Day Trading Explained in 11 Minutes — Full Breakdown & Trans

[00:00] I need 11 minutes to explain day trading. So naturally, I'm gonna put $60,000 of my own money on the line. What could possibly go wrong? A lot. A lot can go wrong. Day trading is basically a game of patient people taking money from impatient people.

[00:15] But it's also a game of chance. To understand this game of chance, I'm personally putting $60,000 of my own money on one single trade using this exact strategy I'm about to share with you.

[00:27] Will my own strategy actually succeed? Or will I lose $60,000 in a matter of seconds? Either way, I guess it's content. It's now Wednesday. I woke up at 7.30 a.m. today. I'm in Texas.

[00:39] Get to it. So, market opens in one hour. I make sure I'm zooted on caffeine, and then I proceed to spend the entire morning scrolling through my trading scanner until I find the one.

[00:52] I set up all my strategy parameters. Tactics, tactics, tactics. I precisely set my limit order. then I do the most important step and that is to wait patiently until price hits my order.

[01:04] Holy it just hit my order. Order show, order show, order show, order show, order show. You see, day trading isn't easy money. I'm sure the only reason you're even watching this video right now is because you saw some rich TikToker talking from a helicopter

[01:18] about his Lamborghini that he got from Trading Stocks. Here in my garage, just bought this new Lamborghini here. Knowledge. But let me tell you something you already know. The world ain't all sunshine and rainbows.

[01:30] In fact, most day traders actually lose money. What? People lose money while day trading? Well, yeah, the majority do. It's a known statistic that only 3% of day traders make a profit, and only 1% actually do it consistently. So in order to make money, you have to become part of

[01:46] the 1% of traders. And how do you become part of the 1% of traders, you may ask? Doing exactly opposite of what the 99% are doing. You see, it's pretty simple actually. If 99% of traders

[01:58] are not profitable, that means if you do the exact opposite of what they are doing, you'll make money. It sounds stupid, but it's true. In order to do this, we are going to use one of the core concepts in our strategy, and that is liquidity. In order to understand liquidity, we first have to understand

[02:14] how the big billion dollar institutions trade, or in other words, the 1%. Now, unlike you and me, where we can simply just buy wherever we want, big institutions can't really do that. They are dealing with so much money while trading,

[02:28] there are simply not enough sellers at the price where they'd want to buy it. So, what do they do? They create the sellers themselves.

[02:41] But how do they do that By doing a little thing called manipulation Have you ever seen this happen Price is coming down to a recent low a key support area Now, what's happening at this low is very simple.

[02:53] Normal retail traders like you and me are seeing this as a key support and enter when price comes down to here, thinking the price will bounce up from this support, so where better to place your stop loss than right below this recent low.

[03:06] That's a pretty normal trade. As being the normal retail trader you are, you would assume if price crossed this low, it would be considered a downtrend, lose all this momentum, and keep crashing downwards.

[03:18] Now the institutions own this stock already, but they want to buy more of it. But since they are trading with hundreds of millions of dollars, there are simply not enough sellers at this price for them to buy from. So they need to create the sellers themselves.

[03:32] So what they'll do is start selling their own shares to artificially drive the price down. They will make it seem like the stock is losing lots of momentum crashing downwards, when in reality it's not, which other retail traders will see this and start selling as well, which

[03:48] in turn drives the price down even more. It will do this to the extent of passing this recent low, which will trigger all of these stop losses that we were talking about before. So now there are tons of people selling trying to get rid of what they are holding, which

[04:04] Which means that institutions can now enter at the price they want, since there are so many sellers. Price hits these stop losses, institutions buy a buff load of shares, and price starts heading in the original direction it was meant to, making institutions billions of dollars.

[04:21] That is liquidity. Now, the trade we just took broke all time high, then reversed back downward. So instead of sell-side liquidity like the last example, this time we got buy-side liquidity. It's the same concept, just reversed.

[04:34] So this is why we are looking to short. If you don't go, instead of making money while the price is going up, shorting is where you make money as the price goes down. Break breaking this all time high is our liquidity, and actually all time highs are usually the

[04:48] most aggressive types of liquidity, and this is part of the puzzle of how we become part of the 1%. But just because we find liquidity, that doesn't necessarily mean we found a good trade.

[05:00] Now the 1% not only know how to find liquidity and even target liquidity, but they also know how to find perfect spots to enter their trades. In order to know where they enter, we have to understand one key thing.

[05:13] Retail traders don't move the price, the institutions do. Now sure, me and your pennies could possibly move the stock price a smidge in the grand scheme of things, but the majority of price movement comes from hedge funds, banks, and

[05:25] institutions That where the price really moves We can find where they entering by finding key levels of supply and demand To do this go to the 4 hour time frame Find the start of a strong move Mark the low to the high of the candle that started this move.

