You take a loss that you know should have been a win, and the next thing you know, you have taken three more losing trades in a row.

You feel a grudge against the stock, treating it like a person who has just wronged you.

At this point, you are angry, confused, anxious, and driven to make the lost money back immediately without question. Instead of walking away from the screens, you keep searching for opportunities. You keep trying to make something work. You keep trading. You keep losing. 

This spin cycle is called revenge trading, and it is a crucial mistake that can absolutely crush your account, and crush it quickly.

Today, we are going to shed light on the importance of avoiding revenge trading in the current market. As a day trader, it is essential to avoid impulsive actions that can lead to significant losses.

Today, we will explore practical strategies to protect ourselves from the pitfalls of revenge trading, ensuring a more steady and successful trading journey.

Understanding Revenge Trading

Revenge trading, driven by emotions like anger, frustration, or greed, lures traders into making impulsive decisions to recoup losses quickly. It is as simple as it sounds. It is the emotional pitfall we human traders fall into when we take one or several losses and want to make that lost capital back immediately, even though we are in a heightened, angry emotional state.

However, revenge trading often leads to further financial setbacks and crushes long-term success. Recognizing revenge trading as a detrimental pattern is the first step towards avoiding its detrimental effects.

Learn more from Kunal Desai, a veteran day trader with over 20 years of trading experience, how to identify revenge trading:

How To Resolve & Prevent Revenge Trading Issues

Embrace Discipline and Patience

Discipline and patience are the key pillars of successful trading. Resisting the urge to retaliate against the market’s fluctuations and patiently waiting for optimal opportunities are essential. By adhering to well-thought-out trading plans, we can avoid succumbing to revenge trading’s allure.

Prioritize Risk Management

Effective risk management is crucial in any market condition, and it serves as a shield against revenge trading. Utilize risk mitigation techniques such as setting stop-loss orders, focusing on proper position sizing, and making sure you are always respecting the 1:3 risk-to-reward ratio on all of your trades. These measures protect your account from excessive losses and maintain a balanced approach to trading.

If you prioritize risk management and ensure that every single trade follows these proper practices, you will avoid taking a bad setup with bad risk management out fo anger and anxiety when in a heightened emotional state, avoiding the recent trading detriment.  

Do NOT be this guy:

Maintain Emotional Detachment From Trading

Separating emotions from trading decisions is a skill that all traders must cultivate. Emotional detachment allows for objective analysis and rational decision-making. Celebrate wins modestly and accept losses as learning opportunities without letting them impact future trades. By staying emotionally detached, we can maintain a clear mindset and avoid falling into the trap of revenge trading. You are then trading the chart and the setup, not your emotions, allowing you to make clear decisions amidst a stressful environment/situation.

Stay Engaged in a Community

Participating in trading communities, joining chatrooms, and seeking mentorship provide invaluable opportunities to gain insights and learn from experienced traders. Engaging in knowledge sharing helps expand our understanding of market dynamics, trading strategies, and risk management techniques. Through collaboration, we can develop a well-rounded approach to trading, reducing the likelihood of succumbing to revenge trading tendencies.

Also, a community or trading partner can prevent you from overtrading or revenge trading simply by having another person ‘monitoring’ you. A trading partner is an amazing resource that many people find within our chatroom upon joining. By opening up to your partner and allowing them to see what you are doing on a day-to-day basis, they can stop you from revenge trading by pulling you out of an emotional state and helping you realize that you indeed are about to revenge trade and should completely walk away from the screens. Find a partner or a community, engage with it, and be open. 

Find out more about our chatroom by clicking here!

Cultivate a Growth Mindset & Accepting Losses

Adopting a growth mindset enables us to view setbacks as opportunities for growth and improvement. Embrace failures as stepping stones on the path to success. By continually learning from our mistakes and seeking ways to enhance our trading skills, we can build resilience and navigate the market with a growth-oriented mindset.If you understand that losses are just a part of the long-term game and journey that is trading, you will learn to accept the losses and move on, taking a valuable lesson with you each time. You won’t on the contrary get angry and try to make that money back immediately by forcing bad setups and revenge trading.

Rrevenge trading poses a significant threat to traders in today’s market. By adhering to discipline, patience, and effective risk management strategies, we can safeguard ourselves against impulsive actions and emotions. 

Only 8 Seats Left In Our Next Live Trading Boot Camp

Click here to apply for our next trading boot camp!

The post How to Overcome The Deadly Trading Sin of Revenge Trading appeared first on Bulls on Wall Street.

Yes, paid programs do have benefits and advantages over the free programs mentioned in this blog. The free ones won’t be as good as the ones that cost money. You can always upgrade as you gain consistency and profitability. But, if you are a new trader, these free programs are a perfect starting point for your career!

So without further ado, let’s dive into our favorite FREE trading programs and software programs!

