All language subtitles for Session 3

Hello, everyone. Today is September
24th, and this is our third session of

Wyckoff Trading Practicum course. I like
the direction that we're going.

I like all of the discussions that we
have. I like a lot of elements that we

have now in the class, just so many
different segments, and it allows us to

think about the market analysis from
different points of view.

I see you, Rick.

Nice. Yeah, nice. Let's go. Let's go.
Yeah. So let's continue with that pace.

I'm going to try to put in more of the
theoretical material, something more

advanced, something new. We're going to
discuss the trends.

We're going to talk about, you know,
more in -depth volume and price

And there are quite a few topics that,
you know, I still would like to discuss.

But this is a lot of.

you know, experimentation through the
exercises that we have. So that's

really great. I'm really pleased with
the class.

Quick announcements.

WMD promotion is going to start on the
25th, which is tomorrow.

October special with myself and John is
going to start on October 10th. That one

definitely do not miss, especially at
this level.

Today, we're going to quickly go through
the bias game.

We're going to look at the markets
because there was a big, big change

And then we're going to look at the
anatomy of the trade through the market

prism as well.

We're going to cover some of the Q &As.

I would love to ask you to put, if you
guys have a Q &A.

And a lot of you are putting those on
slides, which is fine.

Just mention in your email that I have a
question in the slides. So make sure

that, you know, you're going to catch
that. On some of the slides, I actually

not see the question, even though you
guys, you know, tell me that there is a

question. And I see more comments than
questions.

So please make sure that you do comment
and specify, you know, in big letters

that this is the question.

So that would be great.

And then we're going to come back to our
significant bar analysis, something

that we started last week.

This is something that we need to go
into more depth.

So we'll talk about the stop losses and
next class, you know, we'll devote some

time on stop losses and risk control.

You know, what seems to be very
rudimentary, but at the same time, it's

important. So I want to make sure that
you guys have this.

All right, what I wanted to look at,
obviously

everything that we discuss here is for
educational purposes.

I'll stop the recording and read the
disclaimer.

Okay, let's talk about the bias game. I
thought this one was difficult.

And we are studying this pattern a lot,
and by we, I mean all of our students in

our community, and I'm studying this
pattern a lot. And this is the pattern

where, if you look at the whole thing,
you kind of could see that there are

three major volume signatures, or maybe
four, where we have

one segment, and it seems like this is
one texture.

Then we have a second segment, and then
we have a third segment, and then the

fourth segment.

So I want you to, at this level, at a
more advanced level, I want you to think

in terms of textures.

What do you see? How does the story
unfold?

How does the story of the texture of the
price and the volume unfold?

So let's go through this.

So we are having an uptrend right here,
even though not shown, but we assume

that the bias is to the upside. Why?
Well, because there is this formation

here, and that formation seems where the
first initial supply has occurred.

It didn't produce a huge movement to the
downside.

So we are suspecting that this could be
a reaccumulation at this point. So we're

looking at this point for the elements
of reaccumulation in this trading range,

right? Because a change of character
would suggest that we are going to go

the trading range. And because we were
in the previous buys, because we don't

see a lot of selling, and it doesn't
produce a lot of movement to the

relative to the previous run, and I wish
we would have a little bit more of the

beginning of this upswing.

But that trading range.

Our first assumption is the
reaccumulation.

Can we find the evidence of this
reaccumulation? Absolutely.

So look at this segment right here.

Effort to the downside increases.

What about the result?

Decrease, right? So with that, we're
going to say this is bullish.

And now we're going to compare this
supply to whatever supply came earlier.

still feels like it's a little bit
early.

into the trading range for us to make,
you know, a timing,

to make up the timing when the price is
going to get out of the trading range.

This looks like an up thrust, so we're
probably in phase A here, phase B, and

then we are just basically looking at
the reactions.

Okay, so less supply, still bullish.

Then we go to the support level, and
look what it does.

Volatility increases, but...

Relative to the previous places where we
had that volatility increase and volume

increase, it's actually not the biggest
volume signature.

I mean, if anything, we probably are
going to say that the volume in general

went down.

And then we have one bar and second bar
that are reversal bars and a spring bar.

Again, you know, something that... I'll
just come back in a second to this

point, but the test, the test of the
springs, let's discuss that.

And then after that, we are going up. So
we've completed the reaccumulation in

phase C, a lot of points of entry for us
on the spring itself because it's a

spring number three.

And then we are going in this laborious
manner where supply does not increase,

but the price goes up on lower supply.

And we usually would identify this type
of movement as a feather movement.

So it's where both demand and supply are
going down. And not necessarily in this

case where we see that demand is
consistent. So that suggests that, you

there is some buying behind it. So still
some vertical absorption of remaining

supply.

So that's great. Okay.

Then we go into the speculative run. So
let's see the character of this

speculative run.

How would we make a judgment of that?
Okay, well, we want to look at the

signature as well. It seems like demand
is healthy, supporting the run, suggest

a continuation.

This bar right here on the spread
analysis reminds me of this bar. So two

bars where supply comes in.

And by the way, you know, you would be
thinking like the first time.

when that supply comes in it's a very
natural place of where it should come in

because this is where supply at this
level has occurred so we are testing

supply this is something slightly high
this was an all -time high so here we're

just using the vsa uh volume and spread
analysis where the reason attempt to go

down and there are multiple attempts one
two three four so this is a reaction

and the last point right here acts as a
phase C type of point, right? On the

intraday, you will see that phase C
intraday, intraday phase C.

And it's gonna have some volatility
because it was trying to push the price

down.

It doesn't, so that suggests strength
and continuation for the time being, for

the short time being. And then, look at
this two volume spike. So these are the

largest volume signatures.

So therefore, we are thinking that it
contains that supply, increase of the

supply. So from here, we are basically
saying, okay, we saw supply at this

right here.

We saw it here.

And then on the way up, we're starting
to see some supply. So for instance,

here, here, here.

What does it produce?

So as you could see, As we go through
this chart, the main thing is just to

creating this story, keep telling you
this Wyckoff story, what we call Wyckoff

story, right? So what is the Wyckoff
story? We are, you know, narrating this

Wyckoff story right now.

Okay, supply came in first in November,
you know, in this area right here, did

not produce a significant move to the
downside, produced a sprint situation

where the price went up.

Next time supply comes in, this time
supply is really heavy.

What does it produce?

Okay, well, it produces the testing, and
that test is a low or high, so we know

that we're probably gonna fail here into
the reaction.

Where to?

Well, here is our level of where we
should fall.

This actually would be a nice trade.

here a short -term trade just to catch
that increased volatility, short -term

volatility. We see that now supply not
only is the value

selling supply.

So value selling supply.

And usually when the value selling
supply, so like a value investor sells,

usually sells into a strength.

So that's kind of like not a very good
sign for us. It still could be an early

sign that we might have a reaccumulation

and we should have some kind of
reaccumulation rotational pattern.

What does it mean? It means that

some institutions are seeing overvalued
position in the stock at this point of

time and they are selling like a value
investor.

And some of them are actually coming in
and they still see the value way, way up

higher and they are buying.

And that's what produces that rotational
reaccumulation.

Rotational reaccumulation, the
volatility of that is always going to be

somewhere at the beginning of the
reaccumulation. So this is not

what you've been taught before.

Because usually our conventional
teaching goes about the volatility being

phase C, as kind of like this last point
of volatility.

And that might come. But in a lot of
cases, I mean, a true rotational

reaccumulation is going to happen in
phase A and early

phase B.

And the reason why it happens, again, is
because big investors, big companies,

big institutional accounts, they need
liquidity.

They need even more liquidity than the
value.

Now that I'm thinking about this, you
know, of kind of like what would be a

priority because they need big
positions.

So they're willing.

to open up the position, let's say
somewhere in the middle of the price

because they see that the future value
is still somewhere there, up there,

you know, somewhere way, way higher.

So for them, it doesn't really matter
whether they get in into the position in

phase A at the first one -third of the
trading range or in the last part of the

trading range.

It's dangerous about the last part of
the trading range is that there's going

be a low liquidity.

And therefore, they will not be able to
get in into the position or they will be

getting into the position and marking up
the price. And that's not what they

want.

They do not want to mark up the price
out of the reaccumulation on the way

They want to buy it in the
reaccumulation, and sometimes the only

they can do this is during the liquidity
event in phases A and early B.

We'll study this more.

Okay, well, let's continue. So here is
our supply.

So now we want to make sure that that

supply is being absorbed.

There is no absorption and there is a
lot of consistency of selling here on

way down.

So all of this sell, sell, sell.

And now we are waiting because now we
have a new zone where we know that the

composite operator has sold.

We need to confirm that or we need to
see the absorption of

that supply.

at this level. Okay, well let's see if
we have it. It seems that the

subsequent movement to the downside here
has limited progression to the

downside and also the volume signature
is diminishing.

So this would mean that supply also
diminished and would suggest that we

anticipate the rally.

When we're gonna anticipate this rally,
what we wanna see is the character of

the rally.

Is the character bullish or bearish?

What would be bullish characteristics?

Well, we definitely want to see the
expansion of the spread, which would be

confirmed with the increase of the
demand, decrease of the supply on the

reactions, and more importantly, the
intention of this whole rally,

actually here, intention.

is gonna be to overcome the previous
buying climax high.

All right, let's see if we do this.

Well, first of all, intention has
failed, so that raises the big concern

There is no continuation of the trend,
and kind of here we already know.

out of the change of character, that
that's it, we're in the new environment,

are in the trading range.

So from that perspective, we want the
price to commit to the upside after some

elements of reaccumulation right here.

But at the same time, we understand that
we might be in the trading range.

So now we just need to see, would we see
this selling again that came, you know,

as a values selling at that point.

uh value supply so to say all right so
uh we definitely could see

this is so confusing because there are

some down days and then the volume
signature is actually up

all right well let me correct this guys
next time i'm glad that i

caught this

All right, so we are seeing a lot of
interesting volume signatures starting

this bar, and I believe this is this
kind of like this Morningstar bar, or

hopefully I'm calling it correctly, the
Morningstar or

something like this.

Okay, and look at all of these bars
right here.

What do you guys see in those bars and
in the volume signature?

It's pretty heavy.

And at this point, we don't have to have
a lot of supply to move the price

around this level. Why? Well, because we
know that if a true distribution has

happened, so like this is a value
distribution, right?

Some value investor is distributing.

So they sold.

What do they do now during this failure?

They become inactive.

at least for some time, that's what
brings this picture, this reaccumulation

right here.

They sold and then they stopped selling.
And look when they are inactive,

what happens with the price?

It's almost like there is no other force
in the market that would go in at this

low and significantly change the
direction of the price without the CEO,

the big money.

So it drifts because CO is not
interested. It's out. It just kind of

its position, maybe scaled out, and now
it's waiting. And then the price starts

to go up. Why? Because there is no more
selling.

There is no more buying either.

This is a very poor rally here that we
see. Demand is very low on this run

here. And then volume signature becomes
really high in the later portion.

this run so with that inability to
commit to the upside about the buying

climax resistance this volume increase
is going to be interpreted by us as

institutional presence if institutions
are present at this point of

time at this point of the resistance and
considering what has happened before

we're probably thinking that they're
selling and therefore the bias at this

point

might be down for us.

But as we go through the Wyckoff story,
I want you to see that switch between

the bias, right?

So we had the bias to the upside.

Let me just kind of point this out.

Okay, we had the bias to the upside.

After the change of character, we
still...

staying with the bias to the upside.

There was not a big change of character,
right?

Throughout the whole trading range,
confirming the up bias.

Throughout the rally, confirming the up
bias.

Here, we are still in the up bias, but
with the question as to what's going to

be the character of the next change of
character.

Okay, and here we're seeing that the
change of character was larger.

