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$IRBT was an earnings play that gapped up big on Wednesday in response to better than expected quarterly earnings results. The move in the stock Wednesday morning after the market opened  didn’t really offer a great setup to get a good risk vs reward entry point. It happens. Not all stocks will set up and give us an entry point early in the move. That doesn’t mean we can’t trade the stock. After waiting for it to flag we can use our flag strategy combined with the VWAP indicator to get a pullback entry and got us a nice 5% gain on the trade in just several minutes. See the full trade recap in the video below:

Not All Stocks Will Set Up At The Open

Sometimes stocks will just go straight up at the open, without really giving a pullback or anything to give an entry. This is essentially what IRBT did at the open. You must have the discipline to not chase or get FOMO when a stock you are watching makes a big move without you. All stocks pullback eventually, so there is no reason to get emotional and chase a stock if it doesn’t pullback at the open. You need to have an array of setups that will give you low risk, high reward entries after the market open for these scenarios.  This is why we use the VWAP to play pullbacks on stocks that have just made a big move.

Using the VWAP To Play Pullbacks

The VWAP stands for “Volume-Weighted Price Average”. It essentially shows you the average price that everyone has entered the stock during that trading day. It is a great indicator to use after the market opens to play pullbacks, and give you an idea of a stock’s trend. A momentum stock trading above VWAP, in general, is considered to be bullish. When it is trading under the VWAP, it is considered to be bearish.

It will often act as intraday resistance and support as well. When we traded IRBT this week we waited for it to pullback to the VWAP to get a low risk entry to capture some of the momentum in IRBT. It’s crucial when you use VWAP to play pullbacks that you wait for the stock to show signs of holding the VWAP area.

Wait For the Stock To Show Signs Of Holding A Dip

You never want to be blindly buy stocks dipping towards the VWAP without waiting to see how they react to that level. You want to see the stock hold the level for a few candles, to show some sign that it will act as support. Nothing in trading works 100% of the time, and you significantly increase the probability of a VWAP pullback working if you wait to see how the stock reacts to the level first. If the stock just dumps right through the VWAP like it wasn’t there, there is no capital loss on your part because you are waiting for the stock to hold that level before putting your capital at risk.    

Learn Everything About the VWAP At Our 60-Day Trading Bootcamp

We teach all of our students how to use the VWAP indicator in our 60-Day Trading Bootcamp. Our next bootcamp starts July 31st. Contact us here ASAP if you are interested in joining.

The post Simple Day Trading Strategy For Earnings Plays – $IRBT appeared first on Bulls on Wall Street.

The Beginning

I started trading stocks during the Dot-Com boom. It was the late 1990’s and literally every stock that had anything to do with the internet was going up. I was in college at the time and I was buying everything with everything that I had (which was just $500 to start).

I was on top of the world. I was growing my account every day. My plan was to quit college and trade stocks, and become a millionare in the next a few months.

The Bubble

Then came March 2000. The bubble burst. Everything crashed hard and fast. I lost everything. I didn’t know anything about trading. I knew nothing about short-selling, and was completely unaware that I could’ve profited huge on all the tech stocks crashing at the time.

I kept trying. During college I kept trading, but I was at a standstill. I would go on huge runs where I would go six months or so of consistent gains and then I would lose it all in one month. Still couldn’t figure out how to make money consistently from the stock market.

After I graduated college I got a job. I was still trading on the side, and still failing miserably. The pattern was the same, and the same mistakes getting me over and over again. No risk management. No trade plan. No trading system. No discipline. I had no idea when to buy and sell.

Finding A Mentor

Then I met Paul Singh. I stumbled across his blog in the mid-2000’s. At this time there wasn’t really any trading education services. So I started to bombard him with questions via email, asking him every little detail about his trading system and how he was making money.

Eventually he got sick of me and I begged him to let me pay him to mentor me. Luckily he agreed, and he examined my trading system.

He told me,”Kunal you have a great knack for picking stocks. You understand the fundamentals, but you don’t know anything about actually trading to profit off of your ideas.” You could have the best stock in the world, but if you don’t buy it at the right time, sell it at the right time, manage your risk, and size your position correctly you won’t make any money.

Just after a few weeks of mentoring with him I started to see big changes in my trading trajectory. After a few months of working with Paul, I started seeing more consistent profits, and I would actually keep my profits this time.

This made me realize that mentors are critical to finding success in any venture. There is no reason to make all the mistakes yourself when you can learn from others. Mentors can save you years of pain, suffering, and money. The lesson from my story is to find mentors as soon as possible when you begin something new.

