Okay, good morning traders and welcome to the pro trader webinar series Well, it's not the series this week. Joseph has a special event. You guys know who Joseph is. He's on every Wednesday here in Joseph has a special event and at 10 a.m. East Coast time and he's going through stock analysis and You know mostly well small caps and large caps But he is excellent. Well excellent at both, but specializing in the small caps trading with very specific targeted strategies That go through he goes through everything the trade management They exit the entries and the setups what he's looking for on the bigger time frame and then how to read it in book map I have Joseph's information here his website and other links I will be putting this into the chat If you want to reach out to him. He does offer educational services and mentorship as well, so You can Contact him directly. Let me go through the disclosures and then turn it right over to Joseph General disclosure all book map limited materials information and presentations are for educational purposes only and should not be considered specific investment advice nor recommendations risk disclosure trading futures equities and digital currencies Involves substantial risk of loss and is not suitable for all investors Performance is not necessarily indicative of future results. All right, Joseph. So if you want to you've got your screen being shared. Let me Project it here hold on Got it You're all set to go Joseph. Take it away So good morning everybody. Good morning Bruce and book map. It's always a pleasure to be here Today we have two o'clock FOMC so every morning the first thing that I do is looking at the news data that we have on the day and also for the week We're coming from the 4th July. So I hope you had a good holiday yesterday this morning my main focus was Tesla Meta Amazon, so I'm always looking at the three main stocks At the same time, I will be looking in video and then also at the major indexes Futures of reference Actually always they are for me and QES. I'll also be looking at spy, of course in the cues But those are the way to go For small caps this morning we had IMPL. So we're talking about a very small market cap company Fader on day one By a forecast 84 percent and also we had instead CCCC So this is another small cap But the small cab has not a high forecast fader on day one actually This company has a high institutional ownership So when we have a high institutional, I'm always a little bit more conservative in trading a short So I will start with Tesla today And we can proceed with an analysis So this is my first chart that look every single morning Even if I do the analysis on the weekends every day, I look at the monthly chart and I need to look at the trend. So this is the trend of Tesla in the last 15 years over here since 2008 The Last year has been a bullish here and we had several sorry Tesla over here We had several over here Months bullish in the starting of the year. So we had January was a bullish month February was a bullish month and then over here. We had March, which was a bearish month in their reclaim April was the last bearish month and then we had for now three bullish months Look at this price action, so I will point out to be here a few things the first one is a relative low Then we have a relative high Higher low and now we're forming of course a higher high if we're going to connect all these Levels we see that we form a higher low and our high So market is bullish on Tesla also market is bullish on yes and in queue We're trading a bullish market Is since a couple of weeks, I think a little bit more but Three weeks that I'm holding a swing long based really on a simple strategy and J lines Major break over here of the to 15 to 20 area and my first target is gonna be 300 and I'm gonna explain why 300 The next target I'm looking for these highs over here into the 420s. Of course, I Need and actually we need for all the swing traders and bullish traders that yes goes to the 4800 and NQ over here needs to go to the 16 and 100. Okay, so you can see NQ bullish He has bullish. They all broke this consolidation and Then we're looking at Tesla made to Amazon. So we're trading a bullish market. Now. We're not talking about 2020 2021 but it's a bullish market We're gonna start tracing our levels and the first one over here is gonna be on the monthly So the reason why I've been looking for that 300 is essentially a confluence of two major key levels The first one is set From a supply area and we can see over here. This is a supply area that I'm interested in What is supplied if we distinguish the level base on volume in Ordered flow, we're gonna consider that level as a supply because we were ejected here We're ejected here and we're ejected here If you consider instead that the level only as a technical resistance in that case We will call it resistance, but actually this is our supply area. So between 300 and 320 We don't have only a supply here But also look this beautiful trend line over here really seems like a picture perfect Passing over here for the level of 290 300. Okay, so that is the reason why when we Started the long position We're looking we were looking for this target and we're still looking for this target Shifting to the weekly chart. We can see this better Now look at this chart. Okay? We have a major dip over here. Remember, this was number one So we can plot over here number one Which is the main relative low and at this point is still a descending trend, right? We don't have any clue over here. This will be the the last dip Then we're setting We're high so number two exactly this point but then We can set a higher low number three at this point What I liked about this number three and again, I was not sure over here. This was going to bounce. I said Ideally, this is gonna be a nice bounce because this is a perfect hammer But I didn't take any long position over here unless Intraday trades and the reason why is because often we see these hammers like this one over here In this case work as well, but we will see hammers But they keep and even not work, you know, like we can get maybe a small push and then still unwind It turned to be a very good hammer. So I like this Pattern formation over here. This is a beautiful pattern formation. Also, we start reclaiming this level You can see how many times we dipped over here and we had our Bull flag or ascending triangle over here breakout. This is the zone that we started to long Okay, when we start seeing a one two three breakout over here, we had a perfect also higher time from Jlan's curl and That is the target we're watching that key area 300 because look over here traders how many times We push the price in the thread just started accepting. Okay, so we could get 295 300 310, but this is the area If yes any key will push that I'm still more positive that we can get to the 400, right now This is my personal training is what I teach and explain Don't follow as Bruce always say alerts like that. Okay, because behind The strategy, there's a lot of research There is a very systematic process in order to get long and get these trends Next step, I'm gonna go to the daily chart in the meantime, but here I will be discussing about Saturday we had over here right now into the 281 This is our daily chart. So why use the daily? Well, it's the most common use for the hard-thrink analysis I Can also look over here even better at the price action information I'm looking at the key daily levels and We have also here again the monthly in the weekly supply here. So we can see better this range Let's zoom in so It's a man the last week and this is what has been doing over here so Ham information remember what we're talking about before after them information get up And then over here we have a this is is a bar. It's a spinning top. Okay. This could go 50 50 Then with a strong close and over here get up and look now We're forming ideally Pen and tour flag. So I Will be looking for this kind of pattern Okay, I'll be looking for a Bullish candle over here next target 29 and then 300 and we're gonna go to the hourly chart Okay So now is a little bit clearer Why we were looking over here for the longs and traders now will start to Understand the reason why We started to look in for Longs into the dips We started to look for longs into the dips and Long again into the dips and Then over here again longs into the dips The plan of this morning was a bullish plan if I can put up a second. I will try to Explain in few seconds over here About the plan so we have this consolidation the last two days, right and This morning We have a major wedge And we had two major key levels of support.  