Trading with Technical Indicators

Hello and welcome to Trading With Technical Indicators. My name is James Boyd and we welcome you on this August 10th. My gosh, what a weekend we had. I'll maybe tell you about that in just a moment. How was your weekend? I got a community barbecue this weekend on Saturday at my house. It's going to be a big one and inviting all community members. So looking forward to it. My friend and I are going to be the pit bashers this weekend.yeah busy week last week and busy week this week let's get let's get at it here as we talk about trading with technical indicators we got with us charles crispy selva scott luck aloha back to you dom randy rojo richard we also have scott thompson with us in the chat say hello scott let's go ahead and hop right in now remember that uh We do post on X, we post announcements and also educational examples.

My handle is at JamesBoydCS. I'll show you that in just a moment. Just real quick as we're getting started, the information that we talk about and I present here today is done for general informational purposes only. Now this webcast is broadcast via on YouTube.So this page right here, and I'll send this to you, is. right there so if you went to you want to share this uh talk to your investing friends or just colleagues etc go to right to youtube type in trader talk swap coaching webcast and you're gonna see that uh you can subscribe for free okay now this also class has a playlist scott sent this as well i'll send it again right there has a playlist for this class. Think of this as maybe your favorite show that you like to watch.

These are the prior episodes. Last week, we talked about bullish gap down reversals. And so each week, we'll add that episode to this channel of Trading with Technical Indicators.Now, as we get going. Remember that if we bring up stocks and maybe options, remember that options carry a high level risk, not suitable for all investors. All options strategies are not the same. Also understand that our examples will be done in the paid money software application. When we talk about examples, understand that investing involves risk, including loss of principle. Okay, so no, no reward without risk. Okay, the question we want to ask yourself is, is there a risk of not investing something in something? Okay, and that something might be inflation, just eating away the value of that money.

So just putting money in coffee cans.in the backyard might not be maybe a strategy that some investors might be looking at and that's why we're here today now as we get started here i want to talk about the markets i want to talk about the paper money account and i also want to talk about with the focus of buying stocks at and or near highs and sometimes there's like a mental block when i say that it's like wait we're buying atsounds dangerous well we're gonna talk about that now just real quick as we get going here i'm gonna bring up uh first off let's look at the spx when i said buying at new highs well last week we read we were a new high there we were at a new high there we were at a new high there so the first thing that we want to know is if we're at a new high doesn't mean it can't go higher okay Doesn't mean it can't go flat or sideways.

More of the story is if you actually are at a high, we know that is what we call an upward trend. It's made the higher high.So far, when we look at these charts, and I'm going to go through a couple of them, kind of a stiffer flag so far. What I mean by that is we had the pull of the price ascension. and then so far we've kind of gone sideways let me show you a couple charts this next chart you're going to see that we're just still kind of sitting up near the day's highs okay third chart in we don't need to look at fourth chart in uh we don't need to look at either but this chart that that's the one we want when you look at this on the trend candlestick chartStill green candles, not seeing any orange candles yet on the daily chart of the trend candles.

And you're also going to now see that when you look at this on a weekly chart, there she is in all its beauty. OK, now that chart kind of still showing that ascending triangle breakout from last week. And, you know, as long as we hold above support one. 76.50 worst case scenario maybe 75 60 okay still in the process of making the higher low those are the levels to be watching now super quick when i go back to a couple of these areas the one thing that we do want to make sure we're aware of wouldn't take a whole lot to realize thisBut you're going to see the crude oil on the left-hand side is near the top. Now, I put that in the indexes. Why?

Well, because that can impact what the equity markets do. Okay. So we see crude oil up, let's say, 346. Okay. I was walking through the mall. Someone had a t-shirt and it says the Hormuz is open. Cross it out.harmuz is closed cross it out harmuz is open cross it out and had you know it was just whoever's making these t-shirts are really good okay so the moral of the story is do we know if the straight of harmuz is open it might be for a couple hours you have to understand that maybe they don't want it open right maybe they want that uh volatility of priceto push up the price

because they're the sellers of it i mean come on let's not let's not be confused here okay whoever is consuming obviously we want the price to be lower but if you're selling a little dysfunction might help the price i mean let's be honest now if we take a look at crude oil that's going to be something we kind of focus on a little bit here today when we talk about buying maybe at or and or near highs When we also take a look at, let's say, the NASDAQ, the one thing you're going to see on that NASDAQ, it's still holding in the mid-channel, not retesting that 23% line.Remember we said last week, what's the chance of us probably going up to that 30,665? Probably pretty high.