Supply came, was heavier.

So we want to see on the next rally
either confirmation of the up bias or a

bias. We see how supply comes in, and we
are confirming that this is a down

bias. Now, with this down bias, we're
not done.

Because what if it changes again?

I mean, like what if selling comes,
supply is being observed, and then, you

know, demand comes in and just pushes
the price up?

So we need to figure out the rest of the
story going to the right of June and to

confirm or to see the failure of this
down bias.

All right, well, let's do that.

What happens afterwards?

Well, we saw the supply coming in on all
of these bars in this area.

Then what happens next?

A couple of attempts to rally, failure.

Failure. And then again, we see how now
a more

limited supply moving the price easier

to the downside.

Diminishing supply characteristics
produces more result to the downside.

What is it?

It's an ease of movement. It's when the
price starts to move on lesser supply or

on lesser demand, depending on the
buyers.

We do not require as much supply as
before to move the

price even more than we moved before.

So if you can't catch that supply
distinction, then think about demand.

Think about in reverse.

If demand is present and this is a
reaccumulation, wouldn't we have some

more pronounced stopping action that
would not lead to the new

low in the trading range?

Probably we would, right? Or at least we
would have some kind of diminished

characteristics of the supply, which we
had here, and we would be expecting

a rally from here.

Okay, well, very interesting. Let's look
at that diminished supply

characteristics. So the rally has
started here if we're going to use this

when supply was, you know, somewhat at
this level

right here.

So as the price goes down, let's see, we
are somewhere here at this level,

right?

So here is that last selling that we
could analog.

less selling that we could analog,
something like that.

What kind of rally do we have here?

Nothing very serious. Does not even, you
know, just comes to the point of

selling there where they sold before.

And then again, it just being sold with
less supply, but still.

So we can't produce a really good rally.

So that is another failure.

And that is slightly different from what
we've seen before.

And then there is a continuation of that
reaction,

and the price goes to the previous
support level. But look again at the

signature.

So the volume is actually diminishing,
suggesting that both supply is

diminishing and demand is diminishing.

So how the heck would we be figuring
this out?

And I think this is where a lot of the
mistakes are being made.

And I see this from your homework. By
the way, thank you for sending quite a

of homeworks, both Monday and Tuesday
classes are just like insane with

this cycle.

So I'm receiving probably around, you
know, 60 to 70 % of

participants in the class that are
sending the homework. So which is great.

could see where the class is, where you
are individually. And I know that.

This is a common mistake.

And again, I think that the mistake
comes from our generalization, and that

comes from technical analysis in
general, and I think that also comes in

how we were taught.

Because we're basically being told this.

If the volume signature goes down,
that's bullish.

All right, well, absolutely, I would
agree with this.

But I would agree with this in the
context of the structure that we're in,

the context of how the volume was
distributed in that structure before.

Not necessarily, I don't want to just
look at this.

This does not give me any clues as to
the bias.

And that's why there are a lot of
mistakes like this.

Volume is going down.

Supply is going down.

This means that it's bullish.

But what has happened prior to that?

What is the story that led to this?

Okay, well, we told this story before,
so we know that supply has come in and

they sold off the top right here, which
is also an institutional way, a value

institutional way of selling into the
strength and distributing their position

like this.

But if we just look at this area right
here, at least you should raise a

question, what is happening with the
demand?

If this is an accumulation, how would
demand act?

Would demand increase or decrease?

And also, how would the price act?

Would the price go up or would the price
go down?

And we just don't see any demand on this
rally or on

this rally either.

And we are still within the confines of
the downtrend that started from the

latest high.

So we can't really see a change of
character in the demand.

And therefore, we are still assuming
that the previous bias that we said was

changed from up to down stays.

And therefore, this is a distribution.

Let's go through the questions now.

After the bind climax, that comes from
Simon, where is the automatic rally and

secondary test?

I'm finding it difficult to locate.

Okay, so bind climax, and then we are
going to be thinking of the

first reaction as a change of character
reaction, and the law of that reaction

is going to be the automatic reaction.

Then we would be looking for...

a change in the swing, right? So why is
significant bar reversal is so

important? Because it identifies the
swings for us where we see reversals.

So I'm just kind of approximating here.

Here are the swing.

So something like this.

And again, I'm just trying to
approximate here, just visualizing this

quick.

Okay, so these are the swings.

So therefore, it's important for us to
define that first swing that is going to

be a change of character, and then place
the automatic reaction blow at the end

of that swing and see where that swing
is going to change, where it's going to

reverse. here or here and therefore our
labeling is going to be such that

the first swing low is going to be an
automatic reaction low excuse me

and then um the next high of the next
rally is going to be a secondary test

that's how we would define usually uh
not a

big deal

When we look at all of this, let's
practice again, buy -in climax.

Where is our swing?

Here is our swing.

Automatic reaction, where is the next
swing? So the last bar to commit was

one. Here is the high.

We have two commitments to the upside,
so we know that this is the next swing.

So this would be a secondary test, and
this is our phase A.

And we've done this here as well.

All right, next question from Dmitry.

As a high -level view of thinking here,
and I love those, can we simply observe

the drastic amount of selling at the top
of the trading range while observing

minimum buying at the bottom of the
range?

This would start our distribution bias,
then dive into the details.

Is this a good way to start the analysis
of the trading range?

Yeah, absolutely. I love this, Dmitry.
So let's go through this.

So Dmitry is just basically saying...

why not look at the top of the range and
we usually, you know, that definition

of the institutional selling zone or
institutional buy zone, right? So

we see how the volume signature is
concentrated here on the bars that are

at the resistance or off that
resistance, right? So somewhere here,

here, all of those.

Here we go.

So in every time, you know, we go into
the zone at least twice, right? So here

is where the selling is the most
pronounced.

So we know that the majority of
institutions are here in this volume

As the price stops and moves down, stops
and moves down, we know that the

increased effort by institutions to sell
starts to produce the synchronicity

with the price, with the result.

So therefore, yeah, we would be thinking
that this is a buy is down.

Another idea from Dimitri is, well, what
about the demand?

What if demand picks up? And by the way,
look at how demand picks up right here,

around this area. So let's identify
these bars.

And I think that this is where for us by
coefficients, there is a lot of danger.

Okay, let me just define this.

Yeah, I think these are the two, yeah.

Now I need to redo this whole volume
signature, it's very confusing, so I'm

gonna tell my content team to change
that.

Okay, so what is happening here? And by
the way, Not only that, I mean, like if

we take this idea from Mitri, and we've
talked about this in the previous cycles

and in WTC.

So think about the value zone where
institutions are selling or buying.

And that value zone actually changes,
right? So it shifts.

We saw, you know, some buying around
these levels here, here, here,

here, and then a bunch of bars here.

This is... All was buying.

Look at where they are buying again. At
least there is an attempt to buy.

And coming back to Dmitry's point, there
is no demand signature.

There is only supply signature. So that
would be another way of looking at this.

So thank you, Dmitry. But look at the
value zone at the beginning of 2018, and

then look at where they're trying to
buy.

And it doesn't produce a lot of buying.

Even if we would be comparing two
analogs, let's say this rally, and we

would be thinking like, oh, maybe there
is a selling climax here, like we

experienced here.

And look at these rallies.

They are so different than what we're
seeing in this area. So the quality of

rallies, or rather the response of the
price towards the

demand that is coming in.

is different.

It is not going up or rallying as much
as

it did in the late 2017.

And that's the biggest difference.

And that suggests that there is some
selling that goes in as the price goes

So it just confirms and also allows us
to think about another point of entry

here around this area. And obviously
this is an LPSY.

Another question, can you explain the
concept of identification of phase C on

single bar intraday, please?

Okay, so we are probably talking about
this bar right here, just because this

a spring and phase C.

Okay, the intraday for this bar is going
to be such that we had a close of the

previous down bar, and then we had a gap
up at the open.

And most likely, there is still a
continuation of the momentum from the

day, which was down. So therefore, we
are going down intraday, and then we are

going up and closing slightly above.

So this selling was produced by the
prior day's momentum.

We saw this bar right here, and it was
going.

and it had some increase in the volume
signature.

And then demand comes in and pushes us
up.

So that just basically defines the
change

of balance between sellers and buyers.

And for the second time, after this bar
right here, it defines the winning by

the buyers.

And we are doing this for the second
time, and now instead of going into the

reaction here, we are actually creeping
up.

And as we do that, we are not doing this
on the high volume signature, meaning

that supply is really low at this point.

So they just basically consumed whatever
supply was left here by weak hands.

And that absorption

does not allow the price further to go
down and the price drifts up.

Usually out of this feather situation
where we have vertical absorption, we're

going to have a momentum. This is a very
good options play that I usually would

do.

Okay.

Okay, last point and we're going to move
on.

Just to follow up on the last point you
made, who is the big buyer?

They are to create such a high demand
signature at the failed rally attempt in

September labeled major sign of
weakness. That's a good question, Mitri.

so we're talking about this volume
signature and this spot, right? So let's

think really quickly, who are buyers
here?

Well, first of all, let's define them as
institutional and non -institutional

type.

Right away, instantly, we're thinking
institutions.

Why? Well, because retail is not going
to produce such a high volume signature.

I mean, look at the number of shares
here. I mean, like, is retail trading in

and 100 million, you know, trenches?

No.

So this is a collection of institutions
that are being caught on the wrong side

of the trade. So these institutional
hands are actually weak hands.

Could the institutions be on the wrong
side of the trade?

Again, something that I want you to
change in your thinking, because usually

we're saying that institutions are smart
money.

No, not the truth.

There are a lot of institutions that are
making a lot of mistakes, and I work

with those because...

They're the same type of people as us.

The only difference between them and us
is that their nine -to -five job is

actually to look at the markets, analyze
them to make the best decision with the

knowledge and skill that they have.

And they make mistakes.

Warren Buffett makes mistakes.

I mean, you could look at his whole
history of investing and, you know, you

find so many mistakes.

The latest one that I remember just off
the top of my head is his trade in IBM

where he basically was wrong and his
movement out of the

stock produced a huge gap. That was a
mistake. Was he an institutional

buyer?

Yes. Was he strong hands? No.

Not on that trade. He was not a
composite operator on that trade. We do

consider not smart money to be a
composite operator.

And actually, I'm kind of bringing a new
definition of the composite operator,

what this is.

Composite operator is the collection of
smart institutional money

that are hurting.

on the same trade on the right side of
the trade.

Everyone else is weak hands.

And then composite operator is going to
be, you know, derived

or composed rather from multiple
institutions.

with different investment styles. Some
of them are going to be value investors.

Some of them are going to be growth
investors.

Some of them are going to be momentum
investors. Some of them are going to be

just professionals that are doing mean
reversion trades and momentum trades,

kind of like that high frequency trades.

And if they are on the correct side of
the trade, they are part of the

operator.

So coming back to Dmitry's question, who
is actually...

So bold to come in right here. And for
what reason? Well, we've defined that

those are institutions.

Those are weak hands.

Now let's talk about their reasons of
why. Why would they come in? I mean,

what's the logic there?

Because we look at the same spots, we
look at the same positions, and we would

be thinking here, is this a sprain or a
major sign of weakness?

And it looks like a sprain, right?
Because there is that, again, in

diminishing volume characteristic into
the potential phase C, and then suddenly

we're picking up the volatility right
there, meaning that somebody's buying.

see that buying.

So why would they be buying here?

Well, they see some value, right?
Because when we think about weak hands,

what is the weak hands value?

In the whole price cycle, we would be
anticipating that weak hands are going

start... actively investing at about one
half of the trend.

And they're going to be buyers on the
way up and they're going to be enjoying

it. They're going to be having a lot of
profits. Now think about 2017.

Think about 1999.

