Starting with Price and Volume | Podcast Episode #244

0:07
Hey, I’m Ryan Mallory and this is my Swing Trading the Stock Market podcast. I’m here to teach you how to trade in a complex ever-changing, world of Finance, learn what it means to trade, profitably and consistently managing risk, avoiding the pitfalls of trading. And most importantly, to let those winners run wild, you can succeed at the stock market and I’m ready to show you how, hey, everybody, this is Ryan.

0:32
Mallory with Swing Trading the Stock Market And I’ve got good episode for you guys here. Today we’re going to talk about price and volume and specifically starting off a price and volume. And I’m going to use an email from a person that wants to be called Bubba. Bo Bob, Dwayne, for those who might be new to this podcast, I give what I try to give his good old Florida redneck names to conceal their identities, just because most people don’t want their name blasted out there.

0:58
So give them a full to read nickname. So, Bubba, Bo Bob to wainwright’s, I have been listened to your podcast, my trading Journey, sounds a lot like yours. I got interested in the stock market in kindergarten when I watched a business reporter named Jim Newman report, the financial news.

1:16
Got to be honest, I don’t know who Jim Newman is. Maybe I should know who he is, but I don’t boo boo. Bob Duane goes on to write I have always dreamed of treating and thought it was a pipe dream until I beat the S&P 500 by, simply going all cash at critical moments. This year I’ve finally decided to take the jump from three or four.

1:35
Vo o trades a year to actively buying and selling stocks on a weekly or monthly basis and for those wondering what v0o is. That’s basically a Vanguard S&P 500 fund so it’s kind of like trading SPY or something similar. Now Ryan I have two questions.

1:52
Is there a service that will allow me to quickly flip through charts quickly? Notice the emphasis on quickly, with minimal load time. I hate how slow thinkorswim is. Number two, To where can I learn to read price and volume so far. All of My Success has come from reading the news, listening to conference calls and making good guesses that which sectors will Trend.

2:10
The more I stare at charts. The more. I feel like they aren’t and I can only kind of understand what they are saying. Thank you for the podcast. Sincerely, Bubba, Bo Bob Duane, good questions, pretty simplistic questions in the sense that, you know, we’re not getting into anything like really deep here, but I’m going to try to take us a little step further in this podcast with the price and volume question and also give you some of my thoughts on the charting platforms and why I prefer the ones that I do.

2:36
But first, what am I drinking? I am drinking bro. Brothers. It’s called bro, Brothers, bourbon whiskey, it’s 41 percent alcohol. 82. To proof. Now, the one thing that I found, interesting on the back of this bottle because I try to read the story behind and I guess these guys names were Yarborough, so they shortened it to bro.

2:56
And then added some brothers on their. So, these bro. Brothers actually put on the back of their label enjoy, bro. Brothers and mixed drinks and Cocktails. Now granted there’s some Bourbons that do not belong in the neat category. I don’t like the consider them as a standalone bourbon Jack. This is probably one of the most famous ones. Most people if they’re going to use Jack Daniels that are going to make like a Jack and Coke. Rarely this people actually want to go out there and drink Jack Daniels neat.

3:27
But you know, when you’re putting on the label, how this is made with some of the finest ingredients and that you should drink it with cocktails, I don’t know. It just kind of feels like it loses some of its legitimacy as being a good bourbon and I have even had a sip of it yet and when I smell it smells very medicinal.

3:43
I don’t know if that’s the right word but it just doesn’t don’t smell good and the flavor, it’s like it’s very Oaky. You know, it’s like that popsicle stick that you’d get as a kid after you got a treat and you were left with the popsicle stick and you jump down on that popsicle stick just for the heck of it.

4:00
Some that’s kind of like, what the flavor is. It’s like, chomping down on a popsicle stick and it feels a little water down. I don’t know if that’s intentional or what it is, but it doesn’t taste all that great on a scale of zero to ten. I’ll give it a 47 that’s going to be up.

4:16
Our would like to Clyde maze the Heaven’s Door, Tennessee, bourbon. It’s just not that great. Not everyday sipper. There’s a reason why Sam’s Club headed on the clearance rack for $20, I know. Now, why I just couldn’t pass it up at the time. I’ll probably serve this to Guess that I’m not very fond of at Christmas parties or something like that.

