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This opening sits down with Jerremy Newsome—the energetic trader-educator behind Real Life Trading—joining remotely while the host checks in from Europe. Jerremy’s been in the U.S. stock market for years as both an educator and hedge-fund manager, known for making complex ideas simple and actionable for everyday traders. The conversation centers on how he structures his day, why he sticks to a focused watchlist (think SPY, AAPL, NFLX), and how he uses straightforward tools like support/resistance, candlesticks, and volume to make decisions that actually hold up when the bell rings.
In this piece, you’ll learn the exact approach Jerremy leans on: reading volume to spot trapped traders, keeping risk tiny (think ~1% per idea), and working across three timeframes—day trades for cash flow, swings for asymmetric moves, and investing for real wealth. You’ll also see how he automates entries/exits so he’s not glued to the screen, plus the biggest pitfalls he sees (like chasing money too fast) and how to sidestep them with routine, discipline, and simple, testable rules.
Jerremy Newsome Playbook & Strategy: How He Actually Trades
Daily Game Plan & Watchlist
Before any orders go in, Jerremy keeps the day boring and repeatable. A tight routine, a focused list, and a few simple checks beat chasing every mover. Here’s the premarket flow that keeps decisions clean.
- Build a core watchlist of 10–20 liquid names (e.g., SPY/QQQ + AAPL, NVDA, TSLA, AMD, META); don’t exceed 25.
- At least 30 minutes before the open, mark yesterday’s high/low and premarket high/low on each name.
- Draw two key zones per chart: “breakout” above premarket high and “trap” below premarket low.
- If an idea isn’t inside a clearly marked zone, skip it at the open.
- Maximum 3 tickers “in play” for the session; park the rest.
Chart Setup & Core Indicators
Keep the chart readable so your eyes find the price, not the settings. Jerremy relies on clean candles, a moving average backbone, and volume to spot who’s trapped and who’s in control.
- Use candlesticks on 5m/15m/1h/daily; no more than 2 MAs on screen (e.g., 10/20 EMA).
- Add average true range (ATR) on the daily to size stops relative to volatility.
- Keep volume visible; flag unusual volume >150% of 20-day average.
- Hide most oscillators; if you use one, stick to RSI 14 and only for divergence—not entry by itself.
- Color premarket/after-hours background lightly; cash session should pop.
Entry Triggers: Candles, Gaps, Retests
The goal is “simple and testable.” Jerremy favors clean candle patterns at levels, especially after gaps, with retests to avoid chasing. Trade the reaction, not your prediction.
- Only take entries at a pre-drawn level; no level, no trade.
- Preferred triggers: bullish/bearish engulfing, hammer/shooting star, or inside-bar break at the level.
- Prioritize retests: breakout → minor pullback to the level → entry on reversal candle.
- If price moves >1 ATR from your level without a pullback, skip the first attempt.
- Enter stop orders a few cents beyond the trigger candle; avoid market orders unless liquidity is exceptional.
Day Trades (Cash-Flow Mode)
Day trades are quick hits when momentum is obvious and risk is tight. Get in, get paid, get out.
- Limit first trade within first 30 minutes to A+ setups at premarket high/low.
- Use a 5m chart for trigger, 15m for bias, and daily for context.
- Initial stop: below/above the trigger candle or 0.5–0.7× intraday ATR, whichever is tighter.
- First scale at +1R, move stop to breakeven for the remainder.
- Max two attempts per ticker; after two losses, stand down for that name.
Swing Trades (Asymmetric Mode)
Swings target larger, cleaner moves. Let the daily do the heavy lifting; entries come from the hourly.
- Daily trend must align with 10/20 EMA slope; if flat, reduce size or pass.
- Enter from hourly pullback into daily level; trigger on hourly engulfing/inside-bar break.
- Initial stop: beyond the structure, low/high or 1.0× daily ATR, whichever is smaller.
- Target 2–3R core; trail under/over swing pivots once +1.5R is locked.
Risk Sizing & “R” Management
Jerremy frames everything in R so decisions stay consistent across symbols and market regimes. The idea is to survive the dull days and be around for the fat pitches.
- Risk per idea: 0.25%–1.0% of account; new traders start at 0.25%–0.5%.
- Hard daily loss cap: 2R (day trading) or 1% of equity—stop trading once hit.
- Weekly drawdown cap: 3% of equity; reduce risk by half the following week if hit.