That being said, even with mentors you still have to put in the work yourself. Trading is the one of the hardest endeavors you will ever try. But there is no profession that gives you the same type of freedom, independence, and scalability of income. All the pain and suffering is worth it. This what has given me a real passion to teach and help my students achieve trading success.

I look forward to teaching you.

Learn How To Trade Anything From Anywhere

Want to travel the world trading stocks and/or cryptos? Join our next 60-day bootcamp before July 1st and get complimentary lifetime access to our crypto bootcamp along with special pricing for 60 day intensive trading bootcamp. We will teach you all of the best trading setups for 2018. Click here to speak with us.

The post Dear Trader This Is For You – My Story appeared first on Bulls on Wall Street.

Why HUYA, IQ, and Other Chinese Stocks are Exploding

You are probably wondering how did we know that these stocks were going to be explosive momentum stocks to watch this month. There are several reasons:

Recent IPOs

All of these China stocks IPOed a few months ago. IPO stocks have very little chart history cause they haven’t been trading publicly for very long. This means there are very few resistance levels to hold the stock back. Once these IPO stocks break over their all time highs, you will often see some incredible follow through to the upside. Learn more about how to trade IPO stocks in this article here.

Low Float

HUYA and IQ have tiny floats, with both under 15 million shares. This means that it takes very little demand in order to move these stocks. When stocks make huge moves like we’ve seen in IQ and HUYA we see something known as float rotation. This is when a stock trades its whole float in a trading day, and the float ends up rotating because there is so little supply in proportion to the demand. As a result the price of a stock’s shares skyrocket.  

Strong Sector

As we talked about in the video, stocks that are apart of a big sector run will often trade in sympathy with each other. When you have stocks in a strong sector that are breaking out to all-time highs and are recent IPO’s, you get huge moves like you’ve seen with HUYA and IQ. IQ has been the leader of this monster sector run.   

Pay Close Attention To The Leader

During these huge sector runs, you should be paying close attention to what the strongest stock in the sector is doing. When IQ has had an opening range breakout to the upside, HUYA and BILI have usually followed suit. Likewise when IQ is pulling back, HUYA and BILI have tended to do the same as well. You want to align your trades on the sympathy stocks with the trend of the leader.

Strong Daily Trend

All of these China names have had an interesting daily trend. They are getting to the point where they are getting overbought, however they are not going parabolic. You can see on the daily charts of these China names that they have had days where they pullback and consolidate. They have all been on very orderly uptrends. When you are looking to day trade a momentum stock, all of these China stocks have the perfect daily charts. They have a very obvious trend to align your intraday patterns on to get high probability trades to the longside.

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The post How to Day Trade Momentum Sympathy Plays appeared first on Bulls on Wall Street.

The post How To Use A Trading Journal To Find Consistency appeared first on Bulls on Wall Street.

CRSP was on our watchlist going into the 16th (I put out my trading watchlist on the blog the night before most trading days). There was plenty of time to make a trading plan. You can see on the daily that the $60 mark was a key level of resistance. It has been holding a nice flag on its daily, and we have seen multiple tests of that $60 level as well. It had been basing in the high 40’s and high 50’s the past month, forming an obvious higher low on the higher time frame. This bullish action put the stock on my radar this week after it tested the 60 level again on the 15th. The only question was whether the stock on the following day would give us a setup playing with that key $60 level to enter and manage our risk. Check out our CRSP trade and my commentary below:  

Add To Your Winners

You can see that CRSP gave multiple flags to find an entry throughout the day. When trading momentum stocks like CRSP, you can get some great risk reward on your trades and catch some big winners by adding to your positions. It trended most of the day with 9 EMA after breaking out over the $60 resistance, which is very common for momentum stocks.

Breakout Retest

CRSP is a good example of a stock retesting a breakout level after breaking out. This is perfectly normal for stocks to pullback to retest, so do not panic if a stock doesn’t immediately start ripping after breaking daily resistence. What you can do is add to your position after the stock reclaims the breakout level, giving confirmation that the daily breakout is ready. You should also pay attention to whole psychological numbers when trading momentum stocks as well. Breakouts through psychological numbers will often be more explosive, and you will often get huge rips like CRSP did.

Learn How To Capitalize on These Plays With Our 60 Day Bootcamp

Bulls on Wall Street teaches exactly how to execute these types of trades along with many other trading setups in the 60 day bootcamp course. As a veteran trader I encourage you to educate yourself if you want to take trading seriously. I highly recommend the bulls bootcamp which starts May 22nd. Contact maribeth@bullson.ws to sign up.

The post CRSP Trade Recap: Trading Momentum On Multiple Time Frames appeared first on Bulls on Wall Street.

If you are wondering how to use volume in your trading to find the best momentum stocks, you should read this article thoroughly. It is a crucial variable for determining a potential momentum stock, for day trading and swing trading.  

