The Ultimate Step-by-Step Moving Average Trading Guide (Full Training)

as active Traders we rely on technical indicators to help us provide context to current price if we say something is priced to $10 we don't know if that's good or bad that really depends on what it's relative to what was the price yesterday was the price 100 or was the price a dollar because that dramatically changes whether or not $10 is a good thing or a bad thing so a stock chart will give us the historical price and then the technical indicators help provide context so we can understand the current price relative to where it

has been now one of my favorite technical indicators are moving averages so in this episode I'm going to describe the moving averages that I use in my own trading I'm going to show you real examples of how well-respected these moving averages are and I want you to know that whether you're trading Futures Forex cryptocurrency or you're trading stock moving averages can be used because they are part of the universal language of technical analysis the reason these moving averages are so well respected is because Traders all around the world see them and understand what they are

communicating just in the same way that a traffic light works the same pretty much anywhere in the world red means stop green means go it's a respected international language for the road and so these technical indicators are the respected international language of the financial markets and once you learn to recognize those buy and sell signals that for you will be laying the foundation to a PA forward with success okay so we're going to go ahead and jump into this chart this is a Candlestick chart and I'm about to show you something that's going to blow

your mind this is really cool okay so the price is going sideways here and then all of a sudden it starts to squeeze and pull away now this is exactly what I look for as an active Trader I trade volatility I look for things that are moving I don't try to guess what's going to move I don't buy something that's not already moving I look for something that's starting to pull away and as a momentum Trader I'm looking to buy the first pullback back to ride the next wave higher because the market Moves In Waves

you have that first move up which you can't really predict you never really know you know when something is going to have news or when it's going to move up but we can buy the first pullback and that's what I love to do so on this chart right here we get this first move up we get the pullback and this is typically where I would be a buyer but we are missing one very important indicator on this chart we don't have the correct moving average I took it off because I want to show you how

important it is now I'm going to turn it back on and I want you to watch this look at that look at that moving average this moving average right here is a very well-respected level of resistance when the price is below it it's resistance coming back up when the price is above it it'll be support coming back down this is called the 200 period moving average and as the price comes up it ran right into it it pulled back but it came right into it again a third time pulls back comes up a fourth time

a fifth time it's not able to break through this level of resistance so if you didn't have that on your chart if you didn't see that indicator well you wouldn't have that context you wouldn't have that perspective and you might have taken a trade right in this area and lost money because you were missing out on a very clear sell signal this is a sell signal for taking profit for shorting it's a clear indicator to not get in the chart but if you don't see it well you're in without all the information so the way

these moving average averages are calculated is and I'll put on the Whiteboard here just so you could see the 200 period moving average is calculated by taking the closing price of the last 200 periods so the the word period is important because it's relative to what time frame you're looking at so this chart right here shows us a ond which means it's a one- day chart each one of these candlesticks represents one day of time so that means a 200 period moving average represents the average closing price over the last 200 candles the last 200

days so this is a long moving average it takes a lot of days to form and it's very well respected when the price is below well unfortunately this moving average is resistance when the price is above the moving average is support So in this case here I'm using the 200 period moving average and something that's important to know is that moving averages come in two basic varieties you have a simple moving average and you have an exponential moving average simple and exponential a simple moving average simply calculates the average price over the last 200 closing

days so the closing price over the last 200 days it's that simple that's all it is an exponential moving average is a little bit different what an exponential moving average does is it waits the more recent price the more recent closing prices more heavily than the closing price from 199 and you know 200 candles ago and the reason it does that is because if you were just taking the average price over 200 periods you would get a little bit more of a a slow moving line at even as the price starts to pull away but

if the price is pulling away quickly an exponential moving average in contrast is going to hug the price a little bit closer because it's weighing these recent closes more heavily than the closing prices back here so while the math on this is not important for you understand what is relevant is that an EMA also known as exponential moving average is going to be more popular among active Traders because it moves a little bit faster and it's more responsive an SMA which is a simple moving average moves a little slower and is not quite as popular