Think about 2007 as those kind of like
years where

we have that last climactic run into a
big, big cycle and

Weak hands are just enjoying that
because there is a lot of profit.

pick seems to be working.

Those are the times when you should be
making lots and tons and tons of money.

My 2017 was a really good year.

1999 was a good year.

2007, I don't recall completely and
exactly, was not extremely active with

trading at that time.

But those two were just great,
phenomenal, because of that speculation.

And we kind of see that from this leg to
the upside.

So what happens next?

Once they have the profits and we go
into the distribution, the reason why

distribution happens is because weak
hands are getting excited.

And with that excitement, they are
creating liquidity for big hands to

Again, this word liquidity.

It is so important to understand how
institutions are creating liquidity

the trend at which spots.

Again, they are not necessarily will be
buying on the way down. That's not their

desire. They want to sell on the way up
into this trend where there is a lot of

liquidity and a lot of value.

So here is a sell, here is a sell.

Now, weak hands, when they see this,

short -term value after such a big,
prolonged leadership move,

they're going to come in and they're
going to start buying.

So there is some buying here by weak
hands, and there is some buying here by

weak hands again.

And those are institutional hands, and
they're going to fail, and they're going

to start capitulating those positions
somewhere here and then somewhere here.

So this is late capitulation.

All right, great questions.

And again, I think the So those are
great questions. Why? Because I think

we understand the material better with
this group. So these are much more

complex questions.

All right, guys.

Next chart for you. Next bias game.

So look at this chart and then analyze
it. This is your homework.

I want to encourage you.

to analyze this chart before you look
for the solution.

All right, so don't try to find the
solution before you analyze it. And

send me your first version of this
analysis, not the one that you look at

All right, this is the homework, so
let's do it. It's very interesting.

Yeah, this is going to be a lot of fun.
All right.

Okay, let's look at the markets. And I
need a volunteer.

So just say, yes, I just want to go
through the markets with you. I think

very important for us, you know, to kind
of see what's going on.

And then we'll talk about the SunPower.
Hi, Eric. How are you doing?

Are you there, Eric?

Hello, hello, hello. Speak up.

You there? I can hear the background
noise.

All right, Eric.

All right, so some technical
difficulties. Anyone else?

Anyone else really quickly want to go
through the markets with me?

Just share your thoughts. Just tell me
what you guys see.

No? No takers? All right.

All right, so let's look at all of the
markets, and we have S

&P, NASDAQ, Russell, the Dow.

Hello? Yeah, there we go.

Yeah, sorry, I just had to find the
switch over from the speakers to the

headset. no worries no worries okay so
when we look at all of the markets they

kind of look the same right so we are
trying to get above the resistance line

right here and we basically so how would
you interpret this eric

uh well there's some synchronicity i
guess everything's kind of

seems to be behaving in in unison And
when you say synchronicity, you're

probably referring to the synchronicity
between these four instruments, right,

that reflect the show on the market.

I was thinking more even synchronicity
between what? Synchronicity between the

effort and the results.

So when we look at today's bar, do we
have that?

Yes, we have increased effort.

over yesterday uh or sorry if you go
back two days you see in a lot of cases

uh an analog bar and uh more more uh
volume and more results so more effort

results yeah yeah so that would suggest
automatically what what should happen

next we have a synchronicity of movement
are we in the

reaction are we in the rally are we
going to continue this reaction

We haven't seen any stopping action yet.
So we're coming off the top and the

volume is increasing.

So to me, that suggests that we're not
necessarily done yet.

Okay, great, great answer. Because see
what Eric just said. He said, I don't

any stopping action.

That would be a prelude to a trading
range and to the change of bias,

change of bias. And we don't see that
yet.

There is a little bit of a demand tail
on all of them, so we should recognize

that.

But we also recognize that the main
force today in the markets was to the

downside, not to the upside.

And I like how Eric actually noticed the
previous bar that showed that, right?

So like this bar right here, slight
increase in the volume signature, but

of movement, and now it's even easier
movement.

Again, this bar right here, and then an
easier movement again.

So we are seeing how on all of the
averages, supply came in, started

to move the price down.

I'm sorry. And today, we see that ease
of movement even more expand.

So the price moves to the downside even
easier.

So in the question here, as Eric has
mentioned, is, well, when are we going

stop, right? Because we're still long
-term trend to the upside.

Our intermediate trend is a big trading
range. And our short -term trend now is

this reversal. And we kind of see this
was the last commitment bar to the

upside.

And my assumption was that we're going
to see the new high, all -time high

September now I'm kind of you know
doubting that that we're gonna do that

least in September and you know the
reversal happens once we

violate the law of the last
institutional commitment to the upside

did today and we've done this on well we
can't really

Look into this. This was the last of
those. That's a question I had, Roman,

I'm looking at the SPY.

Yeah.

And, you know, we came out of that
August trading range.

We, I guess, technically made a new
high.

Well, kind of. I mean, like we made a
new high relative to, let's say, like

low, right, and this high. But this is
not a higher high, right?

You're just saying, like, we made a new
high here. Okay.

Yeah, we ticked above it.

Did we?

Well, I guess it depends what instrument
you're looking at.

Are you looking, like, at cash?

I'm just using the SPY.

The SPY, okay.

Okay, I'll stick to looking at your
chart. So we didn't make the new high.

So, you know, to some extent, maybe you
say, okay.

Are we going to see a little bit of it?
Because we have been in a little bit of

a trading range for the last couple of
weeks, right?

Or a week and a half anyway.

And saying, okay, are we going to see a
bit of backing up action here? But today

was pretty severe.

And we came right back down to the top
of the August trading range we were in.

I wonder what analog also we can use
here in terms of the bars, right?

you've talked about today's bar.

When you think about the analogs, think
about the same action, right? The

reaction to the downside. Well, we have
it here.

Yeah, at the end of July.

At the end of July, right. So we also,
as you said, a trading range. So this

right here, right? This is the bar where
we had.

that ease of movement to the downside.

So I think I'm identifying it correctly,
this bar right here. And then compare

those.

So what do we see? We see that there is
slightly more supply that's coming in.

And that's what's so disturbing after
the lower high.

Because usually that's a distributional
pattern.

The rally is fading on low momentum.

And then, we have a lower high and then
we have a supply coming in. So it's kind

of almost like a perfect conventional
reversal after the momentum

is done on the lower demand signature.

And then look at how these two analogs
are playing with each other. First of

all, we are starting lower.

Secondly, the close is much better today
for the bears than it was back then.

and then the volume signature actually
increased.

So if we are going to have a
continuation of the current reaction the

did at the beginning of August, we
actually could expect that it's going to

below this level.

And I think this is where a big
capitulation could be happening.

I think that the bullish case scenario
now with this reversal is most likely

we're just in the trading range.

and then we're just coming back, and
then we're just doing this.

This is something that we've talked
about in the WMD sessions, you know, in

sessions here as well, because we said
that after the huge rally, we had that

change of character, then we had a move
up, then we had that volatility of this

reaction right here, small trading
range, we got up, and we were saying

we're probably in some kind of upsloping
structure.

So it would not be surprising if we
could get back to the support and then

consolidate again. So this would be a
bullish pattern and then a continuation.

This would also make a lot of sense
because going into the end of the year,

there are a lot of events.

Brexit, China, Iran is extremely
important right now. I think that we are

paying less attention to a situation
with Iran than we pay attention with

obviously.

China influences, the relationship with
China influences the market the most.

But imagine if Iran is kind of playing
these geopolitical games like North

did a couple of years ago.

So they are irritating the other
countries with their actions

and that could produce a reaction, let's
say, from the U .S. That reaction

could be a military reaction.

And therefore, we kind of see how they
are sending more troops into that region

just because of that reason.

That could derail us. And I also think
that a very, very strong stance by the U

.S. government on China tariffs could
derail us as well and could have a very,

very quick shakeout type of action.

To your point there, too, I think the
theme is going to be a lot of

maybe choppiness as these things come in
and out of the news.

And I think it wasn't Trump's position
that there's not going to be any partial

deals along the way. It's kind of like
we're going to do it or we're not.

So that can make us susceptible to the
ups and downs. By this kind of

stand, it's either a deal or no deal at
all. And I think the

market does not like it. The market
likes more like,

Well, we have, in a month, we have a
meeting, and the market is kind of

waiting, but there is more bullishness
when it waits for those type of

announcements.

And if the HR is going to say, like,
yeah, we can't just basically, for the

whole year plus, we can't really come up
with a good solution on tariffs, then

what's going to happen with the market?
Everybody's just going to sell, sell,

sell, and the capitulation will be
really fast.

What about other markets? Those are very
interesting. So we've talked about in

the last class about the Bitcoin.

And I said that this is very reminiscent
of what has happened in 2018 -19.

We had the same pattern. And out of that
pattern, there was a very quick

momentum move to the downside.

Happened today.

So that's great.

Then we've talked about oil, and we're
following the oil in the WTC class. So

this is the anatomy of the trade for
that particular class, oil.

We were discussing positions that were
opened here, here.

We scaled out here, and we were seeing
it, and it's hard to see here, but more

of the trading range as well. So it kind
of supports also the market trading

range views, oil is.

Okay, and then what do you think about
gold, Eric?

Well, gold went up again today with
silver, so the metals,

there seems to be demand there. It's
increasing.

Yeah, still increasing and supporting
the view that we're in the reaction for

the market.

Where did we have some selling?

Here is your supply, so here is the
profit taken.

Then there is some supply here and some
supply here.

And then this is the largest supply that
came.

And then there is a diminution supply
characteristic.

So they sold here and then there is no
more selling.

So whoever sold here, and I was actually
one of them, not selling

my long campaign position.

but hedging against it and trying to
catch this momentum on the change of

character, which I did. And then looking
at how supply has diminished,

closing the hedge somewhere here,

holding the long -term campaign, because
there is really

not a lot of changes here, like long
-term changes. We don't see anything of

this sort.

and then just add into the position just
slightly here.

And that's kind of like the campaign
move.

Okay, and the last one is the VIX, VXX.

So here, you know, we just kind of like
confirming that volatility increases,

especially today, and we could expect, I
mean, like if there is a rally, you

know, in VIX, we probably would be
expecting it to 30, and depending on

reaction itself.

All right. Is that

right, Roman? It's a question in terms
of the VIX value, in terms of what value

kind of indicates complacency versus
bullishness versus bearishness?

Well, the way how I'm looking at this at
VIX or VXX, I'm usually looking

for the short -term volatility events.

Usually those trades come on this type
of reaction.

So for instance, I had a trade somewhere
here, you know, was supposed

to go to the downside, and I was coming
in into the VIX right here,

VXX.

So it just reminds me of the same
situation.

This is a hedge for institutions against
short -term volatility in general.

And by that, you could gauge as to what
is the short -term bias that they have.

And when you see that institutional
volume has increased, because again,

people cannot trade that much. And that
effort is being translated into

the result.

which is increasing, kind of the same
here, right? So we could be earlier.

So you could start thinking opposite to
the index and just say, okay, if the

VXX or VX has room to go, and it seems
like institutions are piling in

into this trade, especially if tomorrow
we're going to have a ball like this,

that would be the best for the...

bears, then this is a good visual for us
as

to what could come next.

Could we expect more volatility?

And it seems like, yeah, there are some
hedges that were put out in the last

three days or so.

Eric, what else?

What else? Sorry, is there a question?

Yeah, what other thoughts, comments do
you have?

Anything else on the markets?

No, I just kind of wonder what tipped
things over today.

Well, I was watching Trump's address at
the UN, and obviously this is such a

small thing. Why would it derail the
markets?

I think that... markets were waiting for
something, right? So we kind of see

that in the momentum.

We don't see a lot of buying in this
area as the price goes up.