So unless the market doesn't show you weakness Stay long Um We got into the support this was around eight o'clock We start pushing over here and nine o'clock. Then was a big strong move from yes, and then Q. Yes, and then Q this morning I'm taking up and Q look over here And you can see again where it bounced from hourly jailers Picture perfect again, right? So you see that hourly jailers over here bounce break of this consolidation at Now it's breaking the 15 400 So we are in a bullish market scenario. Where's going to be the next target? This here over here So this to go now into the analysis we're going to analyze the order flow together on tesla this morning And we're going to see if How to trail for whose long in these positions Anybody else started this morning in tesla? I will bring up also few considerations think is important over here to Go behind the process and I will show also what we saw in book them up. So let me bring up over here Uh, this So first of all the plan so we can go check the plan that we made And why we're looking to book them. So this was the plan I think is very simple over here to uh, to understand So this morning you can see that the man zone, right? So over here this way we explain this we We shared this at 648 new york time So we had this demand zone at 274 And uh, this other one over here 264. So 264 didn't happen We had a dip this morning Not at 274 by 276 and then we're looking for this push to the long side I want to share also The moment of the entry so over here you can see How was the entry? and What we saw in book map, okay So this is the entry over here this morning So right on this dip 278 and then Selling in partials over here and also What we saw in book map over here you can see alexander explaining the dip. So we're going to put this Just next to it. Okay, there we go So in the moment That we open We often see on tesla our dips Now these dips Are often where if we have a bullish environment A bullish market scenario long term trend bullish medium Term trend bullish short term bullish We see often dips that are bought So this dip that we see here is exactly this over here 278 And we see that Makes that v pattern that me and bruce always talk about So nice v pattern here And then pushed upside. So this push Is here so nice five points move And the reason why is We had an absorption of it here So we'll zoom in after explaining this. This is a perfect absorption And if you look traders at videos of two three four years ago or more This pattern is a pattern that we were training all these years Okay, so remember v pattern is essentially this course You can see The dip and then a bounce I don't really like to long over here Because longing over there will be longing around 280 Instead if you can, you know with practice Try to long into these dips We had a major support 278 Major supporter here 278 A perfect heat map and look how perfect book map give you that timing Okay, so you have to have the key level Key level alone won't mean much for me. Just not Because I see a level I long as Not only because I see a heat map. I will long you have to have a strategy around, okay The strategy over here is combining. So having the confluence of both over here So support The same time book map confirming that over here. We have buyers Simply stacked. Okay over here. We have buyers Stack at the level major Absorption and then we start seeing over here buyers. Look over here I don't see a lot of sellers. Look at those dots, right? So over here, we have a very strong divide. We have a very strong tape And we start making like we were saying before we start making a one two three and four Same scenario that we are looking on the monthly chart. Remember So where we are forming a low A high a higher low and a higher high That's the moment where you see this breakout and that's the moment where we shift the bullish Uh, is it clear to you that makes sense? Joseph I have a question on this so Uh Your v bottom, uh, so as you said like uh, well, there's the support or there's the demand, uh, right at point number one Uh, and then a lot of times like you said like you kind of have a microcosm of what you look at and you've covered this many times before um Basically the pullback to point three or The curl before point three You look at for it in the in more of a kind of micro structure Uh, you look for those buyers to come in and curl it just you know price starts to curl around and then you see those buyers Uh, and uh, and then take it take it on up um, yeah, so so uh, yeah You know, you can really kind of focus in you don't have to uh, or I just wanted to reiterate that point because you've said this many times in the past Instead of just blindly, you know setting a limit uh buy down in those areas or getting in Wait for you know buyers to tell you a bit uh and Uh and then because many times people or traders will anticipate and we don't want that Maybe this is going to go all the way down and you're going to get killed, you know By a massive sell-off and you're going to try to buy buy buy so What you said is Exactly what we need to look for that higher low that confirmation that buyers are stepping in Because we will see many support, right? How we know that this is the one that is going to hold We have to see a reaction. So when Tudor asked me Jay, how you know that that's the main support You have to wait for a reaction You know when we are up here, let's say a number zero. I cannot say a number zero Okay, number one will definitely bounce. I'm going there 100 of my size. No, I don't know it I know it's going to be a support. I know there's going to be a little bit of let's say, um War shift between supply and demand, but I don't know if bulls will take, you know Control over here of the price action, right? What I know is that one and I will say Bruce, we can do this We can put one the first point and we see a key level So we know that that's a key level on a daily chart interday chart So let's say higher time frame and lower time frame And a second point I will put here the confirmation of book map demand zone So seeing in this case what a heat map Of course the bigger the darker as you know traders the more important And then we see also that dot you see that red dot. That's a nice absorption That's for me is a key really it's a key point But I don't I want more because I see the absorption But I have to know now that longs are stepping in right So look at those dots that follow that dip over here all those dots over here all these dots These dots are demand right so these are buyers stepping in and they're just like rushing now They just want to get in they don't want to miss over here the train because they know that this will push up today So we need over here green dots Green I agree and you can have blue white whatever essentially what is Is demand starting to Get into a climax. Okay, so they're starting to acquire over here. They're building Positions and they're getting long And then five I will put the higher low Which for me The number three is the confirmation when we start bouncing That now we don't have any more sellers in control because what could happen number two joins And we start having over here now lower highs and lower lows right But once we form this number three and we start cracking over here the number two high That is my confirmation that longs are in control So that is the main point All of this together All of this is the process all of these traders all of this is a process Okay, so screen shot it Because this is the process to take along like this You buy to dip and you start selling over here for a multiple R return And this It doesn't really matter if it's like, you know, uh, two