hello traders in this video we're going to be looking at how to day trade your
way to financial freedom with the day traders fast-track program we have a
daily target of $400 per day per contract traders will be exploring in
this video one way that you may be able to do that if you haven't already done
so if you go to the bottom right hand side of your screen you'll be able to go
to full screen because you know a couple of moments we will be going to some
charts to have a look at some live setups but I've already marked up on the
charts and I'll explain them in full if you haven't already done so please feel
free to halt the video to read your disclaimer on understanding the risk
when it comes to trading so I'd like to give a thought of the day and my thought
of the day today is this one too many great opportunities cost you every
opportunity now you may be thinking samurai trader what tha have you lost it
what do I mean by that let me say it again too many great opportunities cost
you every opportunity well when it comes to day trading there are so many
different strategies and methodologies and so many different ideas on where you
should be entering and exiting the trade as I say in all of my videos become a
specialist become very very good at a small number of trading strategies where
you own those strategies and in a blink of the eye you can very very easily see
the setups it's absolutely critical because too many traders and I see this
every day of the week trading too many different methodologies and I don't know
what part of the world you're in but down here in Australia we have a saying
jack of all trades master of none and that is so applicable when it comes to
trading so getting on with this video how are we going to target four hundred
dollars a day per contract well in today's video I'm going to focus on
divergence trading tips divergence trading is
probably the most popular trading strategy or methodology or technique yet
it's the one where the majority of traders lose their capital now in the
day traders fast track program we have for specific setups for divergence
trading we have t19A T19B T89 and T20 now in this
video as this is for the general public I won't go too much into the specifics
of every setup here but what I am going to do is give you some ideas some great
strategies so if you haven't already got a pen and paper handy please do get a
pen and paper handy and take notes as I run through because I'm going to give
you some real ideas and techniques and tips that you can use immediately but as
I say what's absolutely critical trade is is that you learn to master one setup
at a time where you've executed the trade at least 100 times on the trade
simulator before you go and trade real money and particularly when it comes to
vert to divergence trading now I love the t89's are about to see however
I've been doing this for over 23 years so it gives me a massive advantage you
know of course you can go to my website to find out more about our program and
for $197 you get the 12 of the world's best day trading strategies with over 20
hours of instruction so let's now go and have a look at the charts now in this
particular chart I've got up the ES now these techniques work on any market and
any timeframe whether you trade futures stocks or Forex as long as you've got
some movement some volatility because we love volatility now remembering that
divergence trading is one of the most difficult forms of trading and what a
lot of people are trying to do when they trade divergence trading they're trying
to really pick tops on bottoms so in this video let me give you some tips
straight away and number one is this fear yellow line you can see here
and let me just get something over here make it a little better here so we can
see this yellow line we've got going down here this is a 34 EMA and I used
that along with the 89 EMA for my overall trend direction so we can see
here my cyan is my 89 then the yellow is my 34 so it gives me a good idea good
indication now where most divergence traders get absolutely hammered is in a
strong trend because you'll get divergence trade setup but of course the
trend continues and if we have a look just down here for an example we can see
we've got great divergence here we've got a higher high on my platinum
indicator and we've got a lower low a classic lower low here on our price
action and we can see we then go up and we bounce off 34 now tip number one is
for further away from the 34 or the 89 EMA when you are divergence trading the
better unless you've already had a good run of trades and let me explain and
show you what I mean by that so let's just readjust the chart here first of
all one of the rules that I have in trading the divergence trade is you want
to have what I call a break of the 8 now a break of the 8 this
blue line is an 8 EMA probably one of the most underutilized indicators when
it comes to day trading now by the way this works brilliantly for swing traders
as well or even position trading so one of the confirmations you want is a break
or a closed on or above the 8 EMA so let me draw up a trendline here for you so
we can see here we've got some divergence theory that a lower low on
price down here so one could say ok let's get in on the break here
now number one it's not a brilliant candle if you notice this candle we've
got here for the divergence trade it's closed at the halfway point it's not
what I called a full candle a full or engulfing candle is one that really
opens at the bottom and closes at the top so it's nice to see a nice push
we're all the way out but then what happened here is we had a 34 bounce what
we call a 34B another 34B but here's a trick I want to show you with
divergence trading the market moves in waves I recommend for traders to be
extremely cautious after three waves in the market so if we look at this here
you've had a break up here pull back when you got to confirm you've got wave
one down wave 2 and wave 3 you could even say this is really away because
you've had a break you've got to pull up your bounce stuff 34 come down so you
could almost say that is way one that really depends on a couple of other
matters which I won't go into here but let's just say way one two three now we
are going to be really interested in divergence trading why did we wait well
you can see here in a strong trend this is where you can be really hammered now
this is the ES now ES works in $12.50 ticks
$50 a point so there are four ticks to a point now by the time you get in and
particularly when you're trading or day trading quite often you do need to use a