So therefore, what are they waiting for?
For some kind of resolution, for some

kind of clearance on the direction of
where, let's say, the story with China

going to go.

And as I'm listening today to President
Trump,

He goes through many of the subjects and
topics that we discuss in the

classroom.

And I was particularly listening to his
stand on China and on Iran.

China came first, and he said that, and
you quoted it correctly, Eric.

It's either no deal at all, or it's
going to be a fair deal to... to the US.

So this means that both countries will
have to compromise and they still cannot

find that compromise.

So that was a really heavy type of
statement.

Now, when I watch this type of news, I
also watch the tape.

I want to correspond what he says with
how the market reacts to what he says.

So during that statement on China, the
market the Dow went down from 60 plus

70 to about plus 10, plus 20, plus 30.
So there was some selling on that.

So market is still sensitive on the
intraday basis to those type of news.

So that just tells me, okay, this is
what the market is waiting for, like a

positive resolution.

And then Iran was also a very big
statement because he basically kind of

conveyed

The U .S. is very strong.

If somebody does not play by the rules,
then we're going to go in and correct

that. And that means that with a country
like Iran, I'm afraid that it could be

also militarily.

And this is where the danger for the
markets is, I think, you know, China and

Iran right now.

What do you think about that, Eric?

Yeah, it makes sense.

There hasn't been much action in the
last week or so, and you saw the volume

going down, which is not exactly the
profile you want to see when you're

to be breaking out to new highs.

And I guess today was kind of like a
little bit of a tipping point, right?

Yeah.

Well, a lot of you guys are mentioning,
what about the backing up action here to

this trading range?

Yeah, we might.

We might have that. I think that we
should look at the whole structure, and

not showing the whole structure here.

I think after this big rally that we
had, which was a sign of strength, and

this first change of character, then we
had the upthrust, then this big

volatility event, and we are somewhere
here.

So if we look at this picture as...

This is the backing up action. I think
we would be wrong in our labeling. I

think that we should look at this whole
formation right here and label it as

bind climax, automatic rally, secondary
test, our phase A, and now we are

in phase B.

How does phase B behave?

Well, usually very volatile on both
sides, up and down, up and down.

So I would not be surprised to see...

if in phase b it would go to the support
level um and you know um another

analog here which i'm a little bit
scared to even bring up you know to your

attention but you guys can handle it
okay so i'm looking at also

2007.

Let me do SPX, right? So SPX, okay.

And in 2007,

this is the area that is kind of

concerning because we had a local
volatility with the upthrust action.

And now this move to the downside could
be kind of slow.

So let's look at 2007, what happened
there.

We see how the initial volatility has
come in and produced the

price movement.

That was quite significant.

And then look at the next rally.

So the volume goes down, demand goes
down. So this is the weekend's rally.

And it resulted into the upthrust. So
the most recent rally did not result

the upthrust.

But look what happens next.

We have that type of bar like today's
bar that comes exactly

into this, what we might think, a
backing up position, right?

And then there is some movement to the
upside. So that tail that we saw today

might actually kind of indicate that we
might have an attempt to rally.

But the failure on the low or high would
suggest a continuation.

And then, you know, look at the
structure with the way how it moves to

downside. So it's laborious.

It's very confusing.

We would have with this laborious move,
this type of bars where, you know, they

go up and we're thinking, well, maybe
this is a spring.

Or maybe there is a spring somewhere
here.

So I will be looking into this a lot.

just to see what potentially we could
do. Because think about this.

What were people thinking at this spot,
like on this box right here?

Indeed, this is a backing up action.

So for those of you who are thinking
this is a backing up action, and this is

one of my scenarios, not necessarily a
backing up action. I'm more thinking

a much bigger trading range that is
going like this, and then we get out of

this. But if it fails and we have this
failure right here, then we would have

rethink the whole thing and the bias as
well.

All right, Eric. Well, thank you so
much. That was great.

Thanks, Roman.

All right.

Okay, so muted.

All right, great.

Let's go through our anatomy of the
trait. Oh, I should change here in CB.

Okay, so from Corey, we're looking at
the sun power.

From Corey, he's saying that he opened
position right

after when the spring happened at day
number two. So somewhere here, let me

indicate this. So I'm thinking here.

But I closed the position.

At day number four, so one, two, three,
four, right?

Corey, just let me know if I'm showing
this correctly.

No worries, Simon.

Since I saw the bearish in -gallop bar
at day number three, I see. This is what

produced that confusion. Okay.

With increased supply, I suggest next
move maybe to another down movement to

the...

Okay. I think my mistake was there was
not follow -up of the bearish engulf

which was a bullish sign.

I agree with that.

Yeah. So supply has occurred on this
bar.

I would also be thinking, Corey, here, I
mean, the first thought that comes to

my head, you know, this bar right here
is we have to compare it to everything

else, what we've seen before.

on the supply side, right? So for
instance, this area right here, these

bars, then these two bars, then these
three bars.

Because it seems like this is the
movement in the latest

identical kind of like texture.

We see that there is a lot of
volatility.

It's a different texture here. This is a
different texture, right? So we see how

Price moves down, but not aggressively.

Price tries to rally, but not
aggressively.

And what do we see with the supply?

We see that there is three days of
selling, two days of selling, two days

selling, and then one day of selling.

What does it produce as a result?

This type of move, this type of move,
this type of move, and then this

type of move. What is the smallest move
here as a reaction?

This one.

So this is the smallest result on
smallest supply.

And therefore, I would concur with you
that, you know, you have to make a

judgment. What was the character of that
bearish engulfing bar?

Did it produce enough movement to the
downside for us to say that, yes,

going to be a continuation?

Another way to approach this query was,

Well, if you went it on this bar, where
is your stop loss?

Probably somewhere here.

This is where it would be.

So then just wait.

Wait, do not go in.

I'm sorry, do not close the position
until your sprint has failed.

So it's just an early exit on
anticipation of the change of

the change of the bias.

And think about the bias. Like, what is
the bias for us here? I mean, obviously,

we're meeting a lot of supply. We'll
talk about this in a second. This whole

phase A area is very volatile. But then
what happens next? Look again into the

texture of this area. What can you say?

How does the price move?

Does it move very aggressively to the
downside?

Or is it laborious where selling
happens, but then there is not a lot of

to the downside?

It feels to me like that, you know, like
that type of the result.

So therefore, we are thinking that the
bias is that we should have some kind of

rally. So this sprain makes a lot of
sense.

And this reaction was just a tilt.

So with the tilt, wait, and then come in
into that position.

All right, let's go to the next
observation. This comes from Ronnie. And

great work.

Really, I mean.

The stuff that you sent me as a homework
on this particular stock, and I've been

thinking about this.

This is probably the type of the stock
that we should have in all of the

classes. I mean, like different type of
the stock. So we're trading oil on

Monday. We're trading SunPower on
Tuesday.

And then we're trading Navadir on
Thursday.

So that's kind of like the plan.

The next step would be just trading
something on Twitter. But I'm still

in classrooms how we could do this you
know effectively so i think that a stock

that is moving that is popular is the
one that we should have in in classes

although oil and nova deer are actually
quite decent so ronnie is giving us here

the pnf counts uh and i love the
counting here um so let's

let's look at the counts okay so first
count from the spring

to the next level of the supply where
it's gonna come. So I would say that

probably the next significant level is
somewhere here.

But there are different phases here. And
Ronnie, I would just be thinking in

terms of those phases, right? So where
is supply is coming in?

Here, here, and here.

All of those three spots are identifying
the tops and then identifying

the reaction

that has supply signature behind it so
therefore our segments smaller segments

are going to be one two three and then
four

well you've took the one that is from
the spring all the way to

the next level of the supply and then
we're going to have this so uh we are at

this level right so 16 bucks very
natural for us to stop

have some profit taken at this point.

And it looks like a very logical place
to have that sign of strength

and backing up action.

I see that we have high objectives.

So my objectives were somewhere above
20, like around 24.

So it falls right into your targets,
which is great.

Ask a little bit of the confirmation for
me.

I have not counted all of the PNF of the
whole range, and I hope that you've

done this correctly because this is a
low -priced stock here, so therefore

counting methods could be slightly
different.

Probably the easiest would be to
establish a user -defined box size.

All right, so if we hit a target here,

Now we would be thinking about the
labeling, right? So we have a sprint, we

a sign of strength, and we have a
backing up action.

I want you to think about this as a
question.

For the trading range that has lasted,
so let's say that this is the whole

trading range, that has lasted more than
two years, how quick the backing up

action should be?

What do you guys think? Should it be a
month?

Should it be two months? Should it be
three months? Should it be six months?

Should it be a year?

What do you guys think?

Could it be just one day?

Probably we are expecting a more
prolonged... backing up action why well

it took some time for them to accumulate
the position and then

the price went up really quickly from
slightly above 4 to 16.

so that's times four indeed they're
gonna take some profit they're taking

profits here they're taking profits here
they're taking profits here on the way

up

So as this supply occurs,

it might take some time for the backing
up action to develop.

Plus, looking at the P &F here, we need
to build the count, and therefore we

need to see this, to build the count for
the next target

of the 26 up.

So that's what we're expecting. We're
expecting a trading range for the

up action.

All right, well, now let's go into this
trading range and kind of see maybe a

little bit more of the price volume
action. And before we do this, I want to

launch the poll, guys.

So let's do that.

And just tell me if you want to keep it
and add some at this point on this last

bar, keep it and sell some, and then
just close the position completely.

So let's see how we're going to vote.

On that, while you guys are doing this,
I'm going to cash your vote.

Okay.

Let's close the poll and where is the
poll?

All right, so the results that we have
here is

kind of slightly different as I was.

copying this. So actually 38 % of you
have said that we want to

close out this position. So there is a
little bit more

of kind of hesitation

here. I wonder why. What's the logic,
guys, for those of you who said that

going to close this position, what's the
logic of closing out this position? I

would just...

Kind of like, what are we doing here?

And please don't forget that we actually
have entered position on this bar right

here. So this is our point of entry at
this point of time.

We voted for the stock.

You guys said, okay, let's do SunPower.

And then we said on this bar, what are
we doing?

There was an option

to do nothing.

But as a group, we said, okay, we're
going to open this position.

So now let's manage it, right? So where
was our stop loss?

Well, our stop loss was below this low,
right? So we're still in this position,

and now we're just basically as a group
saying we want to keep it, even though

some of the people were saying sell it.

Okay, so let's talk about the potential
risks here.

So we are coming in for the backing up
action trade.

And I think that the timing of this
might have been not the greatest.

Why? Well, because if we've just
experienced a major sign of strength,

move concluded with the buying climax,
then we are having a change of

automatic reaction,

secondary test, and we are in phase A.

I'm sorry, in phase B, that, right? So
test, test.

And I'm having a little bit of the down
slope in trading range here. So we have

to be extremely careful with the stop
loss. I would say that the stop loss

should be or should have been probably
two significant levels somewhere here.

Also, we could look at...

where is a lot of binds happening?

So like on this bar right here, so
anything below it. So maybe like

below 11.

This is a long -term position. I would
not really care about where it's gonna

if it's still gonna reaccumulate and go
up.

So also another alternative is to have
the stop loss here or below here. There

is no reason to keep the stop loss in
this area.

It's all about like nine.

between $9 and probably $11. This is
where you want your thought loss to be

long -term investor.

For those of you who are closing
position, well, you are closing position

the loss.

And this could be a right decision. We
still don't know, right? Because what if

the price just basically tanks through
this whole level and we could just have

loss here and then a massive backing up
action develops.

So we just have to trade through.

and see what's going to happen and make
all of those decisions.

For now, as a group, we are keeping this
position. We are not adding to the

position, nor do we close this position.

All right, let's see next week what this
talk is going to do and what kind of

discussions we're going to have.

