📈 SMB TRADER'S PLAYBOOK

Stock Setups • Setup Finder Wizard • Tape & Level 2 • Chart Patterns • Calculators • Official PDF Links • Updated September 2026

📈 You Are Here: Stock Trading Playbook 📘 Options Trading Playbook 📖 Glossary 📋 Game Plan Template 📡 Market Internals 🚩 Red Flags Checklist

What is this page? This is for trading actual SHARES (buying/selling stock directly) — not options contracts. If you want the options strategies page (calls, puts, spreads, the Rhino), use the button above.

New to trading? Read this first: Every setup below follows the same 4-step pattern — 1) find a stock worth watching, 2) know your entry trigger, 3) know your stop (where you're wrong), 4) know your target (where you take profit). Never skip step 3 or 4. Use the calculators below to do the maths for you — you just need the entry price, stop price, and how much you're willing to risk.

0. THE ASET FRAMEWORK — READ THIS BEFORE ANY TRADE 📄 Onboarding PDF ↗

ASET stands for: Allocation (how much you're willing to lose), Stop (where you get out if wrong), Entry (the exact trigger to buy), Target (where you plan to sell for profit).

"If you cannot answer every single one of those questions, you do not have a trade, you have an idea." — Jeff Holden, SMB Training

A STRATEGY = CATALYST (why is it moving) + SETUP (what does the chart look like) + TRADE (entry/stop/target). Change any one of the three and it's a different strategy, even if the chart looks the same.

Allocation Grade	% of Your Daily Stop	When to Use It
A+	80%	Rare. Everything lines up perfectly. Never force this grade.
A	30%	Strong catalyst + confirmed setup + market conditions in your favour.
B	15%	Solid named setup, most confirming signs in place.
C	5%	You're learning this setup. Small risk, real practice, not a P&L trade.
D	0%	The default. Every trade starts here until it earns a higher grade.

The Rule of 20: "Your first 20 trades of any setup should be the smallest you will ever take. You have to earn the right to trade more size." Every trade in a brand-new setup is a C, no exceptions, until you've logged 20 examples.

What a stop IS: a structural price level (below a range low, below a consolidation base) — the price where your idea is objectively proven wrong.
What a stop is NOT: a dollar amount you feel like risking, a feeling, or something you move wider once set. Stops only move in your favour, never against you.

🧮 CALCULATOR 1 — How Many Shares Should I Buy? (Position Size)

Account Size ($)

Allocation Grade

Entry Price ($)

Stop Price ($)

🎯 CALCULATOR 2 — Where's My Target? (Measured Move / Reward-to-Risk)

Entry Price ($)

Stop Price ($)

Direction

Target Multiple (Reward:Risk)

🧭 SETUP FINDER — Answer 4 Quick Questions, Get Matched Setups

Not sure which of the 15 named setups fits what you're looking at right now? Answer below and it'll point you to the closest matches with a jump-link to the full details. This is a helper, not a replacement for the guide below — always read the full setup before trading it.

1. What time is it in the session?

2. What is the stock doing right now?

3. Direction bias?

4. Volume behaviour?

1. FINDING STOCKS IN PLAY (do this BEFORE any setup)

The big idea: a good-looking chart pattern in a dead, boring stock is usually not a great trade. A simple pattern in a stock that's genuinely "in play" today can be one of the best trades of the day. This step comes before you look at any of the 15 setups below.

Why is it "in play" today?	What that looks like
1. News changed the story	Earnings, guidance change, analyst upgrade/downgrade, FDA decision, lawsuit, big contract win, CEO change, major macro headline.
2. The chart changed the story	Breaks a major resistance or support level, clears a multi-month trading range, hits a 52-week high or low.
3. The market/sector changed the opportunity	Strong or weak overall market, unusually high-volatility day, a whole sector rotating in or out of favour, a hot theme (AI, rate cuts, etc.).

