The Power of Pivot-Based Analysis

0:01 hello everyone and welcome to today's webinar we're going to be talking about the power of pivot based analysis my name is Frank Ochoa also known as pivot boss I'm the author of the book secrets of a pivot boss and you can find me at pivot boss calm also at pivot boss masters calm on twitter i am at pivot boss and on youtube I am at pivot boss TV so you can find me at those outlets a little bit about me really quickly if you go to pivot boss calm here just below the main header here you can see about us there's a trader profile experience and also market specialties you can click through that and learn a little bit more about me and my background for the most part

0:48 here I've been trading over the last 20 years in various different capacities at first I learned trading when I was in high school also going into college continue to learn my my trading craft and from there opened up an account as a 19 year old kid and started to dabble in the market those were the good old days in the 1990s when things were going up so everything you touch to kind of go went higher as a senior in college I was hired to be part of the trading room at Nirvana system so while I was still in college with a full course load I was also full time at Nirvana Systems working as well I was blessed to be able to work with such a great crew at Nirvana I learned a lot also contributed a lot

1:36 our main focus was looking to develop automated strategies for traders automated systems that were basically designed to trade any market scenario from any type of market whether it's a bullish market a bearish market sideways market and look to stitch together automated strategies to automatically trade the market we did a lot of great things I think we were well ahead of our time at the time and building incredible tools for traders that were just you know you still don't see those type of tools from some of these you some of these offerings that you see at these platforms so I mean it we were way ahead of our time with what some of the things we did but one of the great things with the automation was that we

2:22 were allowed to really build some fantastic tools for traders you know whatever our our creativity allowed us to create and then from there we were allowed to really test that data or test those strategies on data that goes back decades and from there I was really able to see what worked and what didn't very very quickly and that was something at the beginning of my trading career was incredible being able to create indicators create systems automate certain things and then see really quickly what worked and what didn't on the data set so that was very very instrumental especially to our topic the power of pivot based analysis because I

3:08 was able to see that pivots were incredibly powerful and predictive and allowed us to really pinpoint the best opportunities in the market regardless of the market state regardless of what type of market structure we saw where there was a bullet bullish trending market a bearish trend a market or perhaps a digestion or or sideways type of market and from there I was really able to see the patterns come right to the forefront and I saw what worked what didn't from there after years and years of developing and running these automated systems on on various funds I was able to kind of put a collection of these experiences together in a book

3:54 that is called secrets of a pivot boss this is the book where I kind of put a lot of the foundational market concepts that I learned that I was able to kind of pioneer as well and put them into a book that anybody can use and this book has gotten fantastic appeal from from traders all over the world it was something that I could only dream of the type of feedback that I got for this book you can see down here if you go a scroll a little bit lower some of the testimonials that people really say this book and these aren't just people from anywhere I mean floor traders really gravitated to my concepts the tools I built and my book the floor traders I really model a lot of what I did off of how they approached the market but I

4:40 also blended how the algorithms were approaching the market as well I really studied how the algos were engaged in the market back then and this is 10-12 years ago you know 506 where I was able to really identify how the algos were executing how they were looking to enter markets what they were doing and then modeled that behavior to create our own systems and and approaches and it was just it's been phenomenal how these concepts have continued to behave in accordance with how we you know we developed them so long ago everything that did not work I tossed it to the side of the road everything that did work I continued to to use it and that's what this book is about it's a collection of these ideas

5:26 it really does reveal proven methods for profiting in the market regardless of the time frame that you trade regardless of the instruments you trade and so that's what we're going to cover today the power of pivot based analysis really today's about those traders who still are inconsistent or still want to learn more novice traders could really get a lot about a lot from today's training seminar and also even experienced traders again I'd go back to those floor traders the fund managers hedge fund managers those traders who really said you know what your book is incredible and these are the same types of things we did on the floor but you've also expanded upon those concepts that's really what I knew I had something is when those experienced traders with 30

6:12 plus years of trading experience that you know what this is really really powerful stuff and we knew it we knew it at the time we traded off of it and it continues to be powerful information so what I wanted to do today in today's webinar was really showcase some of the power of the pivot based analysis for those of you who are not familiar with pivot based analysis we'll cover some of those concepts and why it's so power well there's seven reasons why every trader should use these concepts and that's what we're going to cover here today if I share here this is going to be our presentation and we're going to cover just a few slides here about why pivot based analysis is so powerful and then from there we're also going to jump

6:58 in to a few annotated charts and then we're also going to jump into some live charts I'll even take some suggestions on what we can look at as well if you have any but I have a list of a few stocks that I would like to go through and just talk about those as well so without further ado let's go ahead and get started with the power of pivot based analysis with Frank Ochoa aka pivot boss let's go ahead and get started so pivot based analysis at least from my opinion every trader should have a solid understanding of pivot based analysis as this form of analysis has many advantages including being universally applicable to all markets and timeframes and that's super super important so you can see here there are seven important reasons why every trader

7:46 should use pivot based analysis and for me again this is when I when I discovered pivots when I discovered how powerful they were when I was able to go back to 1970 as far as back as 1970 and see how these things worked out day over day week over week or even month over month and even using yearly pivots it was very very clear that these pivots really offer a powerful form of analysis and really help you predict and forecast future price movement so here are seven reasons why every trader should use pivot based analysis number one these are market generated pivots pivots that are based off of market generated information like price and volume tend to seek greater market participation at