This is still a homework. There are two
homeworks for you guys, each class, a

bias game and then the sun power.

the anatomy of the trade.

All right, great.

Where are we? 4 .25.

Awesome. But we still have plenty of
time.

Excellent.

All right, let's go through some
questions.

I like how the class changes pace now
with a lot of segments, so that's

It keeps your attention going.

This question comes from Dimitri.

And this is the question in regards of
the dark pool transactions.

So, Mitri, we actually had a special
with Stephanie Kammerman.

She's trading the dark pool prints.

That particular material we are not
selling because of the copyright issues.

But you can inquire privately with me
and I'll see what I can do if there is

still interest for that.

And it's a very interesting question.

How can we use it? Well, first of all,
is this effective tool?

And then how can we use it with Wyckoff
analysis?

In this instance, would the Wyckoff
analysis be affected by this?

Should we concern one way or another?
Should we take them into account in

certain ways when analyzing volume?

So we just had Melissa, who was a part
of the WMD class,

and she brought up this slide to us.

I've updated this slide on the chart.
I'm just showing you what has happened.

But basically, Melissa is following the
print of the dark pool.

I don't necessarily like the dark pool.

as a sentiment because basically uh you
know dark pool activity is uh

the print of a large volume signature
which basically tells us

it's an institutional signature so what
i want to make sure for people like

melissa or stephanie or someone else who
uses this methodology that you define

correctly what this institutional
presence means

And I think that we know how to
interpret this.

So in a way, what they are doing with
their dark pool prints is they're

only looking at the occurrence of those.

But I wonder how interpretation happens.
So let's just quickly go through this.

So 3 -11, so that's March 11th.

And we right away could see this
probably where? Like in this signature,

the 11th?

I wouldn't even know. Okay, so let me
just be more precise. I'm going to, on

other screen, have this dock.

And I'll tell you exactly where those
places are.

All right, so March 11.

Interesting. Okay, so it's actually this
bar right here.

Okay, so that's the first time.

The 13th, which happens next, this bar.

Okay, so I don't see a lot of like
necessarily big.

indications one way or another. I could
interpret this as a big volume

signature, meaning that institutions

are there, present, but then the biggest
thing is on the result.

What does the price do after that, after
the occurrence of that big volume

signature or big print? So we are
finding it here.

We see just a general volume increase,
so I'm really curious and kind of, you

know, even judging a little bit why the
print did not come earlier. Maybe that

there were some other prints that we had
before, because this is the area where

you would have a lot of institutional
prints, right?

The volume signature has increased.

So as the price creates a high or low,
we would be expecting on the increased

effort.

a reversal because the big effort to
push the price down

does not produce that. We have a high
-low, so a bullish scenario and we are

rallying. Of course, we would be making
assessment of that rally and we don't

see that rally as a big, huge rally.

Okay, well then, what else? What else
could catch our attention? Maybe like

huge prints like this, yeah?

over a million let's concentrate on
those

okay so uh

416 let me find that

okay

so it's the second volume signature
right here and it's this bar Right

here, kind of like the top.

Okay, yeah, that's very interesting. But
again, my question is, why didn't we

have this print here? Maybe we have,
right? Let me double check for four.

No, that's not the bar. That was April
12th. Well, maybe something is there on

April 12th because I see that big volume
signature.

And that suggests, again, like we had
here, that we're just playing with the

effort and the result.

If there is no continuation after this,
then most likely we're going to have a

reaction because a lot of volume is
coming in.

But the result to the upside is
diminishing.

So we would be thinking about, you know,
shorting just based on this and so on

and so forth.

could see where I'm going with this.

If you're gonna use the dark bull
prints, you have to put this in the

the whole structure.

And you have to see what kind of result
that print produces.

And that's the key.

Because at the time, you know, I think
that we were discussing the bullish

scenario, and as you can see, nothing of
the sort.

So, I would want to be extremely careful
just to see, you

know, what kind of result we're going to
have for each of the prints.

And obviously, you know, how else could
you enlighten yourself on what's going

on here? Well, think about the prior
context, so it's to the downside.

Think about all of the points where
supply has come in, so this, this.

so there is selling into the highs where
we had selling before and that's very

concerning so here is that selling and
then interpret it

with the idea of the result of that

print and that probably would be my
suggestion

all right

All right, let's go to the next segment.

And here, oh, okay, we still have some
time. Okay, so here we're going to

continue our discussion of the
significant bar and significant

bar reversal.

We started last time. Ah, hold on a
second, guys.

Oh, yeah, I see. So all of these
questions, Q &As, are all about

bars. So that's great.

All right, a question, the first
question comes from Simon.

Simon is asking, when you were
discussing the last commitment to the

the last commitment to the downside, I
assume these are significant bars

themselves. Additionally, when a
reversal has occurred, this is based on

significant bar that takes out the
previous significant bar.

Is this correct? Yes.

Absolutely. So we are looking for a loss
commitment to the upside on the

significant bar with the close like
this. And if we have other bars

that are going to have, let's say, some
attempts to commit, but where the close

is actually within the body of the
previous significant bar, then this is

commitment for us.

This is just an attempt to commit.

and therefore the reversal of the bias
is gonna be a bar, a significant bar,

in the opposite direction, which closes
below the commitment line.

So close is lower than the commitment
line. That was based on the low of the

last significant bar to the upside.

What is happening here in terms of
institutional presence and what do they

So on the way up, we see that
professionals are still committing to

and then after the reversal, we see that
a lot of them have changed their bias

and they sold. They either sold their
position that they have or they opened a

short position and that's what produces
that reversal.

So we want to see that

based on the two significant bars.

One is in one direction and the other
one, the reversal one, is in another

direction. And obviously, we want to see
the volume signature. The volume

signature could be high in both cases
because if this is the reversal, think

about the value investors selling

into the strength. And then,

the momentum and ITF's trend followers
are gonna sell

on the way down and that's gonna create
that synchronicity.

Wanna jump to Eric's question here right
away.

Eric is asking, does a reversal bond
necessarily need to be a significant bar

is it a close above?

significant bar that is sufficient to be
classified as a reversal bar. So we're

basically, we're discussing a situation
where we have that loss commitment to

the upside, maybe some other bars, and
then a big bar to the downside

significant bar that commits below,
right? So we see that commitment below

line. So this is our significant bar
reversal.

What Eric is describing here is
something like this. What if we have

bar and then instead of a big down bar,
maybe we have a bar like this

that is being followed by other bars
like this and then

suddenly we see that on one of the bars,
which is not a significant bar.

There is a commitment to close below.

Would that be considered a reversal?

Well, the idea here, Eric, is just to
combine significant bars. And we're

to go through this exercise today and
we'll do that.

So we want to, let's say, maybe combine
these two into one single significant

bar.

And we'll talk about how we do this.

So now when we look at this, we probably
would say that there is a significant

body and therefore a significant
commitment to the downside.

So then we could say that indeed we have
committed to the downside. So I would

be looking for those type of situations
where maybe there is no commitment on a

single bar, but both bars have the
characteristics of maybe semi

bars, right? So there is still a
progression to the downside.

and every time there is some kind of at
least commitment above the previous low

of the previous bar.

Then we can combine them.

All right, another question on testing.

With reference to the significant bar
below, you outlined that a possible

of entry is a significant bar down.

Would we ideally wait?

the test and confirmation, the
significant bar down is an action and we

then wait for the confirmation.

If we were to wait for the test and
confirmation, which of the bars below

this be as, okay, and we need to look at
that chart, but

we're gonna look at another chart and
we're gonna.

bring up the same question. And then the
last one, is it the above point of

entry method really based, is the above
point of entry method really based on

your trading style of conservative
versus aggressive?

I wouldn't be saying that, you know, I
define the reversal as the conservative

or aggressive style. But now that you're
asking me, I think this is more

conservative style.

not necessarily aggressive, because if
you think about how the significant bars

act.

So here is a slide for us. This is going
to be an exercise.

Hold on a second. We've done this
exercise.

We did this with Eric, I think, before,
or with someone else.

Okay, so then we're going to go to
somewhere else, another exercise.

Think about the reversal of that
significant bar, and this is a weekly,

confirmation that the reversal has
happened.

But before that, there might be some
bars that are

showing us the

causality of that reversal.

So therefore, if we would define, let's
say, these two bars.

as the combo bars, and we are going to
say that this is going to be a reversal,

and it's going to be a confirmation of
that reversal of the swing to the

downside, let's say like this.

Why is that? Well, we had, what is the
last commitment to the downside that we

see? Well, this is a very clearly
defined commitment to the downside, so

would need to reverse this bar first,
and this bar does it. But also, After

another intermediate high, we have this
bar committing to the downside,

and we need to reverse that.

And we're seeing that these two bars are
reversed. And so we have one

significant bar and then the second
significant bar. Both are confirming

the reversal has happened. It's just
that confirmation comes at different

levels and for different commitment
lines.

So from that perspective, a confirmation
would always be thought as a more

conservative approach rather than
aggressive.

Where the aggression could come and
where it should come is something that

discussed before.

It's on the way to the buying climax.
This is where we want to be aggressive

with the significant bar technique. We
just want to basically...

staircase the movement of the stop loss
and exit as close to the top as

possible. Why is it possible to do it in
this way? Well, because this wave is a

speculative wave.

And therefore, there's going to be a lot
of momentum and a lot of velocity on

this movement, which is going to be
basically an attempt

to push the price as much as possible in
the shortest period of time.

So here we see times two or plus 100 %
from $25 to 50.

And we just basically want to follow
each week and just move the stop as a

staircase because we recognize this is
the concluding to the whole uptrend

And then we will study those.

in the upcoming classes as to how those
moves are going to develop from the

momentum move to the absorption move and
then to speculative moves.

So aggression here is extremely
important.

You could be aggressive here.

With this aggression, you would have to
look at the trading range and go to the

daily and then look for the reversal on
the daily.

And then this would be a more aggressive
approach.

Now there is a trick here.

If we are so aggressive that we are
looking for, let's say, into the

interpretation of the trading range for
the bias, and we set the biases up, and

we are looking at the daily, then we are
coming in on the significant bar

reversal somewhere in phase C.

Preferably. And then we are entering
this position.

So then how could we confirm possibly on
the weekly that

we are done and that we can use the
weekly stop losses?

How could we produce that switch from
daily to weekly?

And this is a great topic for us to talk
about now that I remember that we've

done this exercise.

I'm going to pick up any of the stocks
that you guys want. So give me one

of the stock and I'm just going to pull
up the chart.

And then we'll go from there.

All right, I don't know what's going on
with the top of stock charts.

Kind of funky today for me.

All right, I wanted to do a little bit
differently, okay.

All right, so let me, I don't like how

it's done.

Okay, so this is what we're gonna do.

I don't need this.

Okay, we are gonna do this.

Then we're going to have a second one.

All right.

Oh,

my God. What is going on with me today?
I'm sorry, guys.

When I have two charts.

of the same stock okay so let's do this
and then

and

the second chart that we're going to
have here is going to be our weekly

Well, it took me a while just to do this
simple task.

All right, so let's look at the weekly
first.

A popular stock right now,

momentum stock.

A lot of interesting comments about
this. So we're looking at the original

trading range after the IPO.

So everything develops really nicely.

with how the IPO first is being sold by
the underwriters, then is being sold by

the insiders, and then is being
accumulated by institutions.

Not only they're accumulating the stock
during the

consolidation, and we could see this
from different volume

signatures, and all of it just shows a
lot of buying.

And they also get into this position on
the way up.

This is one of the things that I keep
mentioning to you guys.

And again, you know, it's a little bit
unconventional from the, you know, like

wife of perspective or rather how we
were taught, like that accumulation

happen in the trading range.

