Ten Lessons From ONE Chart
If you’re not a part of my Warlock’s World, YOU. ARE. MISSING. OUT.
That’s because Thursday was a combination of everything I’ve ever learned about the market all rolled into one.
The reason I trade the way that I trade is because I used to be you.
Struggling, reading books, taking any kind of advice that I could find, picking the brains of traders…
And that last thing is how I really started to make money — picking the brains of traders that were trading and really successful.
YOU don’t have to do any of that crap.
Because YOU have ME.
I’m not only the GREATEST trader alive, but I’m the GREATEST resource that YOU have at your disposal.
I used to sit behind traders and watch them in action and ask WHY they did what they were doing, and I listened.
That’s why I trade the way that I trade, and THAT’S why I TEACH as we trade.
I already did the research for you. I already learned the hard way. So you don’t have to.
EVERY DAY on Money Morning LIVE from 8:30 to 9:30 a.m. ET I try to TEACH, to SHARE the gifts of MY knowledge.
Then I really take the VWAPians to school in my Warlock’s World – we go over charting techniques, how to trade certain patterns, psychology of trading, karaoke, and SO much more.
There’s so much VWAP knowledge stuffed into my brain that sometimes I come back to the BIG ROOM — like today at 1 p.m. ET!
I’m not here to sell you alerts or incredible stock picks.
I’m here to TELL you about the greatest weapon in your arsenal – ME.
I come with the tools: VWAP and Multiday VWAP, blue line to orange line, the EKG of the market.
I come with the knowledge – I’ve been trading since I was 13. I’ve blown up my account five times and now I live on the right side of VWAP, right side of LIFE.
AND… I don’t come alone.
Every day in my Warlock’s World, the VWAPians upgrade their mindset with the help of Coach Brian King’s Foundations course.
Then, my main man, the Fractal Assassin 8-Baller, steps in for the Daily Decode, where he not only breaks down my trades, but shares his unique ears-to-the-Street knowledge.
And when we can pull him out of his forest sanctuary, my coder, Solid Jell-O, the Modern Day Maharjaha of the Multiday, steps in and breaks VWAP down to the molecule.
I’m bringing the package, baby!
In fact, I can take a look at ANY chart and break down its VWAP story.
A member of my Warlock’s World family brought me one of the most arousing charts I’d ever seen…
I’m OBSESSED with stock charts. Literally.
They drive me wild, Blanche. Ask my wife.
On Thursday in my Warlock’s World, I was helping my members read the VWAP glyphs on any chart they wanted, and one really got me going, if you know what I mean.
BEKE broke VWAP on Dec 16.
The more I looked at this chart of KE Holdings (BEKE), I fell more in love with it.
While it may take just one look from me, my goal is to TEACH all the VWAPians how to read this VWAP story.
So let’s break it down, because this chart is beautiful.
The first thing I see is capitulation. This is visible on the stock’s daily low price at $16.74. This marked when selling was at its strongest, fear was its highest, and all hope was lost.
The very next candle marks a double bottom.
A double bottom is a pattern in chart technical analysis that can mark a change in trend and momentum reversal from the previous price trend.
BEKE then indeed reversed the downward momentum and retraced to VWAP.
VWAP is like a magnet, and like Solid says, “VWAP is ALWAYS going to be your destination.”
Next, I saw a period of consolidation just below VWAP.
Consolidation (besides being impossible for me to say) is when a stock moves within a well-defined range, and usually reflects a battle of the bulls and bears for control of the price action.
Then the HUGE green candle provided BEKE with an upside VWAP break AND the “Kardashian Bottom” break in the SAME CANDLE.
The upside VWAP break is a bullish move IF there is some follow-through to the upside.
The Kardashian Bottom is that “W” formation that is usually a bullish indicator as well. Right after the bottom is finished, here comes that big green candle.
Then we see the blue line to orange line move that is also called the 1-minute Multiday VWAP reversal.
As the stock rose, this is where I always say to “sell into the move.”
It goes up? Sell some. Raise your stop. It goes up more? Sell some and raise your stop again.
I never exit my trades all at once. This way I’m selling into the move upward, just in case there’s a reversal, I can secure my profits.
And look what happens next. A blow-off top at $21.33.
A blow-off top is a steep and rapid increase in price followed by a steep and rapid decrease in price.
That’s why I sell into the move.
Following the blow-off top, the retrace to VWAP offered an opportunity for nimble traders such as myself to go short.
The retrace was so fierce, that the BEKE share price fell back to VWAP, back to the Multiday VWAP, making the blue line to orange line move again.
Just like that, 10 lessons from ONE chart.
TEN LESSONS. ONE CHART. ONE WARLOCK.
That’s all for now, VWAPians. Make sure to close out your week with me in the BIG ROOM today at 1 p.m. right here.
Kenny “The Warlock” Glick
December 17 2021
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