TradingView.com – Charting

Tradingview started as a small company over a decade ago and now has totally bloomed into an absolute juggernaut in the industry. Yes, they do have a paid version, but the free version of TradingView will give you fantastic charting capabilities across multiple different asset classes and markets.

The free version even allows you to add simple indicators and plot lines to your charts. There are even some additional features such as an economic calendar, top gainers, community chats, and streams. We also use this for crypto as well, since it pulls data from multiple exchanges. 

Overall, if you are new to trading and are looking for a very solid free charting platform, Tradingview has you covered. Check out our YouTube video at the bottom of the blog for a full tutorial on how to use TradingView.

Find out more at: www.tradingview.com

Benzinga – Pre-Market Movers Scans

In trading, it is super important to follow momentum, and trade what is “moving”. We do that by trading and focusing on pre-market gainers and losers every day. A quick and easy way to find out what is moving on the day is to look at Benzinga’s pre-market mover list. It is a continuously updating webpage every morning, that also includes key news headlines for each mover that you should be reviewing.

Bookmark this webpage here: https://www.benzinga.com/premarket/

Finviz – Scanning & Idea Generation

Just like TradingView, Finviz.com is another absolute juggernaut in terms of free software programs that give traders a huge edge and a ton of information.

Finviz is a web-based platform, that allows users to create custom scans for stocks to generate targeted watchlists, shows the performance of various commodities and futures indices, has a news scanner, highlights upcoming earnings, insider trading moves, and more. 

Finviz also allows you to search for the top-performing stocks over any given period of time, from the current day, to the past year. This is a super powerful free software that many professional traders still use to this day to run overnight scans, generate trading ideas, research stocks, and create watchlists.

You can check out Finviz here at: www.finviz.com

Can Free Trading Tools Really Make You a Profitable Trader?

This has to be the question on your mind now. You’ve got some free trading tools to use under your belt. Do full-time professional traders really use these? Of course not. They use paid tools which are better and more efficient in every way. But these are great for using when you’re starting out, and you are on a budget.

This video will give you more insight into how to use free trading tools effectively, and give you some tutorials on how to use them:

Want to learn more about what it takes to become a successful, full-time trader? Apply for our upcoming LIVE Trading Boot Camp to transform your trading:

Get Early-Bird Pricing For Our Next Live Trading Boot Camp

Click here to apply for our next trading boot camp!

The post The Best FREE Trading Tools 2023 appeared first on Bulls on Wall Street.

Stocks (or any trading instrument) moving with catalyst significantly increases the chances of you seeing a strong trend.

Knowing how to properly identify which news pieces are important, and how to actually trade news events will give you a MAJOR edge in the markets.

Let’s dive in:

How Day Traders Use News To Their Advantage

As traders, price action is always king. We are technical traders, and the chart is always carries the most weight in our decision making. But if you really want to get those BIG moves on day trades or swing trades, you need to couple the technical pattern with some fundamental catalysts like news. 

Trading off of news alone isn’t enough. We always need to overlay technical analysis patterns. But, as traders, combining a strong technical pattern with a strong news release in the direction of your thesis is what we want to be spotting. Those types of setups will give rise to BIG moves.

Whether that news is earnings related, industry related, or company related, knowing the sentiment of that particular press release and combining it with a strong technical backing is what you need to be aiming to do every day as a day trader.

A.I. Stocks & News – Example

A great recent example of how combining news and technicals is to look at a chart from $AI. Thanks to the increased hype and popularity of Artificial intelligence from Chat GBT, $AI has gone on a huge parabolic run to the upside.

But, recently as we see in this example, it has taken a huge hit thanks to a major hit piece a short selling firm released on it. This is an example of a negative news event. 

On April 4, 2023, you can see in this hourly chart here the stock dropped significantly, thanks to this press release that was released before the opening bell.

Knowing that the stock has gone on a huge parabolic run recently, the industry is way over hyped, and that there is a negative news event that dropped this morning before the open, we can start to create a trading thesis to the downside thanks to the negative fundamental news catalyst.

As you can see here, we can lean into the idea that today may bring some strong selling pressure on the stock thanks to the news event, and can take a technical intraday short setup with more conviction, now knowing we have fundamentals and technicals aligning together in perfect harmony. 

The reason why we overlay technical analysis with fundamental analysis is the fact that this chart easily could have reversed and went positive on the day. We never want to assume that just because there is a negative news event or article out on a stock that it will drop. It is important to know what the news is and have the overall idea in your mind that the sentiment is negative, but we want to actually enter when the technical patterns confirm its negativity or positivity like in the chart below. Kunal dives into more detail here for the exact strategies to use on this setup, and more about how to capitalize on these powerful opportunities:

Trading “Hot” Industries

A lot of industries like Artificial intelligence for example will become “hot”. Like recently, companies will try to release as many Press Releases that incorporate Artificial Intelligence just to get activity and buying power flowing through their stock. As traders and investors, you have to be aware of the hot “industry crazes” and short-term volatility increasing Press Releases these companies release. Never assume that the hot craze and increased activity will last forever. Use these strategies that we outline below to trade these types of news releases safely. 

