In This Episode:

• We look at a breakdown and backtest of a support turned resistance and emphasize the fact that even with a perfect entry, they don’t always work out.
• Trend line analysis that took some patience to play out. This same ticker provided a RvR setup for those who may have missed the trendline break.
• Wolf candle which as time goes on, gets uglier by turning into a bull flag. Trade plans are fluid and can change with time.
• We establish support and resistance before the day opens and Clay gives a warning based on a candlestick formation. Despite the warning, the chart respects the break of support and continues lower.
• Large bearish gap down but despite the overall trend, the chart goes higher toward the gap fill. This is why risk management is so important.
• The importance of patience to wait for the chart to give you a candle that confirms your trade idea and you won’t always get the perfect wolf/hammer.
• Even with a perfect setup (over extended with a wolf candle on top), we have not had many home runs this week. This is why it is so important to be a disciplined trader and to take SMALL losers and be ready for the BIG winners.

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