among active Traders however what I can tell you is that a lot of Traders will use the simple moving average and and this is true with a lot of beginner traders who aren't as well educated in the differences between exponential and simple so if we go back to our um tra the rules of the road analogy this would be as if most drivers stop on a red light but there's a handful of drivers out there that will also stop if they see a blue light so so that means as an active Trader because there are

people that respect the SMA and will stop when they see it you sort of have to use both and you have to be able to recognize both so then what I do on my chart is I actually have both I have the SMA as a dotted line here and I have the EMA as the solid line and I only do this on my daily chart and I do it because the daily chart is such a well-respected time frame so many people check the daily chart before considering whether or not they're going to take a trade

so I want to make sure you know if I happen to see the price is running into resistance here it's important for me to be aware of the fact that it's probably because of the simple moving average and it may indicate that there are a lot of beginner traders that are invested and purchasing shares of of whatever it is that I'm trading here because they're seeing this simple moving average as a possible resistance level so that'll be more common and uh better respected on Meme stocks meme stocks being you know your stocks like um uh

GameStop gme um AMC Etc so these are the meme stocks all right these stocks are going to have more respect for smas and a little less for EMAs because they're traded very actively by nonprofessional Traders so this could be extremely confusing as a driver on the road if there were literally sort of two sets of rules for different drivers because we're all driving on the same road and so you can imagine as an active Trader it is a little confusing that you have different indicators that are respected by some groups of Traders and then other

indicators that are respected by other groups of Traders so when we're looking at a chart how do we know which one will be respected I have them both up and it's very clear to see in this case that the EMA is the one that is being respected uh it's possible that I could pull up a chart on something else and we would see that oh you know on this one it seems like it's the SMA that's being respected a little bit more and so in that case I might notice that and then pay more attention

to that moving average however for the daily chart these are the moving averages that I use I'm using Em I'm using the two 200 period uh EMA the 200 SMA those are critical and this one is in the dotted line whereas this one is in solid both are in purple and then I'm using the 20 EMA this is in solid and it's in blue and I'm using the N EMA also in solid and this is in Gray all right so these are the moving averag that I'm using on my daily chart so all daily charts

will have these four moving averages on them so when I'm looking at the chart you can see each one of them here we've got the SMA in dotted we've got the EMA in solid for the 200 and then down here we have our gray nine period exponential moving average and you see here this is a good example of how quickly this sort of crept back up as the price moved higher and that's because it's an exponential moving average it's going to adjust more quickly and then we have the 20 period uh exponential moving average down

here in blue and this is one that I actually use a lot more on my intraday time frames to be honest a lot less on the daily chart but to keep things simple I I use the same indicators on all time frames with the exception of the SMA I don't use that on my intraday time frames okay so now we've got a good picture and I I hope you're excited by seeing the potential potential of how well this is respected so let me show you something else we're going to back out here and I'm going

to show you what I call multi-time Frame Alignment so this is my trading platform as I'm using it every single day I've got my scanners on the left hand side right here these are offered at Warrior trading they're called day trade Dash your day trade dashboard I've got my scanners for top gainers I've got my small cat momentum scanners and I've got my news window right here and then of course this is where we have chat rooms and so on and so forth when it comes to charts I always have four time frames open I

have the daily I have the 5 minute I have the one minute and I have a 10-second chart now you can see on each of these I have moving averages so let's look at the 5 minute moving average just for a moment okay so this is our 5 minute moving average or our five minute uh time frame so we've got our five minute chart here and on this one you can see I have the 200 I've got the 20 and I've got the N9 those are my three moving averages now I also have the volume

weighted average price right here in Orange this is a this is an average but it's factoring in volume in addition to price and so this is actually showing us the average price of a stock over the course of the day factoring in the volume the amount of volume that took place at the different prices so this is one of the most respected intraday indicators but it is not available as a daily indicator it's only available for intraday now when it comes to intraday this volume weight average price shows us pretty much the equilibrium it shows

us literally the average price of the the IND of whatever this in instrument is whether it's a stock or a commodity it shows the average price over the course of a day the price is above I would say this is in control by the Bulls if the price is below it's in control by the Bears so if it's below volume weight average price where we if we're above then we're strong naturally the same is more or less true with the 200 period moving average if the price goes below it it's it's obviously a sign of

weakness now if we watch this chart here we can see that the price comes down and breaks below the 200 it tries to get above it but it's not able to hold and if you notice at the open the price pops up runs right into that level and then sells off it pops back up it comes back back up runs into that level and sells off so how do you think your trading would be if you didn't have this at all would there be places where you're buying without realizing that there's a stop sign and

