Before I ever enter—before I enter any company—I always want to delve into the company's balance sheet. Understand that the company has solid fundamentals.

Revenue Analysis

So let's first take a look at the revenue—the top line in the company. You can see this graphical image of five plus year chart of the revenue of PayPal stock, and you can see year after year increasing revenue. Most recent revenue of $29.13 billion.

Cash Flow Metrics

Free cash flow is $3.184 billion. Remember, free cash flow is pretty much shows the efficiency of a company—how much are they able to pretty much profit after all the expenditures.

Key Financial Ratios

Return on Invested Capital

• Return on invested capital: 17.88%
• Return on assets: 4.9%

Remember, return on assets measures a company's ability to generate profit from its assets. Overall shows how efficiently a company's able to use the assets to generate profit—very good.

Return on Equity

Next is the return on equity. Return on equity measures a company's profitability in relation to shareholder equity. So they ultimately—all of these metrics—next is return on equity quarter ending September 2023 was about 19%—excellent as well.

Overall Financial Health

Overall, I want you guys to understand this is a profitable company with great management, showing that they're using their assets, that they're using the money that they have, the profits that they're generating in an efficient manner.

Next, I want to delve into a share buyback. This company has a massive share buyback program.

2023 Buyback Announcement

In 2023, the company announced that it expects to allocate approximately $1 billion inc to incremental share repurchases, contributing to an updated outlook of approximately $5 billion in total share repurchase for that year.

Share Count Reduction

You can see in the graphical image you can see year after year decreasing in share—you can see an exponential decrease in the outstanding shares due to the share buyback program.

Companies can be saying that they're doing a share buyback program, but if you delve into the statistics, some of them may not be this steep of a curve. You can see here that they are executing share buybacks at a rapid pace due to its current standing in this stock. The lower the stock, the more likely a company's going to start buying back their shares.

Price-to-Earnings Ratio

Delving into the price-to-earnings ratio, look at the stock price—pretty much at 52-week lows. We are at a PE ratio way below average. Just looking at the—just looking at this lower end, you can see we're still in capitulated levels.

So what caused the stock to capitulate? What caused this massive selling off in the stock?

Reason #1: Increased Competition

Number one: Increased competition. There's companies that they're competing—companies that are they are competing against are the likes of Mastercard, Visa, etc.

But my counter-argument is: if you take a look at the top line, the revenue, it's free cash flow, all of the fundamentals in the company, you can see revenue year after year, everything is still in line. There's no cause for great sell-off the way it has.

Reason #2: Fintech Sector Selloff

Number two: Fintech overall took a beating. If you look anywhere in the fintech space like Square stock, they also took a massive beating. So took a massive beating.

Why was this? Sentiment was poor due to inflation. What happened with inflation? Higher prices overall affects consumer activity or behavior. If things cost more, less consumers are going to be likely, and how are these companies generating profit? Revenue is largely driven off of transaction fees. So every time you make a purchase through a credit card or whatever it may be, the company takes a certain percentage of that.

Reason #3: Slowing User Growth

Another cause of decrease in the stock price was slowing user growth. PayPal has already addressed this—they already focused on acquiring higher spend on existing users rather than a focus on growing users. Revenue nonetheless was increasing.

Critical Thinking About the Selloff

So when you guys delve into the fundamentals of a stock and try to understand why a company is falling, I want you guys to have this critical level of thinking. Understand why a company fell and whether the reasons are valid.

You can see all of the reasons that PayPal fell—I had a counter-argument to it, and I had ones that are valid:

• Is inflation going to be here forever? No.
• Is this increase in competition really driving down revenue? Not really.
• Does it warrant a sell-off at 52-week lows? No.

But that's how the market works. It will trade out of the fundamentals at times, and it will trade irrationally. And that's when we as smart investors need to understand and read between the lines and take advantage of this opportunity.

So after I've delved into the fundamentals of PayPal stock and understand this is a company that I want to enter into, I'll then—I'll then hop into the chart, see the technicals, and we'll play off those technicals.

Market Cycle Recognition

So like I said, this is a capitulated stock. On the daily time frame, you can see here this pretty much looks like this cheat sheet of the market cycle of the stock market and all the emotions that come with it.

You can see the optimism, belief, thrill, and euphoria—you can see that rise in the stock. And then you can see the complacency, anxiety, denial, panic, and capitulation all the way here. It's uncanny the way it looks. And then there's anger, depression, and sure enough a rise back into all-time highs.

Profit Strategy

So for us, we don't need the stock to go all-time highs. We're just going to be taking profits—5%, 10%, 15% profits around these zones—and our risk is heavily mitigated. We're also going to mitigate further risk by finding the proper entries to enter into.

Chart Structure Analysis

So after I've done that, I've have my moving averages—the 50 and the 200 moving averages there—and I overall want to understand what sort of structure this stock is playing in.