The one thing that we have not seen. that we say, nah, this hasn't been that great. The semiconductors, the big names, the SanDisk, the WDC, all include Micron in there, but maybe that's not as bad as SMDK and WDC, et cetera. The SOX is still holding the breakout, but we need more out of that to get some help.to the nasdaq now that doesn't mean that the nasdaq is bad in general it just we want that to kind of help the net the nasdaq that nasdaq actually still holding uh fairly strong dow jones actually holding uh sitting at the 20 period moving average and mr russell down six tens that one kind of drooping a little bit more in the flag might be trying to make a pennant

but nothing we really see that really looks that bearish okay and just in the last couple days they were at a brand new high now what i want to do is i want to kind of bring up a couple a couple things to begin with and kind of talk through some examples so firstoff when we pull up the paper money account so the the way that we really learn is we actually get off the chairs and we just go practice right if we're playing tennis basketball whatever it is you don't learn by just sitting there you're watching someone get up get out of the bleachers and let's practice together now a couple things when i pulled this account up today a couple of the positions that are kind of standing out a little bit is dell i know you're thinking man he just doesn't give it up he just he just doesn't okay This is not the get even trade.

We have done that before, okay? Dell's helped this account. Microsoft has actually helped this account, okay?And so we do have some tech names. I mean, Apple, Amazon, okay? CrowdStrike. Go back to this just real quick. Some of you, tell me you saw this, okay? CrowdStrike. cybersecurity hitting some highs so you know when we look at this portfolio you'd probably say there's an uh apple amazon crowdstrike uh dell corning is in there coke staple airlines okay financial tech so we have a decent mixture of tech okay now what i want to do is i want to kind of talk about some of these names We'll show some differences here. I want to talk about oil names first. Our focus here today is talking about buying stocks at brand new highs.

I have a good friend of mine.I've been friends with him for probably at least 10 years. When I would talk to him about stocks that are hitting at brand new highs, he would never buy stocks at brand new highs. I couldn't drag him to buy stocks at brand new highs. okay and he would always buy these stocks that here they were hitting new lows or at lows and then he would say well they just kept going lower i'm like well that's what trend is okay so now eventually sometimes people come around sometimes okay now here's the deal i want to kind of focus on a couple energy names okay now if i were to ask you debbie

okay lisa if i were to ask you energy names now if you watch any of my classes you know we talk quite a bit about oil and airlines now pairs trading is where the investor says oh look i'm bullish maybe airlines and then maybe let's excuse me bullish oil and then maybe bearish airlines we haven't really per se done that in the last couple years We tend to be kind of more like bullish oil and then say maybe airlines might be weak, but maybe still have some airlines, okay? So sometimes we tend to be bullish bulls. And that can be the case maybe of the economy or the stock market is strong, like it has been lately, okay?Now, you're gonna see that we have love there.

and we're going to add some of these energy names like what now pia let's put pia to the test here okay pia deserves a test okay and by the way pia's she's a tough she's a tough gal she can handle it and if we take a look at this if we look at let's say xom okay now i'm going to flash a couple namesfor just a sec when we look at let's say xom is it at a high oh it's not the all-time high uh it's kind of like uh in a neutral zone as of lately and maybe starting to kind of show a bounce let's hold that thought for just a sec when we actually say let's say exxon we could probably say chevron right i mean we don't need to be really in the stock market to kind of know this is probably where we fill up some gas right uh or have

chevron not getting the push that exxon is yet and if you look at conical phillips i'm just saying the big three you're seeing if we kind of said which one of thebig horses are getting a little push probably would say exxon and conical phillips now let's say the investor said you know i'm going to actually take conical phillips excuse me exxon first let's kind of talk about these signals now when we talk about technical indicators whether it's moving averages we talk about macd we talk about stochastics things like that the oscillator is going to work better if it's actually coming where they're they're they have been pulling back and they're starting to go back up that's when the indicators are helpful As you'll see in a moment, the oscillators don't help very much, typically, if the stock is already at a brand new high because the oscillators are already at a high, okay?