8:32 those levels that's very important these pivots are based and regardless of the pivots you use whether it's floor pivots or camarillo pivots or my pivot boss pivots market profile pivots all these different types of pivots they're all based for the most part of market generated information and that's what's most important it's about volume and it's about price that is the auction the auction is about volume and price and it's about supply and demand it's about overvalued situation undervalued situation and understanding when those prices are over and under value so you can return price to value when you understand those situations you it really makes trading much much more easy in terms of identifying when to

9:19 engage and when not to engage and that's what's really important about these pivots as they are market generated it is based off of the auction it's not like some other indicators that are super super derivative information oscillators or stochastic type of indicators that are just multiple derivatives of this information this is the option and that's why they're so powerful number two these are leading and predictive pivots are meeting indicators and they offer many ways to accurately forecast and thus anticipate future price direction and behavior these are leading indicators what that means is that when you see these pivots and you understand where these key levels are you know where the levels are gonna be in the upcoming day you know

10:05 that they're gonna be there the next week or the next month and that allows you to anticipate and forecast how price may react off of them it allows you to build a gameplan off of these levels so that you can engage them with a full game plan and understand where your in is where your outs are and so that you can basically engage these ahead of time and build a game plan around it other indicators aren't that way they're not leading they're not predictive they are after the fact and after the fact does not help you in the market and that's what I really loved about these indicators is that when I saw that hey the pivot range is gonna be higher tomorrow I already knew is going to be higher tomorrow it's not going to change so if the market opens in a certain

10:52 opening relationship or does something right at the open I know hey that's gonna satisfy a certain criteria and when price pulls back to that pivot range it's time to buy those types of things allow you to plan for events and you just can't do that with lagging indicators other indicators are super super derivative information and those types of indicators really don't help you number three this is one of the things that I really loved about pivots from the beginning and again this is from analyzing decades and decades of data with this stuff right away but doing it with a push of a button and getting that information right away we were able to see that these self adjusts the volatility and that's what I really like since the bait the pivots are based off

11:37 of market generated data the forecasted levels automatically adjusts to the market's current volatility that's super important because if a market has really really wild swings wild price swings the pivots associated with those price swings are also going to be wider to adjust for that volatility but if the market becomes more quiet and doesn't have as much action and is is much tighter in terms of its price range the pivots will self-adjust and and contract in a way that allow you to still be able to play off those levels so these pivots will self adjust to the markets volatility and as we know based off of the personality of markets

12:23 theory markets will go through various phases where it's high volatility phase and then it goes to a low volatility phase and it goes back to a high volatility phase you're not always gonna see the same personality out of a stock or out of a futures contract it's going to rotate in and out of these personalities for example in summertime trading you see for the most part a lot of price swings that are just much narrow and tighter than normal then you as you come out of the summer as we are now and into October you start to see the volatility coming back to the market that's something we're starting to see a little bit more of this week and heading into next week as we head into October so that's very important is that these pivots will self-adjust to the current

13:08 markets current volatility number for scalability scalability pivots are scalable to any time frame or subset of data that you define that's extremely important as well that means that you're able to use pivots in any timeframe you want so if you're a day trader if you're a scalper or a day trader these can be used by you if you're a swing trader or position trader these can be used as well by you if you're an investor you can use these pivots because they're scalable to any time frame I can even break the data down and create hourly pivots right to our pivots three-day pivots five-day pivots or I can go monthly or yearly if

13:55 I wanted to and again that's very very powerful because regardless of the time frame that you engage you can use these pivots so again if you're a scalper you can use them if you're an investor that looks only to trade six months out or a year out you can use these pivots and that's what's very powerful and that's why I really gravitated to them because you know was almost kind of born out of laziness when when I first started really trying to define what is my trading style so many years ago I didn't want to learn a certain way to trade just for day trading and then have to learn a certain different way to swing trade or trade on on a position or investor basis I wanted to create a

14:42 universal approach that I can trade every single one of those time frames in the same way and I was able to do that with pivots and that was very very powerful right away because I knew that if I can make money as a day trader then I can go up in timeframe but really I always started as a higher time frame trader when I first started trading back in college it wasn't day trading it was holding for weeks or months actually over even years it was holding for a longer period of time and so I've always been able to really trade the higher time frames using these types of approaches but also engage them in a lower timeframe which is also quite liberating number five revealed confluence whether

15:29 it be multiple time frame confluence or multiple pivot confluence the ability to reveal these hidden areas of support and resistance provides a huge edge revealing confluence that's very very powerful what that means is sometimes you may have a weekly key pivot level and if it also lines up with a monthly level you're gonna get more traders that come to the market at that level because it's a call to action to multiple types of traders that's again very important when you're able to identify those confluence levels ahead of time because you can then anticipate that the market may indeed see a reaction at that pivot because there's more call to action from traders using

16:15 you know some traders might use a date pivot some traders might use a weekly pivot some may use a monthly or yearly pivot and when they coincide you're gonna get more money that comes to the market at that level and again you're going to likely see a bigger reaction at that level number six is also the algo advantage pivots lend themselves perfectly for creating mechanical or fully automated algorithms to find and execute trading opportunities that was one thing that I really really tried to create early in my career was how can we create algorithms based off these pivots that help us identify when is the best time to buy when is the best time to sell and there's certain scenarios here where you can do that and once you

