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Become a Chart Patterns 'BEAST' | 3 Hours of 'Uninterrupted' Chart pattern course for beginners💯😎 — Transcript

by Fortune Talks · 32,313 words · 4,560 segments · language en · Watch on YouTube

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0:03foreign
0:06I know many of you have seen a lot of
0:09videos on chat patterns on YouTube and
0:12how to trade them but most of these
0:14videos don't tell you why you should
0:16trade them and in fact why these chat
0:18patterns actually work in the market so
0:21this is going to be one of the most
0:22comprehensive courses on chart patterns
0:25out there many professional Traders even
0:27sell paid courses on chart patterns that
0:30are worth thousands of rupees with very
0:32little content but guess what this
0:35course is completely free of cost and is
0:37exclusively for educational purposes
0:39only so share it with all your fellow
0:42Traders and friends and if you are new
0:44to the channel consider subscribing to
0:46the channel and also enable the Bell
0:48icon so that you won't miss out on any
0:51upcoming videos now the working of these
0:53chart patterns are quite simple chart
0:56patterns work by representing the
0:58Market's supply and demand this causes a
1:01trend to move in a particular way on a
1:04trading chart forming a particular
1:05pattern so when a Trader looks at the
1:08price chart of a stock or an index it
1:10can often appear to be completely random
1:12price movements this is often true yet
1:15within those price movements are
1:17patterns so chart patterns are geometric
1:20shapes found in the price data which can
1:23help a Trader understand the price
1:25action as well as make predictions about
1:27where the price is likely to go however
1:30chart pattern movements are not
1:32guaranteed and simply trading the chart
1:34patterns is not a sure short way to
1:37success in the markets and it is better
1:39used alongside with other methods of
1:41market analysis so in general there are
1:44three types of chart patterns there are
1:46continuation chart patterns reversal
1:48chat patterns and neutral chart patterns
1:51the topic of discussion in this video
1:53are continuation chart patterns I will
1:55talk about 5 most common continuation
1:57chart patterns and why and how they are
2:00formed and how to trade them with the
2:02proper entry stop loss and Target setups
2:05so if you don't know what continuation
2:07chart patterns are as the name suggests
2:10these patterns signal that the existing
2:12Trend in the market will most probably
2:14continue or in simple terms it predicts
2:17that the market will continue in the
2:19same direction after the end of the
2:21pattern now most of these continuation
2:23patterns are formed as consultations in
2:26between Trends so it's like Market
2:29taking a tea break because of exertion
2:31and getting back to work after
2:33refreshment we will be discussing five
2:36patterns and their subcategories we will
2:38start off our discussion with flag
2:40patterns followed by Penance then we
2:43will talk about the ascending and
2:45descending triangles further we will
2:47discuss about the rectangle patterns and
2:49finally we will wind up with cop and
2:51handle and inverted cup and handle
2:53patterns before moving on to the
2:55patterns let me make something clear up
2:57front it's none other than time frames
2:59all these patterns that I am going to
3:02talk about forms in almost all the time
3:04frames from intraday to swing to
3:06positional time frames all these
3:08patterns work better as the time frame
3:10increases because it takes more time to
3:13form and therefore more people are aware
3:15of them moreover the time frame to trade
3:17these patterns will depend on your
3:19trading style the duration you want to
3:22hold positions and your expectations so
3:25I have already made a video on how to
3:27select the appropriate time frames to
3:29trade so you can watch that video to
3:31know which time frame to choose
3:33depending on your trading style okay
3:35then let's get started
3:38the bullish flag or the bull flag as the
3:41name suggests forms during a bullish
3:43Trend the bull flag starts with a strong
3:46almost vertical bullish trending move
3:48which then stabilizes and turns into a
3:51minor bearish correction with parallel
3:54tops and bottoms which are important
3:56levels of supports and resistance now
3:59there are three components to any flag
4:01patterns that make it so I am going to
4:03give you a few hints to correctly
4:05identify the bull flag we have to look
4:07for a preceding up move or an uptrend
4:10which makes a flagpole as we know that
4:12the bull flag pattern forms during a
4:14bullish Trend this means that the
4:17candles range is more bullish than usual
4:19and they tend to close near the highs so
4:22it is a strong indication of buying
4:24interest in the market and it also
4:26signals that the Bulls are dominating
4:28the market now after the strong move
4:30higher the market needs to take a break
4:32now this can be seen as a profit booking
4:35phase where the initial buyers are
4:37looking to book some of their profits so
4:40here's where you can expect a potential
4:42bull flag to form as the market does a
4:44pullback now the type of price action
4:46that is exhibited in the pullback is
4:49what separates a flag pattern from a
4:51normal pullback now what you are looking
4:53for is a shallow pullback that consists
4:55of small ranged candles compared to the
4:58earlier strong bullish move or it can be
5:01seen as a group of indecision candles
5:03after a strong bullish move now this
5:05tells you that the sellers are
5:07struggling to bring the price down and
5:09that the buyers are still in control now
5:12if you see a steep pullback with large
5:14range of candles then it's probably not
5:17a bull flag pattern generally this
5:19retracement ends below the 38 percentage
5:22threshold of the original Trend as
5:25indicated by the Fibonacci so in general
5:27it may not be considered as a flag
5:29pattern if the retracement goes below 50
5:32percentage of the pole now the tighter
5:34this range the more likely the market
5:36will break out higher now that we have
5:38learned how to identify a bull flag we
5:41can discuss how to trade the flag
5:43pattern so I will discuss the entry
5:45methods where to place the stop loss and
5:47how to set the targets now starting off
5:50with the entry criteria as it is a
5:52bullish continuation pattern we are only
5:54interested in the break above the
5:56resistance line so you can take a long
5:59entry following a breakout of the level
6:01that is you can enter at the moment when
6:04the price breaks above the resistance
6:06trend line or you can look to buy a body
6:08high price of the breakout candle after
6:10it closes now the second method is to
6:13wait for a pullback or a retest back to
6:15the breakout level and then take a long
6:18entry when the price moves higher or
6:20when the price moves above the breakout
6:22candle high now you may be probably
6:24wondering which one is a better method
6:26well there's no best approach let's say
6:29if you enter the trade as and when the
6:32breakout happens it could potentially
6:33result in a force breakout also but if
6:37it is a real Breakout out it's the best
6:39possible price you can get alternatively
6:41if you wait for a close above the highs
6:43you will reduce your chances of a fast
6:45breakout but if the breakout is too
6:47strong you will end up entering at a
6:49much higher price the same is the case
6:51with waiting for a pullback or a retest
6:54which may not happen often if the market
6:56is trending strongly and as a matter of
6:58fact you will miss out on the trade
7:00completely so it is up to you to decide
7:03your entry strategy and continue
7:04practicing it over a large number of
7:07Trades and above all it is always
7:09recommended to confirm the validity of a
7:12breakout using volumes and other
7:14indicators so a higher than average
7:16volume can validate a breakout most of
7:19the time as it shows the interest of the
7:21market participants and low volume
7:23breakouts are most likely to fail using
7:26momentum indicators like macd and RSI
7:29can also help you identify your true
7:31breakout I have already made videos on
7:33all these topics so if you want you can
7:35check them out let us now focus on the
7:37criteria for setting stop losses so how
7:41to set your stop loss when trading the
7:42bull flag pattern now you don't want to
7:45set your stop loss at obvious levels
7:47like supports and resistances swing
7:50highs or loss Etc and why is that
7:52because you can get your stop loss 100
7:54easily it is as obvious a level to you
7:57as it is for others including the smart
7:59money so how do you get a proper
8:01stop-loss setup it's simple your stop
8:04loss should be at a level that if
8:07crossed invalidates your trading setup
8:09so what are we trading here we are
8:11trading a bull flag and the pattern
8:13becomes invalid when the price breaks
8:16and closes below the bottom trend line
8:18support so you have to keep your stop
8:21loss below this particular support level
8:23but there are still chances of long
8:25Wicks which can take out your stop loss
8:27and then move higher in the desired
8:29Direction which can be pretty annoying
8:31so to be extra safe you can give your
8:34trades more breathing space by setting
8:36your stop loss a particular distance
8:38away from the market structure using an
8:40indicator like ATR so once you identify
8:43the swing low of the bull flag pattern
8:46set your stop loss one ATR below the
8:48swing low level and now let's learn how
8:51to set Target for bull flag patterns now
8:54there are many ways you can cash in your
8:56winners and one of the most common
8:58approaches is to have a predetermined
9:00profit Target based on the length of the
9:02flagpole this method is also known as
9:04the price projection method let's
9:06measure the length of the flagpole from
9:09the bottom of the bullish price move to
9:11the top of the resistance level and then
9:13project this length from the breakout
9:15point above the resistance trend line
9:17and this will be your profit Target in
9:20the future an alternate method is to
9:22choose to Trail your stop loss until the
9:25market takes you out of the trade why is
9:27this a better option think about this
9:29the bull flag pattern usually appears in
9:32a strong trending Market but just after
9:34it breaks out of a range in such market
9:36conditions there is a lot of potential
9:38for the trend to continue and the only
9:41way to ride it is to Trail your stop
9:42losses now the question is how to Trail
9:45your stop loss in the best possible
9:47manner well you can use a tool like
9:49moving averages or Channeler stock to
9:51Trail your stop loss and only exit the
9:53trade the market closes Beyond it
9:55moreover it is much better if you use a
9:58combination of both the projection
10:00method and the trailing stop loss method
10:02so that you can predict the future move
10:04beforehand using the price projection
10:05method so as to lock in part of your
10:07profits there and then write the rest of
10:10the position using the trailing stop
10:11loss and thereby not impacting your
10:13psychology and avoiding any potential
10:16losses now moving on in the market there
10:18are numerous opportunities that are
10:20available for trading bull Flags but if
10:23you were to ask me to select a few I
10:25would choose 4 different scenarios to
10:28trade with the bull flag so that my risk
10:30to reward is satisfactory now these four
10:32scenarios includes number one the
10:35formation of bull flag during a level
10:37Breakout which is followed by a primary
10:40pullback the second scenario is when the
10:42flag formation occurs during an
10:44uptrending Market which further signals
10:46a trend continuation the third scenario
10:49is when bull Flags occurs inside a range
10:52market and the final case is when the
10:54full flag occurs in a downtrend
10:56signaling a trend reversal now the entry
10:59Target and stop loss criteria are the
11:01same for all these cases so I won't be
11:04discussing them individually for each
11:06case let us take a look at the first
11:08case this happens when the market breaks
11:11out of a range and then does a pullback
11:13for the first time this is one of the
11:15best times to trade the bull flag
11:17pattern and why is that because when the
11:19market is in a Range it will eventually
11:21have to break out and besides the longer
11:24it stays in a Range the harder it will
11:26break so what we are concerned about
11:28here is a resistance breakout where we
11:30can expect a bull flag to form so when
11:33the market finally breaks out the
11:35traders who miss the breakout move can
11:37wait to enter the market at the first
11:40indication of a pullback these primary
11:42pullbacks usually have a shallow
11:44retracement as not many Traders want to
11:47trade against the strong momentum and
11:49this presents a pullback trade with a
11:51very high probability so if I were to
11:53explain the process in a rather simple
11:55fashion it would go something like this
11:57first of all you have to identify a
12:00range Market or a market testing a
12:02resistance level for quite a while now
12:04let the market break out of the
12:06resistance level now you have to wait
12:08for a bull flag pattern to form in the
12:10form of a primary pullback now once you
12:13find such a formation you can look to
12:15take a long entry on the break above the
12:17heist
12:19has it ever occurred to you that you
12:21think the price is too high and it would
12:23be better to wait for the price to
12:25retrace to the support or back to the
12:28breakout level before you go long but
12:30the next thing you know the market
12:31continues to break new highs and you are
12:34left on the sidelines regretting your
12:35decision so have you learned something
12:37from this to put it simply in a strong
12:40trending Market it's far easier to buy
12:43breakouts than to wait for the price to
12:45pull back which rarely occurs in such a
12:48market you can use the bull flag pattern
12:51as an entry trigger here's how you can
12:53trade bull Flags in a trending market
12:55now the first step obviously is to find
12:57the market Trend you can look for strong
12:59trending market with the use of moving
13:01averages for example for short-term
13:04trades you can make use of 20 simple
13:06moving average and for swing or
13:07positional trading purposes you can make
13:09use of 50 or 200 period moving averages
13:12now for this case let us consider a 20
13:15moving average when the price trades
13:17above the 20 moving average