Now, here's what I'm going to do. When we talk about buying at highs, where we sometimes get a mental block is if I buy at this level, it doesn't mean that we're going to set a stop all the way down to 135, okay? It doesn't mean we're going to set a stop below 140. It means if we buy here, we're not going to risk it all the way down to zero, per se. We're going to actually set the stop underneath the 150, 186. So the exit is based upon the short-term support level that is probably on the higher low, which is probably in the last two, three days, or... maybe in the last one.And we set that stop below, let's say 151.

I'm going to bring up the paper money account so we can put this in there. Now I'm going to bring it up so we can paper trade it, zoom in. We're going to right click on the chart, buy custom, and I'm going to go with OCO bracket. All right, now here it goes. Now if I do with OCO bracket. Now what you're going to see, okay? Yeah, the internet did bog. It buffered. I saw that. That's why I started speaking slowly, okay? So I was watching that. That's why I have two eyes, okay? Now, here's the deal. so if we look at that one i'll even say 152.if i say 152 ish area okay less two percent 148.

96 so we you know it this is where we're gonna get that metal block we're not setting the stop down at 140 135 we're choking the stops underneath the most recent one to two weeks If we never get used to buying stocks or considering it, let's say, at highs or near highs, you probably never really ride any momentum, okay? I'm going to show you both. A, something that actually was in maybe a short-term high, pulling back. This is more your classic oscillators. Moving average, MACD is starting to go back up, stochastics, etc. So if we type in 148.96, now remember how that stop works, okay?If the stock goes down to that price or less, it is triggered to be sold. The problem, we don't know what it's going to be sold for, okay?

The good, it's triggered to be sold. Bad, where's the price going to be at? That's why we talk about liquidity. you can't forecast liquidity because we don't know what's going to happen in the future now if we actually go back and say okay that prior high the prior high is 162 this prior high is really about 170. now when some traders are talking about where to set a target many investors say look i got to get six or eight percent upsideto really offset what i think that risk could be so if we said hey we're going to set a target at let's say 170 ish that's about seven percent it's really making where the trade potentially could be one to one okay you got to remember something that reward to risk if we're talking about stocks the fabrication of what you think it's going to do okay

you're just getting an idea okay so if we put that target about 170 ish trade number one pia if this trade goes south we'll say it's pia's trade okay here it is uh here we go okay now what we're gonna do is if we go back and say what's the account balance 61 000 so we're gonna move that up a okay, to 6,100. And that's a full position, okay? Now, what you're seeing is, noted, is our cash is negative. What does that mean in a margin account? We're not only trading the balance that we have, but in paper money, we're kind of using some borrowed funds, okay? Now, you can'tin the margin account that probably leads us to think we might want to go look and see is there something that we could sell to bring that cash balance to the positive okay now what i'm going to do is if we said how many shares this is going to be 38 shares so trade number one exxon mobil

Now, when we talk about, let's say, the MACD, let me kind of just show you this just real quick. Let me get a chart that has that. There it is. So when I said the MACD is kind of turning, right, this is what I kind of mean on the chart. The MACD has not gone to zero. The MACD has actually just gone less negative.Now, if you wanted more confirmation, the investor is saying, give me. Give me that green bar on the histogram. Con, the confirmation is not free. You have to let the stock go up more, which means it's further off support, which means you're taking risk, more risk. So that's why some people like to kind of just see the histogram where it's burning up.

Now, always remember the histogram is not turning by itself.it's actually shadowing what the price is doing now if we take a look at this uh gonna go back target yes stop there confirm send trade number one exxon mobil wait wait is this a stock or an option never said anything about option okay it's a stock trade we can see that right there okay nowokay comment was i can see a cup and handle on xom trader joe says that you know i i think you could actually know the fun thing with technical analysis it could be in the eye of the beholder right and if you have a marker in your hand you could draw almost anything now if we take a look at this you could see that it's uh i mean maybe i drew it a little too high

shoulder shoulder not perfect okay but yeah you could say that trader joe and i would say that's probably not too much of a stretch to get an idea if it were to travel that length a width i should say 135 to 155 okay there it is rightthere all right so we're talking about 20. So if we said 20 on top of 155, it's gonna put the target a little higher at 175, okay? So it's really right there, fair. All right, now, next one. So first off, let me just real quick. Some of you, I just wanna make sure that we're crystal clear on a couple of resources that we have. Before we look at this next trade example, which we're going to get to, I want to pull up something that many of you are in different parts of the country.