17:02 identify those scenarios you tend the city.the algos trading at those levels that was one thing that I really was able to do early on was identify what are the algorithms doing what are they doing what are they using to trigger an entry what are they using to run stops what info are they using and once you identify which key levels are using it becomes very revealing that you know a lot of times they're using these pivots in some way and that's why my pivot boss pivots are so powerful because the pivot boss pivots are based off of what I call Pro part pro price levels which are the previous high low and close for any time frame the previous sessions high/low close of the previous weeks high low high low

17:48 close perhaps the previous month's high low close and once you do that you're able to then extrapolate based off of those levels if you see expansion and that's why my pivot boss payments are so powerful because institutions algorithms programs they all trade off of those key levels and number seven universally applicable pivot based analysis can be universally applied to any market in any timeframe regardless of your style of trading and again that's it's very very powerful because again if you are a day trader you can use it if you're a swing trader you can use it if you're an investor you can use it if you trade stocks you can use pivots if you trade Forex you can use pivots if you trade

18:35 options you can use pivots ETS futures it doesn't matter it's universally applicable and that's really really powerful so these are the seven major reasons why every trader should use pivot based analysis it's something that in my book secrets of a pivot cost I wrote about a long time ago my book turned seven years old last week and I've gotten great feedback again from traders all over the world even in the last week with new traders discovering my book for the first time already giving me fantastic feedback after buying the e-book the reason why is because when I set out to write my book one thing that I wanted to do was write a book that was timeless when I first

19:21 started learning the trade I tried to read every book that I could get my hands on and I was always very very disappointed very disappointed with the books because they were either you know too much fluff in them or maybe they were withholding information and wanted you to buy extra things or buy extra education and for me I thought you know what when I write my book I wanted to have everything that I've got and put it in there so that somebody that has nothing can read this book for the first time and be much more knowledgeable than the person right away and that's what I was able to do with the book was write something that is timeless it just continues to work it continues to work

20:06 these concepts are based out of what I call foundational market concepts foundational market concepts in my opinion are those concepts that continue to work today and will continue to work tomorrow these are concepts that worked decades ago and will contend and continue to work today right and so I wanted to write about concepts that just continue to work concepts like compression leads to expansion expansion leads to compression right concepts like market structure whether this thing is market structure trending up you should be looking to buy tips at certain pullback points if it's a market structure trend down you should be looking to sell rips at certain market structure points these types of concepts continue to work today

20:53 as they have in the past and I have full confidence that they will continue to work in the future and so that's really the whole goal behind writing the book was writing something timeless that can help traders no matter what they trade or which time frame they trade or how they want to engage the market and the feedback so far has been phenomenal and I think I accomplished that with the book let's go ahead and move on to the next lives now you've seen a couple of slides here from my pivot boss masters training and pivot boss masters is kind of my higher level masters training that provides new top level education for

21:40 traders no matter what your experience level is whether you're a floor trader you're going to get something out of it or we're a pro fund manager you're going to get something out of this training if you're a complete novice then you hit the jackpot because I wish I had training like this when I first started instead this was all hard hardcore research 14 16 hour days of learning learning learning that type of thing and I put it all in three hundred pages for you right away and this masters training is is super robust has a whole lot of fantastic training of all kinds of different back disciplines from volume based analysis price based analysis pivot based analysis there's so many different forms

22:28 of analysis that go into what we do at masters but I pulled out a few slides here because it's you know just to show you a little bit what we do but also just to show the types of analytical approaches that we use with pivots for the most part pivot based indicators are those indicators that use formulas or equations to identify where a key pivot might be in the upcoming day most of these inputs are based off the high low close the high low close and so the previous sessions high the previous sessions low the previous sessions close or the previous weeks high low close or the previous months or previous years right those inputs go into a formula and

23:13 it gives us some key pivots some of those pivots are the classic pivots like floor pivots there's the pivot range also made famous by Mark Fisher and his book the logical trader there's camera pivots which are very secretive pivots that offer a specific call to action at each pivot there's also market profile pivots the market profile based off of either pure price or volume profile which provides the value very high the value area low and the point of control and there's also what I call the pivot boss pivots which is the previous high low close press range extensions in the pivot range and regardless of the pivots you use these concepts always hold true

24:02 there's certain value based pivot based concepts that just hold true concepts like the pivot with analysis pivot trend analysis and value relationships pivot with analysis measures the relative width of a given value area in order to forecast trending and trading range markets and this allows us to in participate or give an auction type before it happens and if we're able to anticipate what's about to happen then we can deploy the right bidding strategy and you know this blends auction our you know basic auction market type of concepts so auction market theory tells us how to be a proper buyer in certain

24:48 situations or a proper seller right what's the appropriate or optimum bidding strategy in an uptrending market what's the optimum bidding strategy in a downtrending market what's the optimum bidding strategy in a range bound market so our to market theory tells us how to engage the market as a market participant a buyer or seller and then these pivots tell us when and where to to act pivot trend analysis also tells us how to engage the market given a certain trend so pivot trend analysis tells us say the market is trending up then we should be looking to defend counter trend rotations at these pivots if the market is trending down we should