13:18predominantly and is sloping higher we
13:21can conclude that the market trend is
13:23strongly bullish in a short-term
13:25scenario now you have to wait for a bull
13:28flag formation to develop in the form of
13:30a pullback now once you identify your
13:32pattern you can look to take a long
13:34entry now as I have mentioned earlier
13:36the same entries stop loss and targets
13:39can be used for this purpose
13:44predominantly you can expect a bull flag
13:46to form after a breakout or during a
13:49strong Trend however there are times
13:51when a bull flag pattern can form when
13:53the market is in a range and at a
13:55resistance level so in one of my price
13:57action videos I have talked about the
13:59concept of breakouts with build up era
14:02resistance or support level you can find
14:04the video on the I button if you want to
14:06learn more about it afterwards now the
14:08same concept applies here a build up
14:10near a resistance level happens because
14:13there are no sellers stepping in or the
14:15buyers are willing to buy at higher
14:17prices now whatever is the case this is
14:19a sign of strength and the market could
14:22break out higher so how do you identify
14:24such an opportunity primarily you have
14:26to identify a market which is in range
14:29then you have to wait for a flag pattern
14:31to form near the resistance level in the
14:33form of a build up now as always you can
14:36trade the brake above the build up or
14:38wait for the market to close above the
14:40resistance level there is no change in
14:42the entry stop loss and Target criteria
14:45for this case also
14:49now if you are probably thinking what
14:52the hell this dude is talking about just
14:54a few minutes ago you said that bull
14:55flag is a trend continuation pattern now
14:58why are we looking for it in a downtrend
15:00yes there is no denying that the bull
15:02flag is indeed a trend continuation
15:05pattern but what if I tell you that
15:07there is a way you can profit by using
15:09the bull flag as a trend continuation
15:11pattern even on a downtrend now this
15:14method has to do with the market
15:15structure so if you don't know about the
15:17market structure you can watch it from
15:19my price action playlist it's a rather
15:21simple method you have to look for a few
15:24things before you proceed first of all
15:26the price must close above the downward
15:28trend line resistance now we are talking
15:31about a break in the downtrend structure
15:33then if the price forms a bull flag
15:36above this trend line resistance hola
15:39you have got a jackpot trade what you're
15:41doing here is trading between an ending
15:44downtrend and a potential starting
15:46uptrend you can benefit tremendously if
15:49you are able to catch the uptrend from
15:51the beginning itself now the entry stop
15:53loss and Target conditions will remain
15:55the same but I suggest you use a
15:58trailing stop loss such as a 20 period
16:00moving average since we are taking sort
16:02of a contrarian position just to be safe
16:07now a beer flag pattern is just the
16:10opposite of a bull flag pattern it is
16:12yet another continuation chart pattern
16:14but the beer flag signals that the
16:16market is likely to move lower so I will
16:19be quick with this one or else the
16:20length of the video will be too long and
16:23if you are able to understand everything
16:24associated with trading a bull flag then
16:27trading a beer flag is just a walk in
16:29the park you just have to flip
16:30everything you learned with the bull
16:32flag at 180 degrees and there you have
16:34it you now know beer flag pattern now
16:37here's how to identify a beer flag first
16:39you have to look for a strong trending
16:41move lower this means the range of the
16:43candles is more bearish than usual and
16:46they tend to close near the lows after
16:48the strong bearish move over the market
16:50takes a break in the form of a pullback
16:53now the pullback should consist of
16:55smaller range candles compared to the
16:57earlier bearish move and the more
16:59tighter the range the more likely the
17:01market will break out lower now the
17:03strong bearish move represents the port
17:05of the flag and the price console
17:07rotation during the pullback forms the
17:10flag of the pattern the flag retracement
17:12should not move Beyond 50 percentage of
17:14the poor length or else it is not
17:16considered a bare flag pattern
17:20now the entry criteria are also similar
17:23except for the fact that you will now be
17:25looking for shorting opportunities only
17:27being a bearish continuation pattern now
17:29you can look to sell when the price
17:31breaks below the support trend line but
17:34it is usually prone to fake outs so the
17:36better option is to wait for the
17:38breakdown candle to close and then enter
17:41below its low but sometimes if the
17:43breakout candle is very large you'll be
17:45entering at a very low price and the
17:48risk to reward will be affected so you
17:50can either wait for a pullback or rate
17:52US back to the breakdown trend line and
17:55then take a short entry when the prices
17:57start to move lower now the issue with
17:59this entry technique is that during a
18:01strong downtrending Market the price
18:03won't pull back often enough and you
18:05will miss out on most of the
18:06opportunities so it is up to you to
18:09decide your entry strategy and continue
18:11practicing it over a large number of
18:13Trades also make sure to validate if the
18:16breakout is Real by using volumes and
18:18momentum indicators like mac drsi Etc
18:21when it comes to protecting your
18:23positions you can place your stop loss
18:25at a level that invalidates your trading
18:28setup so a beer flag pattern becomes
18:30invalid if the price breaks above the
18:32resistance trend line with that idea in
18:35mind you have to keep the stop loss
18:37above the resistance trend line or to be
18:39even safer you can give the price some
18:41breathing space by keeping one ATR
18:44buffer above the swing high level
18:46depending upon your risk appetite now
18:48finally the target can be based on the
18:51price projection method or trailing stop
18:53loss method in case of price projection
18:55method you have to measure the length of
18:57the flagpole and then project it from
19:00the breakdown point below the support
19:01trend line this will give you your
19:03projected future Target price for the
19:06trailing stop loss method you can make
19:08use of moving averages like 20 or 50
19:10period moving average depending upon
19:12your trading style or you can use an
19:15indicator like Chandler stop to ride
19:16your positions in case of a range
19:18breakdown or strong downtrend now it is
19:21a deadly combination if you make use of
19:24both these techniques to execute your
19:26winners now the most important thing to
19:28figure out is where to find these flag
19:30patterns you can find a beer flag during
19:33a support line breakdown which is
19:35followed by a primary pullback now the
19:37breakout candles represents the flag
19:39while the primary pullback forms the
19:42flag consolidation of the pattern now
19:44you can take a short entry as per the
19:46entry criteria of your choice and the
19:48price breaks below the flag consultation
19:51now the most common place where you will
19:53encounter a beer flag is during a strong
19:56downtrend as we have discussed earlier
19:58we can identify the market Trend using
20:00moving averages now the selection of
20:02moving averages will depend upon the
20:04trade duration or your trading style for
20:07example the 20 moving average is good
20:09enough to determine the short-term Trend
20:11the 50 moving average is suitable to
20:13identify the medium term Trend and the
20:16200 moving average can gauge the long
20:18term Market Trend but the most important
20:20thing is to make sure that the price
20:22stays below the moving average and is
20:24sloping downwards now yet another
20:26occasion to look for beer Flags is in a
20:29Range Market especially those where
20:31there is a built up happening near a
20:33support level now this buildup can
20:34sometimes be in the form of a flag
20:36consolidation and you can enter a short
20:38position when the price breaks the build
20:40up and the support level now the entry
20:42criteria stop loss and targets will all
20:45be the same as in the other cases but
20:47make sure that the breakout is a valid
20:49one you can also find a bare flag at the
20:52end of an uptrend when there is a break
20:54in the uptrend structure which is
20:55accompanied by a flag pattern
20:57consolidation now this will help you
20:59enter a trend reversal even before it
21:02happens
21:05Penance are a class of chart patterns
21:08that closely resemble the flag patterns
21:10and symmetrical triangle patterns in the
21:12way they form and give breakouts but if
21:14you were to consider a pennant and a
21:16flag as two brothers then the pennant is
21:19the more aggressive brother due to the
21:21explosive breakouts it provides and the
21:23reward for risk it generates now there
21:26are two types of penance bullish Penance
21:28and bearish patterns let us focus on the
21:31bull Penance first now the bull pennant
21:33is a chart pattern that forms a triangle
21:35during the pullback it would consist of
21:37two pods the impulse move which forms
21:40the leg or the ball of the pattern and
21:42the correction move which is formed as a
21:44result of the pullback now you may ask
21:47what is the difference between a bull
21:49pennant and a symmetrical triangle
21:51because they both look similar now the
21:53answer is quite simple the difference is
21:56in the duration of their formation with
21:58a symmetrical triangle you can clearly
22:00see the swings of the pattern however
22:02the candles of the bull pennant are too
22:04crowded and two volatile for you to see
22:07the swings regardless a bullpenin is
22:09more similar to a bull flag pattern now
22:12as I have cited earlier bull Penance
22:14creates a more explosive breakout than
22:17bull flag pattern now let me explain the
22:19reason why I hope you have seen videos
22:21in which a Coca-Cola bottle is shaken
22:24and then thrown onto the ground now the
22:26cap explodes and the boat till flies off
22:29I don't want to go deeper into the
22:30physics of this but one of the factors
22:33that triggered this event is actually
22:35the shape of the cork bottle itself if
22:37you try the same experiment with a Coke
22:39can you may not get the same result now
22:41the bottle is shaped similar to a nozzle
22:44with a width of the bottle becoming
22:46narrower towards the top in comparison
22:49to a can where the width is almost equal
22:51throughout so what's the deal once you
22:53shake and throw the bottle the gas
22:56pressure builds up and the coke wants to
22:58get out and the easiest exit is through
23:00the cap but as they head towards the Gap
23:02the width starts getting narrower the
23:04pressurized gases inside the bottle
23:06would go into rage mode and blast open
23:09the Gap please don't blame me for this
23:11terrible physics lesson but the point
23:13that I am trying to prove is that the
23:15same thing happens with buyers and
23:17sellers in a Bull Pen and pattern the
23:19shrinking prices from left to right of a
23:21pen and pattern is a sign of impending
23:24volatility as both the buyers and
23:26sellers are itching to get out of the
23:28pullback now this can result in a rather
23:30explosive breakout but since the bullpen
23:33and pattern is not a trend reversal
23:34pattern instead it is a trend
23:36continuation pattern we will only look
23:38for buying opportunities this means that
23:41you are better of trying to use this
23:43pattern to ride on the existing trainers
23:45rather than catching the bottoms now let
23:48us talk about the entry stop loss and
23:50Target criteria for this pattern now
23:52starting off with the trade entry
23:53criteria one of the most costly mistakes
23:56that Traders make while trading the
23:58Penance is entering a bullpen and too
24:01early as you know ranging markets or
24:03even pool bags can be challenging to
24:05enter for two main reasons the range can
24:08overshoot or the range can undershoot
24:11now overshooting happens when the market
24:13is highly volatile and the prices will
24:15move beyond the trend line more often
24:17forming false breakouts now
24:19undershooting is the opposite that is
24:21the price fails to test the trend line
24:23every time in case of a bull pennant we
24:25should be more cautious about
24:26overshooting due to the tight range so
24:29what would happen if you buy as soon as
24:31the breakout above the trend line
24:33happens or if you place a buy limit
24:35order above the swing High more often
24:38than not the price could easily touch
24:40your buy order and reverse back into the
24:42range forming a fake out or overshoot
24:45now this can be annoying and can result
24:47in losses so what is the key here now
24:49the ideal thing to do is to wait for the
24:51bullish breakout candle to close above
24:54the pen and line if the price makes this
24:56kind of a move it's clear that the
24:58buyers who got squeezed finally managed
25:00to break out strongly similar to the
25:02case of a exploding Coke bottle so you
25:04can look to to buy Above the breakout
25:06candle's high price but sometimes the
25:09breakout candle will be too large and
25:11you will be buying at a very high price
25:13thereby affecting your robot tourist
25:15ratio the best move in such a situation
25:17is not to take the trade at all or you
25:20can wait for a pullback or retest back
25:22to the breakout level and then take an
25:24entry when the price starts to move
25:26higher but because of the explosive
25:28nature of breakouts from the Penance the
25:30chances for a pullback or retest are
25:32fairly dim so the best possible entry
25:34could be above the breakout candle high
25:36now validating the breakouts using
25:38volumes and other momentum based
25:40indicators can be a good practice during
25:43the pen and consultation the volume has
25:45to decrease due to the evidence shrink
25:47in volatility and the breakout has to be
25:49supported by higher than average volumes
25:51which could indicate a rise in the
25:53buying interest now that you have
25:55learned how the bullpen and works and
25:57how to enter it let's talk about how and
26:00where to set the stop losses when
26:01trading the bullpen and pattern as I
26:03have already discussed you don't want to
26:05set your stop loss at obvious levels
26:08like support and resistance swing highs
26:10or laws Etc because you can get stop
26:12loss 100 easily so your stop loss should
26:15be at a level that if crossed
