Pacific Northwest Trading Workshop

April 16, 2016 Introduction; What is New under the Sun?

Jerry McFarland is totally sick and will not be attending the PNW Trading Workshop. As a result we have revised the agenda for the weekend. The Best Choice User Group meeting scheduled for Friday night at 6:30 p.m. will still be held, but Chris White will present in the last hour of the night from 8:30 to 9:30. I will try to do a BCS/EdgeRater combo during Chris's presentation. On Saturday we will start at 8:30 a.m. instead of 8 to allow you to catch up on your beauty sleep.

All times Pacific SATURDAY APRIL 16, 2016 8:30 to 10:30 a.m. George Lea - Introduction: objectives, the Cone of Learning. The VIX spike/oversold SPY trade George Lea and Chris White - Tools of the Trade Creating Watch lists, Symbol lists in thinkorswim, EdgeRater, and BCS Setting up freestockcharts.com Scans and scripts; combining templates 10:30 to 11:45 a.m. - BREAK 11:00 a.m. to 12:30 p.m. - The Importance of What to Buy Stocks in Play, Linear Regression scans, CCI in Zoom 12:30 to 1:30 p.m. - LUNCH 1:30 to 3:00 p.m. - Barry Muir Examining the Gold Mining Stocks Selling Premium for Income 3:00 to 3:15 p.m. - BREAK 3:15 to 4:30 p.m. - George Lea When to buy/sell short, when to short/cover - rising bottoms/falling tops; breakouts; support/resistance 4:30 to 4:45 p.m. - BREAK 4:45 to 6:00 p.m. - George and Chris - Candlestick Template - Market timing Using the CCI template for continuation trades

Sunday April 16, 2016 8:00 to 9:00 a.m. - Jerry McFarland Selling spreads, adjusting positions 8:00 to 10:00 George Lea and Chris White - Trading with the Squeeze; MOBO and PSAR 10:00 to 10:15 a.m. - BREAK 10:15 to 11:15 a.m. - George Lea - Creating a risk/reward chart on thinkorswim and stockscores. 11:15 a.m. to 12:30 p.m. - George Lea - How to profit in a bear market 12:30 to 1:30 - LUNCH 1:30 to 3:00 - George and Chris Trade (somewhat) like Gil Morales - Short Selling with the O'Neil Disciples; Lessons from some Stellar Traders - Tyler Bollhorn, David Elliott, and Jesse Stine 3:00 to 3:15 - BREAK 3:15 to 3:45 p.m. - Dan Hintz - Recent Trades 3:45 to 4:30 - Simulations - Applying your Rules 3:15 to 4:30 - Chris White - Recent Templates including MA cross with seasonality (Online only) 4:15 to 5:00 - All speakers - Q+A

How to get the most impact out of this weekend: you need to employ deliberate practice or teach others.

There are benefits to attending live - interaction with other traders, (not so) goofy prizes, group dinner Saturday night, etc. For those of you attending online, thanks for doing your part in

reducing your carbon footprint on our fragile planet.

A good question from a former workshop attendee. Though our methodology may remain somewhat constant, the market

is changing constantly and we need to recognize the differences.

QUESTION:

RESPONSE:

WATCHLIST for MARCH

* XLE/ERX * DUST * EWW * PEIX short 3/23 to 4/13 * OIL and GAS

ALJ, HK, PBR, VLO, WNR * UWTI/UCO * SHLD * VXX short 3/15 to 3/29 * BIG

POSTED February 28th Where were they later?

Watch list for AprilLongs: * NTRI* TRMB * SPWR

(inconsistent) * SRTY * GASL * DUST

* IBB/LABU

Shorts: * ANAC * NBIX * ACOR

POSTED April 3rd Where were they later?

Additions to Watch list for April

Gold Longs: * ABX * SBGL * HMY * NUGT * JNUG

Silver longs: * AG * GPL * EXK * HL

Other longs: * TRMB (Reiterate)

*HA * CENX

* TK

POSTED April 10th We also discussed

the maritime shippers Where are they now?

Tickers on the move on April 11, 2016. Note JNUG, NUGT, gold and silver miners. Is anything different since October 2015?

Ticker list from Monday April 11. Use to import to BCS, ToS.

AG came into play in early February and when it broke resistance it was off and running. Notes: rally started prior to February 11th lows. Common

to previous market leaders (example PCLN, CMG, AMZN in 2009). It undercut previous support before making its move, discouraging potential

bulls.Note performance for the month, since Orange County workshop.

Another stock we discussed in March was SA. Note performance for the month, trendline resistance

SBGL was already strong at the beginning of 2016 when gold stocks had yet to assert themselves. Note YTD performance.