25:33 be looking to defend the counter trend rotations at these pivots very very easy yet powerful information and there's also value relationships value relationships provide the ability to forecast future price direction and behavior based off of higher or lower value relationships or based off of narrow or wide relationships and we'll look at some of that in these charts here in a moment so two of the major forms of pivot based analysis that we use in our trading room is pivot with analysis and pivot trend analysis pivot with analysis again looks at the size of the value area so it's a if it's a very

26:18 wide very value area that tells us that perhaps the market just experienced a wide range of trading activity and so after a wide range of price action if you have a wide pivot range that typically tells you that you're likely going to see it raining range market come on and if you're gonna see a trading range market then you're likely going to look to fade the edges in return price to value if the market is super narrow then you're looking for a likely breakout or trending phase you're likely going to see an increase of volatility so wide value tells us we're likely to see a trading range market narrow value tells us we're likely going to see perhaps a breakout or increased volatility phase

27:06 an inside value would tell us you know what we're about to see significant expansion in one direction or the other and get ready so these are very very important for example if you're an options trader if you see a wide value relationship maybe that's a time to in trade an iron Condor if you see an inside value relationship and you're looking for expansion maybe it's time for a straddle or a directional play if you know the direction so it's very important to being able to forecast and anticipate what the market may be able to do and these tools allow you to do that pivot trend analysis very good as well because it allows you to forecast and predict how the market is likely

27:51 going to trade in the upcoming period of time if it's a higher value relationship then you're looking to buy dips at the pivot range for example in an uptrending market if it's a lower value relationship then you're likely going to look to sell the rips at key pivot levels in the down trending market and that's very very important again that's just very simple yet powerful behavior for example look at this year the market tech has been trending up all year long and all we've been doing in the trading room a lot of times is looking to buy dips either at the Pima trigger zone or looking to buy dips at the pivot range in an uptrending market it's been a very

28:37 powerful approach during this current market but after you see trending behavior all year long like we've seen in the NQ perhaps it's time to see compression right after expansion leads to compression after a price discovery phase perhaps leads to a distribution phase and so that's the personality of markets theory again where the market will go through various phases over time sometimes trending then it's going to be sideways then it's trending than it's sideways and again these pivots allow you to anticipate these types of events so let's go ahead and kind of apply some of these concepts here to the actual charts

29:22 here's our first chart and in this chart we're talking about various value relationships what I want you to take notice of in this chart is the pivot range that's the pivot range right there this pink the three pink lines this is one month of trading right there that's one month this is the next month another month another month so basically these can be seen that's either swing trading charts or perhaps position trading depending upon how long you hold but they're very important it's based off of the previous month's information so this is the previous month's hi that's the previous month's low and then this is the previous month's oh this is the previous month's close and from the high/low close you get the pivot range

30:11 the middle pivot here is what's typically called as the pivot point or the pivot the central pivot this is the high plus click plus low plus close all divided by three the high plus low plus close divided by three once you get this pivot then you take the high minus the low / - high plus the low / - and that's gonna give you the midpoint right there so from that high to that low this level is the midpoint that's the high that's the low that's the mid then you take the difference between the mid and the pivot and you forecast it downward and that gives you the other side of the pivot

30:57 range so that's how you calculate this pivot range now notice one thing when the markets going down here you see that this pivot range is lower the next month and then it's lower the next month and then it's lower the next month and then it's lower the next month that's a lower value relationship lower value relationship and that's when the value area forms at lower prices right and when that occurs you want to look to defend counter trend rotations into the value area so this is a down trending market when price bounces into that pivot range that is your optimal selling opportunity for new lows think about it

31:43 this way in a downtrending market you have lower lows and lower highs then you have lower lows and lower highs and lower lows and lower highs and lower lows until you see rejection that's a down turning structure and everyone always tells you if it's trending downwards sell the rips sell the ribs sell the ribs and I remember the first time a pro trader told me that when I was still super novice almost 20 years ago and you say oh it's easy the markets going up by the dips well the markets going down sell the ribs and I thought wow that's incredible that's phenomenal information I get to my training terminal and I'm looking at it and I'm saying okay how do I know if that's the

32:31 dip how do I know if that's the rip where is the dip where is that how do I know and it wasn't until you get these pivots and so you can really see ah I understand now you know in a downtrend the market that's the pullback into the zone that's the pullback right and you're looking to sell in that zone until proven otherwise the other thing we see here is what I call the narrow value relationship you see how narrow this pivot range is compared to this one compared to that one you see how narrow it is whenever you have a super narrow pivot range that's indicative of expansion or an increase of volatility soon look at when

33:17 that happened boom look at the expansion we saw right when you see an arrow pivot range and you see the market gearing up and is coiling you can expect significant expansion to occur because it's narrow that's a cue look how wide this one was you see how wide that pivot range was compared to all the others when it's super wide that's an indication that you're likely going to see a trading range market and go sideways you're likely going to see a compression you're likely going to see volatility drop and so if you see a super wide pivot range that's usually a time where you can fade

34:03 the edges that means buy down here and return it to value or so here and return to value or you can do something like an option strategy here where you're looking for price to stay within the given trading range or given price range for a while so again these are very very powerful cues here that we can use each and every time when this thing is narrow we know that we might see expansion if this is lower then we know we need to be looking to sell pull backs into that area if this is Y then we know we need to be looking to trade in a trading range type of market or perhaps hold off until we're ready to see expansion this is called change of bias down here and the change of bias occurs when the

