short term ABCD pattern. If we look at the long-term ABCD pattern we could look at it like this. So which one is it? Depends on your time view, time horizon so we’ll see how things pan out, we’ll see how the volume goes, where things move but this one’s been on a longer-term trend powering higher.
Here’s our other ABCD pattern, A to B, B to C then C to D, when the pattern completes something else happens usually. If you start looking at this you start looking at in a bigger picture maybe that light bulb is going on, it’s going off.
Let’s look at some other ABCD pattern so this is the first section we’re talking about some ABCD pattern. IBM you can think of it like creating an ABCD pattern the same thing. So here we have A to B, B to C here sideways and C to D could be going this way.
You can see that in this stock we had rejection a handful of times at these levels, at those levels we had rejection so anytime it comes up more than likely for now until things prove otherwise we will reject those.
P&G, same thing ABCD structured let’s look at how that breaks down lets get a thicker one. A to B, B to C and C to D, see how that’s moving we have kind of a triangle pattern in there. It started to break right here on this level and then tried to retest it but its coming back down so we have these structures again coming in place.
We have SanDisk. SanDisk here’s a classic couple of ABCD patterns for you. Again here we have A to B, B to C, and C to D. Let’s remove that.
Now we go again here’s another one A to B, B to C, and C to D classic and you can take a look at the critical charts if you have the free 30 days or even on some of the recent charts just go back go back on Sandisk.
You can see there’s the pattern. What is the technical analysis it tell you, it tells the crowd behavior human crowd behavior, by the time people hit at this retracement pattern these shorts from here are buying back their shares.
Then again they re-short it or new people step in and they want to short the stock or they sell their shares because they got high enough, it’s a comeback to even. That’s what happens to these ABCD pattern.
American Express here we go same thing ABCD pattern here we are. We got A to B, B to C and C to D. If you look at another one A to B, B to C, and C to D so that one could go lower again depends on volume.
You can see here we have this volume right here starting new pick up a little bit just look at that take right there starting to pick up so watch that support line right there of the lows on that swing point and you’ll see how that stock progresses but so far it’s moving based on the technical, the way that it should.
Finally GMCR what a beauty, so here same concept the ABCD pattern we have A to B, B to C then C to D and you can see how that one’s playing out. Again there was your little channel, retracement if you’re noticing it and in between you had some ABCDs right in here as well.
You did have those but if you look at it on the longer term because we want to trade confidently, we want to trade relax you do have some other little ones but look at the long-term ABCD created really nicely moving well, there’s your higher volume spikes right there and your entry point.
You know you have a few, you have another one that could create after it breaks this one and you had another one that was on this retracement. There are a lot different opportunities but just depends on your trading style so there’s your ABCD pattern on GMCR.
Let’s take a look at some gaps, actually let’s take a look at some breakouts, stocks that are moving well. Facebook during the trade since this break out here and stocks pull back they do and this one day down erases three days of gains and people get worried about taking profits as the stock goes up into strength.
As the stock moves in the strength you have to take profits into strength. I know it sometimes painful. I know that sometimes you have to pay commissions 5-10-15 dollars whatever if you got to make a phone order on $50 dollars or however much it is.
It’s painful because okay and then it continues move up and you say I shouldn’t have sold it but when these days come, sell-off days you smile, you smile because you took some profits as that stock continued moving higher because one day can wipe out 3-4.
Look at SanDisk one day this one day wiped out was it two months of gains so if we go back to Facebook this one day only wiped out three days of gains; this is why you take profits in the strength. This business is about risk-money and management probabilities and that’s what it’s about.
Taking some shares in the strength and now you’re comfortable, you have a comfortable setting right here if the stock comes back here and bounces now it’s kind of holding up a little bit here but you’re waiting for this pullback and now if it bounces you can add to your shares.
If it comes back you took half of your shares off and then you have this as your stop, so that way you’re back to your break even. So maybe only took profits on half of your shares and the others you broke even but you’re profitable or at least a scratch, your scratch trade.
You want to keep those risk and reward things in your favor it’s about that risk and reward.
Here again breakout FRSH same thing. One day wiping out two days’ worth of gain. The stocks been moving well, popping higher and again take profits in the strength a healthy retracement the stock can come back here because of that gap right there.
It can come back here and then power higher and nothing be wrong with the stock. That’s okay seven percent on a stock like this because it has move so far and that’s fine, that’s fine, it’s normal and it’s healthy, people have to take the profit it’s human behavior.
It ran up pretty quick pretty fast that’s just part of the markets, part of the human psychology that’s the way the market works. So always take profits in the strength.
ESPR, same thing here stock continued moving higher when they move too high too fast they can retrace and here we are retracing and then bouncing again. So again here’s that gap these gaps can be trouble because they weaken that stock.
With this in mind let’s move on and talk about some of the gaps. Nike what happens with gaps, gaps typically fill, they fill because they’re weak. It’s like having a lot of holes in your roof or in your pillars. So here’s the gap, stock broke into the gap right continued to sell and we fill the gap, filling the gap means it gets into the gap and then it bounced on that gap so that’s what gaps do.
Here’s another one we have, this one ran across my screen talking to somebody last week. So here’s the stock popped higher. We have a gap and gap is the area of weakness right here. So what can happen?
Well we started getting into that gap right around here, we are pushing and pushing down the more you’re pushing on something the more likely it’ll continue to go lower, it’s like a drill hammer, it’s like a hammer pounding.