market order which means you may get one to two ticks slippage which means by the
time you get in you may only have one point of profit now the question is
where does your stop go where your stop should be tucked down here one or two
ticks under your little swing low now if you do that then you may not be in the
trade till up here which means your stop is down here your risk reward is very
very low so getting back to the point I wanted to make with the three
waves is after you've had three waves or three trades in a good strong trend I'm
really starting to become interested in divergence trading why because it's a
very good chance knowing by probabilities or our statistics that we
are going to have at least a pullback in the short term so to take this
divergence trade right down at the bottom would be a lot more interested we
then go up we then have a 200 bounce we have another 200 bounce now these are
classic trades that we teach in the day traders fast track program and so you
had an entry here now when you get these third entries or fourth entries or after
the third or fourth wave notice that your risk reward you're getting a much
much better return on those what you've got to be aware of though when you're
heading up towards at 200 you'll see time and time again you bounce or for
200 as we've done here today so bounce we've bounced again we've bounced again
okay now up here we had a nice little double top we've had a double top what
we call a t7 we've had divergence on our platinum and a Wait it's gone here so
we've had a perfect divergence trade here now when you have divergence trades
with the trend bet the farm on them I am only joking but seriously they are a
great trade I love divergence trades with the trend
and if you had the patience and waited for those these are an 80 to 90%
win-loss ratio there are great trade trading divergence trades with the trend
now what defines our trend well we've got our 89 still in a downtrend and our
200 now another tip I'd like to give you is this that when you start to see your
moving averages as we can see here our 34 and our wait these are areas that you
want to be very very cautious of because you can also be chopped up in the
areas so let's move along and just have a look at a couple of others now what
I've got down here is a nice double bottom again okay now my my platinum
down here it's not really divergence on this particular one however we do have
another set up and I'm going to show you another little trading secret that we
have when we trade and we call it the T89 now our T89 and I know you're
looking at a lot of different lines here so I'll just try to explain this can you
see three black lines is one two three and down here you've got one two three
and notice that the 8 EMA is moved away from that line and down here as
well and our entry is outside the T89 sorry outside the channel I should say
these are what we call T89 these really improve the probability of
having a successful trade so the T89 is one of our stand alone trades that we
teach as a counter trend trader there are a high probability trade but your
entry has got to be outside our channel that we've got here now after a river of
time you get used to all of these lines and let me just pull those off again
okay disable that mare for a moment so another thing that we are looking for
which is very very important when it comes to counter trend trading is what
we called angulation angulation is where price angles away from your main moving
averages so we can see here once again our yellow line here is our 34 and note
how the 8 EMA and price action has moved away so let me just go up here for
a moment and get so notice this see how we've got a wedge virtually
formation here when you see angulation of price moving away from your 34 and
see that little wedge there that also is really an absolute critical factor in
divergence trading now up the top here we've had a small amount of angulation
but not great now notice here how almost it's always to channel so fast to do
this let me just do something here traders let me just do this to there let
me just start so I just want to quickly okay let's go to there see this channel
formation we've got here this is what you want to really be careful of now yes
one could say I managed to sculpt one or two points in this particular move
before you bounce stuff for 34 and the 89 and or for 200 but your risk reward
so your stop would have been a couple of ticks up top here let me move it down
for you okay so your stop would have been a couple of ticks up above here by
the time you got in your risk reward because your issue you're waiting for a
bounce is not great but notice here you've got no real angulation you've got
divergence here but these are the ones you've got to be really careful of and
what I've got here is scalped high probability will bounce on the EMA's which
is exactly what it did and just before I wrap this video up we go along here
we've got a nother t7 we've got down the bottom here you can see here we have
divergence on our platinum we've then got up here we've got some a lovely
little double bottom with the trend notice how our 89 is starting to go up
our 8 EMA is above the yellow line which is at 34 this is giving us all the
indications that we're in an uptrend now a high probability trade
so let me move this down and maybe I'll just show you one more before we wrap
this video up so let's have a look look here okay now this is where I mentioned
earlier that divergence trading can be higher risk if we go here okay we've got
really it's it's there's no real divergence here and notice you do have a
high high on price but then you bounced on the 34 but more trades in a trend
you've had so you've had really a one two three four the more like you likely
you are that is you've had a pullback one pullback to pull back three pullback
for now I'm starting to become interested in my divergence trades why
is a good chance that after three or four waves we are going to have what a
decent pullback and of course just keep in mind that when you do get these pull
backs quite often you get these bounces off your longer-term moving averages now
these are virtually a self-fulfilling prophecy because so many thousands of
traders around the world trade these moving averages in all markets and all
timeframes so you can see I've got a lot of other
information that set up there on my chances is for our standard members so
the trade is if you'd like to know any more about my trade setups please drop
us a line at or a trader at I'm a day trader dots calm or
go and visit my website and of course if you haven't already done so please
subscribe to my channel thank you