34:48 market shifts its its trend or its sentiment to a different side here so this thing is trending down down down down and then all the sudden the market pushes up and closes higher so you have lower value relationship and in this case you were supposed to see price go down from there but it didn't instead price pushed up and broke the trend it broke the lower value relationship and closed higher in that case it was a change of bias then you saw value get traded higher in a higher value relationship and now pull backs become buying opportunities for new and so again this is a whole lot of

35:35 information on this chart but there's a few key things narrow this type of narrow relationship can lead to explosive movement this type of wide relationship means that you might see sideways action and quiet volatility if it's lower like this you're looking to sell the rips into that zone until proven otherwise right until the market rejects down here as it did and starts to head the other way now we're going to start creating higher value relationships right and so again this is a way for you to anticipate what may happen in any market in any timeframe and that's very very powerful that was crude on kind of a lower view basically

36:22 we were looking at kind of this view here if we widen out look at it here another narrow relationship two times in a row and look at the expansion boom look how wide that is and look how quiet it was here these are concepts straight from my book secrets of a pivot box so again for those of you that don't have my book I encourage you to check it out there's a current deal going on right now it's only $40 that's the lowest price ever 40 bucks right now for the seven-year birthday special and you're also going to get a free month of our trading room absolutely free this is the types of the stuff that you learn in that book if this is narrow you're likely going to see expansion but we

37:09 don't know which way it could be up or it could be down right so you have to use additional cues in this case the market broke down and continued going down for two straight months oh look how significant that move was this is crude oil so for this thing to drop from 70 bucks and get a straight two-month drop into about 47 that's pretty significant and we had that marked at that time when it happened we knew it was happening our trading room knew it and we profited from that move again it's just about the cues right and again look at this thing again look at this it gets very narrow right here and oh those are two of the most powerful moves that you'll see but

37:55 it all comes back to how narrow it was how price kind of coiled up at that zone built that energy and then saw the expansion and so in my book I make a very you know a concerted effort to talk about narrow value relationships because those are some of my favorite when I see it super narrow you should be expecting some sort of significant expansion if you see it's super wide perhaps you should be looking for a trading range market or something a little bit more quiet and if it's obviously unidirectional trending down or trending up you should be looking to defend pull backs on those counter trend rotations and this goes back to just general concepts compression leads to expansion

38:41 compression leads to expansion right expansion leads to compression expansion leads to compression these are concepts again that are foundational market principles that worked decades ago they work today and they'll continue to work in the future again because these markets are a collection of opinions these are traders these are people it's fear and greed and uncertainty drives these moves and human nature will continue to remain the same now you also have algorithms and programs to factor into that equation as well nowadays but fortunately those how it goes those programs work based off of

39:27 the same foundational concepts that we teach because someone has to program them right and usually it's a human so the same types of concepts fear greed uncertainty drive the market and they continue to do so to this day here's a look at the NQ again look at how significant this breakout was right here look how narrow that pivot range was and look at the expansion Oh big time drop right look how much wider these pivot ranges were here before that and it led to sideways movement after expansion you see compression after compression you see expansion and again we were able to

40:13 identify right away that we were likely to see expansion because it was compressed and because we had a narrow range and boom you see the move significant significant weakness out of there in the downtrend a move look at price pullback to the pivot range it's a lower value relationship price pushes back to the pivot range immediately sold for new lows again it's based off of that key zone right there once you see rejection down here price comes right back to the pivot range like a magnet like a magnet and then from there by that point we had a change of bias and then things started to trend up

41:00 and once you have higher value relationships you look for bulls to defend those zones again very very powerful concepts here this is something that can help everyone right here this is about as easy as it gets sometimes this is the es these are weekly pivots weekly we just been looking at monthly pivots these are weekly pivots and look at this trending market very strong bullish trending market week over week down here it was a Down trending market but price pushed above it and broke that relationship so here's a lower value relationship but price pushes through

41:45 and closes higher so then the pivot range is formed higher price pulls back into the pivot range gets bought and closes higher so then another pivot range is created at a higher level price pulls back to the pivot range and first higher so then another pivot range is created higher the next week and price pulls back to the paper closes higher pulls back and closes higher pulls back and closes higher until proven otherwise that is a clean market structure there it's a pivot trend analysis a bullish trend market so if you want to know where to buy the dips where to sell the rips oftentimes just looking right here

42:31 to the pivot range can be super super powerful because all pull backs will likely be a buying opportunity and the up trending structure until proven otherwise because it's not gonna last that way forever at some point the thing will break and then all of a sudden perhaps you're pulling back now or maybe after this trending market you go sideways and then continue so again very very powerful concepts here that are very simple but pull backs buying opportunities in a trending market and these are weekly pivots you can do it off monthly you can do it off daily you can do three-day pivots you can do hourly pivots yearly pivots it just depends on which which timeframe you want to engage and for me I engage them