three four five six figure trade Size will come So don't really look at the size that you trade Look at the process and look at the use of book map together with simply key levels on the chart This really is not a picture proof. This is actually what we did also on friday Friday was sharing also on book map on and in the room How we traded along in the dip for about seven or eight points from 276 and 50 to 284 Uh, the same process over here what we don't know is for how much this will push But this is essentially how perfect Is using order of flow and using Uh, the chart the strategy we teach Uh, I had a question over here bruce of a trader asked me What's the difference between this and just looking at tape? And i'm gonna reiterate this another time essentially When we're looking over here at book map Everything is one faster easier And you see all the tape at a glance and more Imagine that you're trading right now We can do this we have over here. Let's say four charts, right? So we have tesla We have meta We have let's say a small cab and we have enq. Okay, so four four charts over here So you can look at the tape and tesla and that's fine Of course, you won't see the liquidity two bucks away from the actual price Over here you have what we said meta over here. We have a small cap over here. We have enq I mean, you have to be a computer unable to look at the tape of four products At the same time Remembering what we had before With book map at a glance you see those levels and more so I can see this morning that When we are longing over here We had Sellers over here place. So this was a level that was already from the open. I had sellers over here Sellers over here and then sellers over here The first was a breakout. The second was a break of the third one was a rejection And essentially from there from this 283 over here We came down three points three points and a half to 275 and 50 soon. We'll see the chart So what it tells me simple trend lane break Lower highs and this over here was 282 from this 282 it went 279 and 50 Just applying a simple strategy of what trend line break and rejection This you cannot do with the tape. Okay. Now, don't get me wrong. I Think that the formation of a trader goes Uh into many directions. So, you know, you have to know everything but then specialize In this case, we're looking over here how to use the levels and how to use book map as a main key guide for entering the trades All right, let's dip over here into our charts Yeah, I just like to review just a quick quickly here, uh, joseph or recap on that Because that curling Basically, if you could go back to that chart for just a second. Okay, so sorry the chart on book map or the chart on the execution Uh, that um what you were just showing that, you know, you're set up there Okay Yeah, so the And there's because I'm there's kind of a back and forth in in, uh, uh, youtube right now Number one is that that where you have that arrow there And then to to the right of it just a little bit. There's there's green dots there That is a microcosm. That's in in fact, if you look at that You can I can even see like a a mini reverse head and shoulders in there Yep, exactly. So this is an order flow event Uh or pattern. This is the behavior that makes up this pattern Uh, uh, so so, you know, um trader carlson continues to ask about this and and we continue to go over it again and again These patterns are made up of the behavior of others This is what you should be studying Right now joseph has one here Uh that is showing a curling and I use joseph your curling, uh word, uh a lot or term Because it it very nicely kind of describes it hit into high liquidity on the way back down You're already bullish, right because of the bigger picture It hit into high liquidity on uh on the bid it starts to curl around and you found buyers Great now you're looking for that structure to break and they're broke broke again and they're broke again those two lines that you just drew uh and um Now the there's a microcosm here. So or a micro structure for that little head and shoulders Right and then that break just above 280 That is this basically The same pattern Uh, it is just a a bigger curl Okay, exactly. It's just a bigger curl It means that he optimized this and got in at a really great price But he doesn't know if the bigger curl is gonna unfold It is confirmed later Uh, and then he can manage it any way he wants, uh at that time Right, so this the behavior is in here, uh, you may see the pattern on your candlestick chart But this is where you'll see the details that are the the uh participants are telling you They're showing you how they're participating Exactly It's all uh, uh, I would say I always like to use this term Maybe because I I come from uh, italian origin. So, you know, the gladiators, but it's always a big fight Unlike in the colosseum we're here between supply and demand And it's just that it's just like a big fight between supply and demand And who wins is going to control the price action is going to control the direction So when we have Uh monthly charter is bullish Weekly charter is bullish Daily charter is bullish lower time frames that are bullish Hourly five minutes one minute and then you see morning pullbacks Often not always but often these morning pullbacks will be perfect levels Dips opportunities to buy for a long side So rather than I see traders that in the market and you know, tesla went from In the last move from 180 till 300, okay 290 from 82 look at nvidia went from 200 to 400 look at uh, amazon look at many others look at it Yes, and in here So don't try always to be counter trend if the market and i'm saying this because I don't want to lose money Because I lost before a lot of times Fighting the trend no do simply trend following strategy in this case the market is strong Yes, and in queue this morning was strong were bullish. They were actually pushing Before tesla So it was only a matter of time that tesla this morning pushed because yes, and in queue were strong and I There's a a nice comment this morning that I remember from a trader. There's called pola fountain and He said few minutes Before the open because a trader was asking What are you waiting for on tesla? And he wrote over here wait for yes and in queue to confirm the long on tesla So we have to see of course the market is strong is trend following If today the market will simply start like dumping let's say in queue down 100 points Yes, down 30 40 points. There's no point of longing tesla unless you know has a very big strength today relative strength news Maybe catty wood's buying another percent or whatever But rather than that Stay with the market better odds Uh, you stay with the volume volume employee this morning. Boom Major big trend following trade and low risk. That's a point low risk All right traders, I think we can move to The last 30 minutes of tesla because there are a few things that we can look together So I keep you can see over here My screen very uh, I will share generally Um more than only uh one stock generally I share two stocks into future or three stocks in one future But over here today, I'm focusing with you on tesla because it's very very volatile. Okay There was also a very nice play on nvidia and uh I see that We got it from the 425 to the 430 31 But this is actually the main play. Okay, so let's look at this together a little bit more So if you look at just a little structure over here And I'm gonna do this look at this structure So we can understand first of all, this is bullish, right? But just zoom out a little bit Try to zoom out and look what is forming This is a nice wedge Again many times tesla Will form these wedges so we're gonna Do this And this This is what it's doing We have a low formed a high a higher low Lower high Higher low and over here. We're getting a contraction of the volume, right? So look over here traders contraction of the volume see the volume right here is pretty low Remember two o'clock today. We have data. Okay, so we're gonna look for that two o'clock and now I want to share The reason over here Of the bear trap And over here of the demand So this morning we had two bear trap Setups, what