I think the answer is yes and that's why it's so important to have these indicators turned on for your charts that way you are fully informed when you're considering taking a trade you might say oh look this broke over volume weight average price yes but we have a little problem here and it's a 200 moving average it's in the way this is a 200 on a 5minute time frame so it's taking the average closing price over the last 200 5minute candles okay now something else that's interesting on this chart is that uh on the day

that we had this big move right here the price as you can see had to break over the 200 moving average right it cross that very critical level of resistance so pre-market when the news first came out I pulled up the chart and the first thing I saw was uhoh we've got the 200 moving average here and it's right at $3 and about3 that's that's really close so when I pulled up this very fast time frame which is our 10-second chart let's see this usually goes back two days I'm not sure if I'm going to

be able to get um to the beginning of this move let's see if I got it okay so we're going to go back here uh NOP so right so it's going back exactly two days so we're going to look at uh the one minute chart okay that's fine so we're going to look at the one minute chart and we're going to see uh where this first ran into a little bit of resistance at about $3 so the price starts to uh move up so we're going to watch this here the price moves up right in

this area and one of the things that I noticed was well this right here $3.30 is our 200 moving average so when we came up here we ran into 330 and we dropped down and initially I was worried about whether or not it was going to be able to hold over that level and what I looked at was the volume I said well jez look at this we've got 300,000 shares of volume in this first one minute candle this is a huge amount of volume we have a news Catalyst that gives us a reason for

the price to continue higher yes we did just hit a little bit of resistance here and when this first came up to this level one of the things I saw were sellers on the level two at $3.30 so the sellers were already there what that told me was that there were people perhaps who had been holding this for a few days maybe from way back here who were saying I want to sell this when it comes up to resistance at the 200 moving average which is at about $330 and that would have been logical it

keeps tapping that level and selling off tapping and selling off tapping and selling off so if you had accumulated during this area where would you logically be taking profit right up here absolutely and if you're a short seller you may think you know what I'm going to sell it against this level and then cover it as it comes back down but what happened in this case is there was enough strength because the Catalyst was so strong that it was able to break through that 200 moving average so oh let's see so we broke through the

200 right here and then once we were above that level all I knew is that as long as can hold above 330 we're golden we're in great shape for a move higher so watch it pushes higher here it goes up to a high of 364 it pulls back and this gives us a micro pullback right here which is our first really solid entry then it pushes even higher it goes up to 388 it pulls back it squeezes up to four up to 420 it hits a high of 430 red candle on higher volume so a

little bit of a caution flag there higher volume red candle but as you can see at the open this thing is able to push even higher and it actually kept grinding all day long now for those of you who are interested in the strategy that I'm trading I focus on trading micro pullbacks at the beginning of the move so right down there that's the micro pullback that's the place where I'm a buyer so if you check down in the uh description there'll be a link at the very top of the description and there'll be a

link pinned to the top of the comments that gives you a link where you can download my micro pullback strategy in PDF form you could download it you can print it out you can put it on your desk and you can start using it sort of as a reference as you're looking at these opportunities in real time my job and my goal is that I'm able to help provide you with financial literacy so you become empowered to be able to capitalize on these opportunities because these are happening every single day we see it again and

again and again so if you're missing it to me it's just because you haven't yet learned the language of the financial markets you haven't learned to recognize these buy and sell signals because they're as clear as can be once your eye has been trained okay so on the one minute chart we're way above the 200 moving average the 200 moving average we're not even really factoring that in but we are looking at the nine moving average and we're looking at the 20 so when we start to trade on shorter time frames this is um these