4:34
Just not good, bro. Brothers, 4.7 now, I got to make sure it Christmas parties. I don’t serve somebody broke brothers and they happen to listen to this podcast, because then I’ll look like a rule ignoramus, but yeah. Pro Brothers is not that great. So back to Bubba, Bo Bob Duane and his questions about charting.

4:53
So, the platforms that I like the best and it really answers this question right out of the gate, what service will allow him to flip through charts very quickly. Best one in my estimation is TC 2000. There’s a link in the description to it. Yes, it’s an affiliate link but I use it every day. That’s the main one that I use. I think it’s phenomenal. The one that would recommend next and I don’t have an affiliate link for just tradingview. I think trading views, really? Good is right up there with TC 2000 but ec2000 just like how easy it is just to hit the spacebar flip, through all the charts and get right to the next one.

5:24
Now, consider this to, I just recently upgraded my computer I was using before computer from Best Buy that I had bought probably like two plus years ago. It was good at did really great. It was like a cyber powerpc. I upgraded the ram to, like 64 gigs of RAM and it worked great. It was really great for trading. I think it cost me like fourteen hundred dollars, but also notice it was starting to slow down when I was doing some videos and some of the rendering on the podcast. So I decided OK it’s time to get a new computer. I decided just go all out and get myself. A really nice when I think I spent like five thousand dollars on a computer.

5:59
I know crazy but it’s also the times that we’re living in to where there’s just tons of shortages but I think it was another cyberpower PC and I got it with the I9 process or 12th generation 64 gigs of RAM. And I also had a 30 90 Scarred. And I could tell you when I ran TC 2000 with that stuff versus my old computer, it may have been just milliseconds, but I can notice that fast fast difference between one chart to the next. Like I could tell it was able to process that.

6:32
Next chart much, much faster. And before I was thought, okay, it’s probably just internet speed, that’s driving it. Now it’s also computer speed from my experience. So the other thing that TC 2000s, really good. And that I like about it is that there’s a lot of flexibility on the chart layouts from tabs and just being able to have floating windows, very, very helpful.

6:52
I also like to some of the indicators that they have that are proprietary like the volume Buzz that kind of Compares different levels of volume over different periods of time. I’m kind of getting into is next question here by covering this right now. The volume Buzz will measure volume, it’s a proprietary indicator, they use, I don’t know it, but it’s worked really well.

7:11
Well for me over the years and that it just measures volume currently to volume at different periods of time on a weekly basis or like a monthly basis, but it does a really good job to let you and help, you know, when the volume is above average throughout the trading day.

7:27
So you might be looking at the volume and you’re like, yeah, it’s a close call, I don’t know. It’s going to be above average volume or not, but you can look at the volume buzz and it’ll actually tell you. The other thing that I think is pretty cool on there is like some of the indicators I use them. Like Tootsie 2108 and the T 2107, those are measuring the percentage of stocks that are trading above their 40-day moving average and 200-day, moving average respectively and they helped me a lot during Market downturns to gauge just how oversold we are.

7:57
And so when those indicators start to get in like the single digits, we’re only like seven or eight percent of stocks are trading above, their 40-day moving, average, usually that’s indicative of an ultimate bottom getting ready to materialize. I also like, and I’m a stickler about drawing to like on thinkorswim. I don’t really do good with the drawing on tradingview. They got really good drawing tools but I find it very difficult to go back and forth between tradingview and TC 2000. Even though I do it, it’s just different commands and different actions that you have to take the draw the same line.

8:29
They’re both streamlined in their own, right? It’s just very difficult to use both of them. Now, TC 2000. It’s just real easy after I draw a line and you know just by clicking down and dragging across the screen I can hit spacebar and if that’s the line right there. So that’s really nice and really on all these platforms.

8:46
I don’t go really crazy with the bells and whistles, even though that I could it’s just that my style of trading doesn’t really necessarily mean I have to get all Hog Wild on using all the tools night. You take thinkorswim, for instance, that thing has so much capability to it, but when it comes to charting and using the grass, it’s not nearly as good as ITC 2000, but For options trading.

