How I Made $27K Day Trading with My Favorite Strategy | Full Breakdown

So Today I made $27,000 day trading, one of my favorite strategies. And in this video, I want to break down exactly what that strategy is. I want to break down my risk tolerance, I want to break down my game plan, and I want to walk you through this trade exactly where I got in and where I got out. So with that being said, let's dive into the trade. All right, so as you guys can see, I made $27,000 on, you know, one particular trade. I have two other trades that didn't really kind of go all the way. But here's my TOS. You guys can see $27,530 on Spy. Spy is ultimately what I traded. And once again, let's just kind of go through all of this, right? So first and foremost, what was my game plan for the day? So before I take on any single trade or any single trading session, I like to have a game plan. I like to have an idea of what has happened yesterday, what is happening pre market, and what I am kind of anticipating will happen in the market right now. The anticipation is based off the reaction on certain key levels or certain reactions of how the market will respond. Now, I know that may sound confusing to some of you guys, but in simple terms, I'll build a game plan. As you guys can see here, the game plan will look something like this, right? So before the market opened, I, you know, analyzed what the market did or what the market was doing. I mentioned gap update today. We. We had FOMC yesterday with mixed action on the market. Strong rally in pre market. I believe it's overextended, but waiting for Price to tell story on the open. I always want price to tell me a story. I don't want to create a story on my own. As a trader, I want price to dictate what it wants to do next. So let me show you guys a real quick example. So here is. Let's open up ES really quick. So here, here is the es, right? Let's kind of make this larger. Let's look at this. So this is what's going on pre market, guys, just to give you guys a little bit of an idea of what I'm looking at, right? So you guys can see yesterday, FOMC happens. As FOMC happens, market gets very unsure. Typically, I like to trade a lot of days after fomc. I like to trade a lot of days after earnings or big economic events. I like to trade them after, not during. So today all we start seeing is we start seeing price rallying Higher and higher and higher. And as we get closer and closer to us market open, you guys can see we're kind of entering a gap update. Now. What do I mean by a gap update? For anyone confused? This is spy. This is where we closed yesterday. This is where we opened today. So essentially we gapped up from yesterday's close though. This is once again really quick. This is a gap update. So we, or I was already seeing the gap of day before the market happened, right? Which you guys should be able to tell, right? And from there I start looking at this, different scenarios that may possibly happen. Number one, do new buyers step in and drive price higher? So a scenario that I anticipated was number one, possibly what can happen is on the open around this zone, Right? Right. New buyers may step in, they may show interest and they may drive price higher. Which essentially for me is a gap and go strategy. Other situations that I have laid out is do we see selling pressure kick in and profit taking happening? We might see aggressive selling pressure kick in right on the open, right. And we start seeing selling pressure which drives the price down. Or number three, which is another thing I was looking at is do we see a gap hold and. And go, right? Meaning we gap, we hold this area and we start rallying. Now all of this is contingent on how price responds at these levels. So what I mean by that is I even mentioned it to myself and I like to reassure myself and just kind of write things down so I'm aware of what is going on. And I wrote down, just wait for price to give direction. I have the following scenarios laid out, but wait for price to give direction. So I don't go into the day bias. I have my different game plans and different ideologies of what the market can do. And this is something you guys should really take away. One main thing you guys should take away from this video is before the market opens, guys have a game plan, have different scenarios laid out and be open, open to these scenarios. Be open to understanding that these are the possibilities that can happen. And let price dictate one of these scenarios. Do not dictate them on your own through randomness. Let price confirm it. And if you can read price action or you can read order flow and it can confirm that this is true or this is where the strength is. That's where you take the trade, right? So now where did I take the trade? What was my trade idea? Let's just kind of go into the big trade, right? So I will open up this in a second, right? But let's go into my trade. So let's go into this trade and kind of look at it. So just from our perspective, I made about a 2.55 R on this trade, meaning I risked $10,000. I made about 26, $27,000. So I made two and a half times what I risked. And this is what I always want you guys to focus on. I don't want you to. I don't want you guys to focus on the 27,000. I know it's mentioned in the video because that's what will get people attracted to the video. But what I really want you to focus on is the R multiple. What did this guy risk on this trade? So for me, I risk $10,000 to make the 27,000. Now this could have been a trade where I risked $50,000 to make the $27,000. Now, the trade isn't as attractive. So always look at how much someone risked on a trade, what the risk tolerance was, and then gauge if the trade was good or not. Right? So once again, risk 10,000 had a 2.5 R, which is solid. So let's go through my entries and exits and I'm going to give you guys a rundown of my entries and exits, right? So every trade I kind of, every single trade I take, it's a rule for me, right? I have to tag my setup. So as I mentioned, this is one of my favorite setups. I love when we have gap up or gap down days. For me, this was a gap up and failed trade. We had a gap up day, buy absorption happened. We saw an imbalance, which I'll show you guys in a bit, and we saw weakness, right? So all three things gave me the confirmation. And I took this particular trade. And I like to track it and I like to tag what setup it is on on tradezilla, just to have my journals, just to have my analytics going on for, you know, overall, for all my trading, to have a clear idea of what setups work, what setups don't work, when do they work? And you know, that's how you're gonna build this report on your own trading, right? So let's go into this trade really quick. So let's go through it step by step and get a good understanding and feel for it. So here is spy. So I traded spy. I traded the 459 puts. I didn't trade, I didn't trade ES futures. I was looking ESC's order flow, I was looking at ESC's action to kind of take the Trade on spy, right? So spy es, essentially same thing. Wonder Futures 1 is kind of trading options if you want to trade options for them. So I traded options here, right? So where did my first trade happen? So as you guys can see, we open up, we gap up. So let's just go into.

