Once You Master Scalping, Trading Becomes Ridiculously Simple

Once you learn this one scalping rule, trading becomes ridiculously simple. 90% of traders lose money and try to find a new indicator or add even more analysis to make their trading more confusing. The answer to profitability is not doing more, it's doing less but focusing on the right strategy. After 7 years of trading, I realized from every trader that I watched become profitable, they all come to the same conclusion. Stop trying to guess and predict where the market is going and start reading it with a simple system. And the most frustrating part is scalping was never supposed to be complicated, but trading gurus just buried it under thousands of indicators, overcomplicated words, and systems. So, in this video, I'll show you exactly how I trade for the first 60 minutes every day. I'll show you my entry model, rules, and my three-step simple system that helps me identify an A+ [music] trade before I even risk a single dollar. And by the end of the video, you'll see once this clicks, [music] you'll never see trading the same way again. All right, so the problem with 90% of traders is they try to make trading too confusing. In this video, I'm going to keep it short, concise, but fill it with as much value as possible. So, make sure to take notes for this video. And near the end of this video, I'm going to be sharing something so powerful on how to combine everything I talk about. But for me, let's look at this chart. When you're a new trader, you come into the markets and you're looking for an indicator. In this example, we have three indicators up and two of the indicators are telling us to clearly sell, and one of them to buy. So, we don't really know what's going on here, but because the indicator is telling me to sell, if I did go into a short position here targeting that low of day area with my stop loss above this previous resistance level, what would happen on this trade? Well, as we play out this trade, we can see we would have gotten stopped out instantly on this trade. But here's the problem, two of the indicators were telling us to sell, one of them was telling us to buy. So, that's why I took this position, but I still ended up losing. The reality is the rookie trader now, instead of getting rid of the indicators, is going to try to add even more indicators or more analysis onto this chart to try to find an indicator that gives him more reliable results. But after my 7 years of trading experience and looking at many other traders, I can tell you the best thing to do on the chart is to completely get rid of all the indicators on your chart and keep trading extremely simple. In this video, I'm going to explain my three-step simple process on how I look to trade and scalp the first 60 minutes of market open. And by the end of the video, you'll understand my exact framework. Now, the first thing you need to understand before I even get into my three simple steps that I'm going to talk about in this video is how to look at a chart. When you're looking at a chart, it's simply representing buyers and sellers. So it's representing human psychology and where there are either big orders to buy the stock to the upside or sell the stock to the downside. Now, in this example, if I got rid of all my indicators and simply put in one line, all it requires is one line. We're not going to do anything else. And I was just taking trades based off of this one line. So every time we come back and touch this line, what I'm going to be looking to do is short the stock, meaning sell it for a move to the downside. So as we can see here, we're coming back into that line area. This is where I'm going to be looking to short the stock. My stop loss is simply a break above that line, and I'm going to have a profit target at the low of the chart, right? So if I enter into a trade like this, which is a very simple trade to understand, we can see just by using one simple line and getting rid of those indicators, trading already becomes extremely simple for us. Now remember, simplicity doesn't mean you're going to guarantee win every trade. Simplicity simply means that it is a repeatable process and a mechanical process that I can follow every single time I look to take a trade. And the more simple trading is, the more clear we can see our charts. Now, with this being said, what are the three steps that I use every time to actually look to enter a trade using a simple entry model? All right, so let's go over the three-step simple process I use to scalp and day trade. The first thing we want to do for step one is going to be look at the trend. So many traders get faked out and lose money because they unfortunately trade the choppy and sideways price action. When you see price hitting support resistance support resistance support resistance all this means is this is choppy price action or where buyers and sellers believe that we're in a fair value. And because we're in this fair value at this time, the market's not going to have big moves where there's a lot of potential volatility to catch. So typically for me when it's low volume choppy price action like this, I tend to avoid it. But for step one, that's exactly what we need to identify to get an A+ trade. So before I put any risk on the table, my first objective is to determine the trend of the day. As we can see here, we're on Apple on the daily time frame. And all I'm looking at on Apple is are we uptrending, downtrending, or sideways price action. The way I do this is by simply looking for highs and lows. In this example here, of course, we have a low on Apple down here. We then created equal highs up here, but we can see from that time frame Apple is all the way back up here. From this example, we can see low, a higher low, a higher low being created right here. And then of course, throughout this trend we had a high, we then had a higher high, and then this is the next higher high. So right now Apple, we can see is clearly in a bullish uptrend. But if we also zoom in on Apple, we're getting a little bit of a pullback. So what does this mean? Well, this pullback on the daily time frame simply lets me know that this could be the next higher low that we're creating. Because remember, every healthy uptrend does need a pullback. So this could be the higher low we're creating for the next move to the upside. Overall, just looking at the market in a very simplified way, looking at the highs and lows, I can clearly see that this Apple stock is in an uptrend. So coming into the day, I'm going to be a little bit more bullish based off the daily time frame. But, that's just step one and that's understanding the trend. Now, we need to understand how we would look to enter a stock. This is where step two comes in. For step two, what I'm going to do is come over to the one-minute time frame and on the one-minute time frame, I only trade for the first 60 minutes of the day. Therefore, I trade from 9:30 a.m. Eastern, which is the New York Stock Exchange open, to about 10:30 a.m. Eastern, sometimes 11:00 a.m. Eastern, but remember I personally trade stocks, options, and futures. However, this can work for Forex, crypto, and any other instrument. Just remember, it is the 9:30 a.m. that I'm trading and what I'm going to be looking for is very specific. For us, what we need to understand is when a