THE 4HOUR 180SMA Setup

A FREE LESSON FROM MY UPCOMING 6 WEEK OPTIONS TRADING COURSE

THE

SETUP

. Timeframe = 4 HOUR CHART

. Moving Average = 180-PERIOD SIMPLE MOVING AVERAGE

BREAKING DOWN

THE TRADE

To become a successfull & consistently-profitable trader, you only need a few go-to setups that work for YOU, that you can eventually master and make your own. The 4 HOUR 180SMA setup is quickly becoming one of my go-to's, responsible for $1,700+ of profits last week in my small account. 

The goal of this setup is to trade stocks long or short as they cross over their 180-period simple moving average. I love this setup for a lot of reasons, but mainly because it is easy to identify, and all the variables of the trade are set-in-stone before ever entering the trade

ENTRIES & EXITS

We'll use the example of a long-trade I took last week using this setup on $XLF. In the image below, I have circled my entry. My goal with this setup is to go long the stock when it makes a strong move through & above that 180SMA. I am NOT trying to take an entry on the very-first few ticks above that MA, rather, I am waiting til it has clearly crossed that level to enter. 

XLF4HOUR.png

Because we are playing the 180SMA on these setups, once we can find and identify this setup, we already know where we want to take out entry. This is big, because most new traders struggle with the emotions of wondering when it's time to enter a trade. 

Even better, we already know where we will exit if the trade doesn't work. THAT IS THE BEAUTY OF THIS SETUP. It completely removes the emotions not knowing when and where to enter & exit.

After you take your entry, only TWO THINGS CAN HAPPEN NEXT = the trade works, or it doesn't. And because we are taking low-risk entries just above the 180SMA, if the trade fails and ends up falling back below this level, the loss is modest. However, when the stock continues to trade above and away from the 180SMA, the gains can be big. 

On this $XLF trade, my options returned 53% in just a few hours..

JPM4HOUR.png

Take a look at the chart from my trade on $JMP last week using this setup. Once I took my entry, the game plan is already set. Despite the pullback, $JPM NEVER threatened to break below the 180SMA. By practicing patience, and sticking to my game plan, I was able to close $JPM a few days later for a 25%+ gain on my options. Had $JPM broken below that 180, I would have taken my tiny loss. 

FB 4HOUR.png

$FB was a beautiful example of this setup a few weeks back, where I made 70%+ on my options on this trade. Though I only held it for a few days, as you can see, if you have patience after your entry and stick to the exit-plan, these setups can lead to some strong, long moves in your favor. 

EASY TO IDENIFY

LOW RISK/HIGH REWARD

PRE-DETERMINED ENTRIES & EXITS

LONG & SHORT

ALL THE VARIABLES OF A WINNING TRADE

6 WEEK OPTIONS TRADING COURSE

If you want to learn the basics of options trading, more low-risk high-reward setups like the 4HOUR 180SMA, and get first-hand insights into the daily-preparation of a full time trader, join me for my 6 WEEK OPTIONS TRADING COURSE starting on 2/18/2019!

Members will receive private video-content and downloadable PDF materials at the beginning of each week, and will learn first-hand the daily process it takes to become a consistently-profitable trader as we review actionable-setups and create our game plan together every morning in our private TRADE PREP live streams. 

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