- Position size = (Account × %Risk) ÷ (Stop distance).
- Never widen stops after entry; only tighten.
Trade Management: Scales, Stops, and Targets
The goal is to remove “hope” from the screen. Pre-commit to scales and stop moves so you’re not negotiating with price at the worst moment.
- Scale 25% at +1R, stop to breakeven; scale another 25% at +2R.
- Trail remaining shares below/above the prior swing pivot or 10 EMA on your execution timeframe.
- If price tags +3R intraday and reverses, exit remainder at +2R on a close below/above the 10 EMA.
- Time stop: if an intraday trade hasn’t moved +0.5R within 45–60 minutes, exit.
- For swings, if two consecutive daily closes go against the position, reduce the size by half.
Timeframe Stack: Day Trade, Swing, Invest
He separates “cash-flow trades,” “asymmetric swings,” and “long-term wealth.” Each bucket has different expectations, holding periods, and rules.
- Day trades: flat by the end of the day; exceptions only if already +2R and closing strong with partials off.
- Swings: 2–15 trading days typical; earnings must be checked—reduce size or avoid if within 5 trading days.
- Investments: monthly adds into leaders/ETFs; ignore noise below the weekly chart.
- Never let a day trade morph into a swing because it’s red; honor the original plan or exit.
Earnings, News, and Gaps
Gaps are Jerremy’s playground—clear emotion, trapped participants, and defined levels. The trick is reading who’s stuck and fading or following with risk contained.
- Gap-and-go: buy stop above opening range high if gap opens above premarket range on >150% volume; stop below opening range low.
- Gap-and-fade: if a big gap runs into a major daily level and stalls with a reversal candle, take the fade back to VWAP/level; stop beyond the wick.
- No new swing entries within 24 hours of earnings for that ticker.
- For day trades, skip the first candle if spread >0.3% or first bar range >1.2× daily ATR fractionally scaled.
- News spikes: enter only on the retest after the first impulse; never chase the spike.
Automation & Order Types
He uses orders to enforce discipline—let the broker do the heavy lifting so you’re not clicking in panic. Preloaded brackets save both time and psychology.
- Default bracket: OCO with stop at planned level and profit target at +2R; adjust live for scaling logic.
- Use stop-limit entries with a small limit offset to avoid extreme slippage.
- If slippage >0.3R on fills, cut size in half for the next attempt or skip the name for the day.
- Preprogram hotkeys: flatten all, reduce by 50%, move stop to breakeven.
- Avoid adding liquidity in thin names; stick to highly traded symbols during cash hours.
Routine & Psychology
Consistency beats intensity. Jerremy’s edge includes sleep, a simple checklist, and the discipline to do nothing when conditions aren’t there.
- Pre-open checklist: sleep ≥7 hours, news scan 5 minutes, levels drawn, risk set; if any are missed, cut size in half.
- First loss of the day: mandatory 10-minute break; two losses: 30-minute break.
- Maximum concurrent positions: 3 day trades or 2 swings; if managing an investment rebalance, pause new trades.
- End-of-day rule: screenshot charts of each trade, annotate the reason for entry/exit, and log emotions in one sentence.
- If you’re trading to “get back to even,” stop for the day.
Metrics & Review
You can’t improve what you don’t measure. Track a few key stats, review weekly, and adjust one variable at a time.
- Log each trade’s setup tag (e.g., “gap-go,” “retest-engulf,” “OR break”) and execution timeframe.
- Record R multiple, maximum favorable excursion (MFE), and maximum adverse excursion (MAE).
- Weekly: identify the setup with the highest expectancy; scale attention there next week.
- Kill or pause any setup showing negative expectancy over 25+ trades.
- Monthly: export win rate, average R, and expectancy per setup; raise size by 10–20% only after two consecutive profitable months without breaching risk caps.
Size risk in R, cap daily losses, survive rough patches.
Jerremy Newsome frames every trade in R so decisions stay consistent when markets get noisy. Start small—0.25% to 0.5% the account, per idea—and only scale toward 1% after two profitable months without breaking rules. Set a hard daily stop at 2R or roughly 1% of equity and be done when it hits. Weekly, if you draw down 3%, halve the size the following week to steady the ship.
