The Launchpad Strategy

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Gertrude Clark
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1 presented by Thomas Wood MicroQuant SM Divergence Trading Workshop Day One The Launchpad Strategy

2 Risk Disclaimer Trading or investing carries a high level of risk, and is not suitable for all persons. Before deciding to trade or invest you should carefully consider your investment objectives, level of experience, and ability to tolerate risk. This content is subject to change at any time without notice, and is provided for the sole purpose of education and assistance in making independent investment decisions. ValueCharts.com has taken reasonable measures to ensure the accuracy of the information contained herein; however, ValueCharts.com does not guarantee its accuracy and is not liable for any loss or damage which may result directly or indirectly from such content or from an inability to access such information or any delay in or failure of the transmission or the receipt of any instruction or notification in connection therewith. Any past performance results are shown for illustration and example only, are hypothetical and as such have many inherent limitations. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. Past performance is not necessarily indicative of future results.

3 CFTC Rule 4.41 (Hypothetical Disclaimer) U.S. Government Required Disclaimer - Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to Buy/Sell futures, stocks or options on the same. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results. CFTC RULE HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR- OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL, OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE DISCUSSED WITHIN THIS SITE, SUPPORT AND TEXTS. OUR COURSE(S), PRODUCTS AND SERVICES SHOULD BE USED AS LEARNING AIDS ONLY AND SHOULD NOT BE USED TO INVEST REAL MONEY. IF YOU DECIDE TO INVEST REAL MONEY, ALL TRADING DECISIONS SHOULD BE YOUR OWN.

4 About Me Formal info 1995 Graduate of Vanderbilt University Full Broker at 23 with Merrill Lynch 12 Year Senior Advisor Vanguard Asset Management Service Over 4 years - Stocks & Options Live Trading Room

5 presented by Thomas Wood MicroQuant SM Divergence Trading Workshop Day One The Launchpad Strategy

6 Question : What makes up a price bar? Candlestick Bar?

7 Question : What makes up a price bar? Candlestick Bar? Answer = Smaller Bars

11 LaunchPad Multi-Timeframe Momentum Theory Price acceleration in particular direction occurs first in a Small timeframe. If acceleration is great enough, price action then begins to affect an Intermediate time frame. If Price acceleration is great enough in the Intermediate timeframe, price action then begins to affect a Larger time frame.

12 small scale large scale domino effect small Medium LARGE

13 We can follow this small scale large scale domino effect, by watching multi-timeframe changes in momentum direction & strength. We do this by simultaneously watching price and momentum direction in 3 4 timeframes simultaneously.

15 LaunchPad Timeframes

16 LauchPad Daily chart End of Day trades

17 Daily Chart Short (Red) line 45 minute bars Intermediate (Yellow) line 90 minute bars Long (Green) line 180 minute bars

18 LauchPad 60 min chart Swing trades

19 60 Minute Chart Swing trades Short (Red) line 8 minute bars Intermediate (Yellow) line 15 minute bars Long (Green) line 30 minute bars

20 LauchPad 3 min chart Intraday trades

21 LauchPad 3 min chart Intraday trades 3 Minute Chart Intraday trade Short (Red) line 30 second bars Intermediate (Yellow) line 1 minute bars Long (Green) line 2 minute bars

22 Create your own Launchpad Workspaces 4 Columns Chart workspace 1 Primary T.F. Chart : Open-High-Low-Close bar chart (OHLC) or Candlestick chart + momentum indicator (MQ momentum or MACD) 3 Lauchpad subset charts / emphasis on MQ momentum or MACD view. Change color of indicator line to Red/Yellow/Green

23 LauchPad 60 min chart Swing trades

24 Practical Trading Strategies Directional Channel Breakout with a Squeeze Reversal Swing Trades at Support/Resistance Launchpad Credit Spreads End of Day Launchpad Trade

25 Directional Channel Breakout with a Squeeze (VBT)

26 Directional Channel Breakout Please note that the MQ VBT is the preferred indicator of this trade as it is a more sensitive indicator, and has a built in Volume signal. Free squeeze indicators on various platforms can be substituted in place of VBT.

27 Directional Channel Breakout Many times a significant increase in rapid, directional price movement follows a time of market compression (Squeeze / quiet price movement) One of our favorite ways of trading a squeeze is by setting up a breakout channel by drawing up near-term support and resistance lines.

28 Directional Channel Breakout with VBT

29 Directional Channel Breakout with VBT

30 Directional Channel Breakout One of the advantages of using the Launchpad strategy instead of waiting for the squeeze fire signal, is that we can often enter the trade earlier and know the direction early in the beginning of a move.