Another stock we picked up as In Play in March was ERII, which started by undercutting the support of the gap window, followed

by a break of resistance and a strong annualized growth breakout.

Here is a chart of Pilot Gold, one of the gold miners we discussed in our February webinar. Went from .27 to .54, then from .55 to .67.

T.PLG

Friday Gary discussed RGR which has very good seasonality in April (9 and 0).

Before its current pullback, RGR was having a very tight run with significant annualized price growth. This is the place to profit.

RGR Daily

Are you paying attention?

The importance of keen observation skills. Last month I did a workshop in Orange County in California,

and it became obvious to me that the secret ingredient necessary for becoming a successful trader is …

A few questions to see if you are paying attention…

1. What is a GCL? When are they significant? Can you find them? 2. What is a Hallmark Day? Recent ones were on August 24, September 29th, February 11. 3. Were you buyer on September 29th/30th, February 11th/12th? 4. What is a LRE? When have we had LREs recently? 5. Location, location, location - where was AG on Monday? 6. You can’t afford PCLN. What are some alternatives? Have you used Chris’ Correlation template? 7. What were the best performing tickers for the week? Did you trade any of them? 8. What were the best performing sectors/industries? Were you in any stocks in these sectors/industries? 9. What are the best performing industry groups and tickers YTD?

T

This list was sent out before market opened August 25th for GCLs on August 24th. Were you paying attention?

How could you profit from this information? By finding some LREs. I traded PCLN. If you can’t afford PCLN, we will show you several alternatives this weekend.

This list was sent out before market opened September 30th for GCLs on September 29th. Were you paying attention?

Fifteen minute chart of TVIX. What do you observe? How would you respond?Entries? Exit? From the Abvol scans for Thursday and Friday

TVIX 15 minutes

Here is a risk-reward chart for TVIX after an IRB entry. Can you create a similar chart on ToS or stockscores.com?

TVIX 15 minutes

Here are two charts of PCLN on finviz (top) and stockcharts (below). What do you observe? What action could you take? Opportunities = LREs = $$$$

PCLN daily

PCLN daily

PCLN after earnings. What do you observe? How could you have profited?

PCLN Daily

PCLN after earnings.

PCLN after earnings. What do you observe? How would you have profited from this move?

PCLN 5 day 15 minutes

The Good, the Bad, and the Ugly: what chartpattern do you see? What else do you observe? What action would

you take? Can you find similar setups on EdgeRater?

VRX Weekly

What do you observe in this daily chart of VRX? How could you profit? Can you scan for stocks like this?

VRX Daily

Tickers up 10% April 11-15, 2016. Were you long any of these symbols?

Here were the tickers that were up over 10% for the week. What do you notice? What ETFs were prominent?

Here are the first 120 tickers up over 10% for the week arranged by Industry. What do you notice?

Tickers 121-223, up 10% April 11-15. What are the wolf packs?

Here is the sector/industry performance for the week April 11-15, 2016. Leaders? Laggards?

Here is the advancers minus decliners and up volume minus down volume from Monday October 5th. What would you expect Tuesday?

ADDC 60 min

VOLSPD 60 min

What are you expecting this weekend?

OBJECTIVES:1. Understand the importance of risk/reward, money management. Be able to create risk/reward charts on ToS, stockscores.2. Be able to find the best tickers to trade. Filter through growth rates, seasonality, price and volume, spreads.3. Have a systematic approach to entries and exits. Simulate trades using a specific buy and sell discipline.4. Be comfortable using the tools Chris and I use to find attractive setups to trade (EdgeRater, thinkorswim, finviz, barchart, freestockcharts).5. Focus on trying to see the opportunities we see, understanding the approach we take to trading.

Are you paying attention?

* Did you short GOOGL in January?* Did you trade NFLX on earnings in January?* Were you long NUGT/JNUG in January or last week, ERY, RUSS and SCO in February?* Did you trade the seasonal up move on PCLN?* Did you trade the seasonal up move on BIG?* Were you long oil, energy, solars, HSY in February or March?* Have you traded oil and gas, gold and silver, biotechs recently?* Have you traded AMZN, GOOGL, or PCLN in the past month? * Have you had any short positions in the past month?

January seasonal move on GOOGL

GOOGL

January seasonal earnings move on NFLX

NFLX

Seasonal up move on GOOGL. How would you play this move?