No, not necessarily.

I see a lot of instances where
accumulation actually happens on the way

And those are the stocks that usually
extend their run significantly rather

than accumulation during the trading
range.

And a lot of stocks have actually both.

They're being accumulated during the
trading range by the value investors

mostly, and then they are being
accumulated on the way up.

by the growth and by the momentum
investors and that's exactly what we're

here all right so for us the key we're
going to look into within the context of

the long -term picture here and the long
-term structure i want to look on the

daily here and i want us to understand
that maybe this supply right here meant

that we are in phase c and we are
looking for the test so let's look into

area right here Find the point of entry
on the significant bar.

And then let's do this switch to weekly.

And let's see where it's going to bring
us, right? Okay, so let's do all of

that. A volunteer.

Say yes.

It can't be just me talking, so.

Say yes, yes, yes, yes, yes.

And then we'll go from there.

All right, let's go.

Sharon, I haven't heard you for a while.
How are you doing?

I'm doing well. How are you doing?

Good.

Everything went well with the rest of
the conference in San Francisco?

Yeah. Yeah? It was good. It was fine.

Great. I'm so happy that you've enjoyed
it.

I was happy to see you, to talk to you.

Same here.

Absolutely. Okay.

All right. So let's look at this trading
range. Now we know where it is.

So it was here in 2017.

I'm sorry.

Okay. And I'm just going to give you
guys a little bit more context here.

So let's start with the selling climax
and then we're gonna go into, let's say

maybe like this area right here.

So again, Sharon, we're looking at the
stopping action, climactic action, and

then we go into the trading range.

And we said that we want to start our
analysis somewhere here.

So how would you interpret this decline
and what comes next?

Okay.

It's probably some people getting out
early, and

I guess maybe just one or two groups who

think it's time to get out, and the
others are like, no, it's time to stay.

Once there's a stop in action here.

I'm sorry, I'm laughing. That was such a
great comment.

Yeah.

But in the essence of what is happening
around this area,

that's exactly what happens.

I mean, like Sharon has described it in
her own words, but think about this move

to the downside as a partial
capitulation by some of the

So partial...

by institutional hands.

And usually when we see that type of
capitulation in the trading range, we

be thinking what type of institutions
are actually giving it up?

Why would they be giving up the position
that we already know in

retrospect would be going up?

They just don't believe that this is
either the beginning of the move or the

bias is up.

But what kind of institution would do
that, right?

Well, the algorithm traders certainly,
of course, they don't do it themselves.

It's just done automatically.

Yeah. Institutional algos, they will be
driven by the momentum, so they will

accelerate this move to the downside. So
that's great. Who else do you think,

Sharon? What about the value investor?

Would the value investor give up the
position on this move to the downside?

I don't think so.

I don't think so either. What would the
value investor do?

Probably just sit on it.

Yeah. They've acquired some on the way
down. Remember that value always tries

buy on liquidity and pushes to the
downside, right, in the trading range.

they bought there. So something here,
something here.

This is just supply.

Supply.

Bought in somewhere here.

Bought a bunch here.

This is the first time when they were
starting to buy more aggressively.

We could see this from the volume
signature.

The volume signature increases, and then
going below the support level, we are

quickly rebounding, so there is some
buying there.

We see it here.

We see it here.

then we see a lot of buying on the way
up. So this was the first time.

So it's a very interesting comment that
Sharon has made. She said that some of

them are selling and some of them are
buying.

So our goal is to define who's buying,
who's selling. That's number one.

And secondly, kind of like to create
that story, that Wycoffian story of what

has happened here.

So we are seeing value investors and
then we're seeing a spot like this.

So let's look at what happens prior to
that. We see a diminishing volume

characteristic here.

And as Wycoffians, we would be thinking,
is this a possible phase C? And a lot

of us probably would be thinking that
way because of how volatility has

diminished and so on and so forth.

we kind of see in the texture of the
price and the texture of the volume as

as you know asking for some kind of
movement to the upside a rally the rally

happens and this bar shows us that there
is still a lot of supply and that

tells us that this is not the correct
timing

supply is still present and therefore
there's going to be a

every test of the support.

To confirm that, supply comes later on
in smaller quantities than the one that

we had here on this spike, but after the
upthrust, the price comes back. This

was a really good trade to the downside.

This trade is based on that increase of
the effort into the resistance

that was based on the automatic rally.

and rejection of the price at this
level.

So this trade would be really easy. So
now let's think about this trade and

market participants.

On the way up, probably ITFs,
institutional trend followers, are

this position.

Some other investors are also getting
into this position. They are excited,

probably some earnings, announcements,
and so on and so forth.

If the position does not go anywhere,
what are they going to do? They're going

to start giving up that position if
they're not value investors, if they're

trend followers. Is there a trend that
has been established?

No. Is there a break of the trend that
has happened?

Yes. And this is where they're going to
give up this position.

All right, so they've done this once.

They got into this position and then got
out.

and they burned on that.

All right, so what happens next?

How about this area right here? Is that
reminiscent of what has happened here?

Quite similar.

Yeah, quite similar. So we're looking
for analogs, and the best analogs

come within the same formation because
the behavior of market participants is

current. It's the same market
participants, so they might behave the

So from here, we are expecting some kind
of rally. And this is a really nice

rally because it takes time. It doesn't
take, you know, like one week to get to

the highs and then produce a lot of
supply.

But it takes a more considerable time,
more thoughtful buying and accumulation.

It overcomes the previous high.

It actually overcomes the previous up
thrust.

And then it spends some time above.

So we see this, all of these signs as
bullish signs.

If I would be in this position right
here, opening up, and I would be seeing

this type of move, I would be extremely
excited.

Now there is a couple of things missing
there.

Those are more details about the sign of
strength rally itself, the way how we

want to see that sign of rally.

But there are more bullish signs.

All the bullish signs that we see is
actually in their ability of the price

stay above.

So look at how it stays above anything
of what we've seen before.

We just don't have that type of staying
power.

Every time we try to stay, then
something happens, we go down. Try to

down. We do it here as well, but the way
how it stays up, it's less volatile

than what we've seen before.

So that's also a good sign.

And then when the price starts to go
down because there is some supply that

in, who's going to give up this
position?

The trend followers, right? The ones
that got in here. They did the same

here and then they gave up here. They're
doing it the same.

Think about this as...

The analog to this, analogy to this
would be, you know, you play in a

lottery, right?

And you know that at some point, let's
say the price will go up, but you just

don't know when.

You don't know when you're going to win.

So you keep buying the lottery ticket.
So here is one, here is the second one,

here is the third lottery ticket.

And then one of them is going to work
out.

Of course, we want to be more
intelligent about our selection.

And therefore, we are studying all of
these patterns.

But even today, I was reading some of
the comments from a very famous

trader who, I don't know whether he is a
good trader or not, but a very popular

trader.

And one of his thoughts and ideas about
trading was that trading has

an element of luck.

I don't necessarily subscribe to that
idea.

I would say that in poker, as a game,
you have more variance, so luck plays a

much bigger role than in investments
where decisions by what the price is

going to do is based on the decisions of
institutional participants and on the

overall, you know, participants like the
Fed, the governments, you know, and so

on and so forth.

So therefore, there is less of a luck
that we could assign to investment,

market investment, than let's say, you
know, like any...

game like a poker where the chance is
really a chance of you don't know what

card might come. You can calculate the
probabilities, but you don't know

what card is going to come.

So here we are kind of waiting for the
same things to happen.

But Sharon, something else is happening.

It's almost like a different analog that
now we're looking at. Now if we would

look at this structure by itself, and we
would be thinking, okay, well we

have

First structure, then we have a second
structure, and then we have a third

structure. And look how easy it is, by
the way, guys.

Divide it into phases.

First structure, phase A.

Second structure, phase B.

Third structure, phase C.

What are the intentions behind those
phases?

All right, well, here we're stopping the
trend, and we are testing.

What are we testing? We are testing that
stopping of the trend.

Phase B tests again.

What are we testing? We're testing phase
A.

Testing phase A. And then phase C,
again, testing.

What are we testing? We're testing phase
B and phase A.

But the structure is slightly different.

So I wonder, Sharon, if because of those
failures, and I'm just

speculating here, right? So here is one
failure for the...

Here is another failure for trend
followers.

Maybe they are not considering this
stock anymore as something very

At least for some time, we don't see
that, right? So we don't see the same

of structure that we've seen before.

Yeah, the volatility has decreased.

I'm sorry, say again.

The volatility has decreased.

Yeah, there is such a decrease of
volatility right here, right? So after

give up, it's almost like they're saying
like, I don't want to go in into this

again. I don't want to make the same
mistake for the third time. And this is

where it just takes off.

All right, so let's analyze phase C and
let's maybe define all of the Wyckoff

points in there as well and define the
phases within that phase C.

So we're looking at this. Obviously, the
first point of interest for us is this

whole move to the downside. How would we
label the low here?

Pardon me, that's the selling climax.

Absolutely. The first rally is going to
be labeled as?

The automatic reaction.

Automatic rally.

So it comes here.

And then we have like multiple tests
here. So whatever test you're going to

here, that's fine. Let's just say phase
A.

And then where is our phase C?

I don't think Phase C comes there until
mid -February.

Okay, so let's talk about Phase C. I
think there was a question from Simon

on this.

How would we describe Phase C, Sharon?
Give me all of the indications that we

would be looking for to find Phase C.

What are we looking for? Well, it looks
like a spring.

Okay, so we are either looking for the
structural spring, we're looking for the

shakeout, or we're looking for the last
point of support.

If we're looking for the spring, because
the shakeout seems like selling climate

had like this shakeout characteristics,
and we don't see that before. So it's

probably either LPS or a spring.

How would the spring look like? I mean,
like what would be the volume signature

and what would be the price signature?

Well, actually, the volume increases a
little bit, not as much as.

Okay. So it increases, and we could
define that local increase that we

say from phase B to phase C.

Okay. So do we have that? Well, we have
some increase in supply, right? And

relative to phase B supply, let's say on
average, we definitely have that. Okay.

And then we also would say that the
volume would decrease from phase A

to phase B, right? Because we want to
see that absorption

of supply by

institutions throughout the whole
structure. That's what we're seeing in

picture. And then we also would like to
see a local volatility where Weak hands

are giving up their positions, so
capitulating into phase C.

Well, that's definitely there.

And it's definitely there, too. So we
don't want that signature to be

high, but we want that signature to
slightly increase relative to phase B

then decrease relative to phase A
supply.

And that's exactly what we have here.
Okay, so we have... a structural

definition, a spring. And by the way,
with this spring, look how nicely it

goes below the phase B level, and then
it just springs.

You would not be expecting a spring
necessarily with such shakeout and with

such, you know, assertion of the demand
at the end into the close of the bar. It

just basically tells you that there is
so much value.

on this bar for big institutions

that most likely once the price

starts to go here, it's gonna be picked
up again and more aggressively.

This was an extreme value for them and
that's why in one day they kind of

it all up into the close.

So if this happens again, most likely
they're gonna

buy much faster and the price probably
would not go to the low of the shakeout

action. And we see that exactly. We see
that spring happening. So spring number

three here or spring number two,
whatever you define here.

All right, so if this is then phase A
and we've defined this

move as a spring and potential phase C.

Now the question here is, where is our
entry, Sharon?

Probably on that little gap candle right
above the hammer.

I love this, yes.

We could actually consider the spring
itself, because if we're talking about

spring number three by the rules, and we
have to have a diminishing supply

characteristic, which we have, by the
way, relative to...

what do this move, right? So supply is
diminishing.

And then we have that, you know, that
type of reversal bar.

And then Sharon is absolutely right.

This is a significant bar that reverses
what?