Here we get into this gap and you can see we’re getting into it and it’s coming back up to retest it, probability and chances are it will reject it and continue to roll over to come back to this 61-62 dollar level to the to this level right here and then after that who knows we’ll see but it just really depends but typically these gaps get filled.
Here’s another one I’ve been watching, if this stock breaks here because of this gap. Actually let’s start with Netflix first right here. I was watching Netflix here there’s a better way to do it, watching the stock right here, there’s a gap right down here.
Right below the stock we have this gap, major gap the size of a gap does matter. We have this little support line right here the stock bounced here came back pretty much bounced here, bounced here so we created a support line we can draw it.
Broke through that support right there, tried to come back and rejected that and now its weakening, the volumes picking up and we have this gap right here.
Now for me I go short right there at this level nibble some meaning go lightly and if the stock comes back here to this level and starts getting in like that CYBX, we talked about it. If it starts breaking this right here or right around this level right there I’ll get into that stock and get in it and then we’ll go down probably all the way to right around this level 350.
That means the gain on the profit would be from let’s just say 4 or 3. Let’s say I get in it late at 397 and I get out early at 356 that’s still a 36-34 point gain something that I’m watching for the long term so we’ll see how this pans out but you know you use five to seven dollars as a stop in stocks like these they’re bigger movers so you want to be careful.
Now same thing with Amazon so here same thing here look at this pushing down, pushing down again still not ready. Still not ready because if it’s not ready and it doesn’t break what can happen stock can pop higher for 10 to 15 points. So you’re waiting for that stock to break lower and drop because we have this gap here.
This gap is an area of weakness and if it breaks this level right here, we break it right here I nibble. If we break this level I add big I add large, why? It’s because more things are in my favor. I add one pillar, two pillar, three pillar, or four pillar.
What is in my favor? I have a small position that’s one thing in my favor. I add another thing my pattern, my volume, volumes’ picking up right here starting to if that comes in that’s another thing in my favor. My support and resistance and the gap all these things start adding up.
The more things that I can tally that are in my favor the higher the probability of success and that’s when you go larger, that’s when you go bigger. that’s when you make the big money is when you allow these stocks to go 335 to 311.
Even if you’re late and early so you go maybe just for nineteen 20-point gain, some stocks aren’t even twenty dollars and this stock you can get 20 point gain in a short run so that’s what I wanted to share with you today is these different things so we talked about ABCD patterns like with SanDisk so we have ABCD.
We talked about same thing with American Express. Also we talked about the gaps like Nike, you can see it filled the gap. CYBX is starting to break into that, probably it’ll fill.
Amazon also same thing weakening, Netflix same thing, so you watch these leader companies this is why I am watching these leader companies to see how they’re acting and behaving because this also tells me how the market will pan out.
That’s why I say we may be coming in for sell off and you know you always want to take some profit in the strength like Facebook, like Fresh, or ESPR so there’s a few of those that if you’re long fine. There’s nothing wrong with being long and nothing wrong with being short it’s just which side of the trade you’re in.
A lot of opportunities that you have even STAMPS we posted this on the recap of the critical charts and this one’s popping higher. You want to know where the ABCD pattern, well here it is. I can pull these out anytime A to B, B to C and C to D, does that look familiar?
Cracker Barrel some of these things I don’t share all the time on the Rapid Recaps because for many people that are beginners its over their head and that’s why I have the courses because for the people that really want to learn that’s what it’s all about.
ABCD pattern in this one can you spot it? I’m sure you can, so here it is after I zoom out you can see A to B, B to C and C to D, that’s the projected move and that’s the long-term. If we look at the weekly look at that that’s the long-term. That’s why I was looking for this one to the upside was because of the long term.
Now the weekly it’s almost Friday and we’re going down 1.2 million shares. We popped on 3.1 million shares, share calculation this is something maybe that we can get into later in the future.
As you start looking at the total volume and you start looking at the numbers in detail you start spotting these things and the more things that can be in your favor the higher your probability of success.
I’m not saying you’re going to have winning trades every single time but the more things that you can have in your favor the better your chances, the more comfortable you are at trading and just a more peace of mind.
I hope this was insightful I hope you learned a lot. Remember about this Pillar Concept and Diving Board concept. If you have a diving board just one thing in your favor whether that’s in life one thing, one job, one revenue income stream or one investment it’s not a bad thing.
It’s not a bad thing when you’re first getting started as you start getting better you may want to diversify.
In terms of stocks you shouldn’t diversify more than five stocks if you have a million dollars and that is personally because you have focus and attention that you really need to cater to. So if you have a million dollars 5 to 6 stocks is more than diversified.
Otherwise one or two stocks is okay but it is a little more risky but then you should also have other things in your investment so maybe real estate, maybe coins, may be antique cars that’s investments but if you talk about income streams maybe you have a business, maybe you have stocks, maybe you just residual income coming in from something you’ve done in the past.
Whatever it is, you’re building these things and the more that you can build, the more things that you can build in your favor the more solid of a support structure you have so that’s what you want to do.
If you’re choosing a stock is the same thing you want to choose as many things, you’re watching out for many things in your favor so that way you have the highest possibility of success.
Thank you for joining me in this week’s Rapid Recap again for those of you that ordered the technical analysis course we will get it out don’t worry it’ll come with time we do have the shipment coming the next set is coming and the minute we get it in, we’ll have that box shipped and ready to go.