GOOGL

Describe your trading methodology. The main types of trading that I practice:

1. Breakouts from low volatility with unusual volume and price action. 2. Continuation plays in high growth stocks. 3. Market moves after VIX spikes

To trade BREAKOUTS, I want to see low volatility (hence the squeeze), Volume signatures (hence pocket pivots), and trend strength (hence MOBO, ADX). For CONTINUATION, look for breaks above resistance (Darvas created Darvas boxes for trending stocks), Snapbacks (FW’s basic CCI), cup and handle, flags. For VIX SPIKES, watch the Upper Bollingers and 10 EMA

The 3 Basic Questions Every Trader Should Ask

1. WHAT TO BUY?With a huge universe of choices availablewe want to create a manageable watch list.2. WHEN TO BUY? Jesse Stine talks about LREs; we want to buy when the risk/reward profile is in our favor.3. WHEN TO SELL?We want to cut our losses quickly, and let our winners run.

This weekend we will discuss where to find answers to these basic questions. We will also talk about tradingduring a downtrending market.

What to buy?* HIGH GROWTH STOCKS

Where to find them?TOOLS - EdgeRater scansfinviz scans; barchart; IBD

HGSI (Box 1/Box 7 stocks)* SEASONALITY

TOOLS - Best Choice, Thackray Report* INSTITUTIONAL SUPPORT

(the I in C-A-N-S-L-I-M)Pocket pivot scans in EdgeRater and ToS

Abnormal volume scans finviz, ToS.Candle patterns in EdgeRater - PBs, IRBs, CBs.

Be your own guru... Ian Woodward

We all use TOS, finviz, Edgerater, ...but why in heaven’s name would you want to trade like me? We all have different tolerances to risk, varied personalities, different time constraints, different size portfolios.From my point of view, the most important takeaway you could get from this weekend would be the ability to see what we see in terms of opportunities, and to use the tools we use effectively to find them. There are some basic principles that are important in trading, but style and methodology should be individual. I also believe a lot of trading is instinctive and automatic after you become an experienced trader.

In any endeavour, to be successful it is important you follow some discipline, that you pay attention, that you

recognize and capitalize on opportunities, that you sacrifice the necessary time and work required in order

to reach your goals

Chris White has created templates on EdgeRater software for trading with the squeeze, with Pocket pivots, MOBO, PSAR, and Keltner triggers. He has also created some very useful templates for candlesticks and Linear regression. Chris will explain the use of the templates this weekend, as well as discussing the High Growth and Kacher/Morales templates. Chris has also created a sector rotation feature, essential for finding leading stocks, leading industries. If you are interested in trading strong growth stocks after pullbacks, and answering the Basic three:

What to buy - When to buy-When to sell.Chris continues to create new templates that will help you with the buying side of the ledger. I am looking forward to

putting his new Red Green template into practice.And remember some basic rules:

Buy stocks when they’re going up, sell them when they ain’t.Protect yourself (Million Dollar Baby).

Prior to 2013 ...

... I would never trade stocks under $5.After reading Mark Minervini and Jesse Stine,

now actively look for stocks in the $2 to $5 range.These stocks are not followed by analysts

so you have the possibility of having an edge.Unloved, unwanted, and potentially explosive.

Book: Insider Buy Superstocks website: insiderbuysuperstocks.comSign up for the Friends and Family

newsletter

Jesse Stine

Mark Minervini

What is significant about this two bar candlestick pattern? How would you respond? We can find this

setup on EdgeRater for daily and weekly charts.

Do you pay attention to candle sticks?What is the message from the first 10 minute candle on the

Nasdaq and S+P 500, and how would you respond?

New 52 week highs on Friday April 15. Do you watch this list?

What do you notice about the color?

finviz Abnormal volume scan from Friday April 15. Monday you should watch to see if you can catch some of these early in their moves.

Daily chart of RMTI. What do you notice? Where are your entry/add points?

RMTI daily

Risk/reward chart for RMTI. Can you create a similar chart? Where is your stop?

RMTI daily

Seasonally, when is the best time of the year to be long BIDU?

BIDU seasonality

What did BIDU do in July of 2015? Featured in Singer Island workshop at end of June. Where is your LRE? Target?

BIDU daily

When is the best time of the year to be long NFLX?

NFLX seasonality

When are the best times of the year to be short ESI?

ESI seasonality

thinkorswim chart of DMRC. What do you observe? Can you find these setups before they are too extended?

DMRC daily

QUIZ1. What is the Capital of the U.S.A.? of Canada?

2. What is the capital of Washington State? 3. What is the capital of British Columbia?

4. What sector is strongest YTD? 5. Who are the three richest people in the world?

6. Who is Jesse Stine? 7. Who is the president of the USA? Who is prime minister of Canada?

8. What team won the NBA championships in 2015? 9. What team won the Stanley Cup (NHL) in 2015? 10. Who was the NBA MVP for the past season? 11. Who was the NHL MVP for the past season?

12. Name three growth stocks that were 10 baggers in the 1990s. BONUS (tiebreak) Who is the trader behind stockscores.com?

Name a stock up 100% YTD from #4.

BREAK