What Is Volume?

Volume is the number of shares that is bought and sold of a stock over a given time period. When you using candlestick charting, you will see the number shares traded on one candle stick, usually at the bottom of the chart, of whatever time frame you are looking at.

For example, if you look at daily chart time frame, you will see the number of shares traded each day of a stock. If you switch to the 5 minute chart, you will see the number of shares traded every 5 minutes of a stock.

The Importance Of High Relative Volume

The best momentum stocks have high relative volume. This means they are trading well above the typical number of shares they trade per day. Stocks will usually trade at above-average levels of volume when they are gapping up or down due to some type of catalyst, like earnings reports, FDA approval, or analyst upgrades or downgrades. Check out the daily of TWLO:

You can see on all of the days when it is gapping with higher than normal volume. TWLO usually trades about 3-4 million shares per day. However, on those days where it was gapping up or down with a catalyst, it trades between 10-20 million shares that day.

Notice that it also trades larger than its typical daily range that day as well, which is exactly what you want as a day trader, because this means you are likely to capture a big move in the stock if you get the right entry.  You can learn more about the characteristics of the best momentum stocks in this article here. 

How To Know When A Stock Will Have High Relative Volume

New traders will not only ask about how to use volume, but also how to know beforehand when a stock will trade at above-average volume. A stock that is gapping up or down more than 4% with a catalyst will usually be trading with higher than average volume that day.

However, another big indicator is to pay attention to how much volume comes into the stock at the market open in the first candle. Let’s look at the TWLO intra-day chart on 5/9 when it was gapping up in reaction to strong earnings:

You can see that it traded almost a million shares on its opening 5 minute candle, about a quarter of what it typically trades in a whole day in just 5 minutes. When you see this much volume come in this early in the day, there is a very high probability that it will trade at well above average volume that day.

Compare it to the opening 5 minute candle of a typical trading day. When you see a stock trading with that much volume at the open, is it a strong candidate to have momentum and go on a strong trend that day, especially when it has a breakout on the daily chart.  

Technical Breakouts and Breakdowns

Momentum stocks can still trade at above-average volume without a catalyst. Another cause of a stock trading at above-average volume is a technical breakout on the daily chart. Look at the SQ daily chart when it broke out in March:

You can see the volume that came into the stock after it broke out above that 48 level. Stocks just having technical breakouts will usually not experience as large of a volume increase compared to stocks gapping with some type of catalyst. However it is still a good indicator of when a stock could be beginning a strong trend intra-day, or on the higher time frames for a swing.

The best momentum stocks are stocks that are gapping above resistance (or below support for a short play) on an earnings catalyst, and are trading at above-average volume pre-market and at the market open.

The post How To Use Volume To Identify The Best Momentum Stocks appeared first on Bulls on Wall Street.

Finding your trading niche is not an easy process. There are so many different strategies out there, it can be quite overwhelming for new traders. In order to extract consistent income from the stock market, you need to know how to find and master a very specific area the stock market. Let’s discuss how you can find your trading niche, and what you need to consider when figuring out which strategy to choose.

Master ONE Setup First

The best traders have one setup that they know like the back of their hand. Starting out, you need to focus on finding this setup that you can count on to bring you income. You should consider what type of stock you will trade, what time frame you will trade on, and what patterns you will look for. On these setups, you should know exactly your win percentage, risk vs reward, how much money you will risk, and every other little detail of the setup.

Mastering a setup takes time, and you need to be constantly refining it. One of the hardest things for new traders is sticking to your setup and not deviating. There are so many stocks gapping and moving every day, it is easy to get distracted and try to play a different setup. Discipline to stick to your niche in the early stages of your trading career is CRUCIAL. Once you master your setup and have an extended period of consistent gains, you can start to add more setups to your repertoire.

Find A Strategy That Suits Your Personality

In order find the best trading niche for yourself, you need to be very self-aware and know your personality inside and out. The reality is you will have trouble executing some strategies because your personality is not the right fit for it.

For example, let’s look at the opening range breakout day trading strategy. If you are not a quick and decisive person, you may not be able to execute this strategy successfully. You are usually trading highly volatile stocks with this strategy, and if you cannot react fast enough, you will probably miss the entry. The good news is this skill can be learned.

The point is you need to know yourself and find a strategy that you can execute with an edge. This is NOT an overnight process, and it requires some experimentation. However, once you find a profitable strategy you can execute, you take massive steps towards being able consistently profit in the market.   

Data Tells The Truth

Refining an unprofitable strategy is a slow, painful death. Don’t believe anything anyone tells you about trading setups until you see with your own eyes actual data that supports the thesis. You will see a lot of claims on social media about supposedly successful strategies. They might work for others, but you don’t know if it will work for you until you have data.  