26:17invalidates your trading setup now we
26:20are trading a bullpen in here and the
26:22pattern is deemed invalid when the price
26:24breaks and closes below the bottom trend
26:26line support so you have to keep your
26:28stop loss level below this trendline
26:31support or below the swing low level to
26:33be precise now there are still chances
26:35of long bicks due to the overshooting
26:38issues which can take out your stop loss
26:40if you keep it very tight and then the
26:42price can move higher in the desired
26:44Direction which can be really
26:45frustrating so to be extra safe you can
26:48give your trades more breathing space or
26:50buffer by setting the stop loss some
26:52distance away from the pen and Market
26:54structure using the ATR indicator now
26:56once you identify the swing low of the
26:58bullish pen and pattern you can set the
27:00stop loss 180r below the swing low level
27:03and finally let's learn how to set a
27:05target for the pull pen and patterns now
27:08there are many ways that you can exit
27:09your windows and one of the standard
27:11approaches is to have a predetermined
27:14profit Target based on the length of the
27:16leg or the pole of the pattern this is
27:18called the price projection method and
27:20here you have to first measure the
27:22length of the pen and leg then project
27:24this length from the breakout point
27:26above the resistance trend line now this
27:28will be your profit Target you can also
27:31choose to Trail your stop loss until the
27:33market takes you out of the trade now is
27:35this a better option think about this
27:37the bullpen and pattern usually appears
27:39in a strong trending Market or just
27:41after the price breaks out of a range so
27:44in such market conditions there is a lot
27:46of potential for the trend to continue
27:48higher and the only way to ride it is to
27:51Trail your stop losses now to Trail your
27:53stop loss in the best possible manner
27:55you can use the indicators like moving
27:57averages or Chandler stop and only exit
28:00the trade if the market closes below it
28:02moreover it is a much better option if
28:04you use a combination of both the price
28:07projection method and the trailing stop
28:09loss method so that you can gauge the
28:11potential of the move beforehand using
28:13the projection method so as to lock in
28:15part of your profits there and then
28:17write the rest of the position using the
28:19trading stop loss method thereby not
28:21impacting your psychology and avoiding
28:23any big losses due to price reversals
28:26now that you have learned what a pennant
28:28is and how to trade one it is essential
28:31to make a note of where to find one so
28:33what are the different types of Market
28:34condition where you can find a Bull Pen
28:37and pattern now pull pens can be found
28:39almost anywhere be it in uptrend range
28:42or downtrend the only thing to remember
28:44is that whenever it forms in the market
28:46the bullpen end is a bullish
28:49continuation pattern and our bias should
28:51always be looking for long trades only
28:54with that in mind let's talk about each
28:56case separately
29:00first you need to Define what an uptrend
29:02is in terms of your trading style and
29:05time frame you trade because if you
29:06can't Define a trend objectively based
29:09on your requirements then it is
29:10difficult to spot a bullpen and setup
29:12that satisfies your trading style now
29:14the easiest way to define a trend is by
29:17using a trend filter such as a moving
29:19average now you can use any moving
29:21average like 20 period 50 period or 200
29:24period Etc to identify the trend based
29:28on a short term medium term or long term
29:30perspective let's say I have a medium
29:33term Outlook or I am a swing Trader and
29:35I make use of the 50 period simple
29:37moving average to define the trend now
29:39if the price is above the 50 period
29:42moving average it means the trend is
29:44bullish for me then I will look for bull
29:46pennant opportunities and if a bullpen
29:49and pattern is spotted then you can look
29:51to take a long entry above the breakout
29:53candle and since we don't know how long
29:55the trend last you can even use the 50
29:57moving average as your trailing stop
29:59loss and we would exit only when the
30:01price crosses below the 50 moving
30:03average so here not only do we use the
30:0650 moving average to filter Trends but
30:08we can also use it to book our profits
30:13since the bullpen and Laser Trend
30:15continuation pattern you might have the
30:16idea that this type of setup is
30:18unfavorable so how exactly are we
30:20planning to trade the range Market
30:22literally speaking we are not trading
30:24the range Market what am I suggesting
30:26now it means that instead of trying to
30:29buy the highs and lows within the range
30:31we wait for the range to potentially end
30:34that is we look for tight consolidations
30:36or build ups in the form of a Bull Pen
30:39and pattern which is forming near the
30:41resistance level so the moment you see a
30:43bull pennant forming at the resistance
30:45it tells you that the buyers are
30:47starting to dominate and an explosive
30:49breakout is imminent you can look to
30:52enter above the breakout candle or when
30:54the price closes above the resistance
30:56and maybe you will even get a retest if
30:58you are lucky enough now the stop loss
31:00and the targets are same as we have
31:02discussed earlier and since there is no
31:05valid Trend you can use a title moving
31:08average such as a 20 period moving
31:10average if you wish to trade your stop
31:11loss
31:12even though the bull pennant is a trend
31:15continuation pattern there is still a
31:17way you can profit by using the bull
31:19pennant as a trend continuation pattern
31:21even on a downtrend now this method has
31:24to do with the market structure here you
31:26have to look for a few things before you
31:28proceed first of all the price must
31:30close above the downward trend line
31:32resistance now we are talking about a
31:34break in the downtrend structure then if
31:37the price forms a bull pennant Above
31:39This trendline resistance you have a
31:41jackpot rate what you're doing here is
31:43trading between an ending downtrend and
31:46a potential starting uptrend so you can
31:49benefit tremendously if you are able to
31:51catch the uptrend from the start now the
31:53entry stop loss and Target conditions
31:55will be the same and similar to the
31:57range Market strategy I still suggest
32:00you use a tight trailing stop loss such
32:02as a 20 period moving average since we
32:04are taking sort of a contrarian position
32:09I won't go into all the details of a
32:11beer pennant this is exactly the
32:14opposite to Bull pennants now it is a
32:16bearish continuation chart pattern it
32:18has a leg comprising of impulse candles
32:21with a strong bearish body followed by a
32:23tight consolidation associated with
32:26smaller candles and a contraction in
32:28volatility we expect the price to break
32:30out explosively below the trendline
32:32support level and continue with the
32:34trend even though this pattern is
32:36usually found in a downtrending market
32:37we can also spot it when the price is
32:40about to break down from a range below a
32:42support level where a buildup IS set up
32:44in the form of a beer pen and pattern
32:46you can even find it at the end of an
32:48uptrend where the break of the structure
32:51is accompanied by a beer pen and pattern
32:56now if I were to discuss the entry
32:58criteria we will only look for shorting
33:00opportunities since the breakdown is
33:03expected to be explosive in nature we
33:05can look to enter when the breakout
33:07candle gives a close below the trendline
33:09support you can then short below the low
33:11of the breakout candle in case if the
33:13breakout candle is too large and is
33:15affecting your reward to risk it is
33:18better to drop the trade or wait for a
33:20pullback to the breakout level which
33:22happens less often in the case of a
33:24pennant so it is up to you to decide
33:26where you want to enter now make sure to
33:29validate the breakdown every time using
33:31volumes or momentum indicators or both
33:34now the volume generally declines during
33:36the pen and formation and it increases
33:38above average when the breakout happens
33:40now the stop loss can be kept above the
33:43swing high level of the pennant and
33:45providing 180r buffer above the swing
33:47high can deal with the unexpected
33:49overshoots and stop loss handling now
33:52the target can be kept by using the
33:54price projection method where the length
33:56of the leg is set as the Target by
33:58projecting it below the breakdown point
34:00or you can adopt the trailing stop loss
34:02method by making use of suitable moving
34:05averages when you are planning to ride
34:07the trend and you only exit when the
34:09price closes above the moving average
34:11now moving on we will focus on the
34:13triangle patterns namely the ascending
34:16triangle and the descending triangle
34:18chart patterns so let's start with the
34:20ascending triangle patterns
34:22the ascending triangle is a bullish
34:24chart pattern that signals the market is
34:27about to head higher now as you can
34:28notice the ascendant triangle has a
34:31series of higher lows that approach a
34:33resistance line now this is a sign of
34:35bullish strength and for a few possible
34:37reasons now the higher lows are an
34:40indication that the buyers are willing
34:42to buy at higher prices now think about
34:44it if the buyers were not willing to buy
34:47at higher prices you won't see higher
34:49lows coming into the resistance now the
34:52fact that the market forms a series of
34:54higher lows tells you that there is
34:56demand even as the price continues
34:58higher the second point is that there is
35:00a lack of selling pressure so if there
35:03was actually a strong selling pressure
35:05the price would not remain at the
35:07resistance for a long period instead it
35:09would rather move lower very quickly but
35:12since the price is hovering near the
35:14resistance it means there is a lack of
35:16selling pressure even though it's an
35:19alluring level to sell yet another point
35:21to keep in mind is that there are a lot
35:23of buy stop loss orders that are
35:25clustered above the resistance because
35:27as the price retests the resistance
35:29every time more Traders will look to
35:32short the market and they will place
35:33their stop loss above the resistance
35:36level in such a situation think about
35:38what will happen if the market breaks
35:40out higher well all these by stop loss
35:43orders will be triggered and this will
35:45fuel further price advances towards the
35:47upside so don't make this common mistake
35:50when trading ascending triangle pattern
35:52because most trading books will tell you
35:54to go short and the price is at the
35:56resistance level but not every
35:58resistance is meant for shorting instead
36:01you must watch how the price approaches
36:03it since you have learned that higher
36:05lows coming into the resistance is a
36:07sign of bullish strength this means the
36:10market is likely to break out higher
36:12from the resistance and the last thing
36:14you want to do is to go short and trade
36:16against it I hope things are making
36:18sense
36:19now we will talk about the entry
36:21criteria so how to better time your
36:24entry well there are a few ways to do it
36:26the first approach is to go along when
36:28the price breaks above the highs of the
36:30ascending triangle or above the
36:32resistance level now all you need to do
36:35is to place a limit by order above the
36:37resistance level and you will be
36:39immediately long when the price breaks
36:41above the highs if the breakout is real
36:44this is one of the best prices to render
36:46but this method is very risky and
36:48chances are it might be a false breakout
36:51the next method is similar to the
36:53previous approach the only difference is
36:55that you wait for the price to break and
36:57close above the highs of the ascending
36:59triangle pattern you can under long
37:01above the breakout candle highs once the
37:04candle closes this method reduces the
37:07likelihood of a false breakout but if
37:09the breakout momentum is quite strong
37:11you will be entering at a very higher
37:13price so if you are an experienced
37:15Trader then you can even enter the
37:17market as the price pulls back or retest
37:19to the resistance line of the triangle
37:21pattern now this can help you enter the
37:23trade even if you miss out of the
37:25breakout move and it offers a better
37:27entry price than waiting for the close
37:29of the breakout candle but the issue
37:31with this approach is that the market
37:33may not give a pullback or retest every
37:35time so it is up to you to choose the
37:37Android type that you like based on
37:39whether you are a conservative or
37:41aggressive Trader with your approach now
37:43make sure to validate the breakout with
37:45volumes and other momentum indicators to
37:48see if there is actually an interest in
37:50the market participants to take the
37:52prices higher now we will learn how to
37:54set a proper stop loss so that you don't
37:56get stopped out too early now it doesn't
37:59matter whether you are trading the
38:01ascending triangle breakouts pull bags
38:03Etc because the concept is the same your
38:06stop loss must be at a location that if
38:09reached will invalidate your trading
38:11setup this means if the market hits the
38:14stop loss you will automatically know
38:16you are wrong so a stop loss below the
38:18resistance level is not a very good idea
38:21so where else will you place it think
38:23about it what is the ideal place to set
38:25a stop loss so that if the market
38:27reaches it you know the ascending
38:29triangle pattern is invalidated since
38:32the pattern forms higher swing lows and
38:34if the price moves below the recent
38:36swing low and forms a lower low then we
38:39can be sure that our analysis has gone
38:42wrong so it is exactly the place where
38:45you need to keep your stop loss that is
38:47just below the recent swing low level
38:49you can give the price some breathing
38:51space by adding one ATR buffer below the
38:54recent swing low I hope it is clear now
38:57the third and most important point when
38:59and where to exit your winning trades
39:01for maximum profits now as always there
39:04are two techniques you can consider the
39:06trailing stop loss method and the price
39:08projection method the idea of a trailing
39:11stop loss is that we have no idea how
39:14long a particular Trend will last so we
