Avoid the Candle of DEATH
Hello, VWAPians!
New Year, same Warlock.
Leave the “New Year, New Me” bull for Facebook moms and your idiot cousin.
Every day is the freakin’ same! It doesn’t matter what year it is!
The market never goes down. And every day some garbage biotech “cures” cancer and runs 300%.
But you know why we’re not getting surprised at this video game? Because we have the cheat code! It’s VWAP!
And every day in my Warlock’s World from 9:15 to 11 a.m. ET, I teach my members how to trade using VWAP.
The party starts EVERY DAY on Money Morning LIVE at 8:30 a.m. RIGHT HERE!
It doesn’t matter if I oversleep, I can roll out of bed and nail VWAP trades again and again!
But I ain’t no one-trick pony, Blanche.
That’s why I’ll be having Money Morning LIVE’s resident Master of Momentum, Garrett Baldwin, join me on Wednesday, January 5th at 1:30 p.m. ET in the BIG ROOM for a special jam session centered around the Fed minutes release!
For most investors, the outcome of a Federal Open Market Committee (FOMC) meeting is BIG news, and the meeting minutes offer even more insight into the tight-lipped central bank’s mentality.
As a nimble day trader, I usually don’t really care about these kinds of things, because VWAP tells all.
But this FOMC minutes release has caught my attention, because of its potential impact on the swiftly approaching earnings season.
For Warlock’s World members, earnings season is always a big deal. Earnings are maybe when the 1-minute Multiday VWAP reversal works BEST out of the entire year.
And for this earnings season I have EXCLUSIVE earnings sessions scheduled ONLY for LIFETIME members of my Warlock’s World.
So make sure you join Garrett and I on Wednesday, January 5th at 1:30 p.m. ET in the BIG ROOM as we discuss how to navigate the volatility the Fed minutes bring to the market, and how what they say can potentially impact earnings season!
VWAP trades, either around earnings or not, are about the same thing — discipline.
Lose your discipline for two seconds and you can lose your a**.
Most stocks stink, and are waiting to kill your account.
On Monday, we found such a stock…
On Monday, a stock that I had previously traded, Nutriband (NTRB), seemed like it had potential for a revisit.
The stock was forming the crowd-favorite “Kardashian Bottom ” and the 1-minute Multiday VWAP reversal. Usually a good sign.
But take a look at what happened next on the chart.
One candle DEATH
The VWAP break from $9.26 to the Multiday VWAP of $9.74 is a nearly $0.50 move on a $9 stock.
That’s a 5% move. That same kind of gain would take you 120 years in the bank. On 1,000 shares, NTRB could have netted a $480 gain just from the 1-minute VWAP to the Multiday.
But look what happens next. That HUGE red candle screamed all the way back down to $8.90!
All of a sudden a winning trade could be a loss. On that same 1,000 shares, that’s a $360 loss!
And this is why I stress about selling into the move and raising your stops.
As a VWAP trader, I sell into the move because I don’t want to get chopped up by candles like this.
I also sell into the move because I never exit my position at one price.
Raising my stop helps to not only remain disciplined, but provides protection from candles like this, which are death personified.
Sure, selling into that move might not have brought the full $480 gain.
But it would have protected traders from any kind of swift downward action and, like 8-Baller always says, padded the profit and loss.
The name of the game is discipline and preparation.
So to help get you prepared for any kind of volatility that the market may experience due to the Fed minutes, join Garrett Baldwin and I on Wednesday January 5th at 1:30 p.m. ET RIGHT HERE.
And to make sure you’re as best prepared for potential earnings-based trades as possible, make sure that you’re a LIFETIME member of my Warlock’s World!
That’s all for now, VWAPians!
Kenny “The Warlock” Glick
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January 04 2022
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