[05:40] This is your area of demand. You can do the exact same thing with areas of supply. Find the strong move downwards. Find the first candle that started that move. Mark the low and the high of that candle. This is your area of supply.

[05:52] The reason we are doing this is because we want to be entering where the big institutions are entering. And if price spikes up strong from this price, that means the institutions are probably entering here.

[06:04] So we would wait for price to come back down through this zone, enter here, where price is likely to spike up again, and we make all of the profit. So if we go back to our trade, we already grabbed the liquidity at the all time highs.

[06:16] Next, we need to mark our area of supply. We marked the first candle that started the downward move. This is our area of supply and we must wait for price to enter into the zone again and we enter our short trade.

[06:28] Now just because we have liquidity and supply, that doesn't necessarily mean price will follow exactly what we think it'll do. You need another layer of confirmation and that confirmation is a narrative.

[06:40] Now narratives come in all shapes and sizes. It could be a sector that has a lot of potential, like AI. It could be good economic news, Trump makes another tweet, or it could be over hype. Now this play is QBTS, and they are a quantum computing company.

[06:56] It's been going crazy this past month or so with all the AI hype going on recently. Now, to be completely honest, I really do believe in this company. I think quantum computing is the future, and I think it's a really good company for that.

[07:08] And I actually traded this exact stock a couple months ago, but the last trade I was in a long trade. I used this exact same strategy, just flipped around. I entered in around $4 and sold around $18. It was my biggest trade to date and I posted it live

[07:25] in my discord group. But with that said, I think it's extremely overpriced at the moment. For example, this company is still in its early stages. They are actually losing money at the making of this video. Now sure, they could be reinvesting into the company to make it stronger

[07:40] for the future and just because they don't have a net profit doesn't necessarily mean it's a bad company. At the making of this video, AI stocks are going absolutely bonkers, and anything related to that is going up along with it, even if the company isn't necessarily making money. Like,

[07:56] just look at this chart. This screams speculation. And on top of that, it's valued at $5.3 billion, with a B. So yeah, I think this stock is overvalued at this point. I don't think this

[08:08] is a long short in any way but I do believe at this very moment it a speculation play for buyers and speculators get scared very very quickly And if buyers are freaking out as the chart goes down that just add the momentum of the stock to plummet

[08:25] which in return, our short trade makes money. So we found three main things. Liquidity and area of supply, then unmarried. So now that we know how I'm trading the stock, now is the time to put my money where my mouth is

[08:38] and enter into the short trade for $60,000. Here's the plan. Like I've stated, we were patient enough to not only find this play, but to get a liquidity grab and a key strong area supply with this candle right here.

[08:52] As I'm editing this now, it's now Wednesday, price just entered into our area of supply, so we can finally enter into this trade. To be completely honest, I'm kind of nervous. This is definitely a more volatile stock,

[09:05] meaning when it goes up and down, it goes up and down a lot. But I'm going to stick with the ideal facts, and play the game of probability, and enter into this trade with 60 grand. We're going to set our stop loss above these highs.

[09:18] Our entry price was $19.13, so if price decides to go from here, we'll lose around 7%, which is roughly around $4,200. I could buy a lot of cool things with $4,200.

[09:31] But, if this trade goes in the other direction, we'll play it safe and are going to sell 50% of our position at this area of demand right here. And we'll sell the other 50% of our position if price breaks these lows and targets these

[09:45] previous highs. If price hits our first target, we'll make around 24%, and if we're selling only 50% of our shares at this point, we'll make around $7,500. price goes all the way down to our second take profit, we'll make an additional $9,000.

[10:02] So, if this trade plays out correctly, we can make a total of $16,500 in one single trade. Let's see what happens. They hit our take profit! Price is now at our area of demand and we sold 50% of our position for a profit of around $7,500.

[10:18] I'll be posting this video now while I'm still in the trade. For now, we're in the profit, and hopefully price can hit our second target. If you're watching this video as I upload it, in no way am I saying you should short this stock now.

[10:30] It's probably too late. If you want to see all of my trades live, I posted this exact trade and many others just like it live in my discord group as I'm entering into them. I give where I'm entering, where I'm exiting,

[10:43] and basically all the information of why I'm entering into the stock in the first place. So yeah, there's that. If you're interested, I'll leave a link to my Discord in the description. But, yeah, that's how you trade stocks. Try it out.

[10:55] See you next time. Here in my garage, just bought this new Lamborghini here. Knowledge.