39:16Trail our stop loss to write the trend
39:18as far as possible to lock in your gains
39:21as the market moves in our favor so how
39:24do you Trail your stop loss well as I
39:26have mentioned a number of times you can
39:28use an indicator like moving average for
39:30example you can Trail your stop loss
39:32using 50 period moving average for a
39:34swing trading strategy this means you
39:36will hold your position until the market
39:39breaks and closes below the 50 moving
39:41average now some of you might be
39:43wondering why 50 moving average always
39:45actually there is nothing special about
39:4750 moving average a much better question
39:49to ask is what type of Trends do you
39:52want to capture and what is your trading
39:54style now for a long term trade you can
39:57use the 200 period average for
39:58short-term Trends you can use the 20
40:00period moving average and so on the
40:03second method the price projection
40:04method is a classical charting technique
40:06to project where the price will exhaust
40:09itself so here's how it works for an
40:11ascending triangle pattern you have to
40:13calculate the width of the ascending
40:14triangle from the highest point which is
40:17the resistance level to the lowest point
40:19now add this amount to the breakout
40:21level and that's your price projection
40:23or expected Target level one of the
40:27issues with price projection is that the
40:28market can almost hit your target profit
40:31only to make a sudden reversal and
40:33sometimes it can reverse all the way
40:35back and hit your stop loss so what
40:38would you do to avoid something like
40:40that happening the best idea is to
40:42combine both the techniques that is make
40:44a trailing stop loss and price
40:46projection combo this means if the
40:48market moves in your favor but it hasn't
40:51reached your price projection level you
40:53can utilize the moving average to log
40:55into your profits so even if there is a
40:58sudden reversal you still protect what
41:00you have and do not give everything back
41:02to the market
41:05now the descending triangle is yet
41:08another logical pattern and if traded
41:10correctly it allows you to catch
41:12explosive breakout trades about to occur
41:14this is a bearish chart pattern that
41:16shows the sellers are in control and it
41:18signals a bearish trend continuation now
41:21the descending triangle looks like a
41:23series of lower Highs coming into an
41:25area of support the pattern signals
41:27strong selling pressure and a lack of
41:30buying pressure usually when the price
41:32drops lower more demand comes in to push
41:35the price higher but that is not the
41:37case for descending triangle because as
41:39the price drops lower there is still a
41:41lack of buying pressure instead the
41:43sellers are willing to sell at even
41:45lower prices that's why you get a series
41:48of lower highs we attending the point to
41:50consider is that sell stop loss orders
41:53are clustered below the support level
41:55this is because many Traders will buy
41:57because the price is at the support and
42:00they will set their stop losses below
42:02the support level since that's what most
42:04textbooks teach them now as more Traders
42:06do it the cluster of stop losses below
42:09the support level builds up our time and
42:11since the market moves from one area of
42:13liquidity to the other the price is
42:16likely to break below the support and
42:18Trigger all these clusters of stop
42:20losses which will increase the selling
42:22pressure and pushes the price downwards
42:24now being a bearish continuation pattern
42:27the most common way to trade a
42:29descending triangle is to go short when
42:31the price breaks below the support level
42:33still there are important things to
42:36consider if you want to find the highest
42:38probability breakout rates the breakdown
42:40should occur near the apex of the
42:42descending triangle Apex refers to the
42:44tip of the triangle pattern where both
42:47the trend lines meet now the reason you
42:49want to short near the Apex is that it
42:51is where the volatility is the lowest
42:53and the prices are squeezed now when the
42:56volatility decreases chances are the
42:58price will explode out of the descending
43:00triangle and quickly move in your favor
43:02on top of that the more times the
43:04support level is tested the better this
43:07is simply because when the price tests
43:09the support level multiple times it will
43:11attract more buyers and thereby increase
43:14the number of stop loss orders below the
43:16support level now this is great for a
43:18breakout Trader because if the price
43:20breaks below the support all these
43:22clusters of self stop loss orders would
43:25be triggered thereby increasing the
43:27selling pressure towards the downside
43:28now moving on we will focus on how to
43:31trade this pattern so how to time your
43:34entry and set your stop loss I don't
43:36know if you have observed whenever the
43:38price Falls it moves quicker than when
43:41it rises so if you wait for the breakout
43:43candle to close below the support level
43:45chances are the price might drop a lot
43:48and you end up chasing the market thus
43:50in this case it is preferred to use a
43:53limit sell order and enter the trade
43:55when the price just breaks below the
43:57support level now if you are a more
43:59conservative Trader and you do not want
44:01to blindly place a sell limit order at
44:03the breakout point because the price
44:05could give a false breakout and Rise
44:07higher so it is ideal to wait for the
44:09price to confirm your bias before
44:11shorting the markets after the breakout
44:13candle closes below the support level
44:16but there can be occurrences when you
44:18can miss the breakout altogether what
44:19happens then so if such a thing happens
44:22the last thing you want to do is Chase
44:24the market after a breakdown of the
44:26pattern instead a better option is to
44:28wait for the price to retest the
44:30breakdown point now if you wait for the
44:32retest you are entering a favorable
44:34trade location where previous support is
44:37likely to act as a resistance level this
44:40means you have a tighter stop loss on
44:42your trade which offers a better reward
44:45to risk ratio but sadly pullbacks or
44:48retest don't happen very often with this
44:50pattern also making use of volumes for
44:52the breakout validation is a good
44:55practice now what about the stop losses
44:57straight away ask yourself the point
45:00where the descending triangle pattern
45:01gets invalidated is when the price moves
45:04and closes about the most recent swing
45:07high level so a good stop loss would be
45:09above the most recent swing high level
45:11and if you would like to be even safer
45:14give it some buffer like 180r and set it
45:17above the recent swing high now finally
45:19how to exit your winners for maximum
45:22profits now similar to every other
45:24pattern there are two ways to exit the
45:27winning trades price projection method
45:29and trailing stop loss method in the
45:32price projection method calculate the
45:34distance between the highest and lowest
45:36point of the descending triangle now
45:38take this distance and project it
45:40downwards from the breakdown point this
45:42projected future price point is where
45:45you exit your trade after you enter a
45:47breakdown of the descending triangle
45:49pattern you can also use the price
45:51projection technique to decide whether
45:52it's too late to enter a trade or not
45:54that is if the price is close to
45:56reaching its projection there's probably
45:58not much reward left in the move and you
46:00might want to skip the trade now the
46:02second method is using trailing stop
46:04losses and unlike the price projection
46:07technique a trailing stop loss does not
46:09have a fixed profit Target instead you
46:12Trail your stop loss as the price moves
46:14in a favor so you can write the entire
46:16Trend now you have to decide on the type
46:19of trend you want to capture whether
46:21it's a short term medium term or
46:23long-term Trend and you trade your stop
46:25loss with the appropriate moving
46:27averages for example a 20 moving average
46:29can be used for a short term 50 period
46:32moving average for a medium term and 200
46:34period moving average for long term
46:36Trends then exit your trades when the
46:38price closes Beyond or above the moving
46:41average so if you want to capture a
46:43price ring in the market the price
46:45projection technique makes sense and if
46:47you want to write Trends in the market
46:49then trailing stop loss works best now
46:53moving to our fourth category of
46:54patterns the rectangle patterns the
46:57rectangle formation is a classical chat
47:00pattern established by horizontal lines
47:02which represents the important support
47:04and assistance now this is a
47:06continuation pattern that forms a
47:08trading range during a pause in the
47:10current market Trend it is quite easy to
47:13identify the pattern because it has at
47:15least two comparable highs and two
47:17comparable laws these highs and lows can
47:20be joined to make two parallel lines
47:22that form the top and the bottom of the
47:25rectangle now a rectangle formation
47:27shows a period of indecision between
47:29sellers and buyers as they take turn
47:32throwing punches at each other but
47:34neither of them have the dominance over
47:36one another so the rectangle patterns
47:38are also known as trading ranges or
47:40concession areas or consolidation zones
47:43in this case we are talking about
47:44continuation patterns so we expect the
47:47price to break out and continue with the
47:49original Trend so in that sense there
47:51are two types of rectangles the top
47:53rectangle which is formed during an
47:55upward price move it signals the
47:57continuation of the uptrend the next
47:59rectangle is formed during a downtrend
48:01and is called as a bottom rectangle
48:04which signals that the down move will
48:06continue after the breakout now the
48:08rectangle patterns can also reverse the
48:10trend so these reversal patterns are
48:13given specific names like double top and
48:16triple top when the price tests the
48:18resistance twice and Thrice respectively
48:20and then moves lower the other category
48:22is double bottom and triple bottom where
48:25the price test the support level twice
48:27and thrives respectively and reverses
48:30upwards so in order to clearly
48:32understand what the pattern is about to
48:34do we have to wait till the breakout
48:35happens so it is essentially a confusing
48:38piece of price action if you try to
48:40learn this pattern by heart what I
48:43recommend is to wait for the price to
48:45give a real breakout and then decide if
48:47you want to trade with the trend or
48:49against it so in short in order to
48:52identify the rectangle pattern we will
48:54need to locate a trending stock that is
48:57having a period of consolidation and
48:59there should be minimum two tops and two
49:01bottoms that are horizontal to one
49:03another which will act as the rest
49:05distance and support levels as I have
49:07mentioned the top rectangle is seen
49:10during an uptrend you would need to
49:11notice a breakout through the upper
49:13level of the pattern now this will
49:15confirm that the bullish move is coming
49:17back and Traders can look to under long
49:19positions when the pattern forms a break
49:22up with the resistance level to continue
49:24with the bullish Trend while the bottom
49:26rectangle pattern is the total opposite
49:28of its bullish counterpart this pattern
49:30occurs during a downtrend and the price
49:32would need to break the lower support
49:34level of the pattern to confirm its
49:36presence and Traders can look to under
49:38short positions when the price breaks
49:41the bottom of the range to continue with
49:43the bearish trend now how to trade when
49:45you see a rectangle pattern for a top
49:47rectangle pattern you can enter a long
49:50trade when the price breaks above the
49:52resistance level if you are an
49:54aggressive Trader looking for the best
49:56price to take an entry the downside is
49:58that it could be a false breakout and
50:01you can get stopped out the next
50:02approach is more conservative where we
50:04will be paid for the breakout candle to
50:07close above the resistance level most
50:09often this method will reduce the
50:11chances of getting trapped in a fake out
50:13but the only limitation is when the
50:15price breaks out with huge momentum and
50:17you will now be buying at higher prices
50:19and finally what if you miss out of the
50:22breakout completely then the only option
50:24available is to wait for a pullback or
50:26retest back to the resistance turn
50:28support level and take an entry from
50:31there and if the rateest doesn't happen
50:33don't chase the price just avoid trading
50:36it all together you'll find even better
50:37trades make sure that the volume Rises
50:40during the breakout indicating a higher
50:42buying interest you can also use
50:44indicators like macd RSI Etc to do the
50:47same and for a bottom rectangle pattern
50:49with a bearish breakdown our primary
50:52Instinct should be to sell now here are
50:55the three entries possible the most
50:57aggressive is entering as and when the
51:00breakout happens the more conservative
51:02approach is to wait for the confirmation
51:04after to the close of the breakdown
51:06candle below the support level the final
51:08option is to wait for a rate test in
51:11case you missed the breakdown so I leave
51:13it up to you to decide make sure you
51:15validate the breakout with volumes and
51:17momentum based indicator each and every
51:19time now we will learn to set up proper
51:22stop loss we don't want the stop loss to
51:25affect our risk management so when you
51:27notice a rectangle breakout you have to
51:29measure the distance between the support
51:31and resistance and then place your stop
51:33loss in the middle of this length this
51:36is applicable to both top and bottom
51:39rectangles now your trade will be
51:41secured by doing this and you will be
51:43aware that the maximum you can lose from
51:45this trade is equal to half the size of
51:47the pattern now after buying or selling
51:50on the rectangle breakout pattern the
51:52stop loss should be placed at the
51:54midpoint because the breakout will
51:56likely to have shakeouts before
51:58continuing with the trend thus if you
52:00put your stop loss at or just below the
52:02breakout Point smart money will probably
52:04your stop loss before beginning to run
52:07with the trend now how to exit a
52:10profitable trade when trading the