Some of you are not, well, not even on the continent, only in the U.S. Some of you are in Hawaii. Aloha back to you. Mahalo.Okay, now, some of the upcoming events. I want to make sure you're aware of this. We're going to be in New York City. you're in Orlando this weekend, New York City on August 28th and 29th. That's the advanced option curriculum. Okay. Two-day event. Scottsdale, Arizona at the Princess. No, check. No, that's not true. It's actually, oh, okay. Yeah, it's not going to give me the detail. It's not, let me go learn more. It's not the princess. It's right down the street. It's right down the street. Yeah, the Phoenician, okay? The Phoenician. The princess is nowhere near as good as the Phoenician.

If you've been to both, you know what I mean.Anything in Scottsdale, for the most part, is pretty nice or very nice, okay? J.W. Marriott. the Phoenician, the Phoenician Fairness, okay, that's going to be right on Camelback Road, that's going to be a one-day event, okay, market drive, they call that a one-day event, when we also go to, for example, let's go back to this just real quick, when we also go back and look at some other events, I just want to make sure that you're aware of, Some of you are also, when we scroll down, Washington, D.C., technical analysis and options. Okay, that's the 2nd and 3rd of October. October 23rd, Miami. Okay, so Washington and Miami. Chicago, advanced options. Honolulu, November 20th and 21st.

And the ones that I want to make sure that you're aware of is coming into also the 2027. You're going to see in Lido Land's backyard, okay, Boston, okay, right there. So I just want to make sure you're aware of that. Those are showing the events getting into 2027 so you can plan ahead. Check those out now. I just want to make sure you're aware of that because we're in different parts of the country and it's also nice to see it live. Now, let's also go back to some of these other names. I'm going to go back to ConocoPhillips for just a second, okay? Now, when we kind of look at technical analysis, we don't necessarily have to do maybe stock trade.We might say, could we maybe consider where we could try to get a little leverage.

I mean, example given, wonder if you don't have any cash left, okay? Or you have less cash, and you're trying to save the cash maybe for other things. Well, what I'm gonna do in this example on ConocoPhillips, okay? Now, here's the thing. If oil goes up, these stocks could be sensitive to the oil price going up, sure. However, it could just be that oil stays up higher for longer, and that's actually affecting what they think the revenue of the company is going to be, earnings per share, things like that.Now, in this example, what I'm going to do, step one, we're going to come in here and just say, look, we're going to buy a call, okay?

now if we said let's say buy a call what is that really doing that gives you the right to buy the shares at the strike price now here's the deal does the investor really want to buy the shares the strike price they might say nah who controls that right the buyer does maybe they just want tothe stock go up in value which affects the option price potentially and they're trying to trade the option value that's influenced by price time and volatility so what we're going to do is we're going to come in here in the paper on account and we're going to buy the september Now, when we buy that September 120, we're going to buy that call for 565. 555 bid, 575 ask.

So if we got somewhere in the middle, 565 could be possible to get filled. Now, remember, if we said, how do these options really go up? Well, it's mainly if the stock goes up higher and higher and higher and higher.above the strike price, we're weak where the investor can buy it at, there's more equity. The other word for equity is intrinsic value. So we're also looking at the technical analysis of this, we did a stock trade on XOM, trade number two, we're gonna buy a call, the con about the call is we need the price to move as quickly as possible. Now, what i'm gonna do is i'm also gonna actually change this go single order first triggers seq right click flip the trade create the opposite order and we're gonna say give me that target now when we do this i'm gonna do market data gtc and we're gonna make the exit based upon the stock

now i'm going to do it in one of two ways we're going to say if we go at or above a certain price at or below a certain price so if i went back and actually said okay if it went up where might the investor try to sell that investor if they said look i'm going to try to sell let's say they said look if we go up to 130 i don't mind and selling the call now how profitable would it be Depends upon how fast it actually goes up, if it does, if ever. Now, if we actually said, I want to get out, the investor actually might say, look, I want to get out if we go to, let's say, below 114.So here's what I'm going to do.