The beginner rule: before trading ANY stock, ask "why is this stock in play today?" If you can't answer in one sentence, you probably don't have a trade yet.
✅ Good answer: "It reported earnings and is gapping above a major daily resistance level."
❌ Weak answer: "It looks like it might go up" or "it moved yesterday."

Your Morning Routine — 6 Simple Steps

Step	What to Do
1	Run a gap scanner: look for stocks gapping up/down at least 3%, with average daily volume over 2 million shares and an ATR (average daily range) over $1. (Finviz Elite screener is the easiest tool for this — see filters below.)
2	Read the morning news for any name where the story has genuinely changed overnight.
3	For earnings names, compare premarket volume to normal: 20% of average volume = worth a look, 50-70% = strong, 100%+ = rare, top priority.
4	Check premarket relative volume (RVOL): 10% of average daily volume premarket can signal a "trend day" coming; 30% of average volume in the first 10 minutes after open is a strong in-play sign.
5	Look at the bigger-picture chart — is there a clean daily/weekly level nearby? If it's gapping into "no man's land" with no clean level, downgrade your interest.
6	Re-scan after the open, and again in the afternoon, for anything still trading above 1.5x its normal volume.

Watchlist discipline: cap your active watchlist at 3 names if you're a beginner, 5-7 if experienced. Watching too many names almost guarantees you'll miss the one you planned best. Use price alerts to "park" names that aren't ready yet instead of tracking too many live at once.

Where to Actually Find These Names (Your Tools)

Tool	What to Set Up
Finviz	Screener tab → Average Volume: "Over 2M" · Average True Range: "Over 1" · Change/Gap: "Up 3%" or "Down 2%" (run both) · Relative Volume: "Over 1.5". Save as a preset so it's one click every morning.
TC2000	EasyScan → build a custom scan comparing today's volume/range to prior days (this is the only tool of the three that easily looks at yesterday's bar vs today's). Good for multi-day setups like Second Day Play and Liquidity Trap below.
Trade Ideas	Best for real-time, all-day alerts — it scans the whole market continuously and pings you the moment a stock matches your filters (volume surge, news, range break). Use this once your morning watchlist is built, to catch the actual trigger moment.

Honest note: no scanner replaces judgment. These tools surface candidates — you still read the chart, check the news, and apply the 3-test standard below before risking money.

The final 3-test standard — a stock must pass ALL THREE before you build a trade around it:
1. Reason — a clear reason it should matter today.
2. Participation — enough volume and attention to create real opportunity.
3. Structure — a clean enough chart level or pattern to actually build a trade around.

2. CHECK THE OVERALL MARKET FIRST (before picking a setup) 📄 Official PDF ↗

Before you trade any individual stock, get a feel for the overall market — is it trending up, trending down, or going nowhere (range-bound)? Trading with the market's mood dramatically improves your odds; fighting it dramatically worsens them.

Market Mood Today	What to Favour
Strong uptrend	Favour long/bullish setups (Second Day Play, Big Dog, Hitchhiker, Fashionably Late, ORB longs). Be cautious shorting into strength.
Strong downtrend	Favour short/bearish setups (Tidal Wave, Rubberband, ORB shorts). Be cautious buying into weakness.
Choppy / range-bound	Favour mean-reversion setups (Backside Scalp, Second Chance, Overextension Short). Momentum setups tend to fail — reduce size or skip.

Re-check the market mood 3 times a day: just after the open, at midday, and near the close — it can genuinely change during the session.

3. READING THE TAPE & LEVEL 2 (order flow)

What is "the tape"? Time & Sales shows every trade that actually executes (price, size, and whether it printed at the bid or the offer). Level 2 shows the resting orders waiting to trade — the "order book" of who's willing to buy or sell, and at what price and size. Together they tell you whether buyers or sellers are actually in control right now, instead of just guessing from the chart shape.

Where this fits: tape reading is the LAST step, not the first. SMB's own rule: establish your catalyst (why is this stock moving) and your setup (what does the chart look like) FIRST — tape reading only refines your entry once those two are already in place. It is not a way to find trades on its own.