43:17 all for the most part lately over the last couple of years have been engaging higher timeframe pivots and they've been fantastic as always let's go ahead and look at some charts here let's look at some new things here this is Shopify look at Shopify over basically year-to-date this is year today these are the pivot boss pivots okay so these are not like floor pivots these aren't can pivots these aren't you know market profile pivots these are pivot boss pivots pivot boss pivots are based off of the previous high low close previous high low close so that means that this is the previous month's high

44:04 that's the previous month's low and the previous month's closes there and so the upcoming pivots will be based off of that so this month's information will create this month's pivots so that white line is this high that white line is though that white dotted line is this close based off the high low and close you then get this middle pivot that's the high plus low plus close divided by three based on this high and this low this is the midpoint that's just dead center between those points and you take that distance and project it downward and now you have the pivot range right that's how you get that level and so

44:49 these pivots very very powerful and now what we can do also is based off of this range from high to low this is 25% expansion 50 75 100 down here 25 50 75 100 percent expansion so I'm able to then use the actual previous month's range to create very clear targets above and below price range so no matter if it goes up we have targets if it goes down we have targets and it's all based off of the previous range that allows us to create a universal approach for targets it allows us to create

45:36 opportunities for fading these edges one thing I say for example is when you have you know a big move like this the 25% level is usually a great fade right on my first test you want to fade it depending upon the circumstances but that's a great level so I just want to talk a little bit about the pivot boss pivots the pivot range here is the same as what we just saw in these charts but look it's shopify here this is basically how price has been trading all year long we really brought this up earlier this spring because what we saw and this is a fantastic way to engage these this right here that is the first trading day of the year right there okay that's

46:23 basically January 2nd 2017 look at the months heading into it very very quiet sideways action I call this accumulation right that's called accumulation that's where price stays in the very narrow range institutions are absorbing they're building there's icebergs down there they're building a position the breakout from the range occurs there the retest occurs there and boom you see the first phase of expansion closes there and you see a higher value relationship come in price doesn't quite get into that low but pushes higher creates another higher value relationship price pulls back perfect test and go creates another higher vanity relationship price

47:09 pulls back perfect test and go look at that it's over and over so when we brought this up earlier this spring I mentioned to our group hey this is a fantastic trending opportunity every pullback is likely going to be a buying opportunity until proven otherwise so every time price pulled back we were eager to buy if price pulls back into the trigger zone we were looking to buy another trigger zone right trigger zone for me is you've seen these moving averages these black lines for me that's the 21:34 255 pivot base DMA and when they are upward trending stacked and sloped the idea is to buy between the first two the first two moving averages that's what I call it the trigger zone if this thing is trending up by that

47:56 pull back there and look to squeeze it by the pullback here and look to squeeze it so Shopify was a fantastic stock for us early on this year look at it now it's continued onward even still but after the trending phase this was compression it compressed look at the narrow pivot range here and in ooh look at that expansion narrow pivot range and then it goes from 90 to 125 in about four five six weeks just incredible expansion and again this all goes back to some very very basic concepts higher value relationships and the pivot trend analysis so buy the dips buy the dips

48:42 buy the dips until proven otherwise then you see compression narrow range and now you're looking for expansion it happened to be up and continues so very very powerful and very great very very good movement based off of our levels here's another one this is Momo Momo very similar very strong to begin the year again this is the beginning of the year it shoots higher and creates a higher value relationship look at the pullback and boom right creates a higher value relationship look at the pullback boom creates a higher value relationship here's the pullback boom creates higher pullback boom look at how that happens

49:29 that's incredible it's not always gonna be perfect this way but there's what 10 or 12,000 stocks a universal just thousands of stocks there's always something that's going to be moving and so it becomes easy to just scan for these opportunities I have scans here and thinkorswim that will find me this lower value relationship right here in an instance I can see what is lower value what is higher value what is inside value what's narrow value and it'll bring those opportunities to the forefront immediately and from there I have a universe of stocks to choose from right away on what to buy and sell if something doesn't look right wait and move on to the next one look at this here we have a higher value relationship here price pulls back and

50:16 goes but kind of fails off the high so I has to come back again test again and goes but fails earnings hits and you have a big gap down big gap down on earnings they didn't like something they sell off so it creates a lower value relationship and look at the bounce and look at price right here right on it that's where Bear is defended and they push it downward so that's a change of bias right there so it's trending up until proven otherwise this thing sells off hard the next pull back into that pivot range was a selling opportunity I know there's lots of people that always say you cannot you cannot pinpoint a market

51:02 you cannot market time you cannot cannot cannot and we always see that yes you can yes you can it's not always perfect and it's not always right but what I'm good at is being able to be patient and when things look great that's when you execute when things are iffy when things don't look good be patient because there's always another train coming just like we say in the training room and you miss that one or hey that was a losing trade this okay there's another one coming there's always something coming and so in this case boom this thing drops off it pulls right back it's a great selling opportunity right back to the previous low fantastic so there's a question here

51:53 about the thinkorswim software the thinkorswim software is you have to open up a TD Ameritrade account and then you can download the thinkorswim software as well thinkorswim is actually free and you really don't even have to fund an account if you don't want to right away you can open up an account with $0 and have this information right at your fingertips free data free charting free scanning options free everything and then from there if you look over here on Stiles and I say load style pivot boss pivot while say they are bands signals clean intraday masters options pema pivot

