📈Wash.Rinse. Repeat. and 1 Idea

Recently I have been asked to share more about the process of trading than stock ideas. Your trading process should have three criteria. Edge. This refers to a statistical advantage.Repetitive. The plan should be something you can execute over and over again. Duplicate. The plan should be something that you can use on several assets classes. This can be through macroeconomics, fundamental or technical analysis. Below I give an example of the exact criteria I used to enter a trade in SOXL in the Alpha Chasers Community. I also show exactly the criteria used to exit the position. I included a stock idea we are currently in as well that appears to be triggering another buy area. Let’s get to it!

Semiconductor Trade

SOXL 3X Bull Fund ETF . The entry was based upon three criteria:

1. Volume drying up and the price getting tighter.

2. The price making a higher high over consolidation.

3. RSI crossing over 50 level for the first time since breaking below.

SOXL 3X Bull Fund ETF. The first exit (50%) was based upon two criteria on a WEEKLY chart.

1. The stock crossed over the 3rd standard deviation (3SD) using the Bollinger bands indicator. There is a 99.7% chance the stock will stay in that range for a period of 20.

2. Volume could not clear through all of my relative volume criteria.

SOXL 3X Bull Fund ETF. The final exit was based upon three criteria.

1. A break below the previous bar which was a doji.

2. A break below the 12 SMA using OHLC as the source.

3. RSI crossing below the 70 line.

One Idea that has a lot of potential is ELF. We bought it the day of earnings with a tight stop of the low of the day. Always watch earnings plays that gap up. If they break the opening price they have a tendency to gap fill back to the previous close. Now we have 15 days of consolidation and a breakout to all time highs on a day when the market is down.This happened on above average volume. We are up $12 dollars and have trimmed zero.

If this information is helpful please comment so that I know to show more trades and the thought process that goes into it. I hear a lot of talk about technical analysis , indicators and oscillators and whether they are useful. Simply think of them as tools or equipment. If I had a basketball I could not dunk. If I put on a Gi and challenged a blackbelt in Ju Jitsu to a match I would get annihilated. If I showed up to do drywall work with plumbing equipment everything would be crooked. Point being go easy on yourself and give yourself time. Learn not only what indicators you want to use but when to use them. The above is repeatable. It can be duplicated and that breeds consistency. Hope this was helpful.

Watch the video below to get my current thoughts on the market and pay attention what I say about the cumulative advanced decline line and what it is telling us.

Wishing Everyone Massive Success!