Buying Bottoms & Confluence
The anatomy of a stage 4 becoming a stage 1.
Hey MFG,
I hope you’re doing well and continuing to build your wealth daily. All major indexes are currently in a stage 1 accumulation zone. I added to TQQQ, UPRO, UDOW, TMF, and BITX. I’m ALL IN across all indexes in leveraged positions and few futures contracts. I cleared my checking account to do this; I'm literally all in. This takes true conviction and courage.
Today's message is about confluence. You should always be focused on your financial education and family's wealth. Building wealth requires a daily commitment of reading, studying, and practicing.
CONFLUENCE - THE ANATOMY OF A STAGE 4 BECOMING A STAGE 1
Confluence is the occurrence of multiple technical analysis indicators aligning at a specific price level. Once a potential anchor point is established, the Money Flow wants 3 additional bars to confirm the new anchor point.
Once the possible anchor point is formed, we should see the MACD histogram change slope direction letting us know that momentum is turning to the upside, along with price above the 5-day EMA (the trigger), an extreme RSI, and the moving averages coming together.
This is a confluence between price and the indicators. Again, we want to be able to catch the anchor point, identify the bottom, and see price above the 5-day EMA to get in on a stage 1 accumulation zone. Never be in a rush in the stock market. Let setups come to you and trades mature.
This week’s homework video is about confluence and buying bottoms.
The Money Flow is simple and a stage 1 should be clear. We should see a confluence of the indicators and a visible repeatable pattern that can be spotted by the human eye. This gives us our edge. The 4 stages of price movement and the fact that quality assets go up 70% of the time is our advantage.
Always be able to define your trading edge. According to Mark Douglas, one of the greatest traders in the world, "an edge is nothing more than an indication of a higher probability of one thing happening over another." Our edge is backed by numbers and statistics. The Money Flow Trading System gives us the discipline and confidence to make bold moves in the stock market.
"We have to be careful about what we project out into the future, because nothing else has the potential to create more unhappiness and emotional misery than an unfulfilled expectation." -Mark Douglas
Always remember, whatever you think about comes about, whatever you focus on grows. - GP
Purchase a hard copy of Gerald’s trading strategy book called The Money Flow Trading System.
We never know where the market is going to go. We do know the stock market climbs higher 70% of the time. Check your charts everyday and keep in flow.
If you need help with this, consider Gerald's course, "Getting Started with Stock Charts the Money Flow Way" and you will be ready to add shares to your portfolios on stage 1 when the markets are about to possibly rotate and trim profits when opportunities arise.
They say that you can’t buy bottoms or sell tops; The Money Flow Trading System can show you how to buy ALL the tops and the bottoms and stay in the flow.
That is what the Money Flow Trading System is all about. Being in flow with the stock market. Simple? YES! Easy? NO, but what in life that is worth having is? Stay the course, don't give up and don't get shaken out by wars, the Fed raising rates, rumors of recession, or any other event that may come.
Don't forget, 70% of the time the stock market climbs higher and the other 30% sets up for good buying opportunities.
Stage 1s underway in all indexes
Really been enjoying the move to Substack. I’m really curious to see how the market plays out the rest of the week the price movement has been very interesting.