Al Brooks Videos

• No emotions.  If you feel emotion when you are going to place a trade, don't trade it.
• Trade Small enough so you feel no emotion
• Great traders 
• Only talk to support / resistance and momentum
• No indicators or candle stick patterns
• Trade Management is the most important thing to making money
• Signals only work 40 - 60% of the time
• Get used to losses
• Trends
• Pullback is a short trading range in a trend.  Breakout likely in trend direction
• Long trading range (15 - 20 bars) loses its trend direction and more likely to break out either direction
• All trends start with a spike, and transition to a channel.  
• You need to know which part in the cycle you are in, including the nested pattern within the larger pattern
• Spike phase 
• you need to get long at the market
• smaller size to accomodate wide stop
• tight channel is a strong bull
• Weak bull is a channel
• if the swings are big, trade it like a trading range.  
• Buy low, sell high
• trade both directions
• Bull Trend in trading range, 
• take normal buy signals
• sell 2nd entry shorts and other reversal patterns
• scalp
• Bull Pressure (opposite for bear)
• More bull bars and they are bigger
• Consecutive
• Small tails on the highs, and tails below bars
• Follow through after breakout
• Consecutive bears decrease and get smaller
• Within trading range
• Look for which case is stronger based on the above
• No overlap between 3 bars back
• Always In
• If you had to choose a direction to be in, at the market, which side will you choose
• Bars
• Every bar is either trend Bar or trading range bar (doji)
• Every Trend Bar (or series of trend bars) is a: ...(only context tells you which one)
• Breakout
• Climax
• Spike
• Gap
• Setups
• Context is the most important
• You need prior evidence of your position
• 80% of reversals in a strong trend will fail, dont take reversals
• Weak trend and big swings, take both sides
• Selling in a weak bull
• need strong bear signal bars
• and selling pressure
• Weak Setup
• context and signal is weak, just wait
• 2nd entry or strong breakout
• If unsure
• Use half size with wide stop
• If stopped
• Double position to normal size.  However, if stopped again dont take 3rd signal since most likely fighting a strong trend
• Take profits at 'actual risk' measured move up (price from 1 tick above to 1 tick below lowest stop that would not have been hit)
• Just because there is a reversal pattern in a bear market, that just means it is a better entry to short.  
• Traders may not cover on the first attempt at to break below their position, but most will cover on the 2nd one
• Bull Signal Bar
• At least close above midpoint and close above open
• Close well above prior bar
• Lower tail about 1/3 to 1/2 height
• Small upper tail
• Little overlap
• Follow through is also strong
• Close reverses the high of many previous bars
• 2 Bar Reversal
• do not have to consecutive, on a higher time frame chart, they form 1 bar
• All Expanding Triangles are considered major trend reversals if they're accompanied by strong reversal bar
• Pullbacks
• Strong trends usually only have 1 leg pullback
• Weak trends, have 2 pullbacks.  At most 4 pullbacks.
• The high1, high 2, ect...don't necessarily have to break above the current bar, they just need to reverse the leg down
• Pullback ends when current bar high extends at least 1 tick above the high of the prior bar
• Wedges
• Usually Low 3 and High 3, 3 push patterns (reversal patterns)
• Double bottom is a high 2 (buy setup), Double Top is a low 2 (sell setup)
• 5 min trading range can be a pullback on a higher timeframe
• Channel
• Market is always in a channel
• Micro channel is different than regular channel
• Redraw the channel as it gets broken
• Eventually it will become a trading range (even if only 1 bar)
• All channels function as the opposite trend 
• Bear channel is essentially a bull flag (it will eventually breakout to the upside)
• Shrinking stairs, breakouts are getting smaller, so you may be able to fade them because bulls/bears losing momentum