The only way you will know if you are trading a strategy with an edge is by tracking the data yourself. For this reason, you need to journal all of your trades in order to find trading success. If you are not making money over an extended period of time, you need to make some changes. If you do not have a positive expectancy with your trading, you are just gambling and will lose in the long run.  

Get Started With Our Free Trading Kit

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Trading is the same. You may not need quite as many years of training as surgeons, but you still need many months of studying and refining your strategy to become consistently profitable. However, there is no other profession that gives you more freedom and independence than trading. The pain and obstacles are worth it.

In the meantime, here are 3 crucial things you must have done before you trade full-time:

1. Be Profitable Over An Extended Period of Time

Trading is a game where a few days of bad decision making can wipe out months of successful trading. So many traders make the mistake of quitting their job after having 1-2 profitable months of trading. You have to prove that you can be consistent and disciplined over an extended period of time. You need to demonstrate that you can be consistently profitable for at LEAST 6 months, some might say longer.     

When I started trading I’d have 2-3 months where I’d think I was on top of the world and no one was a better trader than me. Then I would give back my grains with a few bad trades. The point is that you can never get too excited over a few good weeks of trading. You need to focus on your longer-term PNL trend in order to assess if you are ready to trade full-time.  

2. Have At Least 1 Years Savings/Additional Streams of Income

No one knows when the market will present opportunities when you can make money. You need to be able to sustain yourself for when the market is slow and there is no opportunity. For this reason, you need to have a decent amount of savings in the bank before you go trade full-time.

It is even better to have an additional stream (more streams the better) of income that doesn’t directly interfere with the time you put into trading. Not having enough savings or other streams of income will hurt your trading. You will force trades because you need to make money to pay your rent or bills. You cannot be trading because you need money from the markets. The markets are just a mechanism for displaying information, they do not care about your expenses.

3. Have A Large Enough Account

Trading is game where you need to have money to make money. If you need to make $5k a month to pay off expenses and live the lifestyle you want, you cannot do this with a $2k account, especially as a full-time trader. Trading with a small trading account is not at all realistic for trading full-time if it is your only stream of income. Trading with a small account is not necessarily a bad thing but you cannot expect to sustain yourself with it. For more tips on how to trade a small account, check out this article.   

Obviously, there are outliers to every situation and some students have found success much faster than others. Regardless, when you’re part of our community we stick by you every step of the way and give you the tools to shorten the learning curve exponentially.

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The post 3 Things You MUST Do Before You Trade Full-Time appeared first on Bulls on Wall Street.

For the first time ever, Bulls on Wall Street is doing a trading challenge for our new bootcamp students.

My trading career really took off when I met my mentor, Paul Singh. Trading is one of the hardest ventures you will every try, and it is even harder when you attempt it alone. However, it is also one of the most rewarding. For this reason, we are launching the Bulls Trading Challenge to find the next hot shot trader.

If you are not familiar with our trading bootcamp, here is the schedule for you:

Days 1-30: Live Training Classes

Lead trader Kunal Desai will take you through our full program, four days a week via live web-classes.  Trading DVD’s fail to give you the personalized attention that is necessary to expedite the trading learning curve. Our education will give you the personalized feedback and resources you need to be a career trader.

Days 31-59: Market Recaps + Trade Reviews

The instructors will take you through each trade they took during the market session that day and explain it in detail. This is when you get to see the material you have learned put into practice while developing your own personal trading plan.

Day 60+: Trading Challenge

Students are placed on a trading simulator that mimics real life market conditions. With our guidance, students will trade their plan and upload their trades for feedback. The top performer for the month will win the first ever Bulls Trading Challenge. This person will receive 1v1 mentorship with me, a personal invitation to trade with me in Destin, Florida, and the first ever top performer award as the winner of the talent search.

Mentors are critical to achieving trading success. You don’t know what you don’t know. I have been trading stocks for over a decade, and I have made just about every trading mistake you can make. Instead of making all the trading mistakes yourself, you can learn from my mistakes instead. It will save you from thousands of dollars of trading losses and years of suffering unnecessarily.

The Prize

When you come down to Florida to trade with me, I will give you the personalized attention you need to take your trading to the next level. In-person mentorship has helped numerous of my former students become consistently profitable traders, and I am looking for new traders to do the same with. The trading challenge will show me who is the most dedicated to becoming a consistently profitable trader.

Check out this video to see what its like to trade alongside me in Florida:

Apply to the Bulls Trading Challenge Here.

The post Bulls Trading Challenge: Talent Search For The Next Hot Shot Trader appeared first on Bulls on Wall Street.