52:11rectangle pattern there is a clearly
52:13stated rule about the minimum Target you
52:15should remain in your trade for a
52:17minimum price move which is equal to the
52:19size or the width of the pattern this
52:21implies that the distance between the
52:23support and resistance of the triangle
52:25should be placed on the chart beginning
52:27from the breakout moment now since the
52:30stop loss is at the midpoint of the
52:32rectangle range it means that the target
52:34is twice the size of the stop loss this
52:37enables a reward to risk of 2e's to 1
52:39from the offset you can also use the
52:41railing stop loss method if you want to
52:43write the trend until it's exhausted
52:45there is yet another way in which
52:47Traders can successfully trade
52:49rectangles and that is by buying at the
52:51support and selling at the resistance
52:53levels if the width of the rectangle
52:55pattern is very high now this can be
52:57used as an intraday or swing trading
52:59strategy if it provides a sufficient
53:02reward to risk ratio so for a top
53:04rectangle pad button you can take along
53:06and read from the bottom support level
53:08and place your stop loss below the
53:10lowest Wick or candle formed during the
53:13consolidation and the target will
53:15obviously be the next resistance level
53:17similarly for a bottom rectangle pattern
53:20you can look too short when the price
53:22reverses down from the top resistance
53:25level and place your stop loss above the
53:27highest Wick or candle that is formed
53:29during the consolidation the target is
53:32obviously the lower support level now
53:34let's jump into the final category of
53:36patterns first of all I will talk about
53:38the cup and handle pattern the reason
53:40why I have kept the cup and handle
53:42pattern for the last is that there is
53:44still an ongoing debate as to whether
53:46the cup and handle pattern is more of a
53:48continuation pattern or a reversal
53:50pattern in my opinion the cup and handle
53:53pattern can be both a continuation and a
53:56reversal pattern now it depends on where
53:58it is formed in the chart if it is
54:00formed during an uptrend then this
54:02pattern indicates a bullish continuation
54:04like likewise if it gets formed during a
54:06downtrend the pattern will indicate a
54:09bullish reversal now I am not actually
54:11curious about where the pattern forms
54:14but I'm more interested in the fact that
54:16the breakout always occurs towards the
54:18upside that is the cup and handle
54:20pattern is expected to give a bullish
54:23breakout now let's dive into the finer
54:25details the pattern comprises of two
54:27parts as the name suggests a cup and a
54:30handle and also a neckline which will
54:33act as the resistance the cup forms
54:36after a bearish price decline which is
54:38followed by a period of consolidation
54:40with smaller or weaker candles that
54:43shows signs of the market bottoming
54:45after which the price makes a higher
54:47high towards the resistance which
54:50indicates that the Bulls are taking over
54:52from the beers gradually now it looks
54:54like a bowl or an object with a round
54:56bottom and the volume should decrease
54:59towards the middle of the pattern which
55:01is during the consolidation and then
55:03rise towards the up
55:05which indicates an increase in the
55:07buying pressure how the price reacts at
55:09the resistance is important because it
55:12tells you whether there is still selling
55:14pressure available at the resistance now
55:16a cup and handle pattern becomes invalid
55:18if you see a large sell-off from the
55:21resistance level as it tells you that
55:23the selling pressure is still available
55:25there and the market is not ready to
55:27head higher but if you notice that the
55:30price is holding up nicely at the
55:31resistance then it is a sign of strength
55:34as it tells you that the buyers are
55:36willing to buy at higher prices so the
55:39handle has to form a tight consolidation
55:40or build up under the resistance level
55:43at this point many Traders would do what
55:45they have learned from many trading
55:47books that is price is at the resistance
55:49and it is time to go short now that's
55:51fine if the price has made a strong
55:53momentum move into the resistance and it
55:55got rejected strongly from there but if
55:58the price approaches the resistance and
56:00forms a build up or even if it makes
56:03higher lows into the resistance then you
56:05have to to be very careful because this
56:07is a sign of strength which is telling
56:09you that the buyers are willing to buy
56:11at these higher prices and the last
56:13thing you want to do is to short the
56:15market because it's likely to break out
56:17higher so the handle has to give a tight
56:20consolidation which can be in the form
56:22of either a bull flag pattern or a bull
56:25pen and pattern which by themselves are
56:27bullish continuation patterns now
56:29moreover the volumes should decline
56:31during the consolidation indicating a
56:33lack of selling pressure also keep in
56:35mind that the handle has to be smaller
56:38than the cup and it should not drop into
56:40the lower half of the cup and ideally it
56:43should stay in the upper third of the
56:44cup the deeper the handle moves down the
56:47less likely the market will break out
56:49higher now the handle is the last
56:51bearish attempt to push the prices lower
56:54and when it fails and the prices breaks
56:56above the handle we can expect the
56:58market to rise now let us take a look at
57:01the entry stop loss and Target criterias
57:04the first cup and hand confirmation
57:06comes when the price breaks above the
57:08tight consultation range so this is the
57:10most aggressive and cheapest entry price
57:13that you can find but since there is a
57:15resistance level above it the price
57:17could just reverse and hit your stop
57:19loss so an alternative entry is to go
57:22long on the breakout above the neckline
57:24this is the second best price you can
57:26get an entry end but there is still a
57:28danger of a false breakout in this
57:30method and if you are more conservative
57:32you can wait for the breakout candle to
57:34close above the neckline and then take a
57:37long entry on the next candle above the
57:39breakout candle Heist however sometimes
57:42the market closes much higher and you
57:44will have a poor reward to risk ratio
57:47now this will result in a wide stop loss
57:49and a smaller position sizing on your
57:51trade and in such instances you can wait
57:53for the price to do a ShakeOut in the
57:55form of a pullback or retest pack to the
57:58neckline and you can plan to enter when
58:00the price reverses higher now make sure
58:02to validate if the breakout is Real by
58:04use using volumes and other momentum
58:07indicators another point to note is that
58:09the cups that have longer and more
58:11u-shaped bottoms gives a better signal
58:14and it is better to avoid the cups with
58:16a sharp v-shaped Bottom now the second
58:19question is where should I set my stop
58:21losses now whenever you place a stop
58:23loss it should always follow this thumb
58:26rule your stop loss should be placed at
58:28a level where if the market reaches it
58:30your trading setup is invalidated now
58:33ask yourself when will a cup and handle
58:35pattern becomes invalid a cup and handle
58:38pattern invalidation comes when the
58:40price breaks below the handle of the
58:42pattern now this top loss setting is
58:44same as in the case of a bull flag or a
58:47bull pen and pattern now you don't want
58:49to put the stop loss at the exact low of
58:51the handle because the market could
58:53trade into that area of value and then
58:56reverse higher so instead give it some
58:58buffer below the handle like 180r below
59:01it and finally how to exit your windows
59:04the first method is obviously the
59:07classic price projection method here we
59:09measure the height of the cup from the
59:11bottom of the cup to the neckline and
59:13then project it from the breakout point
59:15above the neckline this will be your
59:17future profit Target now the second
59:19method is to use moving averages to
59:22Trail your stop loss and write big
59:24trends so in a trending Market the price
59:26can remain above the moving average for
59:28a long period of time and you will only
59:30exit when the price closes below the
59:32moving average moving on to the final
59:35pattern of this video the inverted cup
59:37and handle pattern if you flip a cup and
59:40handle pattern upside down you will get
59:42an inverted cup and handle pattern this
59:44is a pattern that gives a bearish
59:46breakdown depending on where it is
59:48formed in a trend it can be a bearish
59:50continuation pattern or a bearish
59:52reversal pattern but we are least
59:54interested in where it forms but we are
59:57more interested in the bearish breakdown
59:59that it provides the formation of the
1:00:02inverted cup shows a depleting demand
1:00:05and a lack of buying pressure which can
1:00:07be validated by using the volumes now
1:00:10the handle should be a tight
1:00:11consolidation in form of a beer flag or
1:00:14a beer pennant which also comes with
1:00:16Contracting volumes now if the handle
1:00:18moves way higher beyond the 50
1:00:20percentage of the cup then it is better
1:00:22not to consider it as a valid pattern
1:00:24since there is enough buying pressure
1:00:26still available at the neckline or the
1:00:29support level which is pushing the
1:00:30prices higher the entry criteria are to
1:00:33either take a short trade when the price
1:00:36breaks below the handle of the
1:00:37consolidation or when the price breaks
1:00:40below the neckline and a more
1:00:41conservative entry would be below the
1:00:44low of the breakdown candle after the
1:00:46breakdown candle closes below the
1:00:48support level and if you have missed out
1:00:50on an entry you can wait for a price
1:00:52pullback or retest back to the neckline
1:00:54and then go short when the price
1:00:57reverses lower now the stop loss can be
1:00:59placed with 180r buffer above the handle
1:01:02of the pattern and finally the target
1:01:04can be set equal to the height of the
1:01:07inverted cup from the neckline to the
1:01:09top of the cup and project it below the
1:01:12neckline from the breakout Point yet
1:01:15another way is to write the whole Trend
1:01:17using a trailing stop loss method using
1:01:19moving averages and exit only when the
1:01:22price moves above the average now that
1:01:25is all the major continuation patterns
1:01:28in a single video
1:01:33now in the last part we talked about
1:01:35five different types of continuation
1:01:37chart patterns however in this video we
1:01:40will talk about reversal chart patterns
1:01:42and we will not just talk about it we
1:01:45will examine why these patterns work in
1:01:47the market and why you should trade them
1:01:49we will discuss the four most common and
1:01:52most profitable reversal patterns along
1:01:54with their entry stop loss and Target
1:01:57criteria and if you don't know what
1:01:59reversal patterns are as the name
1:02:01suggests these patterns signal that the
1:02:03existing Trend in the market will most
1:02:05probably reverse or in simple terms they
1:02:08predict that the market will take a
1:02:10U-turn in the opposite direction of the
1:02:12existing Trend after the end of the
1:02:14pattern now most of these reversal
1:02:16patterns are formed as consultation in
1:02:19between the trends so it's like the
1:02:21market telling us that it is tired of
1:02:23going in a particular direction and is
1:02:25looking to move in the completely
1:02:26opposite direction after taking some
1:02:28rest so in this video I'll be discussing
1:02:30four reversal chart patterns and there
1:02:32counter patterns starting with the head
1:02:35and shoulders and inverted Head and
1:02:37Shoulder patterns followed by double top
1:02:39and double bottoms then triple top and
1:02:42triple bottoms and finally we will wind
1:02:43up with the rising and falling benches
1:02:46so without wasting any time let's begin
1:02:48The Head and Shoulders pattern is one of
1:02:50the most popular reversal jar patterns
1:02:52out there and because it is popular the
1:02:54chances of making a mistake is also high
1:02:57now let us understand what this pattern
1:02:59really implies actually the pattern
1:03:01consists of four different parts the
1:03:03left shoulder the head the right
1:03:05shoulder and the neckline overall the
1:03:08pattern look simple right but what does
1:03:10it actually mean and why does it matter
1:03:12let's Analyze This in Greater detail we
1:03:15will start from the left shoulder the
1:03:17initial Trend in the market is an
1:03:18uptrend where the prices rally is higher
1:03:21and then the market does a pullback or a
1:03:23corruption and the left shoulder is
1:03:25formed as the market does a pullback and
1:03:27at this point there is no way to tell if
1:03:30the market will reverse because a
1:03:32pullback occurs regularly in a trending
1:03:34market and it may just be another swing
1:03:36low from which the prices can move
1:03:37higher the market then trades above the
1:03:40previous swing High forming a higher
1:03:42high however the sellers take control or
1:03:45resist the upward rally and push the
1:03:47price lower towards the previously
1:03:49formed swing low now the swing High
1:03:51formed as a result of this price action
1:03:53is the head of the pattern also the line
1:03:56connecting both the swing lows forms a
1:03:58support level called as the neckline now
1:04:01what we can observe here is that the
1:04:03uptrend structure of higher highs and
1:04:05higher lows is violated but still we
1:04:07cannot guarantee that a reversal will
1:04:09happen because the price might even
1:04:11trade sideways now once again from the
1:04:13neckline the buyers make a final attempt
1:04:16to push the prices higher but they fail
1:04:18to even break above the previous high or
1:04:20the head of the pattern and yet again
1:04:22the sellers take control and push the
1:04:24price towards the neckline this forms a
1:04:27lower high in compared to the previous
1:04:29High which indicates a shift in the
1:04:31sentiment towards bear us now the only
1:04:34level that stands in favor of the Bulls
1:04:36is the neckline which is also a support
1:04:39level or in other words the neckline is
1:04:41the last line of defense for the buyers
1:04:43and if the price breaks below it the
1:04:45market could head lower and begin the
1:04:47start of a new downtrend so basically
1:04:50the head and shoulder pattern signals a
1:04:52possible Trend reversal as the buyers
1:04:54fail to push the prices higher are all