I'm going to bring this order up and say, look, if we get at or above 130, sell the call, whatever it's worth, sell it. okay conical fillers mark at greater or equal to 130 sell the option lesser equal to if we get let's say at 113 ish i could say 114 i'm going to give it a smidge more how bad's the loss if it goes down Well, you get a directional move in the opposite favor, in which you need. The time goes by, and the volatility impact, well, it could hurt more, right? So there's three variables there. It's not just price, price, time, and volatility.And we could actually run those through those scenarios and kind of see the what-if game of the Theo price. Target, stop, or I should say...

target of the shares to be sold at 130, sell the call option if the stock goes to this price or less. Now, the main takeaway of this is this is not the option price. This is the stock price. If the stock goes to this price or higher or this price or lower, sell the option itself. at the what? Current market price. Liquidity being very important. Okay, now, I want to actually go back to, just real quick. Now, the question was, why buy in the money?The purpose of actually buying somewhat in the money is to have some intrinsic value, okay? If you buy in the money, the break-even is a little lower. Now, we're not buying super deep in the money, but there is some intrinsic value.

So we're trying to start the trade where there is some intrinsic value on that call option, which just means the stock price is above the strike price. Save, confirm, send. Note the commission there, $0.65 to buy one contract. So now, is this like buying shares? We're getting a fractional move. okay, of the share price, that fractional move called Delta, okay? Now, we're going to see if that can't play out.So, we did a stock trade, and then we did also a trade on a long call with ConocoPhillips. Now, let's actually go back to, just real quick, I'm going to go back to Dell. I'll just leave it alone. Well, let's review that. Okay. All right. Now, this is the third time we've been in Dell. And I just want to see the position.

Now, why is this position so, why is this portfolio negative $35,000 in cash? Well, it might be because we got too big of a position in Dell.dell by itself okay hundred shares is is that even true we got a hundred shares and there she is right there okay a hundred shares so to get the cash down cash balance back to positive gonna need to try to sell some of those shares realistically I mean, if I just did some quick math in my head, I think we're going to need to sell about 80 shares of stock to get this back down to where it needs to be. Okay. So I'm going to sell about 80 shares. It's going to leave us with 20. It's still going to be too high.

We're going to needto get down to the position size where it's not too big now watch the cash balance okay we have 100 we sell 85 it's going to leave us with 15 shares 15 shares okay times 439 6500 it's a little more than we should have but all of a sudden that one position swung the cash back up so not too not too tough all right now let's actually go back to also some other positions that any questions now on uh dell something to kind of continue to watch these earnings are coming up what three weeks september 3rdremember this has been sideways and what's made the dell trade hard is the width of the range is wide there has been times there here there where you could have gotten nicked out only to see it reverse on the weekly chart when we look at this on a weekly chart pull that up Here's what it really looks like.

And it looks so easy now when you look at the weekly chart, but that's what you got to remember on the daily chart is you're setting your stops on a daily chart. You look at this on the weekly, it's been a very stiff flag. Now, let's be honest. Gary has said, go bearish at your own risk. I mean, didn't Gary say, hey, be careful.Okay, Gary, Gary said, be careful, the there's some fundamental reasons, okay, to some of the trend that we've actually seen lately. And you're going to see that not much of a pullback and that blue 10 day exponential, this is a 10 week exponential, you're going to see that that has been prices held that on a weekly chart now.

I've said to you before, I think this has been, I'd probably say in the last two years, Dell I think has been the most, we haven't gotten whipsawed. Dell has whipped us, it's whipsawed us twice, okay? And now we're in for the very, well, we're in for the third time. Let's see if that plays out now.Now what I also want to do is I also want to go back to just real quick. want to fast fire through a couple stocks that some investors might keep an eye on microsoft that has continued to grind higher i want you to notice how some of these stocks that were beaten down that they reversed salesforce it's even gone up weren't these the ones that were down uh they were ibm

trying to push back to the upside as well keep it on that the other one that's actually was down and reversed back up was adobe okay that was down and now it's starting to come back so what you're going to kind of notice is sometimes when things get pushed down some people kind of view that as maybe fundamentally softness technically weak right and now that The board, the senior leadership, they're responsible to actually kind of create a plan and going forward, keep an eye on that. Now, we also have to actually say in their workday, big reversals on workday, when it broke out at 150, here we are at 184, not much of a pullback.The other one we're going to keep an eye on is Netflix. It's trying to grind higher.