is a bear trap? Let's try to I explained this in the in the past, but you have a setup over here where You can see the price holding you to support and at a certain point you have a breakdown like this morning See open breakdown And then I always circle these you have this So this is This is actually wanted. Okay, we have over here. What we have sweeps So essentially stop loss from the longs are triggered Shorts are generally invited on these breakdowns and bruce will confirm They're actually invited to short over here Because a lot of retail traders or traders are looking to for a breakdown to enter short. They will jump in They will jump in Into a massive over here support And then it will get trapped. That's the reason why it's called bear trap Over here. So bear trap. Okay. We call beer bear trap over here And they start forming the Higher lows are highs that we saw before But we have an add-on over here. So we can see this level, right? This is a clear level of level of liquidity Who are these? These are buyers. Okay, there are a place at 280 Whole round dollar number, right? You can see over here on the right 280 There are they want to get filled Probably these are longs that no or they're adding to a position long or they're looking for 300, but actually they're longs Uh, so they are all executed over here. So they're starting over here to Get filled 280 then we can see that we form a new low into 279 and 50s And again, what do we do? We reclaim the level of 280 at this point We start forming the same Formation that we had over here. So another bear trap And how we know this is going to be a bear trap, you have to wait for the reaction So only once we reclaim over here the level 280 and we start forming a higher low We can now say for sure. This was another bear trap Okay, and that's the reason for me to not counter trend. So don't go against the main trend Of the higher time frame of the lower time frame, you know to try to take over here our shorts like this Because the trend is is still strong over here. We're still making our lows, right? And we are in a bullish environment. So stay away from always looking for counter trend trades This is my suggestion You can see here. We had a high liquidity area so This is clear. So the actually starting over here to Buy this level is a 280 point 60s And then push where? To the supply into the 282 Again, you can see jumps on this level 280 Breaks the 280 point 50 to 80 point 60.  So now we're breaking over here this wedge when I Talk about the wedge means essentially this So we're breaking down this wedge And what is the next target at hypothetically we can hold this over here 279 And then if we break more 278 so from these levels I can start looking for a possible bounce Okay Let's look also the chart Any questions on this traders? No, not yet. I think we're kind of caught up on questions Okay so let's pass from five-minute chart to a one-minute just to see better the structure And uh, this is the moment that this morning it opened. So we're talking about this 930 This is the dip where we started buying so the v pattern Remember the v pattern that we are looking before It was over here. Okay. So this dip And this push And then it dipped again. Remember on the fake breakdown, right? We we just saw the 280 fake breakdown bear trap and push And then over here we saw finally This wedge breakdown now this is a Pretty good breakdown So we set over here. We're possibly going to 279 or 278 Ideally 278 is the low of the day We have a massive demand here over here 278 We can spot over here. So let's see how I'm going to react 279 and ideally 278 if we're going to get that Is this still too long? No, absolutely. Why? The breakdown is real We see major sellers Look over here also traders add These dots over here, right? These red dots or Salmon color they represent the sellers So if you have over here to consider who is in control just looking at something very simple a visual color You see more Salmon dots or more green dots because essentially traders ask you all the j I have the difficulties to understand if they're buyer or selling I tell you a very simple way to do it What is the dominant color over here green where we have only two dots and three dots or the salmon Where we see multiple Big dots over here So sellers are in control, right at this point sellers are in control Then you can look at the candles over here on our right. So on the chart and you can see there are like various candle on the one minute Now it's forming also a hammer. Remember what we spoke about before the hammer We're bouncing, but it's still not a good level where I would buy over here. So we need a little bit of weight And see if we can get a Or reclaim in this case of the 280 point 50. So I will look for this reclaim over here This level Or for that support So this level over here reclaim Or the support over here to do 78s Which is the low of the day Okay, this traders is our tesla off the date some bounce play We're not anymore in a long position Since this zone over here Okay, so we got this part of the move We're waiting right now So or this here or a reclaim and this here So trading did buy or Cut pattern over here reclaim So looking over here for a did buy or a jlc Is our terms that we use move for you from 278 and 80 up to 280 Still not enough over here As I said, we need to reclaim the 280 point 50 So sigh ways For us at the moment I'm also going to upload Bruce and video And going over a few things on invita this morning So we're going to upload this Invita traders is one of the best stocks that Is out there to trade in sense of high liquidity Wide range days And also I would say good options Okay, and I really like in video how it plays or the structure and everything This is this morning in video. So Nice juicy run from the 421 up to the 431 432 And now we see that Is breaking The trend line and once we start breaking the trend line We started forming over here a first level of clear supply in the 40 30 point 15 So look over here higher lows higher highs Lower highs over here breaking down is forming lower lows and lower highs Clear air of liquidity of the trend line. This is a key level that I'm watching right now. So that means For now bearish so possible pullback I am pl. We're shorting this morning Uh, it's a small cap and this small cap We had a high forecast fader for the day. So we're going to do Uh Days removing the caters. Okay So this is one of those small caps that I run the forecast with me in forecast that I know exactly From a forecast system. How much percentage I have we have This to close right on the day 9 30 is over here. So this is the level of 9 30 this morning. We pushed We had this major level of resistance 180, which was the guide And you can see here instead on book map. Where was the major level of liquidity? Stack at 175 We actually got this 175 over here Okay, so This level over here, right And once it got into this level, I will zoom in now. It simply started to fail So for now, we're still looking for this one wine 140 and ideally 120 This is one of the Favorite setup that we trade since many years Since when you started small caps 2017 2018 And we're trading this call gap and crab So the first attempt this morning we had over here to 71 And over here. So we shorted two times Came over here 10 cents in the money Came over here 7 8 cents in the money. Then stop over here break even stop over here break even And then the last one over here This Push in major rejection from the 175 Once we feel the 170 once we feel the 170 over here So again, what is the bull trap, right? Because over here longs are trapped above the rig And this is a particular pattern that I see often in the small caps They tend to trap breakouts traders The level of breaker was this over here, right? You see the 170 breakout And once we break above Now over here we have breakout traders. They're longing over here. So they're longing But once we start going back below the support Reason to short Putting the stop volume was low was not very high volume Major trap over here and rejection Trap because where's the bull trap? Rejection from the heat map started seeing sellers. You see over here those