The honest reality check: roughly 80-90% of tape activity is just noise. Real, useful signals only appear about 10-20% of the time, clustered around key price levels and key moments — not continuously. Don't stare at every tick expecting meaning; wait for a genuine, distinct change.

Core Rule	What It Means
Watch ONE side	Watch only the side of the book that SHOULD be in control given your thesis (the offer if you expect sellers to press, the bid if you expect buyers to press). Trying to watch both sides at once overwhelms almost everyone — switch sides only at a clear turning point.
A signal needs 2 steps	1) A DISTINCT, noticeable change in behaviour or speed, then 2) confirmation/follow-through. A single print is never enough, and price alone (without seeing HOW it traded) is not enough either.
Size is relative, not absolute	"Big" size means big FOR THAT STOCK'S normal clip — 10,000 shares might be huge for one stock and tiny for another. A held level only matters if it's genuinely large for that name and survives about 3 real tests without shrinking (most apparent "holds" — about 70% — are not actually significant).
Displayed size ≠ total size	A 100-share offer showing on screen doesn't mean only 100 shares are actually for sale — real size can be hidden. Don't assume what you see is the whole picture.
Classify tape speed	Slow / Average / Fast. Real edge lives in FAST, sustained tape. Slow tape has little edge. Average tape is "tricky" and produces false signals — be extra cautious here.

What You're Actually Looking For (Signal Cheat Sheet)

What You See	What It Means	What To Do
Price leaks through a level by a few cents, then is INSTANTLY re-bid (or re-offered on the short side)	Sellers (or buyers) tried and failed — the level is genuinely defended	Core entry signal. Buy the re-bid, risk just under the level (mirror for shorts)
Level breaks and is NOT re-bid within about 10 seconds	The level has genuinely failed	Don't buy it. If you're already long off it, get out
A big offer that never decrements, only refreshes slightly	A defended ceiling — real resistance	Don't buy into it. Consider shorting against it once price stalls below
Offers stacked at a level get lifted and visibly decremented on the tape	A genuine breakout — real buyers are taking size	Enter, risk the low of day or the broken level
Offers at a new high are NOT decrementing even though price is there	Buyers are running out of steam	Consider selling into it rather than chasing further
Bids step up for a couple of minutes, then stall and can't hold	The bounce is over	Consider shorting against the resistance that stopped it
A big bid shows on screen but no real volume trades through it	May be "bait" or may get pulled — not confirmed support yet	Don't treat it as real support until proven — ask "was it taken or pulled?"
Stock can't trade lower on elevated volume after a gap	Buyers are absorbing all the selling	Lean long (mirror: if it can't trade higher, lean short)
Spread narrows after being wide	Buyers and sellers are converging on a price — a decision point is close	Follow whichever side wins that decision
Level tested 3+ times and each time it holds weaker	The support/resistance is wearing out ("Tidal Wave" pattern)	Favour the eventual break, in the direction of the wearing-down side

The single most useful practical habit: before you enter, ask "if I'm wrong, where do I get out, and what does it cost?" If you can't answer immediately from what you're watching on the tape, you don't have a trade yet — you have a guess.

Sizing & Managing With the Tape

Situation	Guidance
Confirming before sizing up	Pay a slightly worse price for real confirmation — it buys you a tighter stop and lets you safely take more size. Beginners: size in AFTER the turn confirms, not before. Building size in stages as confirmation increases is safer than going full-size immediately.
Adding to a winning position	Only add on a low-volume pullback/pause at support with a clearly defined "this is wrong" point, or on a re-bid with real speed behind it. NEVER add far away from your level (it wrecks your reward-to-risk), never average up after the main move is already done, and never add to a loser.
Exiting / taking profit	The single most common mistake in tape reading is selling too early. Plan your exit rule BEFORE you enter. Hold a core position with a raised (never lowered) stop, and sell for an actual tape/level reason — not just because you're nervous or bored.
Spotting the end of a move	Watch for: heavy repeated supply at a level (lighten by at least a third), offers at a new high no longer decrementing, momentum failing twice at the same level, or the tape suddenly slowing while sellers hit the bid hard.