The Best Strategy For Trading News

The ORB (Opening Range Break) pattern is extremely powerful for trading news events to the upside or downside. We will continue breaking down this $AI example, as it perfectly depicts what an ORB setup is. 

An Opening Range Break pattern is just as simple as it sounds… It is the break of the opening range. As you can see here on $AI, we had a drop in the stock on the first candle, followed by consolidation creating that opening range, followed by the break of the range to the downside which initiated the all day selloff. 

We want to see a minimum of 3 consolidating bars after the stock opens, and then on the break break of those bars we enter. 

On news plays like this that gap down, consolidate for 3 or more bars, and then break that consolidation, you also want to make sure your stop is above VWAP, giving the stock enough breathing room to develop into a big trade. 

Options Strategies During News Events

Like we mentioned before, aligning technicals and fundamentals (news) like in this example can ignite some pretty large moves. Trading equities is great and can get you some great returns on these types of setups, but options can even bring even better returns. 

Taking calls/puts that have a strike price being in the money or close to your entry after an Opening Range Breakout/Breakdown can bring you some great returns as well, as the premium prices accelerate. Check out the video above to learn the strategies in more detail!

If you want to learn 17 other day trading strategies that we use on a daily basis, make sure to apply for our upcoming LIVE Trading Boot Camp!

Some of our boot camp students have been having their best trading years ever despite the challenging market conditions!

These students have been trading and studying for years with us to make these kinds of days happen. If you want to learn the strategies and tactics that allow you to capitalize in these market conditions, apply for our LIVE Trading Boot Camp below!

Only 8 Seats Left In Our Next Live Trading Boot Camp

Click here to apply for our next trading boot camp!

The post How to Day Trade News Plays Like a Pro appeared first on Bulls on Wall Street.

The best trading idea in the world won’t make you money if you cannot execute it. To succeed as a trader, you must be proficient in planning AND executing. 

Here are five actionable trade management tips to help you improve your trading that you can implement immediately to improve your results in the 2023 market conditions:

Size Down During Market Volatility

Every novice day trader thought they would become a millionaire when banks started failing a few weeks ago and volatility started hitting the markets. More range means more profits, right?

Wrong. During volatility, you can win big if the trade swings in your favor, but you will also LOSE big if the trade goes against you. As traders, we always respect risk. Any trade can turn into a loser.

Here are more reasons why you should size down during volatility:

Taking Partial Profits

As traders, our job is to take profits. We do NOT marry positions. Especially when the market is volatile and choppy like it has been recently, must take profits quickly.

Kunal, myself, and many other traders here at Bulls on Wall Street use a concept called scaling out of positions. This is where you take a partial profit on a position, and move your stop loss to breakeven to make a free trade.

If you are up $200 on a trade, sell half to lock in $100. Then moving your stop loss up to your buy price, or a higher level of support/resistance, allows you to lower your trade risk, while realizing a profit.

AVOID YOLO Options

The stock market is a place for traders not gamblers. On social media the phenomenon of turning $100 into $100,000 with options has become prevalent. It is less than 1% trading strategy. There is no edge to it.

You need strategies that can extract you consistent profits from the market to trade for part-time or full-time living.

Kunal shares with you a more sustainable options strategy in this video here:

Learn more about our new options trading service and our veteran options trading instructor Levi in this free training here.

Use Proven Trading Strategies

One of the worst things you can do for your trade management is to take trades with strategies you don’t know well. If you don’t know the probability of a trade playing out, your emotions will ruin your trade management.

Here are 3 powerful trading strategies you should look for every day in your watch list:

If you want to learn 15 more day trading and swing trading strategies and how to use them, join our next LIVE Trading Boot Camp starting in just a couple weeks!

Some of our boot camp students have been having their best trading years ever!

These students have been trading and studying for years with us to make these kinds of days happen. If you want to learn the strategies that allow you to capitalize in these market conditions, apply for our LIVE Trading Boot Camp below!

Early-Bird Pricing Ends SOON For Our Next Live Trading Boot Camp

Click here to apply for our next trading boot camp!

The post 5 Powerful Trade Management Concepts To Implement Right Now appeared first on Bulls on Wall Street.

More bank-runs are occurring in other banks like First Republic bank on the west coast, for example, as many regular consumers and users of banks that had exposure to SVB are starting to become fearful that their deposits are not safe.

So, with all of this crazy SVB collapse drama going on, it is essential to step back and look at how this will affect the market, everyday people, and other banks. First, let’s dive into SVB and a little more about the collapse before we expand further into the realm of the implications the collapse has for traders and investors.