Salmon dots Major seller And why seems like not a lot. I mean you know Seems like not a lot. I mean you're trading Tesla. You're looking for 345 points Over here. This is a 20 cents for a 150 170 dollar stock. So that's a pretty good percentage for a fail Something like this was very liquid this morning. You can even put size And a good dip in the 170 Now in the last minutes it started for me over here a little bit of bounce But there's still low volume low liquidity. I'm looking Into the stock So I'm looking to hold over here Putting the risk in this case at this 172. So Why not using the profits over here for this morning fail And 150s was a main target Even if you're looking at 140 is the main one Why not risk over here this 172. So we have this level over here Of resistance. We're risking that for the play And this is until we're gonna have low volume CCCC Another small cap this morning This is a little bit more trickier Because today we had a high volume This zone over here was a high ball. You know, I'm gonna There we go I'm gonna put over here the indicators with volume Okay, so we're gonna Put this in a separate field Move over here to the panel below And I don't really like these colors So just like to make it gray or black And there we go, this is a one-minute chart. Okay, and look at the pre-market There we go CCCC Okay, over here. I have only the last 30 minutes pre-market, but essentially You can see the volume started to push over here till 300k per minute at this peak 365 The key levels on the daily were over here 350 and 390 up here So we didn't have, you know, perfect point at 365 that I can tell you Oh, I'm shorted 365 because that's a daily resistance Now what I was looking at was this And this morning we shorted here We alerted at this point, we shorted The risk was 370 Bookmap was the timing so work perfect over here This is what we saw and I explained I'll look over here. So level we shorted this. Okay, 360s This is open That risk was 370 There is 370 because we are risking 10 cents in 10 cents. So we shorted over here 360 once this failed, all right We see that At 366 we have some liquidity. It's not a big Use resistance, but we have like sellers more 370 more 374 So we had sellers over here. So 366 370 378. So these are three main level of liquidity So three main sellers over here level where solar word plays, all right And then once we saw the push over here and this went vertical Look over here From 350 to 362 It came up straight. So at this point I see With you that we have only buyers. Okay, the majority of these dots over here are green. So they're buying over here And this is the front side of the move. So this bar This bar here, they're buying right. We'll try to zoom in This bar here, they're buying this Is this level, okay, and then at the top of it here 362 this It topped over here. Okay, so we start seeing over here a trend line break And then sellers jumping in Now You have to be careful when you short here because if you're short And then we start making again a higher lows in our highs. You need to cut it Because this could be This kind of example and often what I see traders is what they short breakdowns Like here and then this pushed it upside So remember to say if you short a breakdown, like we said before Be able and disciplined that if this pushes again You need to cut With book map I can short higher Knowing the setup the pattern that I like to trade And that's the reason this is the point that we shorted The short We'll share also after on the chart, but this was already shared in room when we took it We see that we have no buyers over here, right? They tried over here to reclaim and bounce from the 355 you can see this buyer But then immediately we had sellers And that's the reason why you can see this bar The open bar made a spike and right away slam down this bar went from 360 too high till the 344 345 low So nice over here 16 cents drop To this point You see till the main liquid area the main demand And then from there Simply faded it bounced a little bit You can see it bounced over here Rejected 344 rejected 350 This is the 350 Nice rejection, right? Again, you have to know what you're looking for. This is a gap in crap So I know that at those levels I will expect A fail Few things for the trader that are still sure with with us on this So we have a key level here then we have Our Low of the day low of the day after the open, right? And then we have this level over here Here so we have three main levels this morning Now over here careful if we're gonna form This and start pushing Or The bc near so the one that we would like to see because A lot of traders in the room are short is looking for this And unwind and unwind. Okay, so we can call over here plan a Which is this one So looking for the fail because we're short from this level or Plan b this over here Okay traders So this is the the point over here I'll look in a book map Right now we have buyers and sellers. So I don't really have Uh enough to say okay only see sellers only see buyers I was also looking over here at the times and sales that we had What I'm looking is a continuation of the pattern. This is still a bearish pattern over here So until we have this formation We're gonna look for holding the trade and the plan a Okay Yeah, this is great Joseph very clear Uh and love the different scenarios you have outlined here or plans And what you and exactly what you're looking for Yeah, essentially every single time that I make a plan I try to make a plan a plan b or even plan c in order not to get caught in uh, I would say, um A plan that I didn't previous consider it Is very important for me to you know evaluate the different possible market scenarios So that Once my let's say a plus set up plan the one that I'm expecting the most is not happening Okay, then I can still rely on the plan b or plan c You know, it's in order for me to not being caught off guard And uh, I always suggest, you know, whenever I talk to a trader whatever they are To make always more than one plan don't always be, you know Only with one plan because that's being sometimes over biased Instead, uh, we say open your mind evaluate different market scenarios Evaluate what can happen if we have a trend following what can happen if we have a stop What can happen if we have a counter trend what can happen if we have for example A entry which is good working but then it reverses So this will be the point having always Different market scenarios In your mind or at least you can write it down. So you don't get confused Another thing Bruce that I that I Always, you know suggest this to write down your plan Because one of that is off trader that I've seen When they start like being mentored or I talked to them And I always tell them write down the plan and sometimes traders don't write down the plan and then they say Oh, I followed that. Oh, I followed this or I didn't respect my plan If we write it down, so really even with the pen on on a paper, maybe sometimes, you know, not for the millennials But for us, you know the old guard that We are still used to studying the books write down the paper and everything And it's good. It really it imprints in your mind the plan And you want to stick with that plan until of course that plan is valid, right? And sometimes what happens? Oh, we know the plan. I'm I know what I'm looking for We say this to ourself because maybe we're lazy. We don't have time We think it's just like a loss of time writing down instead. No If we write the plan down It's more likely we're going to respect that Rather than, you know, like Uh, not writing it down and tell to mark to our mind. Okay. We know what the plan is. I'm gonna follow that Yeah, don't you think Bruce? Oh, absolutely. I just want to let everybody know.  