That reverses the last commitment to the
downside. So we're thinking phase C,

we're going to have something like this.
So what we want to find is A bar that

commits last to the downside.

Okay, so we found it. Here it is.

Then we would like to define a
commitment line through which the

to the upside should go through and
close above.

Here it is.

And then we want to define that bar
itself, right? So this would be a

significant bar.

We would prefer to have some volume
signature behind it because that would

us that the demand is present and
institutions are buying.

GAP was just a bonus to that. It shows
that definitely institutions are buyers.

Why? Because GAP is an overnight action,
and only institutions are going to be

so active in the overnight action, and
we see that.

So our first point of entry is just
almost perfect.

Our second point of entry probably would
be on the next bar. Why? Well, because

we're thinking about a sign of strength
bar on a sign of strength rally.

And we want to make sure that the sign
of strength bar comes before resistance.

This is really important.

And we kind of see that with the sun
power a little bit.

And indeed, you know, if we...

Look at the resistance that comes before
the resistance. And then there is a

second pocket of the resistance here. So
there is a resistance cluster.

So we could get in into this position in
two trenches on these two bars.

So let's just say that one fourth and
then another one fourth were opened.

So we are 20 basis points into this
position so far.

Looks like a confirmation by the volume.
Looks like a confirmation by the

relative strength.

Looks like it's trying to overcome the
momentum as well after this low.

So everything is confirming.

Now, the biggest question at this point
is going

to be how can we use our significant bar
trend following tools and

how could we switch to the weekly bar?

So let's look at where we are at.

On this particular day. So let's say
this is February 14th, 9th, 12th. So

is the beginning of the week, Sharon.

So we event it on Monday and then we
event it on Wednesday.

So let's see how that week looks on the
weekly bar.

Okay. All right.

And here we are. Here's this bar.

Was that the reversal bar, Sharon?

Sort of. Maybe the two together were
kind of a reversal.

Well, again, when we think about the
reversal bar, we're thinking about the

previous action, right? So here we go.
We're thinking about the loss commitment

to the downside as a close.

Okay, so here it is.

Then we take the high of that bar as the
commitment line.

And then we want to see a bar that
overcomes it and closes above that line.

Do we have that?

Yes. Absolutely. Yes.

Here's that last commitment bar.

Close our commitment line as the high of
that bar. And look at this weekly bar.

We have most definitely have reversed.

There's lots of them to go down into
phase C.

And that's the key, guys, because we
want to be in this position. We want to

identify the phase, C phase, and then we
want to identify the reaction that goes

into that phase C.

And we want to catch that reversal.

And that's how we're catching the
sprints, LPSs, and then shakeouts is a

bit different, but, you know, kind of
the same logic.

All right, Sharon. Well, now that we've
identified our points of entry, and

please note that on the daily, we
actually had an entry here and here. So

by the end of the week, we are going to
have some profit.

Where is our stop loss on these first
two positions, Sharon?

For me, I think down below that red bar.

Yeah, absolutely. That makes a lot of
sense. This is where institutions...

came in and produced some buying.

So if the price would go down and they
bought at this level, most likely

going to support this level just because
the price comes back to their value

point. And their bias is long -term to
the upside, so therefore they're going

be looking at this as still a

long -term.

and they would still be buying.

And you would be thinking like, well,
why would they be buying? Well, I've

shown you exactly kind of like the
institutional way of how they would

into the position.

25 basis points, another 25 basis
points, and they only one half into the

position. So if the price goes down and
they still believe that this is a good

buy, they're gonna buy another 25,
they're gonna buy another 25.

until they are satisfied with their
position size.

All right, well now that we are on the
weekly here, what I want to do is to get

in into this position again twice,
Sharon.

So let's come back to the daily.

We have the stop loss on the weekly now.

Let's go back to the daily and then find
the other two entries.

And then after that, jump back into the
weekly.

Okay. So here is our daily.

Let's open bar by bar. And you just tell
me, where do you think that

we should be opening our next position?

Well, I guess you haven't progressed.
Oh, I see. Okay, you're progressing it

now.

I'm doing it bar by bar. Is this the bar
where we would be thinking about?

Yeah,

that would be a reasonable one.

So what is the reason in here?

I guess they tried to go up on that

last white bar and didn't quite make it,
but then it tried to go down on the

next bar and certainly didn't make it.

Yeah, so I kind of see the logic that
you're going through.

The main key is the...

overcoming the resistance point, right?
So the last time we tried to do that, we

couldn't do that.

We were slightly better.

And by the way, this is something that
you guys should be noticing as well.

Look at the way how the price tries to
go up.

And then look at the next attempt.

Would you say that the second attempt
was better?

What do you think, Shar?

Okay, I'm not sure exactly where you
mean right now. Okay, so we are looking

two scenarios.

So we're looking at this.

Oh, that, okay.

And then we're looking at this.

I think that's a little bit better, the
second one.

Why is it better?

I guess because there isn't as much
selling

tale. Right, right, okay.

So if we're looking at analog bars,
we're probably looking at this bar right

here, and we're probably looking at this
bar.

Yeah.

Why? Well, because there are a lot of
similarities there. Same price level,

volume spike, and then the same spread
signature, right? So

closing below the open.

There is a difference here. There is
more supply that comes in here than the

question that we have here, oh boy, then
why this is not happening right away

after the test.

The test is actually okay, and the
supply drops almost instantly.

Here, the test shows that supply is
still present.

I know, guys, this is...

Kind of like a very small nuance, but
it's a very big nuance on how the price

actually gets out of the trading range.
Because it's always at the resistance

that we're going to have the
institutional sell down, and a lot of

going to sell into the strength.

So we've seen how in the second attempt,
the test has

lower supply level.

And then we have another commitment to
the upside.

So overall, second time was much better,
and absorption has happened

much better at this level.

So when the price comes back to the same
level, we would be expecting that

supply would come, and we see that from
the volume signature.

But we also would be expecting that it
will be more successful.

And is it more successful?

Yes, indeed.

Look at how this bar that has...

That volume spike, on par with those
previous instances, does not do

anything, and the price continues up,
and it commits above.

Indeed, there is a selling tail, and as
Sharon has said, it has produced some

supply signature, and then the next day,
there is definitely supply, but there

is also a demand signature as well.

Now, we would be thinking structurally
here that we are in some kind of sign of

strength. probably minus sign of
strength because we have a higher

right here. So maybe a higher major sign
of strength is gonna come later on.

So we're thinking that maybe we're like
in one half of this whole formation

and we could possibly maybe open another
position right here.

So we're thinking maybe like a smaller
backing up action, LPS.

So we need to think about what could
happen here.

The way, Sharon, how supply has come in
tells me that maybe we should have a

test.

But because of all of the bullish
characteristics, I don't mind actually

entering here.

And we would be thinking that the first
low might potentially be a lower low in

this kind of like smaller backing up
consolidation, right?

Minor sign of strength, minor backing up
action, something like that.

So I probably would be waiting for the
test, but let's just assume that we

bought in here. Where would be your B
stop loss?

Pardon me, probably down there below
that moving average.

Yeah, makes a lot of sense just because
of this bar right here that rests on

the support of that moving average. We
kind of see that the other two bars to

the offside, they are smaller.

So whatever...

buying is there, it has some weak hands
characteristics and therefore this

reaction right here. So a logical place
would be below the moving average or

rather would be below that significant
bar that had this pronounced movement to

the upside.

Okay.

And we would still have the weekly stop

loss just below.

just at the $5 there.

All right, let's go and see what happens
next. Okay, inside bar, attempt to go

up.

Okay, so probably here is our retest
here.

We might have another bar here.

That might be a smaller bar that is just
gonna kind of conclude our movement

like this, and hopefully we're gonna go
up, or we might still stay in this area.

might produce some more consolidation
right here. It just depends. But we like

how the level of supply has dropped.

So another way to buy here would be just
buying the breakout, right? So

let's say maybe like at $7 .25 or
slightly above, we could buy that.

Let's see what happens next.

Okay, so here is that small bar. Guys, I
did not see what has happened, so I'm

just interpreting the way how I see
this.

But it's interesting how supply is
diminishing more.

I would be okay buying here on the
reversal or on the breakout.

Everything is behaving nicely here.

Here is that bar to the upside.

I probably would be even timing the
intraday entry here on the high or low

some intraday reversal.

That would be the most aggressive
speculative way to do that.

And then my stop loss still probably
would be somewhere associated with this

bar.

I don't want to, we already came in
twice, so this would be the third entry,

unless we're entering right here.

So I still would be keeping the stop
loss here. So my first position might be

slight loss. My second position, smaller
loss. And my third position, just a

regular loss.

So let's just see what happens.

Okay, we could potentially buy that
breakout as well. So for instance, the

breakout out of the triangle
affirmation. So this bar right here

potentially be like that forced entry.

that we have. So one fourth, one fourth,
one fourth, and then one fourth.

And we are entering exactly by the
guidelines of the Weicker Trading Course

we've created, right? So in phase C,
we're gonna look for the reversal, and

we're gonna look in phase D for the sign
of strength bar.

We got that.

Then we're gonna look for the backing up
reversal.

We got that. And then we're going to
look for the breakout of the backing up

action. And we got that.

And here is our four entries.

Here we are. We are totally loaded in
into this position.

Our stop loss is going to be still
associated with this bar.

And this is where all of our stop losses
will be now.

So let's notice this. So slightly below
six on the weekly.

And let's go back to the weekly.

All right, Sharon. I'm sorry, this is
daily.

All right.

So let's do this.

Let's do it kind of like the way how we
are doing it with the

daily.

So I think this is where we are,
somewhere here.

Sharon, so we said that our stop loss is
going to be somewhere here at 5 .5 for

all of the positions.

Now let's play this all the way.

Let's say that our intention is just to
catch a swing, right? So where are our

targets? We're probably thinking, what,
this levels?

Yeah,

so somewhere between 14 and 15.

This is the area where we're going to
stop, listen,

watch.

Most likely, our PNF is indicating the
same level.

The PNF count, segment 1, segment 2,
segment 3.

Why? Again, look at the levels of
supply.

That's the most important thing for us
to identify where the count goes to.

It has to go to the climactic action,
which is the local climactic action, or

final terminal climactic action.

overall trend.

Sharon, are we moving the stop loss on
this last bar?

No, we could.

We could move it up to about six.

Let me redo this. Let me just do the
arithmetic one.

Is this a significant bar? I think
that's the first question that we need

address. Is this significant?

I don't think in and of itself. I think
it might be with another one.

With another one, right. So maybe like
in combination.

So if we're going to move the stop loss,
we're probably going to move it in

combination. What I'm not liking is that
we usually

would do the combination, or I call them
combos, when you are going to have two

semi -significant bars.

So let's say something like this.

And these two we are combining into one.
So instead of, let's say, a bar like

this, like we had prior, we need to have
two bars like this.

Well, this first one does not really
look that significant because we want

close to be above one half of the
spread.

And, you know, it's somewhat there, but
not really there. So we might as well

just keep it here. Or if we are
aggressive, we might keep it below six

half.

These are our two levels.

All right, Sharon, I'm going to go with
this bar by bar, and you tell me when

you're going to move the stop loss. Are
we moving it on this bar?

I think I'd like to wait until the next
one.

But is this a significant one?

Well, probably, yeah, except there are
some of the selling deals.

Yes, but look at this.

These are the two significant bars.

Are we closing above one half of the
spread?

Yes. Indeed.

Yeah, there is still some supply that's
coming in. Kind of natural we are at

this, you know, level of the resistance.

We had a lot of selling, you know,
around this area before.

So we are testing some supplies coming
in. We need to see how the absorption is

going to happen. But could we move the
stop loss?