The recipe, in order: Catalyst (why is it moving) → Level (what price matters) → Time & Volume (is enough happening to trade it) → THEN Tape (exact entry timing). A "surprise" tape event with no chart context behind it is just noise — always tie what you see on Level 2 back to a level that already mattered.

4. CHART PATTERNS — WHAT THE SHAPES CAN IMPLY

These are classical technical-analysis chart shapes — patterns traders have observed repeating for decades across every market. They describe what a battle between buyers and sellers tends to look like visually, and what often (not always) happens next. Treat every pattern as a probability, not a certainty — always confirm with volume and, ideally, the tape (Section 3 above) before acting on a pattern alone.

Pattern	Diagram	Implies	What It Looks Like	What It Suggests
Head and Shoulders		Reversal (top)	Three peaks: a left "shoulder," a higher middle peak ("head"), then a right "shoulder" roughly level with the left. A "neckline" connects the two lows between the peaks.	An uptrend is running out of buyers — each rally attempt is weaker. A break below the neckline (ideally on rising volume) suggests the uptrend is over and a move down may follow, often projected by the height from head to neckline.
Inverse Head and Shoulders		Reversal (bottom)	The mirror image — three troughs, with the middle one lowest. A neckline connects the two highs between the troughs.	A downtrend is running out of sellers. A break above the neckline suggests the downtrend is over and a move up may follow.
Double Top		Reversal (top)	Price hits roughly the same high twice, with a pullback in between (looks like an "M"). The second peak often shows weaker volume than the first.	Buyers tried twice to push through the same level and failed both times — a sign resistance is real. A break below the low between the two peaks suggests further downside.
Double Bottom		Reversal (bottom)	The mirror image — price hits roughly the same low twice (looks like a "W"), with a bounce in between.	Sellers tried twice to break the same level and failed — support is real. A break above the high between the two lows suggests further upside.
Cup and Handle		Bullish continuation	A rounded "U" shaped dip and recovery (the cup), followed by a smaller, shorter pullback near the old high (the handle), then a break higher.	A gradual shift from selling to buying pressure, then one final shake-out (the handle) before the real move. Often associated with accumulation — buyers building a position patiently. Break above the handle's high suggests continuation upward.
Ascending Triangle		Bullish continuation (usually)	A flat resistance line on top, with a rising line of higher lows underneath — the range narrows as it approaches the top.	Buyers are becoming more aggressive (each dip is bought at a higher price) while sellers defend the same ceiling. The squeeze usually resolves upward as buyers eventually overwhelm that resistance — this is one version of SMB's "Big Dog Consolidation."
Descending Triangle		Bearish continuation (usually)	A flat support line on the bottom, with a falling line of lower highs above it — the range narrows as it approaches the bottom.	Sellers are becoming more aggressive (each bounce is sold at a lower price) while buyers defend the same floor. Usually resolves downward as sellers eventually break that support.
Symmetrical Triangle		Continuation, direction unclear	Both the highs and lows converge toward a point — lower highs AND higher lows at the same time, like a narrowing wedge shape.	Indecision — buyers and sellers are in a genuine standoff, with the range compressing. Usually breaks in the direction of the PRIOR trend, but can go either way — wait for the actual break rather than guessing.
Bull Flag / Bull Pennant		Bullish continuation	A sharp move up (the "pole"), followed by a tight, controlled pullback or sideways drift (the "flag" or "pennant") on noticeably LOWER volume than the initial move.	A brief pause to digest gains before the trend likely continues — this is SMB's "Big Dog Consolidation" setup (see Section 5, Setup #2). Falling volume during the pause is the key confirming detail; rising volume during the pause is a warning the pattern may fail.
Bear Flag / Bear Pennant		Bearish continuation	The mirror image — a sharp move down (the pole), followed by a tight upward drift or sideways pause (the flag) on lower volume.	A brief pause before the downtrend likely continues. Same logic as the bull flag, inverted.
Rising Wedge		Often bearish, even while rising	Both the highs and lows are rising, but the lows are rising FASTER than the highs, so the range narrows while still trending up.	Momentum is quietly weakening even as price grinds higher — each new high is being made with less conviction. Often precedes a reversal or sharp pullback, especially after an extended uptrend.
Falling Wedge		Often bullish, even while falling	The mirror image — both highs and lows are falling, but the highs are falling faster, narrowing the range while still trending down.	Selling pressure is quietly weakening even as price grinds lower. Often precedes a reversal or sharp bounce.
Rectangle / Range		Indecision / consolidation	Price bounces between a clear, roughly horizontal support level and resistance level repeatedly, with no clear trend.	A genuine standoff between buyers and sellers at known levels. Trade the confirmed edges (buy near support, sell near resistance) OR wait for a genuine breakout of either side — never guess the middle of the range.