shorter uh shorter term indicators are what I rely on something that I did early on in my career and you may find it helpful is I actually went into um let's see I went into the style guide on this and I changed the thickness just to make it like impossible for me not to see it and one of the things that I will that I will always do is when a stock is trending higher like this I'm looking to buy dips off of this moving average so I like to buy dips off the nine moving

average because you can see when we're in a strong Trend we pull back to the nine we move higher we pull back to the nine we move higher we pull back to the nine we move higher now we break the nine then I'm not going to buy right there because we broke we broke that level but if we're holding above and we're coming down just finding support at that level that's a place that I'm really interested now if we break the nine moving average the nine the it's the average price over the last nine candles

then the next logical area that I look at for support is the 20 moving average now the 20 moving average I will sometimes buy dips off this level one of the things that I'll tell you is that if the price price breaks below the 200 and it holds below it now this broke it and then came right back above but if it holds below the 200 often that can spell kind of the end of the trend as things start to shift so in this area here and this is especially true when you step out on

longer time frames this is going a little bit sideways when we're in a period of sideways we can jump up and up and down sort of above and below but something to notice are when you see these big crossovers so here the N9 moving average crossed below the 20 so that's called a moving average crossover if you look down here this indicator is also showing a crossover because moving averages are so important one of the indicators that I like to use is called the macd macd and I'll spell it out so you know um m

a CD this stands for moving average convergence Divergence indicator and it's an oscillating indicator as you can see on the chart right down here and the way this works is if we actually look at the settings um of the macd what it's taking is uh the TW sorry the 12 moving average and the 26 moving average and the signal is the 9 period moving average and so what it's doing is it's showing you when the moving averages are diverging which is that they're moving apart and when they're converging which is when they're coming back together

so when the moving averages are diverging the price is almost always moving up when they're diverging to the positive as they are here when they're converging and coming together the price is going into a period of consolidation and when they cross over like this usually the shortterm trend is reversing so here we get a reversal in the trend and we're getting this pullback as part of my micro pullback strategy I always want to be focusing on trading when the macd is above the signal line so this is our signal line right here and I want

to see that we're above the signal line there's different ways that you can color this you you could turn the histogram on or off um some people will do that we turn off the histogram you could change the signal line you could even change this to um you could change this to a histogram so you could you could sort of change the coloring of this a little bit if you want I've done a couple different things over the years um where I'll do this I'll make this bright green and then I'll make this red here

so I'm only going to trade when I can see green if I can't see green I'm not tra I'm not going to trade this all right so that's too thick so that's so I'll do it like that and maybe it we'll make the red just a little bit thicker so we'll go like this so in other words let's just imagine only trading when I see green on this histogram now if I see green on this histogram what this means is that the moving averages are diverging they're moving apart and no doubt the price is going

to be above the 9 exponential moving average right we're going to get when we get crossovers that's when the price drops below so that means we would only have traded right until about here right actually cut it off right about here so that's the window we would have traded now there was a small window here where you could have considered it but it's a very small window this is a very small window and to be honest in this area it's kind of grinding it's not super clean they've got another small window here that you could

trade it then it's a little bit choppy a little bit choppy you got some small windows in this area but this is a little bit later in the afternoon uh so it begins here and continues until about here then it closes and then it opens again here and goes to here so this is a technical indicator that uh that I use and for me I found it incredibly helpful in helping me avoid false breakouts see this candle right here see well I wouldn't have been wanting to trade this here because the moving averages had already

um converged so so this is the area I would have been trading this area nope not interested so this for me in a sense is showing me the windows where I can consider trading and if if that window's closed I don't want to consider it today we had a vvpr which put in a pretty nice move so I'll show you this one and I'll show you the moving averages on it so on this one right here uh over the last uh day we had some really nice volatility so we'll go back to the beginning of

the move and I'll just show you this as an example and let's back this up here again so on this one on vvpr when I first pulled up this chart uh So Yesterday by the way we had over 120 million shares of volume ton of volume uh we had breaking news yesterday and the News came out at like I think it was 8:15 a.m. so I pull up the chart and the first thing I saw once again 200 moving average shoot it's right there and I do see the EMA and the SMA are pretty close