What is Silicon Valley Bank?

Silicon Valley Bank (SVB) was founded in 1983 and has operated for nearly 40 years. The bank was created to provide financial services to technology and life science companies, and it has since become one of the leading providers of financing, banking, and investment services to startups and venture capital firms.

What does the collapse of SVB mean for the stock market?

The collapse of SVB represents a significant setback for the technology startup ecosystem, which relies heavily on venture capital funding. As one of the most prominent venture capital firms, SVB’s failure has the potential cause a ripple effect throughout the industry, with other firms potentially being forced to tighten their purse strings and limit investments to mitigate risk, even with the fed bailout as people lose trust with their bank systems, causing bank runs.

While looking at individual companies in the tech space that are publicly listed or are private, it is important to look into their holdings and exposure to SVB as well as companies that heavily relied on loans and credit lines from SVB and its associated parties/venture capital firms, to see if there will be any drastic impact or not on the company. 

What does the collapse of SVB mean for investors?

The collapse of SVB highlights the importance of due diligence when investing in any financial institution. For investors, the collapse of SVB is a rough reminder that there is always an element of risk involved in investing, and that the failure of one institution can have a ripple effect throughout the industry. It is essential for investors to diversify their portfolios and to carefully evaluate the financial strength and stability of any institution before investing.

What caused their collapse? The age-old story of being overleveraged and using customer deposits to buy risky assets that went south on them. Once the signs of distress got out there, a bank run ensued resulting in the collapse. A bank run is explained in the graphic below:

What does the collapse of SVB mean for everyday people?

The collapse of SVB may not have an immediate impact on everyday people, but it could lead to a slowdown in the creation of new technology startups, which could have a long-term impact on the economy. Additionally, the collapse of SVB is a reminder of the importance of maintaining a stable financial system, as the failure of one institution can have a domino effect that impacts businesses and individuals throughout the economy.

Well, the FDIC (or the federal government) will insure deposits up to 250,000 in the United States. HOWEVER, the fed decided to bailout SVB acc, regardless of their deposit size. The “old definition” of the FDIC is explained below:

Comparing the Lehman Brothers collapse to the SVB collapse

The collapse of SVB has drawn comparisons to the collapse of Lehman Brothers in 2008, which was a key factor in the global financial crisis. While there are similarities between the two collapses, there are also some key differences.

Always worth watching the iconic scene in the Big Short before we dive in, when Bear Sterns is tanking:

The Differences

One major difference is the size of the institutions involved. Lehman Brothers was a massive investment bank with assets of over $600 billion, while SVB was a much smaller venture capital firm. Additionally, the causes of the collapses were different, with Lehman Brothers being brought down by a combination of excessive risk-taking and the bursting of the housing bubble, while the collapse of SVB was more directly related to its exposure to high-risk startups..

The Similarities

One major and fascinating similarity is that both SVB and Lehman Brothers were financial institutions that faced significant financial instability PRIOR to their ultimate demise, which led to their collapse. In 2020, SVB had some very shaky lawsuits and questions about its solvency and ability to cover deposits. These same questions were raised 2 years before Lehman Brothers collapsed as well in 2006.

The collapse of SVB highlights the importance of due diligence and risk management in the financial industry and serves as a reminder that the failure of one institution can have a ripple effect throughout the economy. It’s important now that we keep a keen and watchful eye on the financial system. Always do your due diligence, and lean on the side of caution.

What does the collapse mean for traders?

What does the collapse mean for traders? Volatility and range. With the price action of the last several weeks, this kind of catalyst is a blessing. One of the best parts about being a trader is that you don’t need to PREDICT how this will play out. You only need to worry about reacting to the price action.

Some of our students have been having their best trading months ever!

These students have been trading and studying for years with us to make these kinds of days happen. If you want to learn the strategies that allow you to capitalize in these market conditions, apply for our LIVE Trading Boot Camp below!

Early-Bird Pricing Ends SOON For Our Next Live Trading Boot Camp

Click here to apply for our next trading boot camp!

The post What Bank Failures Mean for Investors & Traders appeared first on Bulls on Wall Street.

This time of the year can consistently deliver A+ trading opportunities… If you know how to play them and identify them correctly.

Earnings season can be a wildly profitable time for you if you know what you are doing, so today, we will get you ahead of the curve. Let’s dive into why earnings season is such a great time of year to trade, and some strategies you can use:

What is “Earnings Season”?

First off, let’s start with the basics. Earnings season is simply the time of year when the majority of companies that are listed publicly on the stock market report their earnings numbers. This happens four times a year, or every quarter.

Stocks are usually more volatile during this time as many sectors get influenced by the reports, as well as individual companies and tickers of course.