12 - 22

• MicroChannel
• No pullbacks below the low of previous bar for 2 - 13 bars in a bull
• Weak bull you buy on 2nd entry or double bottom
• Strong bull, you buy above the high on stop, or below low with limit
• Trading Range
• Starts as a pullback, but after 20+ bars the trend has lost its direction.  Upside or downside breakout equally as likely
• 80% of breakouts in a trading range fail.  Markets will race to the top and then fail and reverse
• There will be many attempts within the trading, and its hard to tell when it will happen.  When you look back it is obvious where the trend began, but at the time it is confusing
• Vacuum effect
• Race to a support or resistance, or measured move, or trendline
• Once it hits, market will reverse back.
• Institutions waiting for the spike up because they know it will get there and can get better prices
• Beginners see the move as very strong and ignore the bars to the left and want to catch the 2nd leg
• Buy with limit order below the low of the bar
• Range Breakout
• Strong Breakout
• Weak Channel
• stop goes below breakout
• Major Trend Reversal
• TL break, retest and reversal
• On the first trend break, it often moves to the MA before continuting w/ trend and then failing w/ a higher / low top
• Final Flag
• Bull Flag that doesn't continue in a trend
• bull trend for many bears (30+).  Forms a High 2  / triangle / trading range just below resistance
• wait for failed breakout and a reversal down
• Wedges
• Down sloping wedge usually leads to a bull breakout 75% of time.  25% it fails
• Failed 
• Measured move from start of wedge to end of wedge.  Then two legs in the other direction
• Successful
• Moves to top the wedge as 1st target, and then another measured move up as 2nd target
• Wait for reversal pattern at the apex
• Double Top / Bottom
• Every double top bottom is a high 2 buy or low 2 sell.  
• Take 1/2 profits at 2x times risk (ie: stop = high + 1 tick - low *2)
• Expanding Triangle
• Always a major trend reversal
• Reverses the trend at 3rd test of trendline

23 - 32

• Climax
• Always end at support or resistance
• Nobody looking to buy for many points, or 10 - 20 bars
• Swing vs Scalp
• 40 ticks+ = swing
• Swing = profit target at 2 times risk
• Use measured moves to find where traders will take profits
• Brooks uses actual risk to find the measured move rather than initial risk

39 - 46

• Strong Bear / Bull Breakout
• Enter on stops in trend direction, look to enter on micro trendline pullbacks
• Only enter in trend direction
• Buyers / Sellers are below / above so enter on stops above / below the pullback bars or on high 2 / low 2 setups
• All will transition to channels and the channels then become a part of a larger trading range
• Stops go below swing points and below higher lows once your trade is positive 
• Take profits at reversal bars or strong resistance
• Strong Bull / Bear Channel (tight channel)
• Enter on stops. Trade in direction of bull / bear channel at obvious support or resistance of the trend channel lines.  
• Enter only in trend direction
• Wedges and triangles are also part of this group
• Use more conservative setups, ie: high 2, low 2 setups
• Stops go below entry bars  / signal bars. 
• Aim to take profits at new highs or resistance
• Weak Bull / Bear Channel and Trading Ranges
• Buy on limit orders below / above bars when you want to buy / sell
• Reward is 2x your risk
• Buy at the bottom of the range, sell at the top
• Eventually you will be wrong, but you want the number of times you were correct to greatly outnumber times you were wrong
• Opening Ranges
• You must be looser with your criteria to take trades, usually ends around 8:30pst, however 7 - 10am is total range
• 20% of the time high / low formed in first 5 mins
• 50% of the time in 1st hour
• 90% of the time in 2 hours
• Breakout or failed breakout
• most of the time it will fail
• Swing trade from the breakout or breakout pullback, or failed breakout
• Lots of 2 sided trading means it will probably be trading range days
• Climax that accelerates near the end of the day often reverses

47 - 53

• Swings in middle of the Day
• Starts after opening range swing usually after 8:30am
• Weak Channels are common, however trading range and trend from the open do occur
• 80% of reversals in a strong trend will fail
• Swings at the end of the day
• Setups
• Look at how many bull bars / bear bars have occurred in the middle of the day and in a range to give a clue how the day might finish
• Higher highs / lows
• Consolidating above / below MA
• Targets for close
• Final hour usually tests support / resistance for the day
• Look for measured move targets
• Previous days, open / close
• Prior swing high / low (and untested big trend bars)
• Trendlines, Channel lines
• trading ranges above / below
• Final hour of the week
• Open of the week
• High / Low Close of last week
• Look to take profits if there is a buy / sell climax at the low or high of the day if moving from one side of the range to the other.  It will often lead to a 10 bar / 2 leg correction
• Best Trades
• Major Trend reversals, 
• wait for TL break 
• Should retrace to the movina avg
• a 2nd entry after a higher high or higher low, enter on stop
• Breakouts
• As long as it is strong, get in immediately
• Usually a measured move target
• Trading Range Reversal
• Make sure market is actually in a range, 80% of breakouts from the range will fail
• Wait for 2nd entry so momentum in the down is fading
• Often there is a new high or new low that fails, buy after the failed new low, sell after the failed new high
• Pullbacks
• If there are pullbacks, you're in the channel phase
• swings in strong trends, scalps in weak trends/ trading ranges
• Strong trends you buy high 1
• Weak you buy high 2, wedges, or triangles