Note that, GE, okay? And the other one, if we're going to get some leadership in the space of, let's say, semiconductors, Micron is holding the breakout, but it's pausing, okay? Now, I kind of view this as if you ever tell someone I love you and they don't immediately respond back, I love you back, not maybe the greatest sign. So the longer that we go without really pushing up to the upside, that stock is not saying to the investor, I love you back. So this is this is one that, you know, by Friday. We need a push on Micron.Now, let's go back just real quick to just real quick a couple of these other, some of these energy names. Apache, pretty big push. Now, I'm bringing up some of these that are lower dollar priced, okay?

We're going to go swing right back to where we were before. Marathon P, MPC. someone says I like a flag. Valero we've talked about, right? We're kind of now getting back into some of these, let's say, drillers, if you will. Phillips 66, I'll just bring up this last one. These last two, PSX, Phillips 66, and Valero, two pretty similar names, right? Now, if I went back What do we mean by kind of a stiff flag?Well, what I mean by that is we had the price ascension to the upside, right? And that we just, we haven't really seen the price pull back off the high. It kind of looks like, I call it, it looks like an upside down hockey stick, okay? So we ran out from, let's say, 235 to 320.

And if we look at this and say, well, how far are we off the top? And the answer is $7. Now, has that consolidation taken time? It has. Now, here's what happens, okay? Trading number one says, there ain't no way I'm going to buy at a high because it's, you know, it's at a high, okay?And they'll say things like, well, I'm going to wait until it goes to another high to confirm, which now just sounds like they're changing their mind all the time. So how about we just did this? How about we actually just practice saying, well, what's the support over the last one or two weeks? Well, it's been right around 300.

why don't we actually just say look we'll buy at a high maybe there's reasons that it's at a high okay well if it's at let's say a near a high we have a support of 300 why doesn't the investor say i'm going to try to buy some inside the channel there let's just say position number one and if we break out okay i'm going to ask that stock for the second datewhat happens is they put all the pressure on themselves on this one breakout point the problem is that's not how trends work that's not how relationships work either okay so here's the deal we're we're just going to say look we're going to take a half position inside this channel set a stop below the 300 second we're going to set alert at 320.

if we get the alert we're going to try to add to the position okay so how do we do that quickly well we're going to do this and we're going to look for some of your questions here we're going to right click on the chart how fast could we do this you're about ready to find out okay and what i'm going to do is i'm going to go uh valero okay we're going to right click on the chart let's go back to that first chart there we're going to right click on that chart buy custom and i'm stop. Now, where is that support area that we talked about? We said 300. I'm going to kind of mark it as 298.21.Okay, less 2%. It's going to give us 292.24.

Now, if we type this in, and what am I really trying to do here today? I'm trying to get you to stop being so sensitive on new highs.okay i'm now there could be reasons why that stock's at a brand new high and just because it's a high doesn't mean it can't go higher you buy a stock at a low we've already proven that it could go lower okay that's called trend now what we're going to do is here in this case we're going to go date gtc so what we got in this case is we're buying the shares at this price setting a stop sell if it goes to that price or same price no or less come back to this sixty one hundred dollars worth ten percent of the account value gonna give us 19 shares how do you set the alert well let's send this first trade number threeokay valero Buying is an option or a stock?

It's a stock position. Now, James, in the paper money portfolio, do you have any energy stocks? I don't believe we do, okay? We can double check. We got one airline, Love, and after today, we're gonna have three energy names. Now, all energy is not the same. You can look at Halliburton. And then you look at, let's say, Exxon, you look at Valero. Sometimes there's some differences there of the width or the, what are they touching, like drilling, all the way to the gas station, okay? And so in this case, we're looking at these three examples. We did Exxon, ConocoPhillips, and Valero. Now, if we send that, there it is.Now, the other thing to kind of remember with the Strait of Hormuz kind of being up there, oh, I should say open, close, open, close, open, close.

We're not saying, I'm not saying that these other regions in the world are going to take the percentage if 20% of oil production comes through the Strait of Hormuz. If that area continues to kind of be rocky, to say the least, other areas of the globe, they might be trying to produce more to try to make that matter less. I'm not saying they're going to fill in the gap, okay, completely. But what could happen, just like in regular demand and supply, they might look for that supply in other parts of the globe.where there's not that type of issues happening. To get it from somewhere else, not a new idea. So trade number three, Valero. Now we got a survey in the chat. It's just two questions, okay? Click on it.