9:10
It’s amazing. And so what really makes T, C 2000. Good is the customization on the charts? I mean, I can make the lines, any color I want, any thickness. I mean, you can make the charts different colors. I know that sounds stupid or weird but believe it or not having charts look the way that you want them to look.

9:28
Makes them easy on the eyes for you and also makes it more tolerable going through the charts especially when you’re doing it on rapid-fire. Like for me, I might look at only a chart when I’m going through my screens for like half. A second to a second, I can look at it and I can tell if there’s something there or not.

9:47
Now, number two, and I’ll read the question again. So you guys can just get a little refresher there. He says, where can I learn to read price and volume so far? All My Success has come from reading the news, listening to conference calls making good guesses at which sectors will Trend. The more I stare charge, the more. I feel like they’re talking to me and I can only kind of understand what they are saying.

10:04
So when it comes to price and volume, one of the things that I would say is, if you want to learn about price and volume, just focus on price and volume. So many people want to clutter up their charts with just tons and tons of end. Haters. I mean people put Mac the RSI stochastics this indicator that oscillator I mean it’s just non-stop stuff that they put on there. They’ll just draw gobs of lines. I see some charts where I came until one line from the other. I mean there’s just so many of them on there and some people Pride themselves on it which blows my mind if I see too many lines on there, I start getting a little bit anxious, I don’t want to see lines or an abundance of lines on my charts because then what are you really reading?

10:39
What are you looking at? There’s no real clear direction that you’re following on a chart. If you have 100 lines on your chart now. Moving averages are important, but moving averages are only as good as how price responds to them. Meaning, if price is just going below and above the moving average, who cares what that moving average represents, who cares that it’s a 10-day or 200 or a 50-day moving average.

11:04
If price action doesn’t care about the moving average. If it’s not showing signs of support or showing signs of resistance. It’s really meaningless because if price A respected. Why should you? But ultimately, if you want to learn the most about price and volume, it takes a lot of time.

11:20
It’s really about learning what different chart patterns mean. Now I’ve been asked a lot about what books would you read to become better at understanding technical analysis and there’s one that I really do, like I think it’s about 32 bucks. I think, when I pay for back in the day was like a hundred and ten dollars.

11:37
So it was really expensive when I bought it but it’s called technical analysis of the financial markets, by John J Murphy. And it’s a A really dry dry book but he covers a ton, a ton of stuff and you’re going to learn a lot and it’s going to be really boring.

11:53
It’s going to be like, holy cow. I don’t know if I could finish this book. I mean, it is like reading an encyclopedia, so that would be the book that I would read that would guide you a lot on understanding the patterns and understanding the charts. Because what, the price action ultimately does is create patterns.

12:08
It helps you to understand technical analysis, like, for instance, supporting resistance. It shows you what? Port levels price action is respecting resistance level shows, you the price levels that price action cannot get through. And then there’s going to be times where it does break through resistance and there’s times where it does break through support.

12:26
That doesn’t mean that technical analysis doesn’t work. It’s actually doing exactly what it’s supposed to do. It’s showing you a change in the behavior of the stock. If you can break through a resistance pattern that has been unable to do in the past, it’s signaling a change in the behavior of the price action and so that’s something that you want to know.

12:43
Note so many times people, zico you drew the support level and said it was a really strong support level and that it’s held for a very, very long time. It’s a long-term support level. So why would it break? If it was so great? I never call it great, I would call it an important support level, but if it breaks, what is the chart telling you then that’s technical analysis.

13:05
Actually, working not failing and so you see a support level breaking that it’s held. Let’s say 15 times in the past, the last five fifteen times in a row but this time on the 16th. Try, it breaks, it doesn’t mean technical analysis is failing. It just means that the support level broke. So now what is the chart telling you now?

13:21
What is price action telling you if you take it personal when I support level breaks or resistance level breaks or the technical analysis does something different than what you expected it to do. That means you were trading with the bias you are trading off of the charts. You were trading off of what you needed that trade to do for you.

13:37
And so, you’re upset about the fact that it’s not doing exactly what you wanted to do. That’s not technical analysis that’s trading with a bias. So when support breaks, when support holes, when resistance breaks, when resistance holes, when trend lines fail, when reversals occur, it’s not a flaw in technical analysis.