Now it seems to have played over at a channel like this. So I drew a trend line from here all the way to here, connecting as much points as possible. You can see: touched, touched, touch, touch. Every time it touched around this top band, it falls.

Let's go to the lower band now. Here I connected as much points as possible: here, here, here, here. Touched it once, touched it twice, didn't reach it here, touched it another time over here.

Entry Strategy

So how did I take advantage of this area? Every time we had a fall and a support around this lower band, I took an opportunity to long into the stock. Most recently, I took a position roughly around here, and I'll explain why to you guys.

So let's delve into the stock further. This is a zoomed-in look.

RSI Analysis

You guys can see here, once the stock ended around here, it was trading at an RSI of 26.46.

If you guys remember what RSI—is considered oversold, it's less than 30. We were trading at 26. You can see every time we had an RSI roughly around this 30 area, we had a rebound in the stock. Ultimately right—RSI was 26 right here, had a rebound. Let's take a look at the RSI over here—had a rebound. RSI over here—had a rebound over here.

So time and time after again, once we reach this lower end of this RSI, we got a rebound in the stock. That's number one.

Finding Multiple Confluences

I want to find other confluences before I enter a stock. I'm not going to just enter a stock just because, "Oh RSI was trading at an RSI of under 30, so it's considered oversold. I'm just going to buy into the stock." No. A stock can always fall further. We want to find other confluence to support our thesis that it's going to rebound at that time.

Moving Average Deviation

So other confluences—you guys remember the secret of price action: when a stock is greatly deviated from the moving average, it will always return back to the moving average. So time and time after again, after the moving averages gets too far away, we start approaching a moving average. Far away moving average—that's another confluence.

Volume Analysis

You guys can see also here around this price, after this close here, you can see that is a huge red candle there, but do you look at the volume here? It's actually less than the prior candle over here. So volume speaks loud, right? Not a lot of sellers are present. Sellers are weakening. Buyers are going to be stepping up shortly. So that's another confluence.

Area of Demand Analysis

A hack that I do with identifying areas of support—areas of major demand—I pretty much use this line. I draw a area of major demand to get a hypothetical scenario and try to locate if this is an area of prior demand or great support.

So I drew a demand level from here all the way to here, and I want to check out this stock. I'm simply just going to move to the left. You can see here it's been years since we've entered into that a area of major demand.

But as we approach 2017, this is an area where you can see prior support. Hit this area, you see a wick off of here, and we just zoomed past it, never returning to that level ever again. So we're area of prior support—area of major demand.

Final Confirmation

So we have multiple confluences in our favor. This is where I'm comfortable into entering my position.

Like I said, before I enter any position, I want to find indecision. You can see here that there's a support candle right here, and when I saw this doji candle and I saw indecision here, this is when I—this is when I had more confidence into entering in the position for a long to pretty much make its way over to the moving average as my sell area.

Like I said, we're not going to be chasing new highs. We're simply just going to take profits at areas of major resistance or at the moving—moving average will act which will act as resistance.

Profit Results

How much was I able to profit off of this position? Roughly around this position, you would have netted roughly around a 12%.

The Repeatable System

These plays, time and time after again, will present to you guys. Take these 5%, 6%, 10% gains and repeat this over and over again, and you're able to compound your wealth to well over six figures. This is exactly how I did it, and this is how you guys should be capitalizing in the market as well.

1. Fundamental Analysis: Strong revenue growth, solid cash flow, aggressive share buybacks
2. Valuation: Trading at 52-week lows with below-average PE ratio
3. RSI Oversold: Trading at 26.46 (below 30)
4. Moving Average Deviation: Stock far from moving averages
5. Volume Analysis: Decreasing selling volume on red candles
6. Area of Demand: Prior support from 2017 levels
7. Price Action: Doji candle showing indecision and potential reversal

Fundamental Check

• Revenue growth consistency
• Cash flow strength
• Management efficiency (ROE, ROA, ROIC)
• Share buyback programs
• Understanding selloff reasons

Technical Analysis

• Chart structure identification
• Moving average placement
• RSI levels for oversold conditions
• Volume analysis
• Areas of demand/support
• Price action confirmation

Risk Management

• Multiple confluences required
• Proper entry timing
• Defined exit strategy
• Reasonable profit targets (5-15%)

All right guys, so that concludes day seven—this is our last day. I want to know your guys's biggest takeaway. Post inside the Facebook group and hashtag day7 for me in the group.

This PayPal case study demonstrates how to combine everything we've learned over the past seven days:

• Day 1-3: Chart reading and pattern recognition
• Day 4: Fibonacci retracements and golden zones
• Day 5: Price action and confluence
• Day 6: Entry and exit strategies
• Day 7: Complete system integration

Remember: The market will always present these opportunities. The key is having a systematic approach that combines solid fundamentals with technical analysis, proper risk management, and the patience to wait for high-probability setups.

Your journey to consistent profitability starts with mastering this repeatable system. Take these principles, practice them, and compound your success over time.