Reading candle bodies and wicks (quick reference):
• A candle with a small body and a long wick on top ("shooting star" shape) after a rally = buyers pushed higher but sellers took it back — a caution sign.
• A candle with a small body and a long wick on the bottom ("hammer" shape) after a decline = sellers pushed lower but buyers took it back — often a bullish sign.
• A series of small, tight-bodied candles = indecision/consolidation, often building toward a bigger move once it resolves.
• Large bodies with small wicks in one direction = strong, decisive conviction in that direction.

The most important rule for ALL chart patterns: a pattern is only as good as the VOLUME that confirms it. A "textbook" breakout on low, unconvincing volume is far more likely to fail than one on genuinely elevated volume. Never trade a pattern shape alone — pair it with the volume check and, where possible, the tape confirmation from Section 3.

5. THE 15 NAMED SETUPS

Each setup below has the same layout: When it applies (the chart picture to look for), Trigger (the exact moment to enter), Stop (where you get out if wrong), Target (where you plan to take profit), and a worked example with real numbers. Use Calculator 1 above once you know your entry and stop, to know exactly how many shares to buy.

Setup	Timing	Trigger	Stop / Target	Worked Example
1. Second Day Play 📄 Official PDF ↗	Morning	A stock trended hard yesterday (Day 1). Today (Day 2), it tests yesterday's support again. Enter when a candle closes back above the previous candle's high — the "Big Player" candle.	Stop: 2¢ below Day-1's support/low Target: 2x the height of Day-1's range	XYZ ran 40→50 on Day 1. Day 2 dips to test 48, then reclaims. Entry 48.50, stop 47.80 (0.70 risk), target = 2x the 10-pt range, aiming toward the low 60s.
2. Big Dog Consolidation 📄 Official PDF ↗	Midday (11am-1:30pm)	Stock has a strong opening drive, then builds a tight flag/wedge. Volume should DECREASE while it builds. Buy the break above the top of the pattern.	Stop: 2¢ below the base of the pattern Target: 2 waves, exit fully on a double-bar break lower	XYZ rallies 50→55, flags 54-55 for 30 min on falling volume. Entry 55.10, stop 53.90 (1.20 risk). Wave 1 to ~57, wave 2 to ~59.
3. Gap, Give and Go 📄 Official PDF ↗	Opening drive (before 9:45am)	Stock gaps up, sells off hard, but HOLDS above a key support level (premarket low). A short 3-7 min consolidation forms above that level. Buy the break higher.	Stop: 2¢ below the consolidation low Target: 2 waves, exit on double-bar break against you	XYZ gaps to 45, sells to 43.20 (holds above 43.00 premarket low). Consolidates 43.20-43.60. Entry 43.65, stop 43.18 (0.47 risk). Move 1 to 44.50, move 2 to 45.80.
