Will This Stock Market Rally Last?

What to look for in the week ahead; YouTube channel now live.

Hello subscribers!

I’ve been receiving a lot of great feedback on my newsletter. I know many of you are busy working full-time jobs, and videos may be more convenient for you.

In my effort to “knowledge dump” what I know about trading in the easiest way possible, I’ve launched a YouTube channel for you.

Don’t feel like reading? Then dive in on my videos.

What to Look for This Week

We saw an impressive rally from the lows last week, triggering MAJOR buy signals on the weekly charts. BUT — you’ll still want to confirm if a move is real.

Watch the video or dive in below to learn more.

Step 1: Confirm a Trend is In Place

Trends are defined by a series of “step moves” (price action that looks like steps).

• Uptrends are defined by higher highs and higher lows.

• Downtrends are confirmed by lower highs and lower lows.

• Trends tend to “break down” when there is a failed new high or low.

• Point P on the chart signaled the downtrend is coming to an end, by failing to create a new low (lower than Point N).

Step 2: Confirm Price Action on Lower Time Frames

Once you see a buy or sell signal, drill down to the lower time frames to see if it confirms what you’re seeing on the chart (example below).

• If you trade the hourly chart, drill down to the 15-minute chart.

• If you trade the daily chart, drill down to the 4-hour chart.

• There’s no science to it really, just be realistic about it. If you trade the weekly chart, don’t confirm with the 15-minute chart — there’s too much noise. Use the daily or 4-hour at the lowest. Remember, it’s all relative.

So, what do you look for on the lower time frame? A break in the trendline.

Step 3: Reconcile Bigger and Lower Time Frames

Here is a perfect example.

This was the BUY signal on the weekly chart.

On the 4-hour chart, we see clear confirmation with a trendline break:

Will This Stock Market Rally Last?

Given we have confirmation on the lower time frame, the bias is to the upside.

You can expect heavy buying/accumulation on any pullback from here.

Happy Trading 😊