Let'S go into es. Let's turn off pre market really quick, right? So I'm just going to turn off pre market to give you guys some idea. So here's pre market, pre market is off. So with pre market off, this is where ES opens up. So ES gaps up, opens up right here. First minute, first five minute candle you guys can see holds really well, which you know is fine. I'm letting the market dictate the levels, the zones it wants to open on. Right. What is the price the market is comfortable in? What is that range on the open? On the open, the range I see is 4625 to about 4633. Now real quick, when we look at pre market on es, when you look at pre market on the overall market, right. We did have some sort of levels, we did have some sort of rejections on the market, right? So just to cover this really quick, here's pre market. You guys can see pre market, we did get some activity, we did get some rejection which I like to highlight. So you can see 4634 we rejected. So already know we're pre market. Buyers are essentially trapped where if there are buyers that are unable to get the best price, that's where they're getting trapped, right? Not to say that it won't go higher, not to say it will go lower. It's just good to gauge how the market is structured at that current time. Right? So seeing that I start watching price action as I start watching price action and as I start watching how the market starts responding. Now this is where I look at order flow. I look at something called a footprint chart and I look at footprint charts to identify, you know, where are imbalances happening. Are we getting an absorption? Are buyers being more aggressive than sellers? Are sellers being more aggressive? Are there passive buyers or passive sellers stepping in? Right. And I'll talk about that in a bit. So here's a pre market action you can see on the footprint chart. Pre market action, we reject here on the open. We now are coming into the same zone. Now my job as a trader is to read the order flow and dictate who is more strong. Is it the buyers, is it the sellers? And that's I know it sounds very simple and I don't want to make it that simple. Essentially it is simple, but it takes a lot of time and screen time essentially for you to start reading these things and being able to dictate what, what the market will do. Guys, right, so first five minute candle opens. You guys can see I'm not trying to trade on the first five minute candle. Especially in a market that we're gapping up, we're having a huge rally. I want to start seeing the first 5, 10, 15 minutes and see how the price reacts around these levels. So as we gap up, what starts happening at around 4632. Right. Is something really interesting. So this is a five minute, five minute footprint chart on once. One side we have the bids, one side we have the asks. How many orders are hitting the ask, how many orders are hitting the bids. Just in simple terms. And if you guys want me to make a video on footprint charts and how I read this, give this a, like, give it a thumbs up and just comment down below because I don't know if you guys understand this or not. Maybe, you know, I make a video for no reason. But if you guys don't just give it a thumbs up or comment down below, I would love to make a video breaking this down soon. So let me, let me know. So anyways, so as I'm looking at this, what I'm seeing by looking at the depth of market and basically just looking at all the orders going through, I'm seeing a lot of absorption. What absorption essentially is, means is that as aggressive buyers are stepping into the market, there's a passive seller that keeps selling, that keeps selling to this aggressive buyer. So imagine someone who's being extremely aggressive in buying, as he or she's being extremely aggressive in buying, the market is incapable of moving in that direction. So that is what starts happening here. I start picking up, well, the market's being really aggressive or you know, the buyers are being really aggressive at this point and they're incapable of driving price higher. And as I'm seeing the orders go through, I'm seeing a lot of passive sellers, sellers on the sideline just selling to these aggressive buyers. And you know, eventually these buyers are either going to get exhausted or they will stay alive to cause the price to go higher. And as I keep seeing that, I start seeing big imbalances on the footprint chart where we start seeing a lot of aggressive buys hitting the ask over and over again in certain situations. But price is incapable of going higher. So me looking at that. And me reading the tape on ES allowed me to identify that, okay, buyers are not as strong as we may think sell it. There's a big passive seller or multiple passive sellers sitting there selling on here. The buyers are not able to control price, despite how aggressive they're showcasing. And regardless of how much effort there is, there's no result, there's no direction. So typically when I see that happen, I'm looking to short. I'm looking to take a play on the downside. So once again, looking at this particular area, right, exactly around 46, 30 to 46, 31, 32, I'm seeing extreme levels of weakness, right? And like I said, looking at the footprint chart, we have, you know, we have multiple imbalances that happen also. The imbalances are also showcasing on the tape, right? The tape you're seeing. Any time price goes higher, sellers come in, drop it a little bit lower. Price goes higher, sellers come in, drop it lower. So that is showcasing weakness. So when I start seeing that in this area, that's where I'm looking to get short. And that is where I'm looking to take a position to ride out the move to the downside. So looking at the first trade, right where I got in on the first trade, now my confirmation, or where I was like, okay, this, this looks good, right? So