With that volatility comes increased opportunities for those who can navigate the crazy waters. Investors and traders of all time horizons pay close attention to earnings results. Every week you should be checking Earnings Whispers and to know what stocks are reporting earnings, ESPECIALLY if you have a position in the name. 

Why Trade During “Earnings Season”

As momentum day traders and swing traders, we want to be in liquid and trending stocks. With how choppy the market has been in the last few weeks, it is CRUCIAL to be looking for these type of stocks that have a strong catalyst. These stocks will go on strong trends regardless of what the overall market is doing. Let’s dive into some strategies you can use to actually

Strategy 1: Earnings Breakout (Day Trade, the Gap & Go)

This is one of the classic, most powerful and bullish patterns that occur following earnings reports. 

Whenever a stock reports strong earnings numbers, investors and traders will look to get involved in the stock the next day when it gaps up. Sure, it may seem like investors are chasing the gap up, but you have to think about it from their perspective. Once good numbers are reported and guidance increases for the year for the company, investors don’t care about paying up a few points the next day since they are looking to hold this stock for a few months to multiple years. 

As traders, we can ride that wave of new money inflowing into the stock the day after solid earnings beat.  

Take a look at $OKTA here for example. The company reported positive earnings on Thursday, March 2nd, and then gapped up the following day. 

Knowing that there is a lot of ‘hype’ around the stock due to the positive earnings the following day, we can look for intraday opportunities to long the stock the next day at the open and ride that wave of new money and volume coming into the stock. 

You want to look for dip-buying opportunities AFTER the morning hype has settled out. You don’t want to chase the morning action at the bell. Wait for the dust to settle, and long the stock on a dip knowing that the sentiment is still positive and bullish in the long run just like in this example.

Strategy 2: Earnings Breakout (Swing Trade)

We are taking the same concept as strategy one above, where we are looking for intraday opportunities to the upside after a solid gap up and a strong earnings report… But now we are looking for SWING TRADE opportunities.

You can also play a variation of this swing trade strategy following a big gap up off of positive earnings. You can wait for the stock to settle out for a few days following the report, build a base, and take a long position 2-5 days after the stock reports earnings and fades.

Take a look at this example of $NVDA here for a more detailed breakdown.

Strategy 3: The Gap Fade

The first two strategies were centered around LONGING the stocks out of a gap, but now we will talk about SHORTING then, taking advantage of profit taking at the open. 

Whenever a stock like $META below has a big gap out of positive earnings AFTER being down well over 60%-70% over the past 2-3 years, selling pressure can overwhelm new optimistic buyers.

On a stock like $META, investors have been beaten down for the better part of 2 years, and finally, see some gleam of hope to recover their losses. So many will look to sell while they can.

Think about it from the perspective of a bagholder. Pretend you longed the stock for a long-term hold at $300. If it went all the way to $95, then bounced to $200, wouldn’t you potentially look to sell? Especially in these market conditions? That is the battle many investors have in their minds in charts like these, and we can take advantage of that selling pressure by shorting the gap. 

On the flip side as well, many investors may have long the dip on a chart like $META at $95-$100, and now are up 100% after the earnings gap, so they will look to sell as well.

We have two strong reasons for selling pressure to ensue following the big gap up on $META, and as traders, we can take advantage of that psychology and selling pressure by fading the gap for 1 day or multiple days.

If you want to learn more day trading and swing trading strategies like these taught in live classes, check out our next LIVE trading boot camp!

Early-Bird Pricing Ends SOON For Our Next Live Trading Boot Camp

Click here to apply for our next trading boot camp!

The post Powerful Strategies to Capitalize on Earnings Season Momentum appeared first on Bulls on Wall Street.

By keeping an eye on these stocks, you can make informed decisions about when to buy or sell, based on market conditions, company news, and other factors during the week.

In this blog, we will cover the steps you need to take to build a winning stock watch list, and some crucial mistakes to avoid:

Mistakes To AVOID When Building A Watch List

Following Random Setups & Posts

Whenever you see a stock or setup blowing up on twitter, social media, chatrooms, or hitting a major scan, it’s already too late. The biggest mistake new traders make when building their watch list is trying to save time by adding other people’s ideas and setups to their own watchlist, and not doing the work themselves.

When you first start out, building a watchlist will take time. Don’t cut corners. You need to be watching stocks that fit YOUR game plan. It’s fine to look at what other people are watching, I’m sure many of you read our nightly watch list. Use these for ideas, NOT for blindly following. 

Follow this guide, take time every night, and learn to build an effective watchlist on your own. 

Adding Too Much To Your Watchlist

You want your list to be ACTIONABLE. Quality over quantity, especially when you’re new. Every ticker on your list should have some sort of highly-probable, actionable setup coming up in the near-term. Adding tons of tickers to your watchlist that just look ‘alright’ will be highly distracting, and will cause you to miss the actual A+ setups you were seeking out in the first place.

