TRADING MY SETUP CONVERTTOSMART COM RISK DISCLAIMER Stock

TRADING MY SETUP CONVERTTOSMART. COM

RISK DISCLAIMER • Stock trading comes with risk of loss and might not be suitable for everyone. You are likely to make gains as well as losses and you should be mindful of that. You are responsible for all the risk you take regarding this strategy. That means I am not responsible for your losses or gains. • You should only trade with money that you are willing to loose. If you do not understand the risk, please seek advice before trading. • Please do not use this video as an expressed promise or guarantee. This is ONLY for information purpose even though success is believed to be realizable. Your success is not guaranteed. Neither do I guarantee future success. • To close, Only you are responsible for your trading and not me.

MY FAVORITE TRADING SIGNALS • Pennants • Flags

PENNANTS • Pennants as defined by Merriam-Webster as“ 1 a. Any of various nautical flags tapering usually to a point or swallow tail and used for identification or signaling. 1 b. a flag or banner, longer in the fly than in the hoist especially: one that tapers to a point. ” Candlesticks dictates all you need to know about what is happening in the market at any given time. The combination of candles sometimes group together to form a Pennant or a Flag. This formation will let you know who is winning. The Bulls or the Bears, and will give you the opportunity to get into that group. Point to note; there are times when the candles will just move in a semi straight line, or just bounce like a leap frog and but still stay in a wider trend. The line will even sometimes go in a vertical move to the upside or downside.

BULLISH PENNANTS • So as established Pennant are “Pointy Flags”. This is my most beloved trading signal. It tells me in what direction the trade is going to run. Will it be Bullish or Bearish? The key thing though is PATIENCE! You need to wait until the formation is complete before getting into the trade. • On the chart, I have identified; the Signal, the Confirmation, the Entry and the Exit. • What you are looking at is a Bullish Pennant and this is evident by the Bullish Candlestick exiting the Pennant. When a Bullish candle emerges first or break the trend line, followed by a Bearish candle, which then is followed by a Bullish Candle, all you need to do is strap on your seatbelt and get ready to soar.

A BULLISH PENNANT AT IT’S BEST

BEARISH PENNANT Here is an example of a Bearish Pennant. You will see, as with the Bullish Pennant, there is a Signal, Confirmation, Entry and Exit. On this chart, there are 2 Entry points. The upper wick shows a pullback, (which is a signal in itself) that there are not a lot of conviction to the upside. Then the 2 nd pullback is the small green candle, which is my true and safe entry point, pullback. So you want to see a red candle breaking the trend line, followed by a green candle, which is followed by a red candle. I like to see consolidation and this is evident just below the “Entry 2”. After this, hop in and slide to the downside.

A BEARISH PENNANT AT ITS BEST

PENNANTS CONCLUSION • There are times when the pennant is distinctive pre-market but there are times when you have to wait for the Pennants to form after open. 9: 30 am EST. • I use the Daily chart to view the trade on a larger scale, over as many years as possible and I also use the 5 min chart, just to take out “hubbub” and get a clearer picture, and more recent view of the activity of the trade. The reason I like to get the “Daily broad view” , is so that I can spot the major support and resistance of the stock. The more they hit the “line” the more convinced I am that the stock may visit that price range again. You don’t have to use my time 5 min chart, feel free to use the 15, 30 or 60, because there are time when you need to check on the stock at those time frames to confirm the set-up. • I find that if the pennant is not evident at Pre-market then it is best to hold trading until it is formed on whichever ticker is the Gainer at the time. My advise to you is to wait until the market “shakes itself out” which is between 10 -10: 30 am or 1 hour after trading starts which is when your pattern usually become more apparent. • Please be advised that there can be days when the Pennants or Flags are not evident. In that case I don’t trade. If however I see what is happening with the volume and candlestick charting I might sometimes chance a trade. However I do not advice that for new traders. This is the safest way to trade as you are not gambling but going off what the market is telling you and not your own assumption. • On the other hand you may have more than one formation, just be careful and not be too greedy. Pick the most prominent set-up and trade.

FLAGS • Wikipedia has the meaning of Flags as; “. . most often rectangular or quadrilateral with a distinctive design and colors. It is used as a symbol , a signaling device…”. • I love trading with Flags they usually give great moves and are unmistakable. Usually they don't beat around the bush when they are ready to run. • Personally I find that unlike the Pennants there is only an Entry and an Exit point. Each flag pattern will signal the direction it will be going, whether it will bullish or bearish, by the direction it exits the trendline. • Of course there are Bullish and Bearish Flags and we will be exploring both.

BULLISH FLAGS On this chart you will notice that the Flag is fully formed and when the trend line is breached, it signals who the winner for the trade was is. I usually wait for confirmation and by that I mean, a second green candle as noted on the chart. I also like to see the trend above the VWAP. I then use my technical analysis to let me know when to get out of the trade. Meaning when it hits the next Fibonacci Retracement line or the prominent support/resistance line.

BEARISH FLAG • Like the Bullish flag, when the trend line is breached, in this case, the lower line, this shows that the bears are winning and the stock will be moving to the downside. • I like to wait for confirmation in the second candle before entry, see chart, and I also like to see that the candlesticks are now below the VWAP. • Using my Fibonacci retracement as my exit signal, I wait for the trade to hit it and get out. Or I will have my Support/Resistance line set and get out if it gets there. • If you don’t have that technical analysis just look for, as shown here in the chart; double bottom or long lower wick (not shown). • Another secret is, I wait to see the stutter in the trend, like a car running out of gas and use that as a signal to exit the trade. Sometimes it may go further, but I like being safe than sorry.

CONCLUSION • One trader puts “trading” in a way that has stuck with me for a long time. He says. . ”Trading is the hardest way to make easy money”. I say yes and no. Anything is easy, if you know how to do it and love it. I think flying a plane is hard but to Chesley “Sully” Sullenberger, flying is easy as pie. Yes you may face challenges but if you love what you do, you will welcome these challenges because overcoming them, is how you grow, stay interested and stay above the crowd. • Like everything else you have to be patient with yourself, take each challenge as a sign to improve on what you are doing. • Learn something new about trading and most of all stay calm. That for me was the hardest, sometimes it still is but, as another Author states going to be in trouble. Learn and adjust yourself and not just your trading habits. • When starting out with, ”When trading, one should look at you and not know if you have made or loss money”. Until to get to that point you are my trading style, you may not be able to spot the Pennants or Flags as quickly but keep at it and I promise you will. • Happy trading and enjoy to ride to profits.