Trading Is Easier Than Counting to 3

Why It Matters

Simplifying trading to three core elements makes the process repeatable and market‑agnostic, enabling traders to achieve consistent profits without drowning in complexity.

Key Takeaways

• Trading fundamentals reduce to three core market states.
• Use 20‑ and 200‑period SMAs as zones, not lines.
• Flat 200 SMA and sloping 20 SMA indicate strong support/resistance.
• Narrow state appears when both SMAs are flat and close together.
• Target narrow‑state setups for repeatable, high‑probability trades today.

Summary

Oliver frames trading as a three‑step process, arguing that success hinges on recognizing market states rather than mastering endless indicators. He emphasizes that every chart should display two simple moving averages—the 20‑period and the 200‑period—and that these lines function as zones, not precise borders.

The core insights revolve around three concepts: positions relative to a market state, the behavior of the two SMAs, and the distinction between narrow and wide states. A sloping 20‑period SMA provides potent support when rising and resistance when falling, while a flat 200‑period SMA offers the strongest support or resistance. When both averages are flat and lie close together, the market is in a “narrow” state—Oliver’s prime setup for high‑probability trades.

He repeatedly stresses, “If you can count to three, you can trade,” underscoring the simplicity of his framework. He likens the SMAs to boxing ropes, suggesting minor breaches are merely leans, not breaks. The narrow‑state scenario—flat, adjacent SMAs with price sandwiched between—he describes as the “ultimate” trade environment, promising repeatable, explosive gains.

The implication is clear: by stripping analysis to three variables, traders can apply a consistent, market‑agnostic strategy across stocks, futures, options, or crypto. Mastering narrow‑state identification offers a repeatable edge, reducing over‑complexity and increasing the likelihood of sustainable profitability.

Original Description

I’ve been Trading the markets for 45 years, 39 of them professionally, and I can tell you with complete certainty that this activity we call Trading has the potential to change your life like no other profession in the world.

If you want access to the right knowledge and training to start or consolidate your path as a professional trader, guided by a mentor with four decades of experience, this will interest you.

https://tradingolivervelez.com/yt-eng.

0:00 Intro

5:00 20 Period Moving Average

11:06 200 Simple Moving Average

15:50 The 3 Types Narrow State

25:11 Wide State

32:34 The 7 Positions

41:20 My 3 Trading Patterns

50:35 Real Examples

1:16:10 My Trading Program