13:59
It’s the actual beauty of technical analysis. Showing you, something new is emerging, and that you should consider acting on it now, look making good guesses, like what Bubba talks about in his email, listening to It’s calls. That’s great when it can work for you and everything else.

14:16
Guesses will only take you so far. What is critical is that you gravitate towards a risk-reward mindset? How are you going to manage the trade if it doesn’t work in your favor? Because a large chunk of stocks especially when you’re just starting out in, it are not going to work.

14:33
A lot of Trades are not going to go in your favor. So how are you going to get out without blowing up your account? These are the questions that you have to ask yourself before you get into the trade, not when it’s actually blowing up on you and right now, and this Market that we’re in, there is a ton of traders that are blowing up their accounts because they didn’t plan for this.

14:53
They never expected this to happen. I’ll tell you, hey, I was trading in PayPal when I was at $300. Now it’s below. 100, what going on here? I’ve lost all this money, why? Well, because you didn’t plan your tray before you ever got into the trade. You didn’t consider this as a possibility.

15:09
And I go into a trade. I never expect any trade to work out, right? In fact, I go into it with the mindset that this tray that this trade can blow up my account at any given moment. And so with that being said, how am I going to manage the risk?

15:24
Where am I going to place my stop loss so that I can see when something’s not going, right? When something is not going, according to the original technical analysis that I mapped out. When a change in the behavior of the price action results in a key, support level breaking, will I have a stop loss there? To go ahead and get me out of that stock for most people, the answer is no, for me.

15:43
It’s yes. Why. Because I fundamentally believe in my ability to blow up my account. And as a result, I’m going to guard against that. And also what helps me and others guard against blowing up, accounts is swingtradingthestockmarket.com, with swingtradingthestockmarket.com.

15:58
You’re going to get all of my stock market research each and every day guys, this is going to include the dill Elissa setups that I’m following my weekly watch list. Also, you’re going to get Calluses on the most important charts of the day plus analysis, on all my thing, stocks plus, Microsoft and Tesla, and you’re going to get all of the major indices.

16:18
So check that out swing trade in the stock market outcome. So the takeaway with all this one, I think TC 2000 and tradingview. They’re very very good trading platforms. The chart to learn how to chart to be able to flip through charts very, very quickly, really good.

16:35
They’ve got all the tools that you could possibly want. Number two, when it Comes to understanding price and volume. You have to teach yourself technical analysis and I gave you a book. Technical analysis of the financial markets, by John J Murphy. It’s a boring, boring boring book, but maybe if you take it, you know, with you every time you go to the toilet, instead of looking at, you know, your Instagram feed, you might read up on a new pattern or two and you can just learn more and more about different patterns and what they mean in the financial markets, Also, you have to move your mindset from making good guesses or finding good stock picks to a mindset of risk reward.

17:16
And if you’ve been listening to this podcast for any length of time, you probably like Ryan, you say this in every podcast and I’ll continue to say it in every podcast because it’s the most important part of trading is the risk, reward Factor. If you enjoyed this podcast, make sure to leave it.

17:35
A five star review and support swingtradingthestockmarket.com. You’re supporting the podcast, your five star reviews are To help me to build the audience and to reach more people to help them not blow up their accounts as well. And make sure that you’re sending me your questions. I really don’t get enough questions from you guys. ryan@shareplanner.com, I do read them all and I will try to put every single one of them on a podcast episode of its own.

17:55
Thank you guys. God bless. Thanks for listening to my podcast. Swing trading the stock market. I like to encourage you to join me in the SharePlanner trading block, where I navigate the stock market each day with Traders from around the world with your membership, you will get a 7 day trial and access to our trading room including alerts via text email and WhatsApp.

18:16
So go ahead, sign up by going to shareplanner.com trading block, that’s www.shareplanner.com/trading-block. And follow me on SharePlanner’s, Twitter and Instagram and Facebook, where I provide unique market and trading information. Every day you have any questions, please feel free to email me at ryan@shareplanner.com all the best to you.

18:37
You and I look forward to creating with you soon.