If you don’t have a list of set ups that you know you perform well on, we recommend you go back to the basics. We teach 18 different day trading and swing trading strategies in our Live Trading Boot Camp so you know what set ups you perform well on, and as a result what stocks to put on your watch list.

What Softwares To Use When Building Your Watch List?

In the video below, Kunal breaks down how he uses TC2000 to build his watch list, and incorporates several scans and lists into his process. TC2000 is a great charting platform and software to trade off of, and plan due to its easy to use interface. Kunal Desai is a veteran day trader with over 15 years of experience, and has simple routine you can learn from in the video below:

If you don’t want to use TC2000 though, you can easily use other software programs and websites like Finviz.com and TradingView.com to run scans and filter down stocks by certain setups and criteria to add to your watchlist. 

Types of Stocks To Look For & Scans To Run

Stocks That Have Big Momentum

First off, when we are scanning through different stocks and lists, we want to find stocks that are starting to have big momentum along some sort of trend. Look for stocks that have broke through a massive range to the upside on volume for example, or are about to break out. Or vice-versa to the downside for short-selling. We want to be where the activity is, and this will help you. Right before the market opens, you should be running a liquid gainers scan, a simple scan that filters stocks that are gapping up or down 4% or more 1M minimum average volume:

Stocks Coming Out of a Pattern

Usually you have 3-6 days AFTER a stock breaks a pattern to trade it before it becomes too extended. Take $MARA for example below.

$MARA broke the long downtrend on extremely high relative volume. You basically had 6 days of clean upside activity after the trend broke before you had a condensing of the range, and a big reversal candle.

Look for stocks coming out of big patterns, set alerts at key levels, and add them to your watch list so you’re ready to jump in once they set up.

Flagging or Range-Bound Stocks

Looking for stocks that are coiling right now on their longer term time frames like their daily chart is great to add to your list. Look for stocks that are just getting ready to break a huge range to the upside or downside, or a flag to the upside or downside. You can actually set alerts on your charts in TC2000 for that certain level to break, which will help you a ton with not missing these moves.

 $CCL is a great recent example of this type of price action:

Go-To Stocks

In addition to all of the new lists I am building, I also like to keep a list of my go-to stocks by my side. These are stocks that have big range, high volume, are well-known, and have a high ATR (learn more about ATR here). These stocks usually give rise to solid opportunities a few times per week, and are great to keep on a revolving list to analyze. 

How To Analyze Indices

Whenever we are building a watchlist, it is important to look at the major indices like the Russel 2000, $SPY/@ES, and $QQQ/@NQ to get a solid gauge on what the overall market conditions are.

If we are trending downwards, it is a good idea to look for shorts or over-extended bounce plays to the upside. If the market and indices are trending upwards, it is a good idea to do the opposite: look for longs or over-extended short setups. Use the indices as market color to aid in your bias going into the week.

If you want to learn more strategies and tactics to use to dominate the 2023 market conditions, make sure to apply for our LIVE Trading Boot Camp below!

Early-Bird Pricing Ends SOON For Our Next Live Trading Boot Camp

Click here to apply for our next trading boot camp!

The post Step-By-Step Guide For Building a WINNING Stock Watch List appeared first on Bulls on Wall Street.

Now, to be able to trade the market though profitably, you have to be able to pull these opportunities out of the ‘junk’.  Tiy nyst identify the prime setups and best stocks to trade, choosing the wrong stocks has the biggest consequences when the market is flying like it is now. 

A method we use to do that here at Bulls on Wall Street is by using and analyzing a concept called Relative Strength.

The focus of this blog will be talking about this crucial concept in detail, how you can use it, as well as some examples of Kunal identifying the best stocks to trade in 2023 based on this relative strength concept.

What is Relative Strength?

Relative strength is a strategy used in trading and investing for identifying value stocks. It focuses on investing in stocks that have performed well relative to the market as a whole or to a relevant benchmark like an indice. This video will explain this concept in more detail: 

How Do We Use Relative Strength To Identify Opportunities?

Traditional technical analysis and relative strength tells us that the strongest stocks in a bear market will lead the way when a bull market shift comes. We definitely aren’t in a bull market just yet, but we do have plenty of bottoming and basing in tech stocks, market leaders, and the overall indices. 

The concept of Relative Strength tells us that we want to focus on stocks that held up well while the market was getting crushed when the market starts to turn to the upside. 

What Stocks Should I Watch now?

Let’s dive into some examples. 

There is no question that 2022 was a nasty bear market. Tons of stocks were getting crushed, but a few sectors held up. Oil stocks were one of them Sure, they did have their fair share of downturns and red days, but overall, stocks like $OXY, $XOM, and $CVX did rise and see positive relative strength. Compare the $USO chart below to what the $SPY and $QQQ looked like. 