4. Opening Range Break (ORB) 📄 Official PDF ↗	First 15-30 min	Mark the high/low of the first 15-30 minutes. Buy above the high (or short below the low) on rising volume — look for a flood of green (or red) prints.	Stop: just below/above the breakout bar Target: 2x the opening range height	First 15-min range: 100.00-101.00. Break above 101.00 on volume. Entry 101.10, stop 100.80 (0.30 risk), target 103.10 — about 6.7:1 reward-to-risk.
5. Breaking News 📄 Official PDF ↗	Any time, as it happens	A sudden headline hits (earnings, M&A, macro). Score it -10 to +10. If it's a genuine momentum move, buy/sell against the tape immediately. If not, wait for a pullback instead.	Stop: the "undisturbed" pre-news price Target: ride tape momentum, cover most into extreme speed	XYZ at 30.00 gets a +8 contract-win headline, volume spikes 20k→1M shares. Entry on the break of the post-news high, 31.50. Stop 30.00 (1.50 risk). Runs to 36.00 — cover into the momentum.
6. Tidal Wave / Bouncy Ball 📄 Official PDF ↗	Any time	Short scalp (inverted for longs). Price bounces into a key support/resistance level 2-3 times, each bounce WEAKER than the last. Enter short on the 3rd, failed bounce.	Stop: 2¢ above the high of the nearest bounce Target: half off at 2x the risk, rest at 3x	XYZ bounces into 100 three times, weaker each time: 99.80, 99.50, 99.20. Short 99.10 on the 3rd failure, stop 99.22 (0.12 risk). Target 1: 98.86. Target 2: 98.74.
7. Spencer Scalp 📄 Official PDF ↗	Any session time	Stock consolidates 20+ minutes in the upper third of the day's range on steady, EQUAL-SIZE volume (a sign of a quiet institutional buy program). Buy the break higher.	Stop: 2¢ below the consolidation low Target: sell 1/4 at 1:1, 1/2 at 2:1, final 1/4 at 3:1	XYZ ranges 60.00-60.50 for 25 min on steady volume. Entry 60.60 on the break, stop 59.98 (0.62 risk). Sell 1/4 at 61.22, 1/2 at 61.84, last 1/4 at 62.46.
8. Fashionably Late Scalp 📄 Official PDF ↗	10:00am-1:30pm	An upward-sloping 9 EMA crosses a flat/downward-sloping VWAP line. Enter long the moment the cross happens (inverted for shorts).	Stop: 1/3 of the (VWAP to low-of-day) distance Target: 1 full measured move above the cross Official stats: 60% win rate, 3:1 R:R	Low of day 25.00, 9EMA crosses VWAP at 26.00 (1.00 distance). Entry 26.05, stop 25.72 (0.33 risk). Target 27.05 (1.00 gain) — matches the 3:1 ratio.
9. Hitchhiker Scalp 📄 Official PDF ↗	Opening drive (before 9:59am)	Stock drives higher off the open, then holds SIDEWAYS for 5-20 minutes (instead of the usual pullback) — a sign of a large institutional order needing to be filled. Buy the break of that range.	Stop: 2¢ below the consolidation low Target: exit half into wave 1, half into wave 2 Official stats: 55-60% win rate, 1.9:1 R:R	XYZ opens at 20, drives to 21.50, holds sideways 21.30-21.50 for 12 min. Entry 21.55, stop 21.28 (0.27 risk). Wave 1: 22.05, wave 2: 22.55.