together this unlike the other chart that we were looking at this doesn't have that really recent price action of several tests of the 200 200 so I can't tell for sure whether or not the EMA or the SMA is being respected more when I look back on the chart it's a little hard to tell so either way I know that both of them are right around this $3 area so I know that that's going to be my first level of resistance so now I flipped my intraday time frame this is down here so I can

always see a little snapshot of it but I switched uh to my intraday time frame so we'll pull up um our 10-second chart on the 10sec chart I am concerned that we may see resistance around $3 okay so let's watch this so what first happens is the news comes out and the price squeezes from about a150 all the way up to $3 and it moved pretty fast but right into the 200 moving average that was resistance so I didn't buy it right here I didn't buy it here because I knew this was resistance and that

saved me because other Traders bought right here thinking it was going to keep going and look at this flush it came all the way back down to two and it did it on pretty high selling volume I think short sellers were confident and shorted this with a stop at the 200 moving average so it ends up going sideways for a few minutes and kind of slowly curling back up and as I saw this volume coming back in I started to think that I should watch this to see if it has the strength to break the

200 just the way the other chart had on the previous day okay so these were two very similar charts back to back so as I'm watching it right here I'm thinking to myself this looks like a buy for the break of 290 and I actually take that trade uh it's going to be right here I take the trade for the break at 290 but look what happens we hit 305 and it drops down again so actually on my first trade right there I got in and I got stopped out and I had a small loss

and I thought boy all right well that 200 moving average is resistance and we're right at it here this is I'm looking at the the 10-second chart but I know that this is the price where that moving average is on the daily so I know that we have resistance here now there are some people that would overlay the daily moving averages on top of your 10 seconds so you would see them on the same time frame and you could do that but then you have to find a different coloring system so you don't confuse the

10sec 200 200 with the daily 200 I think it gets a little confusing I think it's easier just to remember that we've got a daily level at $3 but then it comes back up here and I got back in at 305 I said it's coming back up again I think we're going to get a break and on this one it pushes up to 329 to 337 365 up to four up to 420 now we've got micro pullbacks so that was a micro pullback right there this was a micro pullback right here now we top out

a little bit at about 420 and then we break up to 440 all right right we pull back again we dip back down and this what's happening right here right here our moving averages we're getting the drop back down and this is where we had the moving average crossover so uh let's see I don't usually use um the uh the macd on the 10-second chart so I'm just going to go back and show this to you on the one minute all right so on the one minute chart right here we've got this move from a150

approximately all the way up to a high of $5.60 and the window was open this whole time it closed right about here as we pulled back so this was the window where I made the most money this was a really nice window this was great there was nothing to complain about here this was really solid now it pulls back a little bit it comes back up now some people bought right here but what I was looking at was the position of the macd I was like you know I'm not sure about that because this is

negative right now this is pulled back for a little a little bit too long I then said let me check multi-time Frame Alignment let me check the 5-minute time frame so the 5-minute time frame at that moment what it was showing was that the price was very extended and it was extended relative to what the support of our 9 exponential moving average I need to wait for the the price to come down closer to the nine or for the nine to come up closer to the price before taking the next trade and Watch What Happens

price comes down right to the nine it breaks below it for a moment and then off of support it rallies again so this is the area to be a buyer especially when you're when you've already had a big move now when you've had a big move and you're getting a micro pullback like what we had right in here this is when we have a frenzy of of volume a lot of buying and this is a fine place to take a micro pullback trade and this is when we can get some really nice parabolic moves and