1:04:57Head and Shoulder patterns worth trading
1:04:59actually there are a few things that you
1:05:01must seriously look at before you train
1:05:03The Head and Shoulder chart pattern
1:05:04these things are associated with how
1:05:06reliable is the head and shoulder
1:05:08pattern found now what you need to
1:05:10understand is that not all Head and
1:05:12Shoulder patterns are created equal
1:05:13because how the right shoulder forms is
1:05:16a key Criterion to whether you want to
1:05:18trade the breakout or not for example if
1:05:21you have a head and shoulder pattern
1:05:22that has a very long right shoulder then
1:05:24you want to avoid buying the breakout
1:05:26and why is it slow because the price has
1:05:28moved a very long distance from the
1:05:31highs of the right shoulder to the
1:05:32neckline of the support area which will
1:05:35attract more sellers on the way so the
1:05:37market is likely to face a buying
1:05:39pressure due to the profit booking by
1:05:40the sellers and also from the traders
1:05:42who want to buy from the support level
1:05:44now this creates a strong buying
1:05:46pressure which will lead to an increase
1:05:48in the price and the pattern will fail
1:05:50so make sure that the right shoulder is
1:05:53shallow and ideally it should stay below
1:05:5550 percentage of the head other than
1:05:57this there are two more things you must
1:05:59pay attention to while selecting the
1:06:01best Head and Shoulder patterns first
1:06:03one is the market structure and the
1:06:05second one is the duration of the
1:06:07pattern let me explain each one of them
1:06:09it is true that head and shoulders is a
1:06:11reversal chat pattern but if the market
1:06:14is in a very strong uptrend it is very
1:06:16unlikely that a simple chart pattern can
1:06:19reverse the entire up move instead the
1:06:21market is likely to continue higher
1:06:23maybe the pattern can generate a
1:06:26short-term retracement but not entirely
1:06:28a reversal so make sure that you don't
1:06:30bet against a very strong trending
1:06:32Market just because you have seen a head
1:06:35and shoulder pattern now the second
1:06:36factor is the duration of the pattern a
1:06:39typical head and shoulder pattern can
1:06:40take 200 days 20 days or even 20 minutes
1:06:44to form depending on the chart time
1:06:45frames that you follow but with some
1:06:47common sense it is very obvious that the
1:06:50pattern that takes 200 days to form is
1:06:52more significant than a head and
1:06:54shoulders that takes 20 days to form
1:06:56which is more relevant than a pattern
1:06:58formed in 20 minutes and why you may ask
1:07:00because if the market breaks the 200-day
1:07:03pattern neckline there will be more
1:07:05Traders or buyers who bought at the
1:07:08support and most of them will keep their
1:07:10self stop loss orders just below the
1:07:12neckline now these buyers will get
1:07:13trapped and they will rush for exit or
1:07:16their sell stop loss orders will be
1:07:17triggered on breakdown which will
1:07:19further increase the selling pressure
1:07:21now when you take the case of the
1:07:22pattern formed in 20 minutes this may
1:07:24not always hold true because only very
1:07:27few people are aware of it and the
1:07:28pattern may not give you the desired
1:07:30result so a head and shoulder pattern on
1:07:33a higher time frame and one that took
1:07:35more time to form has a higher chance of
1:07:37success now this does not mean you go
1:07:40short immediately when the price breaks
1:07:42the neckline there are a few ways to
1:07:44train the head and show the chart
1:07:46pattern in the best possible manner
1:07:49now I will start off with the trade
1:07:51entry techniques and there are four
1:07:53possible entry methods for this pattern
1:07:55the first and most aggressive entry is
1:07:58when the price break down the neckline
1:08:00now the idea is to wait for the
1:08:02breakdown candle to close below the
1:08:04neckline and then take a short entry
1:08:06below the floors or the lower price of
1:08:08the breakout candle now the advantage of
1:08:10this technique is that you will be able
1:08:12to enter into a train very early and
1:08:14perhaps you will get the best possible
1:08:16entry price but the drawback is that the
1:08:18price could reverse and give a false
1:08:20breakout and might even hit your stop
1:08:22loss so the second entry technique is
1:08:25associated with a breakout following a
1:08:27buildup of prices now build up means a
1:08:30tight consolidation of prices near an
1:08:32area of value prominently near a support
1:08:34or resistance level you can learn more
1:08:37about this concept in the secrets of
1:08:39support and resistance in my price
1:08:40action course in this case we will pay
1:08:43it for the market to form a tight
1:08:45consultation near the neckline or
1:08:46support level and if the market breaks
1:08:48down you can reference your trade entry
1:08:50just below the close or the low of the
1:08:53breakdown candle now the advantage of
1:08:55this method is obviously the tight
1:08:57placement of stop loss and an improved
1:08:59reward to risk ratio which we will
1:09:01discuss in the next section and it also
1:09:03provides a good entry price but the
1:09:05drawback is that the breakdown candle
1:09:08can be huge and you will be selling at a
1:09:10much lower price now you might be
1:09:12wondering what if I miss the breakout or
1:09:15what if the market doesn't form a build
1:09:16up and still continues to head lower
1:09:18won't I miss out on the trade now this
1:09:21is a relevant question because buildups
1:09:23don't actually happen every now and then
1:09:25so another common method is waiting for
1:09:27a primary pullback in prices this
1:09:30technique lets you catch the price more
1:09:32even after a breakdown now here is how
1:09:34it works so if the market breaks down
1:09:36without forming a build up then we will
1:09:38wait for a primary pullback to occur
1:09:40which is a temporary up move of prices
1:09:42with B candles which generally resembles
1:09:45a flag or panel pattern which you may
1:09:48obviously know how to great and
1:09:50eventually if the market does a pullback
1:09:52then you can look to go short on the
1:09:54break of the previous swing lows or
1:09:56enter right away when the price start
1:09:58moving lower and as I have mentioned the
1:10:00best pullbacks are those with shallow
1:10:02retracement and small Body candles but
1:10:05what if we get a steep pullback and with
1:10:08large potted candles what will we do
1:10:10then now if the pullback is deep then we
1:10:13will wait for the price to retest the
1:10:15neckline or the previous support turn
1:10:17resistance level as per the principle of
1:10:19polarity we have to observe the price
1:10:21retest the neckline and then wait for a
1:10:24price rejection from the neckline in
1:10:26form of bearish reversal candlesticks
1:10:28like shooting star bearish engulfing
1:10:30pattern Evening Star Etc you can learn
1:10:33more about reversal trading using
1:10:34candlesticks in my price action course
1:10:36and if you find there is a price
1:10:38rejection then you can go short on the
1:10:40very next candle now the rate test
1:10:42technique lets you time your entry and
1:10:45even short the market at better prices
1:10:46but the downside is that the market will
1:10:48not not always do a retest and you might
1:10:51miss out on the trade altogether another
1:10:53important point to keep in mind is that
1:10:55the volume should decrease during the
1:10:57formation of the left shoulder and the
1:10:59head indicating a loss in the buying
1:11:01interest and it should rise during the
1:11:03formation of the right shoulder and also
1:11:05during the breakout and forming an
1:11:07interest in selling so make sure you use
1:11:10the right entry techniques at the right
1:11:12times now let us talk about the
1:11:14placement of stop losses with respect to
1:11:16our entry criterians as I have discussed
1:11:19multiple times the stop loss should be
1:11:21at a level that if breached will
1:11:23invalidate your trading setup now since
1:11:25we are dealing with a head and shoulder
1:11:27pattern your stop loss should be at a
1:11:29level that invalidates the pattern
1:11:31altogether to be fair if the price moves
1:11:34above the right shoulder the pattern
1:11:36will get invalidated so if your entry
1:11:38was aggressive as and when the price
1:11:40break down from the neckline then you
1:11:42should set your stop loss at or about
1:11:45the right shoulder of the pattern now
1:11:47what if you took a short entry after
1:11:49built up near the neckline then you get
1:11:51the freedom to place a much tightest of
1:11:53loss preferably just above the build up
1:11:56consolidation which will boost your
1:11:57water risk ratio by some margin now
1:12:00let's say you missed both these entries
1:12:02and you shortened the market after the
1:12:04prices formed a primary pullback then
1:12:06set your stop losses above the highest
1:12:09price in the group of the pullback
1:12:11handles or just place it above the
1:12:13neckline if the pullback is formed very
1:12:15close to the neckline and the last
1:12:17method is if you have endured after a
1:12:20retest in this scenario the stop loss
1:12:22can be placed just above the highest
1:12:24Wick of the group of retest candles or
1:12:27one can be more conservative and place
1:12:29the stop loss above the right shoulder
1:12:31of the pattern and finally we will take
1:12:33a look at how to exit from our trade for
1:12:36maximum profit well there are three
1:12:37popular techniques that you can use the
1:12:40price projection method that railing
1:12:42stop loss method and a combination of
1:12:44these methods now let me explain each
1:12:45one of them the price projection is a
1:12:48classical charting that determines where
1:12:51the move might end how it focuses on
1:12:53price exertion the idea is quite simple
1:12:56the prices will move a distance equal to
1:12:59the highest width of the pattern now in
1:13:01this case the highest width of the
1:13:03pattern is from the neckline to the head
1:13:05so all you have to do is to measure the
1:13:08width from the head to the neckline and
1:13:10then project this distance from the
1:13:12neckline towards the downside the second
1:13:14method is more like trailing your stop
1:13:16loss to write big trends now if you have
1:13:19followed me on my last video you know
1:13:22how to trade your stop loss to write
1:13:24massive Trends in the market one way you
1:13:26can do this is to Trail your stop loss
1:13:28with moving averages the selection of
1:13:30moving averages will depend on the time
1:13:32frame that you're trading on for
1:13:34short-term Trends a 20 moving average
1:13:37will do the job but for a medium term
1:13:39Trend a 50 moving average will be a good
1:13:41choice and for a long term Trend a 100
1:13:44or 200 moving average is the best
1:13:46possible option the idea is to ride the
1:13:48trend and the price moves above the
1:13:50trailing stop loss where you can exit
1:13:52your position the last method uses a
1:13:55combination of both these techniques the
1:13:57idea is to exit half your positions at
1:13:59the price projection level and then
1:14:01write the rest using a trading stop loss
1:14:04by doing this you will be able to log
1:14:06into some good profits and not fall prey
1:14:08to the market reversals now I would like
1:14:11to add a few more points as to when and
1:14:13where to trade this pattern on the
1:14:15charts so when you think about it Head
1:14:17and Shoulders is a reversal pattern but
1:14:20it is also a bearish breakout pattern
1:14:22with that idea in mind you can either
1:14:24trade this when the uptrend is weakening
1:14:26and you find a head and shoulder pattern
1:14:28that confirms the trend change or you
1:14:31can also trade this pattern when the
1:14:33market is in a downtrend and the pattern
1:14:35appears as a temporary pose in the
1:14:37downward price Action Now by doing so
1:14:40you are taking a trade in the direction
1:14:41of the trend and not against the fault
1:14:44prices but make sure that you don't bet
1:14:46against a very strong uptrend just
1:14:48because you part of this pattern and it
1:14:50may not work in your favor then moving
1:14:53on the inverse head and shoulders are
1:14:55inverted Head and Shoulders or a reverse
1:14:57Head and Shoulders pattern is a bullish
1:14:59reversal chart pattern that signals that
1:15:01the buyers are in control it is just
1:15:04like a mirror reflection of The Head and
1:15:06Shoulders pattern so I won't be digging
1:15:08deep into the minute details of this
1:15:10pattern anyway let's find out what
1:15:12inverse head and shoulder pattern really
1:15:13means this pattern also has four parts
1:15:16the left shoulder is the result of a
1:15:18pullback against the downtrend either
1:15:20because of a profit booking or eager
1:15:23buyer stepping into the market but the
1:15:25sellers are still in control as they
1:15:27push the prices lower however the buyers
1:15:30are also stepping in which explains the
1:15:32stronger pullback to retest the previous
1:15:34Wing high level which forms the head of
1:15:37the batter from this we can assume that
1:15:39the sellers are getting weak as they
1:15:41couldn't push the price lower instead
1:15:43the buyers are getting stronger as they
1:15:45continue to push the prices higher
1:15:47retesting the resistance area previous
1:15:49swing High which forms the neckline of
1:15:52the batter now the sellers tried to push
1:15:54the price down one last time but they
1:15:56were met with the intense buying
1:15:58pressure thereby forming a higher swing
1:16:00low compared to the head of the pattern
1:16:02now this forms the right shoulder of the
1:16:05pattern and it tells us that this
1:16:06independent has changed from bearish to
1:16:09bullish and if the price manages to
1:16:11break above the resistance then the
1:16:13inverse head and shoulder pattern is
1:16:14confirmed and the market could continue
1:16:16higher now you might be thinking of
1:16:19buying when the price breaks out of the
1:16:21inverse head and shoulders and gain some
1:16:22profits but this is not easy because not
1:16:25all of them are reliable what matters is
1:16:28the strength of the market structure and
1:16:30the duration of the inverse Head and
1:16:32Shoulder formation so if the market
1:16:34trend is strongly bearish the chances of
1:16:36reversal are quite dim even if the
1:16:38pattern forms and could just be a short
1:16:41pause before the continuation of the
1:16:43trend now the other point is that the
1:16:45longer the inverted head and shoulder
1:16:46pattern takes to form the more
1:16:48significant it is this also means that
