How to Trade Like the Billionaires With
Money Channel Breakouts

When I first encountered this incredible pattern, I was stunned.

“It can’t really be that simple,” I told myself as I saw chart after chart revealing the undeniable truth. The evidence was clear as day and impossible to ignore.

This unique chart pattern has a proven record of signaling high-profit trade setups with very low risk in a short time span.

It’s so effective for earning huge windfalls – in some cases even doubling or tripling your investment in just a few months – that I’ve come to the conclusion that it’s the most profitable chart pattern in the world.

A big statement? Absolutely. But it’s backed by 20 years of my personal research and professional experience as a successful trader and investor.

That’s why it’s essential that you, too, become familiar with how and why this pattern works.

I’ve put together this short guide revealing how and why this chart pattern can grow your account faster than you ever thought.

Let’s get started.

The Money Channel: Heavyweight Champ of Chart Patterns

The Money Channel strategy is the centerpiece of the Chairman’s Circle Breakout Alert service. But what exactly is a Money Channel?

A Money Channel has three key components: the rise, the lock and the breakout.

1. The Channel Rise: This is the first stage of pattern development. It typically appears as a gentle rise in a very narrow price range. The stock can spend several months gradually moving up and down, but it never exits that price range.
2. The Channel Lock: This is the second stage of pattern development. The key for us is watching traders testing the lower line of the Money Channel. If the share price falls through the support line, then it’s a bust. If the share price bounces off the line, traders know it’s strong and likely headed higher. When the price touches the lower support line and it bounces back off… That’s the Channel Lock.
3. The Channel Breakout: This is the final stage of pattern development… when it’s time to get in. The moment the share price touches the support line, traders start to pile in. They want to take advantage of the cheap price because they know a big upward move is coming. Traders saw the price rebound earlier, when the Money Channel was just forming. But this time, the price launches off the support line. More traders pile in and soon the stock is breaking through the upper line and heading higher.

Now take a look at the chart below.

Not all Money Channels look exactly alike. But the key components outlined above should always be present.

In the chart above, the Channel Rise is the gentle rise that occurs from about May 2017 through May 2018.

The Channel Lock is the key moment in May 2018. The stock price tests the lower boundary line of the channel but then bounces off it immediately.

The completion of the pattern is its Channel Breakout, which occurs when the price bounces off the lower support line upwards, and breaches through the top of the trading range. For Five Below, this was in May 2018. Once the stock breaks out of its trading range, even more traders rush in. Their “feeding frenzy” of buy orders pushes the stock to new highs.

Why Money Channels Develop

You may be wondering why this Money Channel forms the way it does.

Like most price actions in the stock market, it comes down to understanding crowd psychology.

When a stock’s price rises significantly in a short time span, traders who have managed to hit it big will begin to take profits.

The short-term selling pressure leads to a temporary pause in the uptrend, as profit takers begin to exit the market and new bullish traders hoping to buy on the dip start coming in.

This is the consolidation period, where the trading range occurs. The new traders effectively replace the profit takers and maintain bullish demand for the stock to rise.

In other words, the back and forth of bullish traders buying at bargain prices, and bearish sellers taking profits, forms the trading range.

Once enough sellers exit the market, the trend can finally break through the trading range and continue the uptrend.

As you can see, crowd psychology plays a crucial role in driving this pattern to completion. But it’s not just a matter of theory. As I pointed out earlier, this pattern has a proven record of forecasting huge profit opportunities with relatively low risk.

For example, celebrated market wizard Richard Dennis used trend trading to turn an initial stake of $1,600 into $200 million in about 10 years.

Legendary trader Victor Sperandeo is another gentleman who has used charts and trends to amass a mind-boggling fortune. He put together a string of 18 profitable years in a row, clocking an average return of 72%… enough to turn $500 into $8.6 million.

If you invested $1,000 with Bill Dunn in 1974, it would be worth $980,000 today. Michael Marcus turned an initial $30,000 grubstake into $80 million in 10 years.

I could go on… but I think you’ve got the idea.

With all this evidence to back up the power of the Money Channel, you’d imagine that every trader in the world would devote themselves to the strategy.

But the truth is that very few make money on it.

Why? Because too many traders lack the patience and discipline needed to take advantage of these unique breakout opportunities… and even fewer are prepared to utilize them with an exact plan.