10. Backside Scalp 📄 Official PDF ↗	10am-1:30pm	Stock sells off, then stalls, printing at least 1 higher high AND 1 higher low above a rising 9 EMA (a "backside" forms). Enter on the break of a 1-min consolidation.	Stop: 2¢ below the most recent higher low Target: exit the WHOLE position at VWAP Official stats: 50-60% win rate, 1.4:1 R:R	XYZ sells 50→45, stalls, prints higher low 45.20 then higher high 46.00. Entry 46.10, stop 45.18 (0.92 risk). VWAP at 47.40 = full exit target (1.30 gain).
11. Second Chance Scalp 📄 Official PDF ↗	Any session time	A resistance level just broke. Price pulls back to retest that same level. Enter when a candle closes back above the prior candle, confirming buyers are still there.	Stop: 2¢ below the low of the turn candle Target: sell half at the pullback high, trail the rest below the 9EMA Official stats: 50-55% win rate, 1.9:1 R:R	XYZ breaks 30.00, runs to 30.80, pulls back to retest 30.00, then closes above the prior candle at 30.15. Entry 30.20, stop 29.85 (0.35 risk). Sell half at 30.80.
12. Rubberband Scalp 📄 Official PDF ↗	10am-1:30pm	Stock has a controlled move down, then sellers get sloppy and rush — an unsustainable acceleration. Buy the moment a single candle clears the highs of the 2+ prior candles (the "snapback").	Stop: 2¢ below the low of day Target: thirds — 1:1, 2:1, then trail into VWAP Official stats: 60-65% win rate, 1.6:1 R:R	XYZ drops 40→34 on 5x volume, then a candle clears the prior 2 highs at 34.60. Entry 34.65, stop 33.98 (0.67 risk). Exit thirds at 35.32, 35.99, and trail into VWAP ~37.00.
13. Liquidity Trap	Multi-day (Day 1-2-3)	Best in a hot small-cap. Day 1 = huge volume spike day. Day 2 = quiet inside day holding the gains. Day 3 = breaks above Day-2's high on fresh volume. Buy on confirmation.	Stop: under the Day-1 high, tightened once confirmed Target: scale out 20% at a time into the first leg	XYZ runs 3→8 on Day 1 (huge volume). Day 2 quiet 7.50-7.90. Day 3 breaks 7.90 on fresh volume. Starter entry 8.00, stop 7.40 (0.60 risk), add to full size at 8.20 once confirmed.
14. IPO Playbook	First sessions of a new listing	Treat the first 20-30 min as pure price discovery. Then trade the range break, a shallow pullback, or a later consolidation break — reduce size, IPOs are extra volatile.	Stop: wide (~10% below the open print, no history yet) Target: trail with a 1-2 bar trailing stop	XYZ IPOs, prints at 25.00, drives up with no pause. Entry near the print, 25.20. Stop ~10% below = 22.50 (2.70 risk, deliberately wide). Trail the trend once it develops.
15. Overextension Short	Multi-day, mean-reversion	A stock has run too far, too fast: RSI 85+ (ideally 90+), moved 4+ ATRs in 5 sessions, outside the Bollinger Bands, on capitulatory 5x+ volume. Short the break of a lower high.	Stop: a few cents above the lower high, or VWAP Target: prior day's high/low, the daily 5 EMA	XYZ ran 100→180 in 5 sessions, RSI 92, 6x volume. Bounce fails at a lower high of 176 (below the prior 180 high), then breaks below 172 support. Short 171.50, stop 176.10 (4.60 risk — just above the lower high). Target 1: 165.00 (about 1.4:1). Target 2: the 5 EMA ~160.00 (about 2.5:1).