1:16:51the shorter the duration of the inverse
1:16:53head and shoulder pattern the more
1:16:55likely it will fail especially when
1:16:57you're trading in against the trend also
1:16:59keep in mind that how the right shoulder
1:17:01forms is also a key Criterion for
1:17:04whether you want to trade the breakout
1:17:05or not so let's say you have an inverse
1:17:08head and shoulder pattern that has a
1:17:10very long right shoulder then you might
1:17:12want to avoid buying the breakout
1:17:14because the price has already moved a
1:17:16long distance from the lows of the right
1:17:18shoulder to the resistance area which
1:17:21attracts more bias along the way so the
1:17:23market is likely to face a selling
1:17:25pressure from The Profit booking by the
1:17:27buyers and also from traders who want to
1:17:30sell at the resistance level now this
1:17:32will create a strong selling pressure
1:17:34which will lead to a price decline so a
1:17:37rule that you can follow is that the
1:17:39right shoulder should be above 50
1:17:41percentage of the head of the pattern
1:17:43now let's talk about when you trade the
1:17:45inverse head and shoulder pattern even
1:17:47though this is a reversal pattern the
1:17:49idea that inverse head and shoulder
1:17:51pattern is a bullish breakout pattern is
1:17:54more prominent so it makes sense to
1:17:56trade this pattern when the market is in
1:17:58an uptrend and when you train the
1:17:59inverse head and shoulder pattern in an
1:18:01uptrend you just increase your odds of
1:18:03winning because you are now trading with
1:18:05the trend and not against it another
1:18:07opportunity to trade this pattern is
1:18:10when you spot this pattern at the end of
1:18:12the downtrend and the inverse head and
1:18:14shoulder pattern acts as a confirmation
1:18:16that the existing downtrend is weakening
1:18:19and there's a possibility that the
1:18:21market might reverse and move higher but
1:18:23make sure that you don't trade this
1:18:25pattern in a very strong downtrend
1:18:27because the possibility of trend change
1:18:29is very low in such instances now let's
1:18:32move on to learning how to trade this
1:18:33pattern when your spot one we will
1:18:36discuss the entry criteria first
1:18:38the most aggressive entry is when the
1:18:40price breaks above the neckline or the
1:18:42resistance the idea is to wait for the
1:18:45breakout candle to close above the
1:18:46neckline and then take a long entry
1:18:49above the close price or the high price
1:18:51of the breakout candle the advantage of
1:18:53this technique is that you will be able
1:18:55to enter into the trade very early and
1:18:58perhaps you will get the best possible
1:19:00entry price but the main drawback is
1:19:02that the price could reverse and give a
1:19:04false breakout and might even hit your
1:19:06stop loss the second entry technique is
1:19:09a breakout with build up now this
1:19:11happens when we observe a tight
1:19:13consolidation of prices near the
1:19:15resistance level or neckline so when you
1:19:18see a build up at the resistance it
1:19:20tells you that there is buying pressure
1:19:21willing to buy at higher prices despite
1:19:24profit taking and short selling from
1:19:26that level also the traders who went
1:19:28short at that resistance level are
1:19:31likely to have their buy stop loss
1:19:33orders above the resistance level so
1:19:35when the price breaks out of the
1:19:36resistance these clusters are stop
1:19:39losses will provide fuel to push the
1:19:41prices even higher and if the market
1:19:43breaks out above you can straight away
1:19:45enter into a long trade or you can wait
1:19:47for the candle to close and enter above
1:19:50the close or above the high of the
1:19:52breakout candle the advantage of using
1:19:54this method is obviously the tight
1:19:56placement of stop losses and an improved
1:19:58reward to this ratio and also a very
1:20:00good entry price but the main drawback
1:20:03is when the range of the breakout candle
1:20:04is very huge and you will be buying at a
1:20:07much higher price now what if the market
1:20:09doesn't form a build up or it forms a
1:20:12huge breakout candle and still continues
1:20:14to head higher so if you miss both the
1:20:16above and race the other method is to
1:20:18wait for a primary pullback in prices to
1:20:21happen this technique helps you to catch
1:20:23the price more even after a breakout so
1:20:26if the market break out without forming
1:20:28a build up then we will wait for a
1:20:30primary pullback to occur which is a
1:20:32temporary down low of prices with weak
1:20:34candles and if the marketing does form a
1:20:36pullback then you can look to go along
1:20:38on the break of the previous swing high
1:20:40or end the right away and the prices
1:20:43starts rising and as I have mentioned
1:20:45the best pullbacks are the ones with
1:20:47shallow retracement and small boarded
1:20:49cameras but what if we get a steep
1:20:52pullback with large Body candles what
1:20:54will we do then so if the pullback is
1:20:56very deep then we will wait for the
1:20:58price to retest the neckline of the
1:21:01previous resistance turn support level
1:21:03where we expect the buyers to come in we
1:21:06need to observe if the price retests the
1:21:08neckline and if it does we will wait for
1:21:10a price rejection from the neckline in
1:21:12the form of bullish reversal
1:21:14candlesticks like bullish Hammer bullish
1:21:16engulfing pattern Morning Star Etc and
1:21:19if you find there is a rejection then
1:21:21you can go long on the very next candle
1:21:24now this retest technique lets you time
1:21:26your trade entry and even take up
1:21:28positions at better prices but the
1:21:30downside is that there is no guarantee
1:21:33that the price will retest the level
1:21:34especially if the market is in a strong
1:21:37uptrend and you might miss out out on
1:21:39the trade all together yet another
1:21:40important point to keep in mind is that
1:21:43the volume should decrease during the
1:21:45formation of the left shoulder and head
1:21:46indicating a loss of interest in selling
1:21:49and the volume should rise during the
1:21:51formation of the right shoulder and also
1:21:53during the breakout conforming an
1:21:55increase in the buying pressure so make
1:21:57sure you use the right entry techniques
1:21:59at the right times
1:22:13this is exactly where you should
1:22:15reference your stop loss so if your
1:22:17entry was very aggressive as and when
1:22:19the price break out from the neckline
1:22:21then you should set your stop loss at or
1:22:24below the right shoulder of the pattern
1:22:25now what if you took along entry after a
1:22:28build up near the neckline then you have
1:22:30the convenience of placing a much
1:22:32tighter stop loss preferably just below
1:22:35the build up which will in turn improve
1:22:37your reward to this ratio now let's say
1:22:39you have missed both these entries and
1:22:41you entered a position in the market
1:22:42after the prices from the primary
1:22:44pullback then set your stop loss below
1:22:47the lowest price in the group of
1:22:49pullback handles including the evic or
1:22:51place it just above the neckline of the
1:22:53pullback home this very close to the
1:22:55neckline now the last method is if you
1:22:57are entering the trades after a rate
1:22:59test in this scenario the stop loss can
1:23:02be placed just below the lowest week of
1:23:05the group of Rita scandals or you can be
1:23:07more conservative and place your stop
1:23:09loss below the right shoulder of the
1:23:11pattern to save yourself from longx now
1:23:15we will take a look at how to exit from
1:23:17our trade for maximum profits and as
1:23:19previously mentioned there are three
1:23:21popular techniques that you can make use
1:23:23of the price projection method training
1:23:26stop loss method and a combination of
1:23:28both these methods the price projection
1:23:30helps determine where the price move
1:23:32might possibly exhaust now here's how it
1:23:34works just calculate the distance
1:23:36between the head and the neckline then
1:23:38project this distance upwards from the
1:23:41breakout point or neckline this
1:23:43projected price point is where you
1:23:45should exit your trade this price
1:23:47projection techniques helps decide
1:23:49whether it's too late to enter a trade
1:23:51or not and if the price is very close to
1:23:53reaching the price projection then
1:23:55there's probably not much juice left in
1:23:57the move and you might want to skip the
1:23:59trade but unlike the price projection
1:24:01technique a trailing stop loss method
1:24:03does not use a fixed Target profit
1:24:05instead you Trail your stop loss as the
1:24:08price moves in your favor so that you
1:24:10can write the entire Trend so in order
1:24:12to do that the first step is to to
1:24:14decide on the type of trend you want to
1:24:16capture whether it's a short term medium
1:24:19term or long term Trend then you can
1:24:21Trail your stop loss with the
1:24:22appropriate moving averages like 20
1:24:25period for short term 50 period for
1:24:27medium term and 200 period moving
1:24:30average for long term trades you will
1:24:32exit the trade only when the price
1:24:34closes below the moving average now the
1:24:37last method uses a combination of both
1:24:39these methods and you will exit half
1:24:41your positions at the price projection
1:24:43level and write the rest using the
1:24:45trading stop loss by doing this you will
1:24:48be able to lock in among the profits and
1:24:50not for pray to the market reversals
1:24:52let's move on to the third pattern which
1:24:55is the double top pattern now this is
1:24:57one of the most common chart patterns
1:25:00that you will encounter so this is a
1:25:02good thing because you will get a good
1:25:03number of Trades but this is also a bad
1:25:06thing because which trades to select
1:25:08will be a big concern so we will discuss
1:25:11the basics of what a double top pattern
1:25:13is how it works and how you should go
1:25:16about trading it now a double top is a
1:25:19bearish reversal chart pattern and it
1:25:21consists of three parts the first Peak
1:25:24or the first price rejection the second
1:25:26Peak or the second price rejection and
1:25:28the swing low forms a neckline or an
1:25:31area of support now what does the double
1:25:33top chart pattern really mean the first
1:25:36Peak is formed as a result of the market
1:25:38doing a pullback at this point you can't
1:25:41tell for sure if it will be a reversal
1:25:43as pullbacks are very common in trending
1:25:45markets from time to time this is
1:25:47followed by a second Peak where the
1:25:49prices get rejected in the same area
1:25:51again indicating that the buyers are not
1:25:53very keen to buy at higher prices now
1:25:56this is the first time that the market
1:25:58could reverse lower and the break below
1:26:00the neckline will confirm our bias that
1:26:02the sellers are in control and the
1:26:04market could continue lower so in a
1:26:07sense the double top chart pattern
1:26:09signals a possible Trend reversal as the
1:26:12market is unable to go higher but keep
1:26:14in mind that not all double top chart
1:26:16patterns are created equally for example
1:26:19if you spotted a double top when the
1:26:21market is in a strong uptrend the
1:26:24chances are the market will continue
1:26:25heading higher and the last thing you
1:26:27want to do is to go short or trade
1:26:30against the trend just because you have
1:26:31spotted a double top chart pattern so
1:26:34there are two important things that you
1:26:36must pay attention to when trading a
1:26:38double top chat pattern first of all you
1:26:40need to see where and how the pattern
1:26:42forms and secondly how long does it take
1:26:45to form or the duration it takes to form
1:26:47the pattern as I have already mentioned
1:26:49you don't want to short a double top
1:26:51against a strong uptrend and in addition
1:26:54to this the space between the first and
1:26:56second Peaks is also an important factor
1:26:59worth considering this means you should
1:27:01probably avoid double tops with both
1:27:03their peaks very close to one another
1:27:05instead we want to trade those double
1:27:07tops when the space is far apart from
1:27:10the first and second Peak and why does
1:27:12the space between the Peaks have to be
1:27:14so far apart the reason is quite simple
1:27:16when there is more time and space
1:27:19between the first and second Peaks these
1:27:21swing levels or Peaks become more
1:27:23significant as more Traders will become
1:27:25aware of the price level and as you may
1:27:28have already guessed when a level
1:27:29receives more attention it attracts more
1:27:32order flow as more Traders would want to
1:27:34trade around that area so when a large
1:27:36group of Traders gets it wrong with
1:27:39presence and opportunity that we can
1:27:40take advantage of so beware of trading
1:27:43double tops and double bottoms and
1:27:45trading on an indralay basis over a
1:27:47shorter time frame the higher the time
1:27:49frame and the larger the space between
1:27:50the swing highs the greater the chances
1:27:53of a successful pattern now most trading
1:27:55gurus will tell you to short the double
1:27:57top breakout and the price breaks below
1:28:00the neckline and they will ask you to
1:28:02set the stop loss above the ice however
1:28:04there are two issues with this approach
1:28:06first of all after a strong move lower a
1:28:09market could reverse higher proving to
1:28:11be of hours breakout and thereby hitting
1:28:14a stop loss secondly the stop loss is
1:28:16inherently very large and it does not
1:28:19offer a favorable reward to risk ratio
1:28:21on your trade so there are a few ways
1:28:23that you can think of to fix this let's
1:28:26start by discussing the trade entry
1:28:28criteria first now the most aggressive
1:28:30entry is when the price breaks below the
1:28:33neckline or the support level the idea
1:28:35is to wait for a breakout candle to
1:28:37close below the neckline and then take a
1:28:39short entry below the close or the low
1:28:42price of the breakout candle now waiting
1:28:44for the candle to close will ensure that
1:28:46the candle closes below the neckline and
1:28:48suggests that it is not a fast breakout
1:28:51the other advantage of this technique is
1:28:53that you will be able to enter into a
1:28:55trade at a very early stage but the
1:28:57drawback is that the size of the
1:28:59breakout candle can be too large
1:29:00sometimes which can badly reduce your
1:29:03reward to restriction in some cases it
1:29:06is always beneficial to wait for a price
1:29:08build up to form near the neckline which