first trade, I get in around 947. So 947, I add about 200 contracts at the 459 puts. So looking at 947, right. Obviously I'm trading, you know, spy, but just looking at 947, really quick, what do we see at 947? What is the strength or move we're seeing? So 947 is my first trade. I'm seeing the imbalance. I'm like, okay, we're incapable of breaking this area. Buyers are not strong enough to drive this higher. In my opinion. Obviously, if buyers are able to get into the zone, especially the 35 zone, I will exit and I will take take a loss there. That was my game plan. If we're able to get into the 35s. And if buyers are able to drive it into that, I'll get out, I'll reassess my position. So I take my first short there right now. I took it with 200 contracts. As we make a move down and as we come back into this zone again, that weakness is, is still there. So I add 400 contracts at 954. So going to 954, I see that rejection again I'm shorting this once again shorting this. At 954 we make it push down, we come to the opening low, we hold the opening low. But once again price action is a little bit sloppy. And you know I am going to keep writing this out because for me my stop is around this area. If we we do control price in this area, I will be wrong and I will gladly take that loss Going into this zone right here. We start consolidating. 10am comes and you know, as you guys know I always talk about 10am we start seeing an influx of volume, we start seeing an influx of movement. 10am comes, we start seeing some movement. And then right after 10am you guys can see now we start slowly fading. Now when we start fading guys, that's where I tend to take my first exit. So around 1008 I scale out. So this is 1008, I scale out at 1008 for, for multiple reasons, right? Number one, I'm already in the profit. So at 1008 I'm already in the profit. That's number one. I'm going to take half off, I'm going to take some of my position off which is what I do at 1008 when I take some of my position off at 1008. One reason was I want to lock in profits. Second, we're breaking the pre market low and not the pre market low. We're breaking the opening low. So I don't want to get trapped in here where retail traders are entering, you know, market traps them in, gets sloppy and then goes down. So I'm like, you know what? Before I get caught in this crazy mess, even though that didn't happen right away, let me just exit or take some off. So I take some off right there, right? You know we can see my running P and L. You know where I start taking off, I start taking some off right there and then right a couple of five minutes later at 10:13 is where I fully exit my position. So when you go to 1013, this is where I exit. Now the reason I exited at 10:13 is because what I saw at 10:13 I saw somewhat of a trap. So what I thought was going to happen based on the movement I saw here was market is going to start fading back into this 4626 area and it will then start dictating the next move. So I was like, you know what, I'm up on the trade. I'm up about a 2.5 to 3R. You know, I'm up 20, 30 grand. Let me take this trade and let me walk away. That was essentially my game plan. Now after that I want to talk about. I was looking for a re entry of short. I wasn't able to read this. I just wasn't able to. Neither did I have the confidence. So I let this trade just kind of flush out. You guys can see it flushed out. Came back here and now I'm watching. Are we able to come back into this zone? Is price able to control this zone or not? And then from there I honestly just kind of called it a day. And I was like, you know what? I'm going to call it a day. I don't want to take on any more trades. I had a good opening trade. Let me just walk away now. When I go back to this trade, guys, right, this is a crazy part. I kind of took the trade from here right to here. This is like my trade. I just want to emphasize on something really quick that's kind of my trade right now. This trade has essentially went down so much lower that my contracts. On this particular trade, if I go to my option contracts, right, let's just look at my option contracts just for one second. My option contract where I traded was about 60, 70 cents. I got out around A$10, A$20. These contracts went all the way to $7. So when you go here, just to kind of clarify on something is essentially this could have been a 300 grand trade. And I'm not saying, oh man, I missed out on a big trade. I'm just trying to showcase something that as traders, our job guys, is to maximize on the trade where we have an edge and where we have a risk placed. Once we have an edge and once we have our risk placed, we. We take these trades and we kind of follow through. That's it. We don't go back to the trade and say, well, I could have made 200,000 or I could have made 20,000 or I could have made 2,000. No. Yes, you could have made so much. But if you focus consistently on those small wins that align with your edge and align with your risk, you will stay alive in the long run. So yes, when I see this, I'm like, oh man, if I held, but I had no reason to hold. That was in my game plan. My game plan was execute this setup that I see that is giving me an edge, maximize on that, have my risk placed and do that consistently in the long run. And that's what I did. And from there I am super happy with the trade, regardless of how much more I could have made. So with that being said, that is the trade setup. And yeah, with that being said, I hope you guys found value in this video. I plan to do a lot more of these trade setups. Like I said, I want to make a video eventually for you guys with footprint charts and, you know, more ways I assess the market, more ways I look at the markets and more of my setups. But until then, I hope you guys found value and thank you so much for watching.