Rob Smith is a trading mentor and the Director of Research and Trading Operations for Smith’s In The Black LLC at www.SepiaGroup.com.  He’s been engaged in the markets since the young age of 15.  In this episode of How To Trade It, Casey talks candidly with Rob about the Broadening Formation and his famous creation, The Strat. You don’t want to miss it! @RobInTheBlack believes that once you understand the concept that there are only three possible options for the next candle, you will begin to maximize your success.Tune in to this episode of How To Trade It to learn more! #Momentum #Reversal… Click To Tweet

Subscribe to How To Trade It

subscribe itunessubscribe_itunes2subscribe google podcastssubscribe google podcastsubscribe stitcher podcastssubscribe stitcher podcastsubscribe_youtubesubscribe on youtube

You’ll want to hear this episode if you are interested in…

  • [01:10] Trading is a two-person job
  • [04:08] How a “loser” affects your next trade
  • [05:50] Magnitude
  • [12:50] Sideways 30 Pattern
  • [16:52] The Strat!!!
  • [20:35] When to get in
  • [25:54] The learning curve
  • [31:23] How long to stay in a trade 

Magnitude

Magnitude is the idea of knowing how far an expected move will go and WHY.  Once you understand the concept that there are only three possible options, you will begin to maximize your success. At The Sepia Group we look at Time-Frame Continuity, instead of the usual Moving Averages because we believe that price doesn’t actually “move”, it aggregates.  So, for every buyer there must be a seller, and vice versa. Ultimately, understanding magnitude allows you to stay in trades a lot longer.   

Sideways 30 Pattern

When Rob runs a scan, he wants to see how many things are taking out yesterday’s highs and yesterday’s lows.  He looks at weekly and monthly time frames, in addition to the typical daily time frames. All of his software updates at the top and bottom of the hour (every 30 minutes).  If you can learn to train your brain to see the same data at the :15 and :45 minute marks, you essentially double your signals.  This approach is identifying participants by both price and time.  

The Strat

Rob had been looking at charts for 20+ years and was trying to find a commonality to price action. On a discernibly good Fed news day back in 2009, he began to question why the markets responded the way that they did. If the news is good, the market should just explode, right?  Well, it did initially, then tanked before it shot straight up again.  And that’s when he discovered that the broadening formation isn’t nearly as rare as he had once thought.  Voila, the Strat was born!

Resources & People Mentioned

Connect With Rob Smith

Connect With Casey Stubbs

Subscribe to How To Trade It

Disclaimer: Trading carries a high level of risk, and may not be suitable for all investors. Before deciding to invest you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment. Therefore, you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. 

 

With over 50+ years of combined trading experience, Trading Strategy Guides offers trading guides and resources to educate traders in all walks of life and motivations. We specialize in teaching traders of all skill levels how to trade stocks, options, forex, cryptocurrencies, commodities, and more. We provide content for over 100,000+ active followers and over 2,500+ members. Our mission is to address the lack of good information for market traders and to simplify trading education by giving readers a detailed plan with step-by-step rules to follow. 

>