Yeah, we can. We usually would love to
have the stop loss two levels away. And

next class, we're going to talk about
the stop loss, the time stop loss, the

price stop loss, the volatility stop
loss, and so on and so forth. So we

have an aggressive stop loss here.

And I think that a more conservative
stop loss would be two support levels

or two significant bar levels away.

All right. Well, that's great. So let's
say that our stop loss is here or

aggressive stop loss is here.

Let's see what happens next.

Are we moving the stop loss?

Think about is this a significant bar or
not?

Not, no. So we are not moving the stop
loss.

Let me ask you a different question. We
said that there was a supply tail on the

previous bar.

Was that supply observed?

It's like a little bit of it was, maybe
not at all.

Well, think about this. If it wasn't
observed, then the price would do what?

Think about the instances of where that
happens. So something like this,

something like this.

Yeah, exactly. The price would probably
decrease.

Yeah, the price would go down. If supply
is not observed, the price would go

down. Instead, the price actually holds.

And look at how we are having all of the
indications of the momentum and

outperformance.

So that's great.

Okay. We love to see that as the trade
unfolds. All right. How about this bar?

Are we moving the stop loss? I'm not
asking about the supply yet.

I'm asking about the stop loss.

Probably.

Maybe you might.

Move it to the aggressive level or keep
it where it is.

Okay.

Let's go by the rules, right? Let's just
say that we're just using the

significant bars, our first methodology.

Okay, then we wouldn't move it.

Methods, right? So first one, one
significant bar away.

Second method, and we'll talk about this
more in the next class.

Two significant bars away.

Let's just kind of have those two ways.

Just leave it where it is, I guess.

This is stop loss two.

This is stop loss one.

Let's play both.

Okay, so we would not move the stop loss
because this was not a significant bar,

and this is not a significant bar to the
upside.

Now let's address the supply issue.

Definitely a lot of supply.

So what are we doing here?

Supply occurs.

What do we do?

Just watch it.

Yeah. We just wait. Thank you, Sharon.

We are not selling right away unless our
goal was a very, very short -term swing

trade, which already it's two months
into.

Our goal is to capture a more meaningful
rally into

like 14, 15 area or at least above.

this area, we would be thinking also
that maybe this is a sign of strength, a

major sign of strength. So we might be
going into the backing up action.

So I think that for aggressive position,
you know, you either need to get out of

here for sure.

Let's say once it hits 10, you go on the
daily and then just see that reversal.

and get out of this position and just
take that profit, that would be times

for you, 100 % return in two months.
This is a really good run or close to

maybe 80%. If you're a longer -term
investor, then exactly what Sharon said,

just observed.

If the long -term trend is sustainable,
and this

is... sustainability of the trend is
going to be the focus of the December

special.

December special is going to be all
about long -term campaigns and how we

trade those as well.

So we did intraday a couple of years
ago. We did the swing.

Now we're doing the long -term, and
we're concluding this, and this is going

be offered as just like one package.

Troika, right?

In threes.

We have, yeah, some other products that
we have also in threes.

So a long -term investor, if there is a
conviction of the long -term trend, and

more importantly, is there conviction,
institutional conviction of the long

-term trends? I would say so. I mean,
look at the volume signature, look at

the price reacts to that.

And we just, time two um on the move
like in what two months that

tells us that institutions have urgency
to get in into this position we will be

staying as long -term investors okay so
next bar did we hit our stop loss no

we're staying next bar is this a
significant bar

In the size, it is significant, right?
So look at this.

We want to identify all of those
significant bars or combinations, and we

four of them now.

So the stop loss, you could move the
stop loss like this. But is this a

significant bar that makes a commitment
above the previous commitment line,

which is defined here by this line? No.

So we're not necessarily going to move
the stop loss.

We could keep it where it is right now.
So aggressive here, conservative here.

We want to see that commitment to the
upside. Remember that Wyckoff himself

that we only want to move the stop loss
when there is a confirmation of

the commitment to the upside.

By the way, that might have been Hank,
because when I was discussing this with

him, the movement of the stop loss, I
thought that was his idea, you know,

developed as to when actually to move
and where.

Okay. All right. So we are just
consolidating.

Here we go. That's a big bar for us
right there. And probably some points of

entry, some add -ons that we could see
in that area.

Okay.

Sharon, what are we doing here? Are we
moving the stop loss?

I wouldn't move it very much.

Well, let's think about this, right?
This was the commitment line.

Is this a significant bar?

Yeah, it is that.

Yeah, so we have that. We have a big
body, and we also have one half of the

spread.

I'm sorry, the close above one half of
the spread. It is a significant bar. It

overcomes the previous commitment line.

So we definitely would move the
aggressive stop loss there, and we

would be thinking not necessarily about
this low for the conservative stop loss,

but more about the low of this trading
range.

So here is our stop loss number two,
stop loss number one. Okay, great.

Nothing that we do here is different
than what we've done here or here.

Supply emerges, and as a long -term
investor, what do we do? We just want to

see. If the conviction and
sustainability of this trend is going to

we're staying.

Here we go.

Nothing happens.

No movement of the stop loss.

Nothing happens.

No movement of the stop loss.

By the way, these two bars are actually
showing us the test of the supply that

came on that big bar in the first week
of May.

Is this a significant bar?

Yes. Yes, absolutely.

The body is significant, and the close
is significant, and the close above the

commitment line is significant as well.

So therefore, this is the bar that we're
looking for. Stop -loss here, and then

conservative stop -loss here.

Yes. All right, great. We're close to
our area. We said 1415 long -term

resistance based on IPO pricing.

So we would be looking forward to see,
you know, price going into that area.

Nothing happens here. Some supply is
coming in. We want to recognize that

diminution spread characteristic, but no
movement of the stop losses as it is

not a significant bar.

Next bar. Is this a significant bar?

Somewhat more so, yes.

Yeah, the last bar is a significant bar.
So we have one, two, three,

four, five, six significant weekly bars
for us. And

also we fall into this long -term
resistance.

Yeah. Okay, so also, and we're taking
more time here than I wanted, but... You

know, this is important, so let's
conclude this. We'll practice this more

time as we talk about stop losses.

Look at the texture with which the price
moves first, and look at the texture

with which the price moves now.

It's very different.

Yeah, a little bit.

In which way?

Okay, you're getting a slight decrease
in volume now.

What about the price bars themselves?

When you compare one period to the
second?

I think more trend followers are coming
in.

Yeah, there is more like aggression,
aggro

behavior, where they are pushing it much
better.

Easier movement.

The price travels price -wise more over
distance than originally.

It took two months to go from $5 to $10.
That's $5.

And then from $9 to $14, the same $5.
But we traveled there in like a

month and one week.

So ease of movement.

Momentum is increasing.

Velocity is increasing.

We're seeing all of the positive signs.

Institutions are getting in.

We're close to that long -term
resistance.

When we are close to that target and we
go into more of this speculative run

when momentum velocity increases and
more participants are trying to get in,

this is where we could expect some kind
of mean reversion trade.

This is where...

Other institutions, value investors,
they're going to take some profits and

want to book them.

So the key for us here is to go to the
daily and become more aggressive with

stop loss.

So let's do exactly that. We are in the
second week of June.

Let's switch to the daily.

Here is that additional trading range
that we've seen.

Okay, so did I say second week of June,
right? Yeah, here we are.

Here we are.

So we could be extremely aggressive here
because we're seeing the speculative

nature with which the price moves.

And by the way, there was an add -on
right here in this area.

And we would be using the same.

principles of the significant bar as we
used on the weekly.

We could define, and let me just again
do the arithmetic.

Okay, here we go.

We can define the significant bars.

So here is our last significant bar,
last commitment. This is gonna be our

aggressive stop loss.

And then two significant bars away, I
probably would be like thinking about

maybe these two bars, semi -significant,
and stop -loss somewhere in this area,

so slightly below 11 .5.

So this would be a long -term investor.

This would be more of a swing trader.

You could be even more aggressive and
even get out around this bar if you're a

significant trader.

I'm sorry, if you're a swing trader.

But you can wait and see how the price
could take you out.

so we're looking for something of a
climactic run on the daily we're also

looking for the change of character uh
on the daily and we're looking for the

change of character bar for the swing
trader all right let's see if it's going

to just take us out or if we could
possibly gain a little bit more so

this kind of unfolds uh

in a less attractive way for us, suggest
some weakness, and suggest that we

might actually see the move to the
downside already.

So we're probably seeing a climactic run
here with the majority of the profit

taken on this bar, and then we're seeing
how that supply actually diminishes

together with the demand as well. And
it's that demand, you know, demand.

Fading signature that could be the end
of the move and that's probably what

we're seeing right here So I think that
the next bar could potentially just take

us out with this stop loss If I would
see something like this, I probably

just get the stop all of my stop losses
even aggressive up to here We've done

really well. Here is the point of the
entry Here is the point of the entry.

Here is the point of the entry

we could have entered here as well. So
if we're exiting at, let's say, 12 and a

half, about, maybe 12 .75, and we bought
on average maybe around seven, seven

and a half.

So we've made this March, so about maybe
like

70 % return in what, one, two, three,

four,

in maybe four, four and a half months.

So this is an extremely good return
because you have to think about

percent here, annualized P &L, and it's
going to be astronomical.

The key, obviously, is just to be in
this position always with all of your

plus leverage.

using your capital efficiently and
optimally. All right, well, let's see if

going to take us out or not.

Okay, probably did not take us out. So
let's just assume that we're still in

this position. And this is so nice
because we might be wrong in our

right? And we're still in this position.

So now we're feeling like, okay, stop
loss worked.

This reaction now that we're assessing
it was not that dangerous.

So that's great. And we're trying to
break out to the upside. If we're going

have another bar like this, we're going
to move the stop loss more aggressively

and just go with that aggression until
we are out. So let's just go quickly

here. Are we a little bit beyond the
time?

Okay. So move the stop loss below this
last bar.

Move the stop loss below this
significant bar again. So we are at 14

And this looks like now a more defined
climactic round. So here we could be

aggressive and put it right below the
loss commitment to the upside or still

keep it at 14 .5.

One way or another, I think it would be
good. We would be out here if we move

the stop loss below the loss commitment.

All right, so this seems to be a very
interesting bar.

So this looks, Sharon, like a bar like
this, but slightly different

volume signature, right? So there is
some synchronicity now between the

price and the volume, the price and
effort, and this

looks a little bit connected. Okay, so.

Our conservative stop loss is here and
our position on the swing is out.

So let's see how conservative stop loss
would be hit.

All right, so here we would be hit on
the open.

Okay, great. So I think this is the
conclusion of that run.

So opening positions here, here are some
add -ons here that we didn't go

through. And then the exit here and then
here.

And we kind of see that this is a change
of character right there. And if that

we don't recognize, then this is a
change of character for sure.

And this is the trade. This is the whole
thing. So we're looking for the

definition of the long -term position in
the big trading range with

the short -term Wyckoff labeling.

We want to time it into phase C.

We want to enter on the significant bars
that are reversal bars.

And then we want to use the trend
following technique like significant

stay in the position until it gets us
out.

And that's it.

That's the whole thing.

Sharon, any questions?

No, not really.

Okay. Well, let's pick this up next week
where we left it off with the stop

losses. We'll talk about the time stop
loss. We'll talk about volatility stop

loss and so on and so forth.

Sharon, really good job.

Thank you. Really good job. Yeah. So
just keep doing it. Keep doing it. The

you do this, the more I see the skill
has been elevated, which is very

to me.

So keep practicing.

Okay. All right. Thank you, Sharon.

And thank you, guys.

Thank you for sending your homework.
Thank you for being active during the

class.

We're covering a lot of material, so it
was really good. I'll see you next week.

Don't forget about your bias exercise,
and don't forget about the sun power

exercise.

Thank you, guys, and I'll see you next
week. Bye -bye.