52:39 signals all those all that right there is just sharing a link with you and once you get that link you get all this information instantaneously and so from there it say for example you bought the book today you will also get access to our pivot boss Premium Membership which includes our trading room and from there there's these downloads that you can download right away and import these into your machine so I have resource libraries for thinkorswim NinjaTrader investor RT omni trader and you can download these

53:24 right away right now ask actually if you want it to and so from there you can just go up here actually at the top right of your thinkorswim screen of your main screen there's going to be a button at the top that says setup and from there once you click setup there is open shared item and from there you can put a link in and once you use my links it'll put it right in there absolutely so that and i can show you where that's at no problem at all if you need help I'll help you out right away also we do this every single day in the trading room and so from there in the chat you can let me know I can show you right away live in the chat so yeah all

54:10 of these tools are right here at your fingertips I've also created this pivot boss advanced ADR indicator which helps us basically quantify average movement and so we know that if things are compressed you see these pink lines right here that tells us that five-day range is significantly narrower or more narrow than average and when price range is significantly narrow and below 65 percent you should be looking for expansion soon and an increase of price range and look what happens afterwards right over here look how narrow it was because compression leads to expansion

54:56 look over here how narrow it was compression leads to expansion and so these concepts I built tools for them these are the same tools that I built for many of the automated funds that we ran and these tools are available to you as well and so let's take a look at another one here what about Facebook Facebook's been doing well question hey Louis good to see you you asking uh do you have any classes that explain how to apply your trade logic to options market with smaller accounts that's a great great question and that is something that we're jumping into more and more in our trading room we

55:41 have many traders that trade options in our trading room and I've been kind of the laggard in jumping on the options train because a lot of the options trading that I did in our fund was all automated so we had automated everything but we're incorporating much more options in our in our room right now and and a lot of what we do apply so well to the options market and something we've been talking about are some of these tools that we're using here to identify which strikes to buy which strikes to sell based off of these ADR tools that we have and also the pivots so I think if you if you're an options trader you know we're starting really really get going with some of the options and this

56:28 fall we're gonna be hitting it even more so that's something that I'm definitely pushing for this year I try to learn something new and push myself every single year in a different discipline of trading this year I wanted to focus on options and I've been dedicating myself to option significantly this year and it's been it's been super refreshing I really really enjoy it it's been an eye-opener for me with how we approach the market and it's been a much better way not only to trade smaller accounts but also to handle bigger accounts as well because of the way that you can you know manage your risk much better than if for example trading futures or something else so that's something that we're going to be doing much much more

57:14 of in the next in the coming weeks and months and we're gonna be focusing a lot more on on options oh there's a question here about bonds as well we do engage for example like ZB I know a lot of traders really enjoy trading bonds and really a fantastic instrument and I know it recently ZB for example has been a little bit more difficult here than it had been before last earlier this year and even last year I mean we were nailing that one it's gotten a little bit more back and forth here lately but the concepts still hold there's still hold true and so ZB is

58:00 something that kind of pulled back off of here recently just because the market structure has broken down compared to what it was but when the getting's good is fantastic absolutely fantastic absolutely yes so here's Facebook here's a look at Facebook look at this thing trending up again everybody knows that the market has been trending up especially tech the market has been led by tech this year it's been no surprise we just looked that shop in Malmo and now Facebook and you can see this thing trending up look at look at this trending behavior you know look at the pull backs to the zone look at the pull backs and look at that I mean it just goes look at how narrow this was right here and look at the

58:48 expansion again when you can see that hey this thing is coiled we have a narrow range this is what I call an inside value relationship where this pivot range is inside the previous month's range that is usually indicative of significant expansion to come boom that's your significant expansion it goes from 150 to 175 by the end of the month by the end of the month and that was in July in the in the summertime right right now we're seeing something here where we broke the relationship now higher value and this thing broke down and now it's testing from below are we about to see a change of bias or are we

59:36 going to see another push higher right if the mark if the month were to end today we would see a lower value relationship with a very narrow pivot range that's something to consider here so very very important how it's playing out right now but look is a trending market buy the dips all the way inside value look for expansion very very powerful stuff look how wide this pivot range was and you see trading range action right again when when you see that you can help anticipate what's what's about to happen can we tell it will go higher or down lower can we tell it if it will go higher lower you see

1:00:21 yes yes you can there's a couple of things that I do and it's explained in the book but thinkorswim does something cool here where it forecasts the upcoming range so this is October's pivots these are October's pivots that's why I say this is leading information this is leading because we already know where the pivots for October are going to be based off of current action now these pivots aren't set in stone until we close Friday because when we close Friday it's gonna be the last day of the month once it closes Friday these are set in stone then you have Saturday Sunday and then Monday comes online and

1:01:06 you already know days ahead where these pivots are going to be so then you can see it's gonna be higher lower the other thing that I do is hidden inside this indicator is what I call the developing pivot range and this is in the book you see the squiggly lines here and those squiggly lines tell you see this is where the pivot range is but after all this action that squiggly line closes here this one closes here sorry that's a long one closes here closes here and close this here those three squiggly lines close there and that tells you that the upcoming pivot range will be there so you can see ahead of time that the upcoming range is gonna be higher but just because this thing