I've seen times where price went from $2 to five to 10 to 15 to 20 to 25 to 30 and it and it's super extended on the 5minute chart but we keep getting these little micro pullbacks and it keeps going higher so that'll happen if we have a really strong Catalyst and I am happy to trade that I have no complaints about that but once we start to pull back and we're going sideways if the price is floating here way above support it usually has a high likelihood of doing a false breakout and dropping it

needs to come down and test and hold support and if it does then we look for the rally back up so this rallied back up uh but then we had another false breakout right here now if we look at that false breakout and we pull up our one minute chart what we'll see is that once again the macd was against the trade so this moving average convergence Divergence indicator was telling me not to be in this trade so see how this is gone this is going negative right here you can see it's going negative and

then where's that false breakout right there so no you shouldn't be getting caught in that but a lot of Traders if they're not using the right indicators they're not seeing the market with all the available information and it's true that there are more technical indicators than you could possibly put on the chart I mean there are thousands and thousands there are an infinite number of combinations of indicators you could use but use the ones that are most respected so you know even with traffic the rules of traffic you may not know every single sign there's

all these little signs you know like construction and deer crossing and you know Hedgehog I mean who knows there's like a million different signs you may not know every single sign but you better know the stop sign right you better know what a red light green light mean you have to know at least the basics and these indicators the moving averages the 9 the 20 the 200 and then using the macd these are standard indicators that everyone should be using and if you're not using these you really are going to find yourself making unnecessary mistakes

and trading is hard enough without making unnecessary mistakes so anyways so the max is against the trade here um now the price action looked fine if you didn't have macd on your chart you know if you sort of hid this you might have thought well the price is holding up here you know it's okay but what I would say is that we went sideways for too long we'd already seen a history of a couple false breakouts high volume on red candles high volume on red candles red candles red candles red candles red candles high volume

red candles indicates that there's a lot of selling and that's the importance of using the volume as an indicator the volume and seeing that volume profile is is what's telling me you know what's going on here now some Traders use um I mean there's like I said there's a million indicators you can use I won't I won't over complicate it for right now so just to stay focused on the moving averages all right so we got that rejection there uh this popped up right here and then we go sideways and then what happened on this

this morning is look at the position of the 200 moving average we end up coming down to the 200 we bounce off right there that's our low and then we move higher so could we put an arrow here and say buy here we probably could right buy me I'm at the 200 this is support as long as this holds it should we should be in great shape all right so it ends up holding it goes sideways and and and curls back up and then it pulls back again okay so now this time it dips back

down it goes right to the 200 it bounces back up it comes down a second time it breaks below it it comes back above it comes back and it can't get above and this is so classic that you'll have this price action where you'll have the 200 moving average so let me just draw this here um you'll have the 200 moving average like this and you'll have the price um you know let let's just say for instance um the price is moving up and it kind of hesitates here for a second it ends up pulling

back for a moment just for a moment then it comes back up and it breaks through this level so we have a nice breakthrough resistance here and then we come back down and it has to hold so it breaks above it comes back down it proves it can hold and if it can hold then this is where a lot of people are going to begin buying with a stop just below right there so the same is true when we break to the downside so right in here if we got zoomed in what we would see

and we'll go ahead and zoom it in here just to get really dialed in on this what we see is that the price came down and bounced and springs back up it kind of comes down again and comes back up it comes down a third time and this time it actually breaks below that critical level of support it comes back up it goes lower now it comes back and it cannot get above that level and it sells off tries again can't get above that level can't get above it sells off tries one more time it

gets above it and now sellers probably try to push it back down and can it hold it does and then it rallies you get that little rally back up and all of this is happening right around this moving average if you didn't and this is also sort of a inverted Head and Shoulders pattern so if you didn't have this moving average here well you wouldn't have understood why we're having such a struggle in this area okay so then this morning this ends up pulling back pulling back um it's going sideways and then we get above

that 200 moving average right here at about 7: a.m. and then all of a sudden we start to pull away right we get this nice move here up to 620 up to 640 pull back up to seven pull back up to eight and we ended up getting a move here all the way up to nearly $10 a share now if we look at our moving averages again 200 it stays well above the 200 for this entire move until it comes down right here and then finally breaks it right here we look at our moving averages

or our moving average convergence Divergence indicator and what we'll see is that we had the window open closed for a moment was open again closed for a moment was open again close and was open and was open so if we look at the areas where uh we were open Let's see we were open basically for this whole stretch here we were open we closed for a moment and then we were open again until here then it closed for a second and then it opened again as we curled back up and this was an area where