It rose while the market was getting hit, are consolidating now as the overall market starts to base out, and are setting up for another leg up when the market breaks out.   

Again, these stocks have ‘relative strength’ to the market, are basing out as the market bases out, are getting ready for another leg higher, and are also in a hot, stable sector. The more factors like this that you can stack onto a trade thesis, the better.

The Base Breakout Pattern

Another way to play the turn of the market to the upside in 2023 is by looking for a little bit of the opposite. You can also on the flip side look for stocks that have had an extremely NEGATIVE relative strength to the market, and have been beat down 75% or more. What we do here is look for a Base Breakout Pattern.:

To find stocks that fit this pattern, we want to see a multi-month base being formed at the lows on the stock, and fit this structure.

These stocks will give you opportunities for asymmetric reward vs risk. This setup allows you to ride short squeezes to the upside, and limit your risk to the downside. Just make sure there is sufficient volume in the stock, as well as a high correlation to a major index that is gaining strength.

If you want to learn other day trading and swing trading strategies to capitalize on relative strength names, enroll in our LIVE 60-Day Trading Boot Camp!

Early-Bird Pricing Ends SOON For Our Next Live Trading Boot Camp

Click here to apply for our next trading boot camp!

The post Relative Strength: Crucial Concept Needed For Successful Trading appeared first on Bulls on Wall Street.

The truth is this is one of the biggest trading fallacies you hear peddled on social media.

After working with thousands of traders from all over the world since 2008, we can tell you from first-hand experience that early profit-taking has disastrous consequences.

Knowing when to lock in a gain is not that simple. There is a whole system for doing it properly.

It sounds counter-intuitive, but you can GO BROKE by taking profits in the wrong way, at the wrong time, and at the wrong spots.

Today, we are going to break this concept down in detail, show you how to take profits correctly, and why taking profits incorrectly can be the ultimate downfall of your trading career. 

What is Taking Profits?

Taking profits is just like it sounds, selling some of your existing long position, or conversely covering your short position when you are in profit to get out of the market.

Most new traders have the expectation that the stock will just move straight to their profit target like this:

The reality is that a stock will only do that maybe 1 out of 20 times. The stock won’t ever just move straight to your profit target without any pullbacks:

New traders will often make the mistake of taking profits way too late. They hold a position because they don’t want to miss out on the next Amazon. As full-time traders, especially when day trading, we tend to focus on taking profits on the earlier side. Here’s why:

Why is Taking Profits Important?

If you don’t make money, you aren’t a professional trader. The only way to make money is to lock in profits. Many new traders make the mistake of holding their winning trades too long and getting greedy. Usually, when things look great, and you feel the rush of emotion from being in the green, THAT’S the time to start taking profits. 

There are a few reasons why taking profits is important in trading. First, when you take profits, you are locking in your gains. This means that you are not risking those profits by leaving them in the market and hoping that they will go even higher. 

Second, taking partial profits allows you to stay in the market longer. This is because you will have more cash available to buy more shares if the stock continues to go up. 

Third, taking profits allows you to stay in the market without having to add to your position. This is important because it can help you avoid over-trading and increase your chances of success. 

Fourth, taking profits allows you to adjust your position size. This is important because it can help you to manage your risk and protect your profits. 

Finally, taking profits is a true sign of discipline. This is important, because it can help you to stay in the market longer and increase your chances of success.

How Does Risk Vs. Reward Ratios Come Into Play When Taking Profits?

Trading is all about risk, versus reward. As traders, we have to have a properly skewed risk-to-reward ratio in our favor, ideal 1:3. What that means is our winners should be 3x as big as our losers.

Here is where profit-taking is key in this equation. If you learn to take profits INCORRECTLY and take profits early as a trader before your target, you will skew that risk-to-reward ratio down away from a 1:3. 

So, you really have to know when to take profits, where to set targets, and how to stay disciplined to your original targets. As long as the structure of the market and the stock itself stays intact, do NOT move your targets and take profits early. All that is doing is limiting your potential gains, and making your account more skewed towards a bad risk-to-reward profile. 

Now, this is a very important topic, and one that regardless of your current experience level needs to explore more.

Below we have a full, free webinar posted to our YouTube channel that covers this concept in more detail. Finish this blog, and then go right over to this video.

Let’s move on to our final section, talking about the relationship between your emotions and taking profits.

Emotions & Taking profits

Why do losing traders want to take profits early?

Because they are trading SCARED! They are trading out of fear and emotion, versus logic. If you find yourself taking profits too early on a consistent basis, chances are you are just trading with a lot of anxiety and are too worried about the MONEY, rather than the PROCESS and the trade itself.

Removing your PnL box from your screen can really help with not taking profits early. If you allow yourself to only look and focus on the chart and the trade, you will stay more true to the trade and your original plan. 