6. QUICK DECISION MAP — "What Am I Looking At?"

What you see on the chart	Setup to check
Stock trended hard yesterday, testing that level again today	Second Day Play
Strong opener building a flag/wedge midday	Big Dog Consolidation
Gap up sold off hard but holding a support level	Gap, Give and Go
Tight opening range about to break on volume	Opening Range Break (ORB)
Sudden headline just hit the tape	Breaking News
Stock bouncing weaker and weaker into a level	Tidal Wave / Bouncy Ball
Long, steady institutional-looking consolidation near highs	Spencer Scalp
9 EMA crossing VWAP after a slow turn off the low	Fashionably Late Scalp
Opening drive holding sideways in the upper 1/3 of range	Hitchhiker Scalp
Stock stalling and reversing off a sell-off, higher lows forming	Backside Scalp
Missed the first breakout, price retesting the level	Second Chance Scalp
Extended move suddenly snaps back with a double-bar break	Rubberband Scalp
Small-cap Day 1 huge volume, Day 2 quiet, Day 3 breaking out	Liquidity Trap
Fresh IPO in its first sessions	IPO Playbook
Multi-day parabolic run, extreme RSI, capitulatory volume	Overextension Short

7. KEY NUMBERS TO REMEMBER

Rule	Number
Position size formula	Shares = $ Risk ÷ (Entry − Stop). $ Risk = Daily Stop × Allocation %
Allocation tiers	A+ = 80%, A = 30%, B = 15%, C = 5%, D = 0% of your Daily Stop
Rule of 20	Minimum 20 logged examples, C-size only, before sizing up on a new setup
Minimum target standard	At least 2:1 reward-to-risk on every trade
Stocks In Play scan filters	Gap 3%+, average volume over 2M shares, ATR over $1
Premarket volume signal	10% of average volume premarket = possible trend day; 30%+ = strong signal
Mean-reversion short qualifiers	RSI 85+ (ideally 90+), 4+ ATRs in 5 sessions, outside Bollinger Bands, 5x+ volume
Watchlist cap	3 names (beginner), 5-7 names (experienced)

8. MANAGING PRESSURE (Jeff Holden's Framework)

The strategy and the charts are the easy part — staying calm once real money is moving is the hard part. SMB splits pressure into two types:

Type	What It Is / What To Do
Macro Pressure	Existential worries that have nothing to do with the trade in front of you ("will I make it," "can I pay my bills"). You CANNOT fix a Macro problem with a trade — trying to trade your way out of financial fear is how accounts blow up.
Micro Pressure	Normal, in-the-moment discomfort of an active trade ("I'm down $500, should I cut it"). This is NORMAL. Handle it with: 1) Label the feeling out loud, 2) Force a 60-second pause, hands off the keyboard, 3) Re-apply ASET fresh before acting.

Simple grounding tools if you feel pressure building: walk and get a glass of water, paying attention to every sensation for 3-5 minutes; or name 5 things you see, 4 you hear, 3 you feel, 2 you taste, 1 you smell. Sounds silly — it works because it interrupts the pressure loop before it turns into a bad decision.

9. CORE RULES — NEVER BREAK THESE

✅ Never enter a trade before defining Allocation, Stop, Entry, and Target — in that order.
✅ Never exceed your daily stop, no matter how good the setup looks.
✅ If you call a trade a "C," take C-size — never secretly take more.
✅ Stops are structural (chart-based) only — never a feeling, never a random dollar figure.
✅ Stops move only in your favour once set, never wider.
✅ Targets are guides, not contracts — exit early if the stock stops behaving as expected.
✅ Never size a brand-new setup above C until you've logged 20 examples.
✅ Cap your watchlist — 3 names if you're a beginner.
✅ Never trade a stock without a one-sentence answer to "why is this in play today?"
✅ If you're feeling Macro pressure (existential fear), do NOT try to fix it with a trade.

Source: SMB Capital's own official cheat sheets (Second Day Play, Big Dog Consolidation, Gap Give and Go, Opening Range Break, Breaking News, Tidal Wave/Bouncy Ball, Spencer Scalp, Fashionably Late Scalp, Hitchhiker Scalp, Backside Scalp, Second Chance Scalp, Rubberband Scalp, Beginner's Guide to ASET Trading, Stocks In Play, The Peak Performance Shortcut, Market Context Best Practice, How to Create a Game Plan) plus 3 supplementary setups (Liquidity Trap, IPO Playbook, Overextension Short) and the Tape Reading & Level 2 guide (desk guide + Reading the Tape cheat sheet, human/AI versions, "Reading the Tape" YouTube playlist T1-T40) from the session archive. Chart pattern section is standard technical-analysis reference material. Reference only — not financial advice — verify everything before risking real money.