we bounced off of that 20 moving average so that 20 moving average held a support we didn't have a full moving average crossover in fact we had it looks like a crossover here we almost had a cross over here the price did go below the the 20 but we didn't cross and then we finally had a clear crossover here so just moving average crossovers are something to pay attention to uh so much so that there are some traders who use moving average crossovers as part of a trading strategy it's not a great strategy all by

itself Because by the time the moving averages have crossed over usually it's already pretty clear the trend is Shifting you know if you were waiting to sell or short till this cross over here you know it's it's well off the highs um this crossover was okay but in any case I'm not a fan of trading just based on crossovers but it is something that I pay attention to so this ends up pulling back it's below volume weight average price which is our Orange Line we're below the 200 again and at this point you know it's

not in play there's no trades to be had so I think success a Trader uh it's very important that you're of course using the right indicators it's also important that you're focusing on trading aggressively when the window is open the the window so to speak the way I think of it is you know each day there's a window of opportunity and on each stock there's a window and again doesn't matter if you're trading a currency pair or you're trading Futures but on each instrument you're trading there's a window of opportunity when it's going to be

clean where you're going to see these big moves and usually it's early in the move it's early in the move because usually that's when you sort of get this first reaction from a catalyst there's a news event that brings in a lot of volume that brings in a lot of Traders and initially short Sellers and even sellers are like well let me just hold off for a second let's see how high this thing wants to go right let's not you know sell too soon let's see what it wants to do so that first move can

be very very clean you get that first push higher you get a couple little micro pullbacks and then that's where I'm making usually the most money and on stocks that go parabolic that go from 5 to 8 to 10 to 12 to 14 to 16 a lot of times they basically go straight up and they don't look back the in fact the only opportunity to trade those is to be buying you know these brief little micro pullbacks as they shoot higher and this is going to be on like a 10-second chart so again you could

download the micro pullback strategy PDF that's um pinned down in the description and in the top comments but this is the place where I want to be a buyer and what I would encourage you to do is print out a lot of these charts as examples so you can have them as a reference point because one of the things that we're doing as Traders is we're actually visualizing the future what we're doing is we're looking at a pattern but we only see half the pattern right so if you're looking at this you're looking at just

at this point you know you've got a couple green candles and you don't see this yet so you've got just a couple of the green candles you got your first red candle CLE and you now have to visualize what's going to happen next is this just going to go you know all the way back down or is it going to Rally back up and so we visualize this based on recognizing patterns and based on using the technical indicators that are available to us it's not a guarantee there is no sure thing in trading but we

use these indicators we use these patterns to help us improve our statistics and our probability of making money of being right and the trader who's able to predict the future the best will be the ones who make the most money so on these micro pullbacks I'm buying these little dips I'm buying these little dips and then next thing you know the price is up you know 200 300 400% this vvpr yesterday between two days went up 5 73% 573 per from the low down here all the way to up here but would it have made

sense to trade it all day long every single day no there were Windows here where there was a lot of opportunity to make money and then there areas or windows so to speak uh where you probably would have lost money if you were trading it too much so using your moving average convergence Divergence indicator this is a great way of just sort of base level is this the front side of the move is this the area I should be focusing or you know is this choppy so I look for when the moving average is above

the signal line to trade aggressively and I want to be really aggressive on the front side of the move and then when it starts getting choppy when we see that moving average cross over I'm just going to step back I'm going to sit I'm going to be patient I'm going to wait now there's a lot of other traders that are going to keep trading they're going to be in the trenches they're going to be trading trading trading every single candle I see some Traders out there who will literally trade every single candle buying and selling

and I think you do a lot better if you focused on being aggressive during the candles that are really um strong in green and just sitting on the sidelines completely when it gets choppy so if you found this episode helpful I hope you hit that thumbs up I hope you subscribe to the channel for more episodes on trading strategy just like this and I want to make sure you download my micro pullback strategy PDF it's pinned in the top of the comments and the link is in the description and as always I'll remind you that

trading is risky my results aren't typical so manage your risk take it slow and I'll see you for the next upload real soon