Win or loss, forget about your last trade as well. If you didn’t take profits and the stock reversed on you, no problem! Move on.

If you took profits at your target and the stock kept trending higher, resulting in you missing out on another thousand dollars, no problem! Move on.

Risk management is huge, and if you become emotional and just start taking profits in random places, holding onto losers, and just hoping you make money at the screens, you WILL end up in some very rough scenarios.

This chart below shows you just how big of a role proper risk-to-reward, profit-taking, and risk management principles are to your success as a trader.

Trade the chart, not your emotions. In doing that you will see drastic improvements in your PnL, and your ability to take profit at the right spots.

Signals To Watch

There are other signals you need to pay attention to know when it’s time to take partial or all your unrealized profits.

1. The stock is approaching major support or resistance on the daily chart
2. The stock has traded through its ATR (Average True Range)
3. The stock has a major news catalyst like an earnings report coming soon
4. A major macro event is coming up, like CPI report, that brings significant volatility into market

If you want to learn more about these signals for taking profits at the right time, make sure to apply for our next LIVE Trading Boot Camp below, where we teach you the exact  strategies we have used for over two decades in the markets!

Early-Bird Pricing Ends SOON For Our Next Live Trading Boot Camp

Click here to apply for our next trading boot camp!

The post The Ultimate Guide to Profit-Taking in Day Trading appeared first on Bulls on Wall Street.

The Federal Reserve is the central banking system of the USA. Having a basic understanding of its function and how it affects markets will give you a huge edge over most retail traders.

So why do people pay so much attention to it in recent years? Because it controls the money supply in the US and interest rates, which have been shifting dramatically in the past 18 months.

Nowadays though, people see the FED as a major market mechanism, which truly it is. Let’s start by defining what the Federal Reserve is:

What is The Federal Reserve?

The Federal Reserve was created in 1913 following a series of tough financial panics, its purpose was to establish central control of the monetary system in order to alleviate financial crises.

It is the center for monetary policy in the United States. It controls the tightening and loosening of monetary policy in the country, and sets many key metrics like interest rates for example to combat inflation. 

Basically, think of the Federal Reserve as being the controlling body of all things that have to do with fiscal policy, and the leader of the Federal Reserve is the chairman, Jerome Powell. This video dives into more detail:

How does the Federal Reserve Affect the Stock Market?

Being that it controls monetary policy, the Federal Reserve has a major impact on the US stock market. The announcements, debates, and policies they release have major short and long-term implications on the entire economy. The main thing that investors and traders focus on when Jerome Powell and the FED release information, is what they are doing with interest rates. 

Typically, when the Federal Reserve cuts interest rates, it causes the stock market to go up. When the Federal Reserve raises interest rates, it causes the stock market to go down. That is usually the reaction, and interest rates and adjusted to try to control things like inflation.

Here’s another good 3-minute video explaining the relationship further:

Why do we care about Jerome Powell?

Now that you know how important the Federal Reserve is and how drastically it can affect the overall market, you can probably piece together why Jerome Powell is so important, and why every trader always wants to know when he’s speaking.

Powell is the chairman of the FED, meaning whenever an announcement is being made, he is the one speaking about it publically. He is sort of the ‘spokesperson’ for the FED, and has a lot of influence on the decisions the regulatory body makes as a whole. 

If you look at Powell’s schedule (which you can find on tools like Finviz, and even on the Federal Reserve website), you can see he travels a lot and speaks a lot about different topics regarding the FED’s outlook on fiscal and monetary policy, as well as their plans for the future. 

Knowing the times he will be speaking as a trader and investor is crucial, because at any given time he can either say something material that can affect the market, or allude to some major announcement or change coming up. Jerome Powell is an extremely important person to know as a trader and investor, as ultimately, his words can drastically affect the market, and your trade in an instant. 

Make sure to always know where he is, what he is speaking about, and when he is speaking. If you see a major release about monetary policy, rates, and fiscal policy coming up shortly, as well as any major FED meetings, it is best not to hold positions into that news, and look to trade when the announcements and speeches conclude.

What to Pay Attention to in 2023 

The question on everyone’s minds this year is when is the Fed going to start cutting interest rates. This of course is dependent on the trend of inflation. If the monthly CPI reports indicate the inflation is downtrending, the Fed will get hawkish, meaning they will be more open to entertaining the possibility of lowering rates.

In our Live Trading Boot Camp, we dive into more detail the exact strategies that will give you success in the 2023 market conditions, so you will know how to trade as the Fed adjusts its monetary policy and markets shift. The class also gives you LIFETIME access to all future boot camps, so you are always on top of what strategies are working best in any given market!

Early-Bird Pricing Ends SOON For Our Next Live Trading Boot Camp

Click here to apply for our next trading boot camp!

The post Beginner’s Guide to the Federal Reserve & the Stock Market appeared first on Bulls on Wall Street.