He cuts the trade. We we were talking, uh, uh, joseph like, uh I don't know the last few weeks about trader psychology and trader management and I keep on saying look if you want to learn this go see joseph um Because you're one of the the the best in with the trade management that i've ever come across Uh, you just very Unemotionally you just cut the trade and then you don't you don't worry about it and you look for the next one Uh, and that's it Uh, it's it's brilliant. It's really great. Uh, and therefore you if you don't worry about it You don't give it that energy and and then you get all confused About did I do it right? Did I do it wrong? Um, whatever Uh, it's just uh now you're looking for the next event that you know is going to be high probability Because you've done your homework It's as simple as that um, so, uh, one of the things that um, well a question I have for you here um Is so what would you recommend for traders beginning and and so you've outlined two different scenarios here uh, and um You know What i'm getting at is like how to learn to take a loss Uh, so for example, uh, if they take scenario a which is a short a short here Um, uh, and they know exactly, you know, we won't have to go over the you know the the trade or the um, the entry or whatever Right now, but let's suppose everyone's doing it correctly. They're entering it correctly Uh, you know based on your strategy um, and then it goes against them so Uh, what do you what do you recommend? Like just Where would you put your stop or how would you manage it? Uh, and um Uh, just just run through that scenario because uh Uh, yeah be really helpful. You know if if someone's taking any trade Uh, they if it's not working or behaving the way that they think it should what do you do? So, uh I don't want to be too long because um, I'm going to try to explain and answer this um I would say Sincerely and precise But a point is I will trail differently according to the setup that I'm trading and on the asset that I'm trading also Based on the statistics I make an example. We had this morning two stocks in small caps not much today was a slow day for small caps I am pl I run stats. Okay statistics. So really statistic data since 2021 and since 2021 Uh, my system and this is something I show in the room And I wrote it. It gave me 84 percent to close right on the day. What means below the open level? 84 percent since 2021 Trust me is a very big edge. This doesn't mean we'll simply fail Because it can still push and then fail or it can be that 16 percent of those times that this it extends So always, you know, read price action or the flow Is what always Bruce tells you even if you have conviction You know, this could be the uh, let's say that the black swan that goes up 10 points today And you're gonna have a big loss So stats give you an edge give you that conviction. Of course, I need order flow and and the strategy cccc I wrote instead less than 60 percent fader on day one for a series of reasons Basically, it's a long forecast is a system that I put all my data and I know how many percent this will fail or not Good Based on this factor that this is not for me a high forecast fader So I don't have that huge amount of conviction that this will fail all the way down Every single time that this morning we ran into a support like this day like this case over here I'm very very attentive That this any single moment could trap and squeeze And that's my reason more I would say reinforced to have two scenarios our scenarios because we're short over here And we're looking for this But I know Or actually we know because we've seen this A lot a lot of times that this could actually Push and maybe squeeze over here So what it means if we're short at this point Maximum we're going to risk that break even today That's my answer Because this is one of those stocks For the series of reasons I said before that I don't want to risk more Then you know that the Not the risk per day, but the entry level that we're getting On something like impl where we have a high forecast fader We can risk a little bit more because we have essentially the stats by our side So What Bruce wanted to tell you traders is that whenever you have conviction You can maybe in my case Uh, always, you know Adopting a little risk per day with the broken everything you can risk maybe a little bit more But on something that you're not really that convinced for a serious of reason Be really strictly Discipline if doesn't work to cut it Okay, be very very strictly discipline to cut um The other thing that I found out And every year is different So don't think that 2023 is like 2021 is not like 2018 or 19 So every year has different months where we have more liquidity in small caps or less liquidity We have more gaps that uh are running or more gaps that are fading And it really changes really from I would say season to season or three months in three months Now in the last I would say one month and a half. Okay, end of May until now um More than 70 of the stocks that we're trading Are fading on day one. So we have essentially more faders than runners But if we go back for example in april and i'm talking about small caps We had a lot of runners If you remember uh cxsi si si lucy and all of these Runners that will stay up for day one Maximum until day three generally and then fill again But still they will give you a little bit of like problems like remember top Okay on day one So we had a different market in april Starting of may versus the market in small caps. Okay talking that we have right now on um Month of july Okay And how to know this essentially have to simply track analyze the market From a different perspective So there are tests that you can run in order to see this And that really gives you so much more confidence when you're trading So based on the market scenario that I have and this really are pro trips that I'm giving you Uh, you can simply run certain setups rather than others If I know that the market of april because I was looking Uh Runners day after day I was not really looking to trade too many gaping crabs. I was looking more to trade for example dip and bounces or on dover's longs or Breakouts and then buying the pullbacks in small cap plan rather than now I'm not really doing that almost Almost at all Because 90% of stock and I'm trading small caps in the last month In the room. It's only for shorting. Okay. There's a reason and this reason is simply data And you cannot go against data because it's that is numbers mathematical numbers. That's your certainty So you can discuss you can have all your thoughts. No stats data is what counts all the thoughts are announces And this is the market right now This is all great great joseph So like um, but this started with if I interrupt you this is Good because I've seen both sides And I was there as a trader not having that edge To tell me what I was what I needed to trade with you know size with conviction So when you don't have that you try to do everything study everything starting from everybody in order to create that edge that you can tell Okay. Now I simply have Confidence in my tools in my strategy Therefore I can look you know to grow my account to trade good to make my paycheck whatever that is But only you know with a lot of work with a lot of data Because a lot of traders they ask me they write me on twitter or whatever And they tell me j is this going to fail how I have to do this It's not, you know with one answer you will clear all your doubts It with a lot of study, but there's a procedure in study that I personally created and I believe all the good traders Uh are doing That gives you that confidence and that structure Tell me ruse Yeah, I mean that that's that's it. Exactly. It's not one outcome here. Uh, it's not two. It's not five. It's It's hundreds thousands uh, and you you have to You know know that this is going to work Uh in general Uh, and then you take the trade if it's not behaving you cut the trade Uh, so for example, uh That that's set up that short set up that you were covering Uh, and and you know for if for people that want to learn, uh You know how to Cut trades or managed trades Uh, you may consider uh going over to joseph and, uh You know following up with him Uh this Set up here for example Uh, you know you should Practice and see okay, so this is the setup Uh, this is where you would put your stop and don't trade with money Uh, you know, uh, if you have to trade and push buttons because everyone wants to Um either trade with extremely small size or don't trade at all Uh, you know trade maybe maybe in in demo, uh