1:01:53 really closed way up here you already know it's likely gonna be higher but this 10 points exactly where that range will be so you can definitely know ahead of time this is leading information and that's why I really really love these pivots because it's leading you know ahead of time that means you can plan ahead of time and understand where the buy point is going to be where the sell point is or whether to anticipate expansion let's look at something like ITA this is something that the traders in our our trading room brought to the forefront which was been fantastic this was a aerospace and defense ETF we were talking about it back here in this zone it was a pullback to the trigger zone and bang look at that and move one of our traders talked about it brought it

1:02:39 to the to the room and really nailed it on that on that recent rally and you can see here the trend right the trend is clear look at the narrow pivot range right there and look at that expansion and then look at the pullback here just shy the pivot range but again it's a pullback here's into the pivot range and boom again not every markets gonna look like this so if it doesn't and it looks crazy didn't move on to the next one move on to the next one who does have a great trending structure that does exhibit some of these characteristics it's gonna be much better and so I just wanted to talk about these concepts because again they're very simple to understand it's very clear when you see

1:03:26 it on the charts and anybody can do it if my eight-year-old daughter can come up here and say hey that's a higher value I want to buy when it comes back to this pink line right then I know anybody else can do it and that's what I want to do is develop super traders here at the house by the time my daughter's 10 she's gonna be you know managing a huge account here I mean she she can come up here and tell you hey this is where to buy this is where to sell green means go up red means down right here's the trigger zone that type of thing and so these are just powerful concepts that are very simple but anybody can apply yeah here's a s Pyo here's s py you can see some of my key

1:04:11 levels that I put up on here as well I always put key levels up on the charts for our traders I put the the impulse moves that are most important the most important levels right now for SP y 232 240 and 250 we've been in an uptrending structure you can see the pull backs to the pivot range up this was kind of a sideways but still held it just barely this one was up this one is a little bit crazy in here and that was August where things kind of break down a little bit but still an upward trend e market you still see a higher value relationship but we're sitting right near those highs I've mentioned to our group that you know up here it's holding up here but

1:04:57 it's really not going to much yet we may see a little bit more pullback but overall any pullback is still phenomenal buy an opportunity in this market until proven otherwise so let's be Y been a trending market here again you can see things like a narrow pivot range here that leads to expansion you can see a wide pivot range that leads to wide our trading range behavior so if you trade options and you see a wide pivot range coming up and you see they the range is from here to here then maybe I can do an iron Condor maybe I can do a short strangle whatever the case is to keep price in that range or if you see that this is about to be narrow you know you can go directional right and buy your

1:05:43 call or do a call spread or do a straddle or whatever the case is based on for this and that's that's a powerful approach when you can do that so right now we're sitting right there 250 I still think we may see a little bit more pullback and if we do I think it'd be a great buying opportunity so bring back up over here I just wanted to really talk really quickly about the book offer that we have again it's been seven years I can't believe it since it's been published it took me about 18 months to write it three hundred and fourteen pages the the cheapest price this is the price I usually get when I do a live speaking engagement $40 you're also going to get

1:06:31 a free month of access to our Premium Membership which includes our trading room it also includes proprietary tools and indicators it also includes additional training including our 10-part executive training series and our five-part signature setup series there's a lot that comes with it so for 40 bucks that's incredible you're gonna get significant value and that's the whole goal here to help as many people as possible I was fortunate enough to have see just amazing mentors amazing traders I learned from as many people as I can as I could and I continue to and you know paying it forward has always been very important to me writing a book for me was a childhood dream since I was a

1:07:16 kid one day I'm gonna write a book or two I don't know of what but one day I do just because I want to and just because it's something I've always had inside under that I wanted to do but this was a way for me to give back because I've been so incredibly blessed and fortunate my entire life something like this can really help especially for any of you that trade your IRAs your 401ks small accounts big accounts it doesn't matter this provides an approach that anybody can use so 40 bucks you can get a hard copy if you like there's also an e-book option available that you can get immediately and if you take a look here at the website pivot boss calm you

1:08:02 can click on book and you can read a little bit more about it here you can go down to pricing right here and you'll see $40 for the paperback $40 for the e-book usually it's $99 for our trading room which is the Premium Membership where you can go 990 for the year that'll get you down to just 80 250 a month that's just insane that's incredible great value for what you get there but again if you buy the book you're also going to get a free month of that premium membership and you can learn more about that up here as well so if you click on premium you can learn a little bit more about what we do here if you want to look at the Premium Membership really quickly you know it's a it's a fantastic way to

1:08:47 get in right away and then you can get access to that training like our 10-part executive training series our signature setup series premium chart gallery all those proprietary tools a lot of value there so I hope you enjoyed today's presentation the power of pivot based analysis I want to thank you all for taking the time out of your evening away from your family to hang out with me tonight thank you so so much very very much appreciated I'm very grateful you're here with me and let me know if you have any questions let me know if you have any questions and I'll be able to answer them them through email and Twitter however you like and I look forward to seeing you perhaps in the trading room soon and if you did buy the book thank you very much

1:09:33 I know some of you already said you bought it here so thank you so much I'd love to hear your feedback from it I always love to hear feedback I will be working on book two very soon and I already have begun and so you know all this feedback goes into what's gonna be a book - that's gonna be ten times better I mean this one was incredible I'm gonna put even more behind the next one so looking forward to it and again thank you very much for being a part of tonight's webinar and I look forward to seeing you soon take care everyone and I'll see you soon