Translate that into practice with a simple formula: position size equals (account × % risk) divided by stop distance. Place the stop the moment you enter, and never widen it—only tighten as the trade works. If the first two trades of the day are losers, Jerremy steps away for a reset window before taking the next shot. He treats survival as the edge that compounds, because protecting R today funds the next high-quality setup tomorrow.
Trade levels, not predictions: retest entries, preplanned exits
Jerremy Newsome focuses on price reacting at market levels, not on guessing the next headline. He draws premarket high/low and prior day high/low, then waits for the price to break and retest before committing. The entry comes only when a reversal candle prints on the retest—engulfing, hammer, or inside-bar break. No retest, no trade, even if it runs without you.
Exits are scripted before the order goes live to remove hesitation. Stops sit beyond the structure that justified the entry, and targets are set in R multiples with a scale at +1R. If price hits +1R and stalls, trail under the 10 EMA or the last swing pivot to let the winner breathe. If the setup morphs or the level fails decisively, flatten immediately and wait for the next clean retest.
Stack timeframes for clarity: 5m trigger, daily bias alignment
Jerremy Newsome starts with the daily chart to decide long or short bias, then zooms to the 15-minute for structure, and finally the 5-minute for the actual trigger. If the daily EMAs are rising and price is holding higher lows, he’s hunting long setups only; if they’re sloping down with lower highs, he’s hunting shorts. This keeps him from fighting the dominant flow and getting chopped by random intraday noise.
On execution, Jerremy waits for the 5-minute to print a clean signal at a level already validated by the higher timeframes. A breakout is only taken if the 15-minute structure agrees and the daily bias supports continuation. When the 5-minute goes green but the daily is bearish, he passes and saves the ammo for a cleaner alignment. If the trigger fires and then the 15-minute breaks structure against him, he exits fast—timeframe conflict is a non-negotiable red flag.
Use volatility-based stops and targets anchored to ATR.
Jerremy Newsome sizes every stop with the market’s current heartbeat, not a fixed penny amount. He measures daily ATR and sets stop distance at a sensible fraction—typically 0.6–1.0× ATR for swings and 0.3–0.5× an intraday ATR proxy for day trades. If the required stop is too wide for his planned %R, he cuts the share size rather than forcing a tighter stop that will get pinged. Targets mirror the same logic: first scale around 1× the chosen ATR distance, then trail for 2×–3× if price stays orderly.
When volatility expands, Jerremy widens stops modestly and reduces size so the dollar risk per trade stays constant. If ATR contracts sharply, he tightens stops and is more selective—tight ranges mean he wants clean breakouts or fades with obvious levels. He avoids entries after a one-candle move greater than one full ATR without a pullback; that’s chase territory. If price tags +1R but stalls below the next ATR-based target, he locks partials and lets the rest ride behind a dynamic ATR or 10 EMA trail.
Diversify by trade bucket: day cash-flow, swing asymmetry, long-term investing.
Jerremy Newsome splits his approach into three buckets so each position has a job. Day trades exist for cash flow and are flat by the close, even if they’re green; swings hunt the 2–3R moves that change weekly P&L; investments compound in market leaders and ETFs on the weekly and monthly charts. Keeping buckets separate stops the common mistake of letting a day trade morph into a hope-filled swing after it goes red.
For Jerremy, each bucket has distinct risk, entries, and exits that do not overlap. Day trades get the tightest stops and the quickest scale decisions, while swings accept more noise and use daily or hourly structures. Investment adds are scheduled and rule-based, ignoring intraday drama entirely. By diversifying across time horizons and intent, he smooths equity curve volatility and avoids overexposure to any single regime.
Jerremy Newsome’s edge isn’t a magic indicator—it’s repeatability. He treats R as the common language for every trade, keeps risk tiny, and lets the market’s volatility set his stop distance and expectations. He builds plans around levels he’s drawn in advance, waits for the reaction and retest, and only triggers when price confirms with a clean candle. Bias flows from the daily, structure from the 15-minute, and entries from the 5-minute, so he’s never fighting the bigger tide for a small intraday win.
He reads volume to spot emotion and trapped participants, respects gaps because they expose those traps, and keeps day trades, swings, and investments in separate buckets so each has a job. Automation enforces discipline—bracket orders, preplanned scales, and time stops—while a hard daily/weekly loss cap protects the account on off days. Most importantly, Jerremy logs outcomes in R, reviews which setups actually pay, and kills the ones that don’t. Simple rules, executed the same way every day, turn a watchlist and a few lines into a durable process.
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