and uh See did it work Or didn't it work? uh and And then how to manage the trade like oh, I got stopped out on this one. Okay. I took it again I got stopped out on this one. Oh, I took it again. I got stopped out on this one. Uh now You're gonna have to do this at minimum 20 times to have some sort of data Just some this the beginning of it. Maybe 2000 times Exactly So ruse I want to add something. It's very very important Uh, and this is from a direct experience that I have from with a trader I think is just like explaining better what you're just saying right now Uh I was talking with a trader for less month. I'm talking only about june and this trader trades futures. Okay Uh, he's not a professional traders yet. He just has his goal Uh, he's been doing good But he told me j having this certain amount of Percentage of risk let's say off on my broker I closed the amount. I believe with 14 hours or 13 14 hours. Okay And essentially his problem is that on the red days he loses too much Then he started to make a run a test. Okay And he said instead of making my red days, you know, let's say I look I cut my red days at 1.8 average green days Instead of cutting like that, let's cut it like one or 1.2 average green day So one red day essentially is gonna be No bigger than an average green day Okay His performance. Okay on the back test right on on his tracking went from 14 hour above 20 So this is to tell the trader that of course you have to now don't do this First study your system back test that improve it. See how you can improve it But essentially it's actually this So learn how to accept the losses because many times we don't accept the loss and we dig a bigger hole Maybe you did splendid work for two weeks and this happened to me so many times So yes, I lost as well and that's the reason why I'm telling you this And because I've seen that and because I brought Uh, I would say improvements to my trading style. I can't tell you what worked for me Of course, you have to experiment and see on yourself. Okay, but in this case was accepting more Or is accepting more To manage the red days so to have less Not very less less red days, but to have smaller red days That's in simply increased His return on his account, which is what we're looking for. We don't really care if he's making 70% green days or 50% green days We're caring that he's making 15 are or 25 far of course is better 25 far And that's our goal in order to increase your account. Okay so for me is Actually analyze your work and see how you can improve better accepting to lose Really accepting to lose training is all about that I want to say this Bruce and I'm practically very very happy because I've been working with uh with a coder or the programmer in the last time and We built a system that in the last 10 years had maximum 4% of drawdown average. Okay The win rate is around 50% So it's not that you know, it's extremely 90 80 percent is 50 percent more or less depends on the product Is a lot of algorithm together But the drawdown Average in 10 years maximum was 4 4 without optimization all this like So that's incredible, right? So you don't really need A system that you have 90% win rate You only need how to manage the red Days the red trades. That's how you're gonna make money But at least this is my point beautiful. I mean, uh, that's it. I did I think, you know I see again and again lots of from gauging, uh, you know people's educating and and Talking to other people their questions Are revolving around what's happening right now? What are you looking at? What do you think this is going to do and we're talking about one event here, you know And um, uh, the mindset is kind of caught up in this one Singular event And said the bigger picture here is it's over stretched over multiple events hundreds of events and Then understanding And like your your trader being able to understand. Okay. Well, how about if you just cut the big red days? Mm-hmm. That's it. Exactly. Exactly. It's not easy. I'm not saying This is easy because maybe is is the hardest Thing in trading Maybe the hardest thing to trading. Yeah, I I I agree. I mean like, uh Uh, there's so many reasons why like like ego revenge. Um missing out all sorts of things uh that uh You repeat again and again as a trader And and don't understand that's this is something that the clarity in your trade management. I really really Uh respect It's okay. This is what it should do. It's not doing that. It's going against me. I'm out And then it probably turns around and goes the the the direction you thought it would be it doesn't matter Exactly, exactly. And then you say, oh, I knew it. No, I knew it doesn't really work Yeah, yeah, exactly. Is you're protected yourself. It should have worked then That's your setup. You have all sorts of information and data that tells you that this works So you believe in it, you know, it works. Uh, you take the trade Exactly Uh, bruce, I want to share Uh, two trades, of course, we we didn't have time to cover them today But I say that, uh, it's oh, sorry it's uh It's what traders should do. I'm very proud. So I need to show them one second Adopting the same the same process with book map This is meta This morning. So I think it worked pretty good. Very proud of this trader He's doing a lot of he did a lot of work and I believe he's going to become a professional And then also this over here on nvidia And this was confluence of book map with a very simple strategy So not


So I want to walk through a fatigue problem example which is actually from the textbook but I think provides a useful illustration of how to implement this process for understanding fatigue loading. So on the screen I have some setup for what we're talking about here. Basic ideas you have a part cylindrical part loaded axially with some sort of cyclic loading and we have some material properties that tell us the yield strength and the ultimate strength for this part. So the first thing that we need to start working on is is setting up our SN curve and setting up what we want to know or what we know about our SN curve. So to do that I mentioned in an earlier video that we need to know our 10 to the third limit and if we refer to the textbook figure 8.11 gives us that for axial loading we have a 10 to the third limit of 0.75 SU. So that's easy enough we can take 0.75 plug in our 150 KSI and we get 112 KSI. Great we also need to know our infinite life endurance limit where we say it's equal to SN prime CLCG CSCTCR and we can go through and kind of figure out what each of these is. Well SN prime and I've pulled in table 8.1 from the textbook because it provides useful insight to basically all of this information. SN prime gives us right down here in this small little bullet at the bottom which you can't probably read it says SN prime equals 0.5 SU for steel lacking better data. So it's kind of a generic answer when we don't have more specific information 0.5 SU. So coming back to my equation then I'm going to plug in 0.5 times 150 CL is my load factor for axial my table says that that's one CG for axial loading and let's see based on diameter we have a range of 0.7 to 0.9 let's assume that our diameter is less than two inches it isn't specified yet but let's assume that it is and we just need to pick something then so I'm going to say 0.9 let's see surface surface factor we would refer to figure 813 the setup for this problem says that it is a commercially polished surface so that's a pretty good pretty good surface and if we look at table 813 under these conditions I think we would get that or excuse me figure 813 0.9 would be our surface temperature the problem doesn't say anything about having high temperature so we can go ahead and use one and reliability doesn't specify anything that we want higher reliability so from our table over here we'll just start with the default of one great so we can calculate all that out and we end up getting 61 KSI for our endurance limit and that's pretty much all we need in order to fully define our SN chart so through the magic of television I have the SN chart down here already and basically what our two calculations just did is gave us this point here and this point here