Getting Started with

Secrets of a Pivot Boss

with Frank Ochoa
AKA PivotBoss
 The Edge You’ve Been Looking For
“I came upon your book by chance and was amazed by what I was reading.
Your book is brilliant!” － A.C.

• Scalable to all timeframes － perfect for all

traders, from scalpers to investors

• Universally applied to all instruments － perfect for

traders of stocks, options, ETFs, futures, and forex

• Applicable to all market personalities － tailor your

approach to the market’s current personality

• Emphasis on market-generated, leading

indicators － perfect for forecasting future price
direction and behavior

• Includes proprietary setups and code － perfect

for creating market scans, automated signals, and
program trading
 Getting Started with SPB
Secrets of a Pivot Boss lays the essential foundation for how traders must
approach the market, which paves the way for more advanced forms of analysis
and techniques that are also covered in the text.

• An Array of Analytical Approaches

• Auction Market Theory

• Understanding Value

• The Personality of Markets Theory

• The Four Market Phases

 An Array of Analytical Approaches
Secrets of a Pivot Boss introduces traders to a wealth of analytical approaches,
from price-based analysis to volume-based analysis, from value-based analysis to
pivot-based analysis － all of which can be applied by all traders, from scalpers to
active investors, from stock traders to futures traders.

• Price-Based Analysis
• Auction Market Theory
• Value-Based Analysis
• Price-Based Setups
• Volume-Based Analysis
• Market Profile
• Pivot-Based Analysis
• Volume Profile
• Pivot Trend Analysis
• Advanced Floor Pivots
• Pivot Width Analysis
• Advanced Pivot Range
• Multiple Timeframe Analysis
• Camarilla Pivots • Confluence Zones
 Auction Market Theory: 5 Key Tenets
Auction Market Theory is used to understand how market participants act in an
auction, including studying market efficiency, inefficiency, and optimal bidding
strategies for each scenario. AMT is a self-contained approach that all serious
traders must understand and implement.
5 Key Tenets of AMT
1. The market is an auction, and operates solely to
facilitate trade between buyers and sellers
2. Price is used as a tool to advertise value; value is
the dominant variable in the markets － changes
constantly
3. Price auctions higher to motivate sellers (supply),
and lower to motivate buyers (demand)
4. Price auctions higher until the last buyer has
bought, and auctions lower until the last seller
has sold
5. When buyers and sellers find an agreeable
price, they trade in large volume, thereby
establishing “value”
 Auction Market Theory: Participants
Auctions have four types of participants in two distinct categories: Initiative and
Responsive. Understanding the roles of each type of participant allows traders to
diagnose who is in control of the current move and who is in jeopardy of having
their stops run, which allows you to better position yourself in the market.
A. Initiative Participants
1. Initiative Buyer: buys above value,
betting that price seeks higher value
2. Initiative Seller: sells below value,
betting that price seeks lower value
B. Responsive Participants
3. Responsive Buyer: buys below value,
betting that price will return to value
4. Responsive Seller: sells above value,
betting that price will return to value
Auction Market Theory: Auction Process
The Auction Process is ever present in the markets, in all instruments and all
timeframes. Understanding the market’s cycle allows traders to anticipate future
price direction and behavior.
• Auction Market Theory provides the
pathway for trading any auction

• Price auctions higher and lower in search

of value in order to facilitate trade between
buyers and sellers

• When buyers and sellers establish value,

price trades within balance

• Imbalance occurs when excess supply or

demand enters the market

• After an imbalance phase, price then

reestablishes value and creates balance

• Knowing the cycles of the auction process

and its participants gives you the
knowledge required to have longevity as a
professional trader
 Understanding Value
Participants identify value to discern when prices are undervalued (Discount) or
overvalued (Premium), and will trade from either a responsive or initiative
standpoint depending on their opinion of value.

1. Price is used as a tool to advertise value

2. Value is the dominant variable in the
markets － changes constantly
3. Price is valued differently in each timeframe
4. Historical value maintains significance into
the future
5. Demand drives value; change in value
reveals demand
6. The market moves from rejection (unfair
pricing) into acceptance (fair pricing), then
back to rejection
 The Personality of Markets Theory
The Personality of Markets Theory (PMT) suggests that price tends to experience
various cycles of behavior, or personalities, over a period of time. Experienced
traders tend to trade during the cycles that offer the best possible opportunities.