stock is moving in an uptrend, you need to understand it needs to still pull back for support because there is no stock that's just going to move up 90° and never pull back. So, it is my job as a trader to find these areas of support where I can put the lowest risk in, meaning in this example, let's say I'm only willing to risk $50, but the potential to make $200 on that trade, right? This would be a good risk-reward trade because my risk is so low. And that's what I'm going to help you try to identify in this video. Now, the way I like to identify this is if we play out this day here in an uptrend, what you need to understand is the highest down close candle, right? So, we have green candles, which is an up close candle, and then we have the red candle, which is a down close candle. The highest down close candle is what's going to be used as support. And this is because buyers are obviously stepping in very aggressively here. Sellers stepped in here and buyers can see that with the red candle. Therefore, buyers know if we break back below this red candle, the momentum on the stock is going to die. And therefore, when we are pushing up, the buyers want to hold this down close candle for continuation to the upside. Now, in this video, I'm going to be showing you a bearish example as well, but the first example I want to show you is a bullish example. As we can see here, if we mark out this down close candle. Now, there's two ways to mark this out. We can either mark out the top of the wick to the top of the body in terms of the bullish price action. And if the stock just came back for this retest, this would be a very aggressive healthy pullback. Or we can mark out the full body. If you're a newer trader, I typically recommend to draw out the full body just because it keeps trading a lot more simple. But just remember the higher probability trade is always going to be the wick to the body. In this example, let's draw out the full red candle and now we know that this is going to be our entry model that we can use as a support level for the price moving to the upside. What we would want now is simply the stock to retest and continue to the upside. And remember if you're a little confused in this video, don't worry. I'm going to make it much more simple as we go on. So, if we play this trade and see what happens, we can see we're actually pulling back into this down close candle and this is where step three would come in. For step three, what we're looking for is at least a 2R multiple. Every time I take a trade, if we can see here we have strong price action, we're coming back into the down close candle, I'm going to enter into the trade here. And my stop loss in this example is just going to be a break back below the body of this candle. Remember I said that's going to be the highest probability. If you want your stop loss to be at the bottom of the down close candle, you can also do that. But for me, it's just going to be a break of this area because we can see this candle is pretty strong. And I'm going to be looking for at least a 2R multiple. In this example, the 326 whole psychological number is what I'll be looking for. So, if I entered into this trade, I'm risking about $480 for about $1,620 of potential profit. Let's play out this trade and see exactly what happens. Now, as you can see this trade worked out very nicely for a move to the upside. However, once you understand the simple scalping rule, which is the one candle rule, you can also look to hold the trade a little bit longer. At this example here, if I was looking at this trade, we can see the next highest down close candle we have is this level right here. So, if the price wants to come back and retest this area and hold, I would still be in this trade because this would still be a valid trade for a move to the upside. And as the market continues to push up, we can continue to draw out these down closed candles in an uptrend, right? The highest down closed candle right now is this 956 candle. Therefore, let me keep playing out this trade. Let's see what happens. We're creating a brand new high, therefore my stop loss, as long as we hold above this down closed candle, I'm not going to stop out of the trade because there's no reason to stop out of the trade. Here we can see we got another entry of a potential move back to the upside, and you can see this trade continues to work out very, very nicely just holding those down closed candles as support, and this continues until the trend is invalid. Therefore, it's very important you understand how to read the one candle rule. But, this was just the first example where I show you my three simple step process, and this was a bullish example. But, let's go over to a bearish example now where I can make this even more clear. All right, here we are on a bearish example, and we're on Tesla. Now, for the first step, we're going to do the exact same thing, and as we can see here, Tesla was putting in these higher lows as we were pushing to the upside along with a high up here. However, now recently, we can see that we're putting in lower lows and lower highs as the stock is moving to the downside. Therefore, right now on the daily time frame, Tesla is actually a little bit more bearish than bullish, and this is why coming into the day, I'm going to be leaning into that bearish price action on Tesla. So, this was on the daily time frame. Let's go over to the 1-minute time frame, and on the 1-minute time frame for step two, the simplicity of the system is that we don't have to come into the day with any sort of key levels. We can simply look to trade the price action that is in front of us. So, as we can see here, we open up on the day, Tesla is pushing to the downside, and therefore for the bullish example, remember we marked out the down closed candles for price to support that move up. However, in a downtrend, the green candles is what we have to mark out, and this is because this is the last place buyers were. Therefore, sellers know that if we break back above the green candles, we may be bullish again, and therefore in this example, we can simply mark out the green candle. Now, what we're looking for is going to be a retest of that green candle for continuation to the downside. Let's see if we can get any sort of potential entry here. So far the stock is moving to the downside. No entry just yet. And right here we can see we broke down and now we're getting that entry with weak price action for a move to the downside. So this is where I would be looking to enter into a short position. My stop loss in this case scenario can simply be at the break of that one candle rule. And I need at least a two R multiple. Meaning if I'm risking $100 on this trade, I'm looking to make $200 of potential profit. Let's see what happens on this trade. And as you can see here, this trade was another great example of how simple and repeatable trading can be if you get rid of the indicators, noise, and confusion from your charts. So if you want any more information on how to start trading from scratch, make sure to click the playlist on screen now. If this video helped you, make sure to leave it a like. If you have any questions, put them in the comments down below. Subscribe to the channel. Follow me on Instagram and Twitter for more education, and I'll see you next week with a brand new video.