The Pullback Technique With Steven Primo

TradingPub Admin | September 26, 2014

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At the TradingPub we are committed to connecting you to professionals who share their trading education, so you can pick up great tips on your way to becoming consistent and successful traders. Yesterday's class with Steven Primo did not fall short of our commitment and almost 500 of you peaked in for a session packed with great education and no fluff. Below is the brief summary of the class and the full video of the session for your reviewing convenience.

Steven Primo, the president and founder of Specialist Trading, has been actively involved in trading the markets for 38 years now. During his career as a specialist he was responsible for making markets in over 50 stocks. Primo left the trading  floor in 1994 to focus on managing money and to teach his own unique approach to trading the markets. A hundreds of students, from beginner to advanced levels, have gone on to become successful traders after being introduced to Steve's proprietary methods of trading.

During his presentation, Steve stressed the importance of education. His goal as an educator is to empower traders with the knowledge to trade on their own and diminish their reliance on external sources, which often becomes the reason why so many fail.

Some of the main points he shared during the class included:

  • #1 – The importance of trading in synch with the market and trend. Most importantly how you can actually do it
  • #2 – A powerful price bar pattern you can implement in your trading right away
  • #3 – Fine tune your entries so you can improve your level of consistency and success
  • #4 – All those components form the Pullback technique, explained in further detail during the session

Component #1 is being in synch with the trend, which is not a new concept. Identifying the trend properly is where the issue lies for most traders. The way trend is discerned at the Specialist Trader is by using the 50 period Simple Moving Average (SMA). Once the SMA is implemented in your charts you simply determine the relationship of price to it. If the overall price is above the SMA, then the trend of the market is up and you would only look for buy setups. When the majority of the price is below the SMA the trend is down and shorting setups are then sought.

The relationship of price to the 50 period Simple Moving Average can be applied in any market and any time frame.

Component #2 is to look for a price bar that closes in the top 25% of its range. Identifying this bar is simply a clue from the market, not a chat room or a lagging indicator,  as to what direction it wants to go. If we already know the trend is up, by having used the 50 SMA, and we find a bar which is indicating further the uptrend, then we can be fairly confident the next 3-5 bars will continue in the same direction. An example of a bar like that is depicted with green in the image below:

Primo 1

Component # 3 is to enter a trade upon confirmation of the trend. While you may think that the 2 components mentioned above are all you need to be sure of the overall trend, you have to also apply the confirmation rule or method. The confirmation rule/method is to buy on the bar after a bar that has closed in the top 25% of its range. In this cases price is expected to likely trade 1-5 ticks above, as seen below.

Primo 2

When selling the market, the same rules apply. Being in synch with the market in relationship to the 50 SMA. When price is below the 50 SMA we look for sell setups. Then we look for a bar that closes in the bottom 25% of its range. Lastly, just as above, you want to enter upon confirmation of a trend. That is to sell, on the next bar only, if price trades 1-5 ticks below the bar that closed in the bottom 25% of its range.

The Pullback Technique is not a full-fledged strategy, it is just an entry technique that has proven to work time and time again over the years. The technique rules simply apply when looking for entry setups. Those rules again in summary include Price “pulls-back” towards the 50 SMA. The price is related to the SMA and closely moving along the line. For BUYS: bar closes in top 25% of range for SELLS: bar closes in bottom 25% of range.

As mentioned above, the technique is valid for all time frames and all markets, including stock, forex and futures.

During the class Steven made a special offer packed with great information,  knowledge, and experience on the following topics:

  • All About Trading Edges
  • The Wrong Indicators To Look At
  • What Steven Primo Learned From Other Traders On The Floor
  • How Simplicity Equals Consistency
  • Systems vs Strategy
  • Concepts #1 and #2
  • Edge #1
  • Edge #2
  • The #1 Chart Pattern
  • 3 Ways For Identifying The Trend
  • Using Donchian Channels, Bollinger Bands, and The RSI In Your Trading
  • Learn How To Be On The Right Side Of The Trade
  • Learn When A Trend Has Changed Direction
  • Learn When To Stay Out Of A Trade
  • Position Trading
  • Learn All Of The Rules Of Steven Primo’s Strategy #1

This is a special, limited time offer available only to TradingPub.  CLAIM YOUR COPY OF THE FULL OFFER STEVEN MADE


Primo 3