31 Directional Channel Breakout with VBT

32 Directional Channel Breakout with VBT

33 Watch for Yellow Signal Dots on VBT Setup up Support/Resistance or Trendlines Use the appropriate Launchpad workspace; look for the Short (red) and Intermediate (yellow) lines to identify direction of breakout, just before the Long (green) line.

34 Look for opportunity to enter position based on direction of the Launchpad signal (Short & Intermediate line direction) Watch for VBT to Fire the squeeze as a confirmation signal, and verify strength of Volume

35 Reversal Swing Trades at Support/Resistance Levels

36 Swing Trades are some of the most practical trades to take. They take place on intermediate time frame (60minutes) Allowing for multi-day sized moves (more $$$) plenty of time to enter and exit trades Increased number of available trades to take.

37 Swing Trades are some of the most practical trades to take. By using Launchpad as a screen you can go through a list of securities every couple of hours and you ll always be aware of up-coming Swing trade opportunities. Watch the Short & Intermediate signal lines for changes in direction at Daily & Weekly support & resistance levels.

38 Reversals on Support/Resistance Levels

39 Reversals on Support/Resistance Levels

40 Reversals on Support/Resistance Levels

41 Identify Support/Resistance on Daily chart As price approaches levels, begin to watch on Swing (60 minute) Launchpad workspace Watch for proof of bounce off level - look for the Short (red) and Intermediate (yellow) lines to rebound off level, just before the Long (green) line rebounds off level

42 Look for opportunity to enter position based on direction of the Launchpad signal (Short & Intermediate line direction) in the rebound direction.

43 Launchpad Credit Spreads

44 Launchpad Credit Spreads Launchpad signals are directional in nature. Using the Short & Intermediate line alone is an early entry signal When you wait and get directional confirmation from all (3) signal lines Red/Yellow/Green, is a significant indication of direction.

45 Launchpad Credit Spreads When you wait and get directional confirmation from all (3) signal lines Red/Yellow/Green, is a significant indication of direction. This is also the best time to sell Credit Spreads AWAY from the price levels, preferably opposite side of support/resistance level or behind an area of price congestion.

46 Launchpad Credit Spreads

47 Launchpad Credit Spreads Watch for potential Squeeze breakout trade or Reversal trade at Support & Resistance. Upon Launchpad signal of breakout or reversal, wait until all (3) signal lines confirm directional move.

48 Launchpad Credit Spreads Upon (3) signal lines confirmation, identify area on Opposite side of support & resistance level or Opposite side of area of price congestion like a Channel area or Pennant area. Identify suitable Short strike price level for an aggressively priced Credit spread premium ($.40-.$50) with expiration date of less than 5 trading days

49 Launchpad Credit Spreads

50 Reversals on Support/Resistance Levels

51 Launchpad Credit Spreads

52 Launchpad End of Day Trades

53 Launchpad End of Day Trades For those that can t trade during the day, Launchpad signals can assist on making After- Market Hour trades. Identify suitable trading securities large individual stocks, futures, or (my favorite) ETFs, either based on Index or Sector.

54 Launchpad End of Day Trade Use the Daily Launchpad workspace chart. Identify potential areas of support and resistance. Use either the Directional Breakout or the Reversal at S/R trades to enter at the beginning of the Launchpad move.

55 Launchpad End of Day trade The entry is the break of the previous daily bar s High or Low price If the Launchpad signal is Bullish enter your order to BUY (bullish) a position upon the break above the previous day s HIGH. Set stoploss at the midpoint of the previous bar s high/low.

56 Launchpad End of Day trade

57 Launchpad End of Day trade

58 Launchpad End of Day trade If the Launchpad signal is Bearish enter your order to SELL (bearish) a position upon the break below the previous day s LOW. Set stoploss at the midpoint of the previous bar s high/low.

59 Launchpad End of Day trade

60 Launchpad End of Day trade

61 Launchpad End of Day trade TIP : Watch that the GREEN signal line of the Long sub-chart stays consistent with the trend you are trading. If it starts to flatten & reverse, consider exiting the trade. Short and Intermediate signal lines can fluctuate. The Long GREEN signal line is a better indication of the daily trend.

62 Launchpad End of Day trade

63 Questions & Answers

64 Thank you for Attending

- My 4 Favorite Trades - Essential Trades of a Professional Trader

presented by Thomas Wood MicroQuant SM Divergence Trading Workshop Day One - My 4 Favorite Trades - Essential Trades of a Professional Trader Risk Disclaimer Trading or investing carries a high level of