So let’s go over our plan for successfully trading it.

Max Out Your Profits; Reduce Your Risk

When it comes to any trading strategy, it’s important to put risk management first. That means knowing exactly how much you’re willing to lose before you enter an investment.

My recommendations will always favor high-reward, low-risk setups.

I’ll look only for trades that offer at least a 2-1 reward-risk ratio, and preferably 3-1. That means if I’m willing to risk five points on a stock, I have to have a price target that is at least 10 points higher, if not 15.

For example, let’s say a stock is currently in a Money Channel formation and we enter the trade at $20. Based on our analysis of the trend, we’ve determined a price target of $35.

For our target reward of $15 per share (a gain of 75%), we would typically risk no more than $5. That means we’d set our sell stop at $15 ($5 below our entry price).

And if our trade performs as expected and the stock price rises to $35, we either take profits immediately or secure our gains by raising our stop and letting our position continue to run.

Like I said earlier, we want to know exactly how much we’re risking and for how much of a potential profit BEFORE we enter a single trade. That’s why keeping a strict stop policy in place is what makes our trading strategy low risk.

And the beauty is that this strategy is both incredibly simple and highly effective. Yet so few have the skill and experience to recognize these trade opportunities when they arise.

Fortunately for you, you’ll have me to guide you through each trade so you can achieve these profits for yourself.

Now that you’ve got a keen sense of this strategy’s ins and outs, it’s time to put it to work.

Here are two stocks forming Money Channel patterns right now.

No. 1: Mirati Therapeutics

Mirati Therapeutics (Nasdaq: MRTX) is a small cap biotech focused on cancer treatment. I love the chart, and we don’t have any biotech or healthcare exposure in the portfolio. So it’s time to add some.

The stock spiked in early June after Amgen (Nasdaq: AMGN) presented strong clinical trial data for one of its drugs that has similar characteristics to a therapy being developed by Mirati.

The stock then consolidated for the next two weeks and appears ready to break out.

I expect Mirati to run to at least $134.50. We’re going place a stop at $91.61.

The stock is down this morning on an analyst downgrade, giving us a chance to get in a little cheaper and with a better reward-risk ratio.

Action to Take: Buy Mirati Therapeutics (Nasdaq: MRTX) for $104 or lower. Place a stop at $91.61.

Speculators can consider the January $100 calls. The spread is very wide, so be sure to get filled in between the bid and the ask.

No. 2: Starbucks

Here’s a chance to get into a household name stock that has come back down to the bottom of its channel.

Starbucks (Nasdaq: SBUX) has been in an upward channel for nearly a year.

Since late June 2018, it steadily climbed higher, popping above the channel in October but falling back into the pattern and eventually stopping right on the bottom of the channel – the trend line.

From there, it rose again, eventually hitting a high of nearly $80. The recent market sell-off has taken the stock down to the trend line for the first time since January.

The longer a pattern is in effect, the more reliable it is and the more you can expect it to continue. That’s why I want us to jump on Starbucks here. If this pattern continues, the stock should be in the mid-$80s in no time.

The stock is also getting close to oversold territory, so it’s a good time to get in from a risk perspective.

Lastly, after decades of never drinking coffee, I’m kind of into it now. I finally get what all those java addicts have been talking about for years. And while I wouldn’t quite call myself hooked on Starbucks’ iced Americanos, I would say I’m a recreational user.

It’s probably only a matter of time before it becomes a habit. Good news for Starbucks shareholders!

Action to Take: Buy Starbucks (Nasdaq: SBUX) for $76.50 or lower. Place a stop at $62.30.

Speculators can consider the October $77.50 calls for $3.75 or lower.

Money Channel Profits

The trades above should give you a head start on your way to using this incredibly underappreciated trading tool to take home big gains from the market.

As mentioned in my initial correspondence, I’m so confident in this system that by this time next year, I’m expecting you can make $218,471 with the Money Channel.

My research team and I are constantly on the lookout for significant Money Channel profits. When we identify a stock in the process of a breakout, I’ll send you a Chairman’s Circle Breakout Alert. Simply follow my instructions for executing the trade. From that point forward, I’ll be monitoring the position and will let you know when to take profits.

Thank you for joining The Chairman’s Circle. You have many profitable days ahead.