We identify ONLY mathematically high probability setups (70% or higher) and we integrate wave theory analysis to increase that 70% probability of success even higher towards 80% and higher —and then take even less risk by betting where the market WON’T go — rather than bet where the market will go, which is what most people do.
This gives us a very high probability of success. The downside is the rewards aren’t millions.
If you risk up to $3,500 cash ($7,000 margin) for each trade, you can conservatively expect to make $2,000 per month — that’s $14,000 per year. In the United States — $14k per year is considered poverty for a 2-person family — which has the cutoff at $15,930.
So this strategy won’t exactly make you super rich — especially with the laid back once a week trade approach we take here.
But hey, $14,000 per year is still a good amount especially for the level of effort. If you have a day job — even better.
Here on this site, we risk a little bit more than $3,500 cash on some trades — sounds like a lot but when you consider the 90% probability of success to make $1000 — it works. So some of the profits we generate can be a little bit more.
Trying to bet where the market will go is a recipe for disaster. We take a different approach.
We bet where the market won’t go by this Friday. As long as the market does not go where we are 90% sure it won’t go, then we collect $1,000.
Our Strategy = Elliott Wave Theory + Weekly Options Time Decay
We combine complex wave pattern analysis with weekly options time decay to identify high probability trade-setups with defined risk management to reduce risk and maximize profits.
The result? Slow and steady weekly profits that we share with you week after week.
Here at LifeStyleTrading101, we surf the stock market wave patterns but we don’t just surf with any kind of surf board.
That’s right. Just like water waves appear naturally in the ocean and follow somewhat predictable and repeatable patterns as they ebb and flow through the ocean and into the beach, the stock market also operates in a nature-like way.
Just like ocean waves, the stock market forms wave patterns that reflect mass human psychology. These waves are repeatable and fractal in nature—they follow simple mathematical rules that can be seen on a small time-scale and also on larger time-scales.
Tree branches, the spiral loop of a sea shell that follows the golden ratio in a circle, the ferns of a tree, patterns of snowflake—notice how each of these are just tiny patterns that are repeated over and over.
Well, the same thing happens with human psychology — mass human psychology. Humans experience certain emotions spread out over time that roughly follow a handful of repeated patterns that manifest themselves in the stock market as wave patterns.
Putting it all together:
Notice the small pattern in the black circle is effectively repeated on multiple larger time scales–this is what fractal means.
5-wave patterns appears inside other 5-wave patterns at multiple time levels. Just as fractals appear in nature, so too do they appear in human psychology as shown through the stock market.
You really think this 5-wave pattern that repeats itself on multiple time frames is just a coincidence?
These patterns happen over and over and over again throughout history.
Ferns inside ferns repeat the same size and shape patterns at multiple levels
And these patterns form regardless of unusual “news” events such as earnings releases, terrorist attacks, GDP numbers, Fed interest rate decisions, etc.
In the end, the pattern that is formed — takes the shape of an Elliott Wave pattern.
And with the spiral to the right, notice how each curve is effectively 1/4 of a pie — but that 1/4 of a pie keeps getting repeated at various size dimensions and ratios that happen to exhibit the golden ratio and match the Fibonnacci sequence (2, 3, 5, 8, 13).
Now, when it comes to spotting wave patterns in the stock market, understanding the direction and size of these stock market wave patterns is not easy, but there are definitely patterns that can help us predict what might happen.
While this Elliott Wave Theory analysis can help a lot, it can also give you a sense of false confidence if you are wrong. Analysis is just that — analysis Without the proper trading strategy to capitalize on that analysis, you still don’t make money. Especially because that wave prediction is never always 100%perfect and can sometimes even give you a sense of false confidence to bet big and then lose it all. Kind of like when you have a flush hand in poker (all spades) — but then your opponent has a full house. You had a great hand and probably bet big, but lost it all.
Simply spotting the pattern just isn’t enough.
If you execute trades just based on what predicted wave patterns, you could be wrong and lose all your money. That’s why you need to use this strategy in conjunction with the right kind of surf board.
The surf board represents what tools we use to trade the wave with. It represents how we execute a wave surf — how we execute a trade.
And the way we do it is not the typical strictly directional buy and hope it goes up or sell and hope it goes down approach.
You see, the ocean-like stock market can be a very dangerous place — there’s all kinds of sharks and scary sea creatures. Computerized algorithmic machines and sketchy Wall Street people gaming the system to their advantage. And those waves can really knock you out.
So if you just surf with any kind of surf board and try to make it by calling which direction the market will go, you’re bound to get your butt kicked.
If you misread the waves, you could get pounded and lose all your money.
The way we surf – we use a special kind of board. Yes, the direction of the market is still the most important (70% importance) — but our strategy also gives us a bit of cushion (the other 30%) by incorporating other components such as time and voltatility. Even if we misread the waves, we could still be OK — and oftentimes still actually make money. We can’t be entirely wrong — but if we’re just wrong a little bit, we can still make money.
And if we’re right –which we have a high probability of doing– we can make a little money consistently.
Reading the market wave direction impacts of our results around 70%, and we draw out a lot of chart analysis to help us understand where market psychology is going. But the other 30% is this really important risk management strategy portion that we take very seriously and that also capitalizes on time decay.
But it’s not just any kind of risk management. It’s not risk management that just limits the potential gain we can make. It’s actually risk management that can also make us a little bit of money when used properly. Not a lot — but each time we implement it (every week) — we can make a little bit, and over time, this adds up to be pretty significant — as long as we are careful about it.
So as we surf the waves with our Silver Surfer Trading board, we do so with an eye for risk management using carefully selected option combos.
I know – sounds really complicated, but actually it’s not.
Instead, our strategy:
Our strategy uses the mathematics of options to identify 70% probability of success trades. We then integrate that math probability with wave theory analysis to increase that 70% success rate towards 80 or even 90%. From there, we bet where the market won’t go so we allow room for error. As long as the market does not go above or below a certain level by this or next Friday — then we collect money.
In the 10% event that we are wrong, we have defined maximum risk that is usually 3-5 times the size of our gains — but usually we would cut the losses and notify our subscribers before that maximum risk is ever reached.
Learn how our strategy is similar to to the way some of the most successful insurance companies in the world make money. Think Berkshire Hathaway (Warren Buffet), MetLife, Prudential, Aetna, etc.