1. Price experiences various personalities

over periods of time
2. Price will gradually transition between
phases, or personalities, over time
3. A volatile, unstructured personality, offers
more risk and inhibits the ability to forecast
future price behavior
4. A well-behaved personality offers the best
opportunities for trading, and allows traders
to better anticipate future price behavior
5. Price will remain within the current
personality until proven otherwise
Personality of Markets Theory: Volatile

A volatile, unstructured personality,

offers more risk and inhibits the ability
to forecast future price behavior
Personality of Markets Theory: Well-Behaved

A well-behaved personality offers the best

opportunities for trading, and allows traders
to better anticipate future price behavior
 The Four Market Phases
The Four Market Phases were pioneered by Richard D. Wyckoff and help to
provide understanding of the various price cycles that markets routinely
experience, thereby allowing traders to better diagnose current price behavior and
anticipate future price movement.
1. Allows traders to diagnose current
FOUR MARKET price behavior
PHASES:
2. Allows traders to anticipate, and
1. ACCUMULATION prepare for, upcoming price
movement
2. Markup 3. Traders that can recognize market
phases the earliest are able to identify
3. DISTRIBUTION the best profit-making opportunities

4. MARKDOWN 4. Allows traders to tailor their trading

approach to the current market phase
 The Four Market Phases
3. Distribution

Re-Distribution
Re-Accumulation
4. Markdown

2. Markup
Accumulation

1. Accumulation
 Four Market Phases: Accumulation
The Accumulation phase occurs when institutional investors begin buying
substantial supply of a given stock over a period of time, which creates
compression that eventually fuels a Markup phase.

1. Institutions gradually buy large

amounts of stock over long periods of
time, so as not to drive up the price Accumulation
Fuels Markup
2. A trading range, or base, develops
as Institutions build their position
3. The compression fuels an eventual
Markup expansion phase
4. Recognizing the Accumulation phase
gives insight into future opportunity
 Four Market Phases: Markup
The Markup phase is a bullish expansion phase that occurs after, and is fueled
by, the Accumulation phase. While Institutional money enters during the
Accumulation phase, retail participants enter the market during Markup.

1. Price experiences expansion from the Markup Occurs

Accumulation phase, which triggers a After Accumulation
bullish trending move when buy stops
are triggered
2. The Accumulation phase fuels the
eventual Markup phase
3. Institutions develop positions during the
Accumulation phase, and the expansion
is when retail money enters the market
4. The Markup phase offers the best
trending buy opportunities
 Accumulation to Markup

The Accumulation phase should be seen

as a “necessity” in order for an established
Markup
Markup phase to develop; the bigger the
Accumulation, the bigger the Markup

Once in the Markup phase,

Accumulation every pull-back becomes a
high probability buy
opportunity
 Four Market Phases: Distribution
The Distribution phase occurs when institutional investors begin slowly liquidating
(selling) their inventory of a given stock over a period of time, which creates
compression that eventually fuels a Markdown phase.

1. Institutions gradually liquidate large

amounts of stock over long periods
of time, so as not to disturb price
2. A large trading range develops, as
Institutions liquidate their position
3. The compression fuels an eventual
Markdown expansion phase
Distribution
4. Recognizing the Distribution phase Fuels Markdown
gives insight into future opportunity
 Four Market Phases: Markdown
The Markdown phase is a bearish expansion phase that occurs after, and is
fueled by, the Distribution phase. While Institutions liquidate during the Distribution
phase, retail participants generally exit the market during Markdown.

1. Price experiences expansion from

the Distribution phase, which triggers
a bearish trending move when sell
stops and margin calls are triggered
2. The Distribution phase fuels the
eventual Markdown phase
3. Institutions develop positions during
the Distribution phase, and the
expansion is when retail money exits
the market Markdown Occurs
After Distribution
4. The Markdown phase offers the best
trending sell opportunities
 Distribution to Markdown

Once in the
Markdown phase,
Distribution every pull-back
becomes a high
probability sell
opportunity

Markup Markdown

The Distribution phase should be seen as

a “necessity” in order for an established
Markdown phase to develop; the bigger
the Distribution, the bigger the Markdown
Essential Foundation for Approaching the Market
Secrets of a Pivot Boss lays the essential foundation for how traders must
approach the market, which paves the way for an array of analytical approaches.
• Secrets of a Pivot Boss lays the essential
foundation for approaching any market in
any timeframe

• Secrets of a Pivot Boss teaches an array of

analytical approaches, from price-based to
value-based analysis, which can be used by
all traders, from scalpers to investors

• Auction Market Theory provides the pathway

for trading any auction in any timeframe

• Understanding value allows traders to

discern when price is trading at a Premium
or Discount, which allows traders to deploy
capital at the most responsible prices

• The Four Market Phases allow traders to

diagnose current price behavior, and
forecast future price movement
 Getting Started with
Secrets of a Pivot Boss
with Frank Ochoa
AKA PivotBoss