now on the chart it's showing points for 10 to the fourth cycles and 10 to the fifth cycles as well luckily we could just calculate those because we know everything else about it and I just want to talk about that for a second so say I wanted to know what this 10 to the fifth limit was so basically I would call that s 10 to the fifth there's something like that equals what and if you kind of remember any of your math courses you might remember that we can do something called linear interpolation so anytime we have a straight line and we know two points on that line we can interpolate between them to figure out a point that we don't know and effectively we do have a straight line now we do have to be careful because this straight line is only straight on log log axes so when we do our linear interpretation we have to take that into account so to start our linear interpretation we basically take two known quantities um and do like a rise over run type calculation so I need to remember this is log and my first point that I know is 112 over here that's my 10 to the third limit and my other point that I know is my endurance limit of one or of 61 and my x-axis change so this is the the run of my rise over run is 10 to the third to 10 to the sixth now I would also be using log scale here but if you recall log is base 10 so log of 10 to the something means that I just take that power and move it out front in the log and the 10 cancel so I can say 3 minus 6 and that's the same thing as using the log scale in this case and this has to be equal to one of my points and the point that I'm trying to interpolate so I'm going to take that 10 to the third point again one two minus log of the limit that I don't know which is s 10 to the fifth and now I'm talking about three compared to five as my run in this case and I've got everything in here all I have is this one unknown value that I can go ahead and calculate so you can obviously see the answer is over on my on my chart but effectively all I need to do is you know take this three minus five multiply that over divide that by the three minus six so negative two over negative six and multiply that by log 112 minus log 61 divide or excuse me subtract that from log 112 and then I would be end up with log of s 10 to the fifth is equal to something I can undo that log by taking 10 to the power of it so 10 to the power of the log gives me the s 10 and then 10 to the power of whatever number is on my right hand side gives me my s 10 to the fifth value in this case of 75 ksi so I can use this this linear interpretation or excuse me linear inter can't talk linear interpolation in order to find any value that I would want for any you know say particular life cycle on this chart the next step then is to take this data from my my s n curve and move it to my constant life fatigue diagram so just like in the example what we do is we take all of these data points and read them onto our chart and plot them extending the lines from wherever they cross on the the alternating axis down to where they cross the ultimate strength on the mean axis and that gives me the the chart that I need I add on my yield strength 120 and the lines connecting that onto my chart and I've I've constructed my my Goodman diagram now to give us something to solve for let's go ahead and say that we have an alternating load between 1000 pounds and 5000 pounds and we want to design for a safety factor of two and basically what we're talking about is what diameter of our round shaft that we're applying this load to would result in a safety factor of two so first we need to go ahead and calculate what our mean stress would be well we've got our alternating situation here right 1000 to 5000 pounds so let's say that we can take our mean force and divide that by an area area is unknown because we don't know the diameter that's what we're solving for so we get 3000 over a if we factor in a safety factor that means we're looking for 6000 over a so basically our stress we have to double our stress effectively if we want to take in that safe take into account that safety factor our alternating stress is basically what is our peak past that mean so if our mean is 3000 then our peak is 5000 that means our alternating load is 2000 because it's the difference between those two or with a safety factor I get 4000 over a now the way that that they've shown how to do this in in the book is to say well if we look at this graphically let's figure out what our slope of our our line over here is on our constant like fatigue diagram so that's 4000 over a over 6000 over a that gets 0.67 so that gives us the slope of this line here and if we charted this accurately enough we can kind of read some stuff from this chart then one of the things is if we were looking at the infinite life fatigue then we'd want to know what's going on right at this data point where my line my dash dotted line crosses my my infinite life infinite life chart and that's easy enough to find to do that I need to go ahead and set up an equation to solve for the intersection of these two points so I know what my two equations are right we can use the equation of a line give myself a little more space here so I know the equation of my two lines one is 0.67 again as I said what my slope of my dash dotted line is uh so that's uh slope times x which is sigma mean and it has a zero for a y intercept my other equation is my endurance limit line which goes from 61 down to 150 so I can set that equal to rise over one minus 61 over 150 sigma m plus y intercept of 61 so I have an equation if I add this uh component over to the left I have everything in terms of sigma m I can go ahead and solve that for sigma m and I would get 56.69 ksi and great now I have a a mean stress at which my endurance limit would be my where I would hit my endurance limit and I have a relationship from up above to area so I can say 6,000 over area now I have to be careful this is 56.69 ksi so 56,690 pounds per square inch so take that thousand into account and my area I can substitute in pi r squared if I do that and solve for r I get 0.1835 inches or a diameter of 0.367 inches great so what this is telling me is that if I want a safety factor of two my diameter for infinite life endurance should be 0.367 inches and in theory my part won't fail no matter how many cycles I would subject it to now suppose I wanted to save some money and this isn't a high use part so I only need it to last for a thousand cycles so if I come over here and follow this line up the one thing we should notice right away is well right here is the intersection with 10 to the third cycles however we have to be careful because I've already at that point crossed my yield stress limit so I'm going to get yielding due to static you know load exceeding the yield criteria before I make it to my 10 to the third line so in that case I need to calculate my limit based on that static yielding situation so I'm not going to write it all out but I could basically apply this same criteria set up two equations solve for sigma m plug in my 6000 a and maybe I should note that this is 10 to the third or excuse me 10 to the six cycles for 10 to the third cycles using the same process I get that my diameter would only need to be 0.326 inches so I could have a slightly smaller part if I don't have as high of a load or a cycle requirement um on on the thing so overall uh oops realize you can't even see what I'm writing there overall for fatigue I have a couple of things I need to take into count I need to figure out what my loading scenario is I need to determine what my mean and alternating stress are because they allow me to apply my situation to the constant life fatigue diagram and I also need to determine my limits so depending on how many cycles I want my part to last I need to figure out what those endurance limits or 10 to the third limit would be which is you know it's kind of like setting the yield criteria when we talk about when we talk about static loading and we use the failure theories when we're talking about fatigue we're comparing against whatever this endurance limit is which is a statistically determined quantity okay I'll go ahead and stop there