Thank you in advance for filling that out. And also I'd love to actually see your comments as well. First thing I do in the morning. Now, there's a comment that says, what's another approach to the Valero trade if you don't want to risk a 20 point stop? So it's funny you said that. So when you say a 20 point stop, it sounds like a lot. But what we don't say with actually that is, well, how much is the stock price?okay and so this is where it kind of comes back to is that understanding the numbers of it so when we actually look at this and said okay the stock price hey we're gonna risk let's say 20 bucks We don't look at per se that by itself.

We actually say, what's 20 bucks relative to the current stock price? What are we buying it for? So we bought those shares for 314.04. We said the support was, let's say, 298.20 or so, I said. Stop, let's say, 292-ish. There's the 20 bucks that MCT. BLR is saying. What we're really looking at is we're saying, what percent is that of the entry price? And it's 6.94%.Remember, if you buy a stock and you're risking four, maybe 5%, you got a tight stop loss. If you're risking five to 6%. Medium. If you're six or seven, that stock has gone up a little bit off support to cause that bounce signal to occur. And if you're buying, let's say, greater than seven, I mean, the love boat's leaving the harbor here, okay?

And all of a sudden, if you're buying at greater than 8% offnow we're actually saying do you want to look for another re-entry maybe you want to do a let's say a buy limit and i said the love boat i really mean the opportunity the boat of opportunity if you will okay so what does the 20 mean uh it means we're not at seven percent we're kind of a little elevated because that's because the stock went up five percent just today alone but it's not likeif we tomorrow if this stock goes up to 327 and we look at this now the conversation is different now it's actually going to be in this case where now we're at 10 it's elevated we're going to need a pullback when we look at the envelopes we know where those areas need to be but if we go back and say where are the envelopes right now we're barely at the yellow line which says

We might be freaking out when it's not that high off support. Yet. Let's see if that continues. All right. Now, let's see. Let's go. Any other questions there? Now, the comment was, and I'm not, we did three examples in this area. I'm not going to do this other trade.But if we look at it, let's say Schlumberger, okay, Berger. depending upon where you're from. Now, if we look at this, that is the one that you do see that has been carving off the bottom. Who said this? Oh, Bill, okay? Sharp-eyed Bill. And what you're now gonna notice is Schlumberger is actually grinding here. That is also one that we always talk about this, breaking out of a channel, right?

Well, if you break out of channel, if we get much higher than north of 52 and change, how do you do that? I'm going to put our alert, just like we could on Bolero, right click, okay? I'm going to go to alert.Now, when we say alert, the alert is if we get to another high. now let's just think about this let's say someone's bank account gets an all-time high their brokerage account gets an all-time high their marriage gets to an all-time high their house value gets an all-time high is any of those things a bad sign any of them why is it when we talk about stocks that are trending if it's at a high it's a bad thing it's a psychological block

the things that the investors looking for bullish investor is looking for a trend if they buy at and or near high it's not saying they're risking all the way down to zero now with the stop it could go to zero noted but the biggest thing is we're not setting stops that low understand that now what we're going to do in this case we're going to create alert and we're going to say look if we go ahead or above where i right click on the chartlet us know now bill if we see this stock tomorrow get north about 53 the path of least resistance 57 ish the width of the channel as we close here is going to be right at about that's about an eight percent gap so keep an eye on that i'm out of my time here today focus a little bit on energy We're trying to kind of find an area where the portfolio is a little weaker in and its energy.

We tried to actually kind of patch up that area here today. We'll keep an eye on that of this area throughout the week. Don't forget about the in-person events. And also don't forget also about coming up next.We got Cameron May that will be teaching the next class on. uh cover calls and short puts join them don't forget to subscribe to the trader talk channel right on youtube it's free also remember that all investing involves risk today we did three trade examples focusing in the energy area we're going to continue to watch that and our focus point was really looking for stocks at and or near highs today i'm kind of trying to break that down that psychological barrier sometimes that some of us have had. I'm trying to help you. With that said, stay tuned for Cameron coming up next. Thanks to all of you and Scott, and have a great day. Take care. Bye-bye.