1:29:10acts as a support level in this pattern
1:29:12now we will take a short rate when the
1:29:14price breaks below the neckline after
1:29:16the buildup this will ensure a higher
1:29:19probability of success because the
1:29:21trader who are long near the neckline of
1:29:23the support will have their stop-loss
1:29:25orders placed below the support level
1:29:27and this will cut their losses if the
1:29:29market continues to head lower and once
1:29:31price breaks below the support level all
1:29:34the sell stop loss orders would be hit
1:29:36which will add further selling pressure
1:29:37thereby increasing the probability of
1:29:40success on top of that this trade will
1:29:42ensure a more favorable reward to risk
1:29:44ratio as you will have a much tighter
1:29:46stop loss anyway problem with this
1:29:49approach is that the breakout candle can
1:29:51be too large and also the fact that only
1:29:53a limited number of Trades are available
1:29:55now what if you miss the breakout trade
1:29:58This is the End not really you can still
1:30:00enter a trade if the prices form a
1:30:03primary pullback in the form of a flag
1:30:05or a pen and pattern a primary pullback
1:30:07is nothing but a temporary up move of
1:30:09prices with v candles most probably due
1:30:12to profit booking and a good pullback is
1:30:15always shallow and is associated with
1:30:17weak candles but what if we get a steep
1:30:20pullback with large bodied candles what
1:30:23will we do then yet again we can look
1:30:25for a retest of prices back to the
1:30:27neckline which will now behave like a
1:30:29resistance level where we can expect to
1:30:31find the sellers to come in so if the
1:30:33price do the retest then we will wait
1:30:35for a price rejection from the neckline
1:30:37in the form of bearish reversal
1:30:39candlesticks like shooting star bearish
1:30:42engulfing pattern Evening Star Etc and
1:30:44if you find there is a price rejection
1:30:46you can back yourself to take a short
1:30:48entry as the price begins to move lower
1:30:51the rateest entry provides a better
1:30:53entry price than any other entry methods
1:30:56but the downside is that the prices
1:30:58don't always give a retest and
1:31:00especially in strong trending markets
1:31:02you don't expect pullbacks or retests a
1:31:05bowl make sure to confirm the breakouts
1:31:07with higher than average volumes and
1:31:10using other momentum indicators like RSI
1:31:12macd Etc
1:31:15your stop loss should be at a level that
1:31:17if breached will invalidate your trading
1:31:20setup since we are trading a double top
1:31:22pattern our stop loss should be at a
1:31:24level that invalidates the pattern
1:31:26altogether in that sense if the price
1:31:28moves above the swing high of the
1:31:30pattern the pattern will be invalidated
1:31:33but there is a small twist number one if
1:31:36we do this the stop loss can be too
1:31:38large and so the reward tourists will be
1:31:40very low secondly the market can move up
1:31:43to the top of the resistance level and
1:31:45then reverse lower after hitting your
1:31:47stop loss just to form a triple top
1:31:49pattern and then move lower completing
1:31:52the pattern which can be really
1:31:53frustrating so what I recommend is to
1:31:56either place your stop loss at 50
1:31:58percentage level between the swing top
1:32:00and the neckline or if this distance is
1:32:02too large then set your stop loss with
1:32:05an adequate buffer using the ATR
1:32:07indicator just above the breakdown
1:32:08handle high this could be your stop loss
1:32:11your entry was very aggressive that is
1:32:13you went short as and when the price is
1:32:15broke below the neckline now what if you
1:32:17took a short entry after a build up near
1:32:20the neckline then you get the freedom to
1:32:22place a much tighter and hassle-free
1:32:24stop loss preferably just above the
1:32:26build up or consolidation which will
1:32:28boost your reward tourist ratio now
1:32:30let's say you miss both these entries
1:32:32and you shot the market after the prices
1:32:34formed a primary pullback then we set
1:32:37your stop loss above the highest price
1:32:39in the group of the pullback handles or
1:32:42just above the neckline if the pullback
1:32:44is formed very close to the neckline now
1:32:46the last method is if you are entering
1:32:48after a retest in such a scenario the
1:32:51stop loss can be placed just above the
1:32:53highest Wick of the procopter scandals
1:32:56or you can be more conservative and
1:32:58place the stop loss at 50 percentage of
1:33:00the width of the batter
1:33:02now how to set your targets as you may
1:33:05have guessed there are three techniques
1:33:06to exit your trades price projection
1:33:09training stop loss and a combination of
1:33:11these two methods let me explain each
1:33:12one of them the price projection focuses
1:33:15on price exertion the idea is that
1:33:17prices will move an equal distance to
1:33:20the highest width of the pattern after
1:33:22the breakout now the highest width of
1:33:24this pattern is from the neckline to the
1:33:27swing top or the swing high so all you
1:33:29have to do is to identify the distance
1:33:31from the swing top to the neckline then
1:33:34project this distance from the neckline
1:33:36towards the downside this will give you
1:33:38your desired profit Target the second
1:33:41method of trailing your stop loss is to
1:33:43write big moves we will make use of
1:33:46moving averages of different periods to
1:33:48do this and the selection of moving
1:33:49averages will depend on the time frame
1:33:52that you're trading on so for capturing
1:33:54short term Trends you use a 20 period
1:33:57moving average for a medium term Trend
1:33:59you use a 50 moving average and for a
1:34:02long term Trend you use 100 or 200
1:34:05moving average and we will accept the
1:34:07trade only when the price moves below
1:34:09the trailing stop loss the last method
1:34:11uses a combination of both these methods
1:34:14the idea is to exit half your positions
1:34:16at the price projection level and then
1:34:19write the rest of the move using a
1:34:20trailing stop loss by doing this you
1:34:23will be able to log into some good
1:34:24profits and not fall prey to the market
1:34:26reversals now there is one more
1:34:29important piece of information that I
1:34:31want to share which is associated with
1:34:33finding and trading double tops with a
1:34:36high level of accuracy and win rate
1:34:38which involves the use of multiple time
1:34:40frame analysis the concept is rather
1:34:43simple the first step is to identify a
1:34:45downtrending market or a downtrending
1:34:47price action on a higher time frame
1:34:49depending upon your trading style I have
1:34:52already made a video on time frame
1:34:53selection you can watch that video to
1:34:55learn more now what you need to do is to
1:34:57wait for the price to approach an area
1:34:59of resistance on the high time frame so
1:35:02if you find such a setup move down to
1:35:05your lower time frame then look for a
1:35:07double top pattern on the lower time
1:35:09frame this is a very simple yet
1:35:11effective technique that allows you to
1:35:13time your trade entries at the absolute
1:35:15highs of the double top pattern which by
1:35:17the way is the best possible price level
1:35:19that you can get and is also a
1:35:21professional way of trading this pattern
1:35:23so please keep in mind that if you are
1:35:26not comfortable using this then you
1:35:28would be better off ignoring it you
1:35:30don't necessarily have to consider all
1:35:31the options just choose one or two that
1:35:34work well for you now we will focus on
1:35:36what a double bottom pattern is how does
1:35:39it work and how to approach it while
1:35:41trading it a double bottom pattern is a
1:35:43bullish Trend reversal pattern and it is
1:35:46the exact opposite of a double top this
1:35:49pattern also has three parts it has of a
1:35:51slow or fast price rejection followed by
1:35:53a second low or second price rejection
1:35:55and also a neckline which is an area of
1:35:58resistance connecting the swing high in
1:36:00between now what do this part of the
1:36:02pattern indicate a first low is formed
1:36:05and the market declines lower forming a
1:36:07swing low and then moving higher at this
1:36:10point it is likely a retracement in the
1:36:12downtrend but then a second swing low
1:36:15gets formed when the market rejects the
1:36:17previous swing low level and retraces
1:36:19higher again so we can now assume that
1:36:21there is buying pressure but it is too
1:36:24early to tell if the market could
1:36:25continue higher we can only confirm the
1:36:27strength of the buying pressure and the
1:36:29price breaks above the neckline now when
1:36:31the price breaks above the neckline or
1:36:33resistance level it signals the interest
1:36:36in buying and the possibility of the
1:36:38market moving higher so in short the
1:36:40double bottom pattern signals that the
1:36:43downtrend has possibly bottomed out and
1:36:45the price is about to move higher many
1:36:47Traders make this mistake of buying the
1:36:50break of the neckline after a double
1:36:52bottom pattern is formed but this won't
1:36:54always work in your favor because if the
1:36:56market is in a strong downtrend and it
1:36:58forms small double bottoms every now and
1:37:00then the chances are the Market is
1:37:03likely to continue lower in addition to
1:37:05this not all double bottoms are made the
1:37:07same the time frame that we use for
1:37:09spotting the pattern and the space
1:37:11between the swing lows or the swing
1:37:13bottoms are also important factors worth
1:37:16considering so a double bottom pattern
1:37:18formed on a higher time frame is more
1:37:20significant than one formed on a smaller
1:37:22time frame
1:37:26moving on to the entry criteria for
1:37:28trading so an aggressive entry is when
1:37:30the price breaks above the nutline or
1:37:32resistance the idea is to either enter a
1:37:36long position on the breakout which can
1:37:38often cause the force breakout problem
1:37:40or you can wait for the breakout candida
1:37:42close above the neckline and then take a
1:37:44long entry above the close or the high
1:37:46price of the breakout candle the
1:37:48advantage of this technique is that you
1:37:50will be able to enter into the trade
1:37:52early and might even get the best
1:37:54possible entry price but the drawback is
1:37:56that the breakout candle could be too
1:37:58large or even the price could reverse
1:38:00and give a false breakout and hit your
1:38:03stop loss the second entry technique is
1:38:05a breakout with build up nearly neckline
1:38:07this happens when we observe a tight
1:38:10consolidation of prices near the
1:38:12resistance level or neckline so when you
1:38:15see a buildup at the resistance it tells
1:38:17you that's buying pressure and people
1:38:19are willing to buy at higher prices
1:38:20despite profit taking or short selling
1:38:23from the level also traders who shot
1:38:25from the web level are likely to have
1:38:27their buy stop loss orders placed above
1:38:30the resistance level so when the price
1:38:32eventually breaks out of the resistance
1:38:34all these clusters of buy stop loss
1:38:36orders will be hit and it will provide
1:38:38the Boost that the price needs to move
1:38:40higher and if the market breaks out of
1:38:42the neckline you can enter your long
1:38:44trade just above the close or above the
1:38:46high of the breakout candle now the
1:38:48advantage of using this method is
1:38:50obviously the tight placement of stop
1:38:52loss and an improved reward to this
1:38:54ratio and also a very good entry price
1:38:57but the drawback is that the range of
1:38:59the breakout candle can be huge and you
1:39:01will be buying at a much higher price
1:39:03now what if the market does not form a
1:39:05build up or it forms a huge breakout
1:39:08candle and still continues to head
1:39:09higher so if you missed both the above
1:39:12entries the third method is to look for
1:39:14a primary pullback in prices to happen
1:39:16this technique helps you to catch the
1:39:19price more even after a breakout so if
1:39:21the market breaks out without forming A
1:39:23build-up then we will wait for a primary
1:39:25pull back to occur which is a temporary
1:39:27down move of prices with weak candles
1:39:30and if the market doesn't pull back then
1:39:32you can look to go long on the break of
1:39:34the previous swing high or enter right
1:39:36away when the prices start Rising now
1:39:38the best pullback should have a shallow
1:39:40retracement with small bodied candles
1:39:43but sometimes we get a steep pullback to
1:39:45the neckline this is called as a rate
1:39:48test so when the price reaches to the
1:39:50neckline or now a support level we
1:39:52expect buyers to come in so we need to
1:39:54observe if price retests the net line
1:39:57and if it does then we wait for a price
1:39:59rejection from the neckline in the form
1:40:01of bullish reversal candlesticks like
1:40:03bullish Hammer bullish engulfing battle
1:40:06Morningstar Etc and if you find there is
1:40:08a price rejection then you can go along
1:40:10on the next candle now the rate test
1:40:12technique lets you time your trade entry
1:40:14and even take up positions at far better
1:40:17prices but the downside is that there is
1:40:19no guarantee that the price will retest
1:40:22to the level especially in a strong
1:40:24uptrend and you might miss out on the
1:40:25rate all together yet another important
1:40:28point to keep in mind is that the
1:40:30rolling should increase during the
1:40:32breakout confirming and increase in the
1:40:34buying pressure so make sure you use the
1:40:36right entry techniques at the right
1:40:38times
1:40:39now let us talk about the placement of
1:40:41stop losses with respect to our entry
1:40:43criteria the double top pattern becomes
1:40:46invalid and the price reverses from the
1:40:48neckline and closes below the swing low
1:40:51of the pattern and if you're aware to
1:40:53place your stop loss based on this idea
1:40:55then stop loss would be too large and
1:40:57you will incur huge losses and moreover
1:41:00the price could reverse from the swing
1:41:02low and move higher again from your
1:41:04triple bottom batter so where exactly
1:41:06should you place your stop loss now what
1:41:09I recommend is to either place your stop
1:41:11loss at 50 percentage level between the
1:41:13swing bottom and the neckline or if this
1:41:15distance is too large then set your stop
1:41:18loss with adequate buffer using the ATR
1:41:20indicator just below the low of the
1:41:23breakout candle this could be our stop
1:41:25loss if your entry was very aggressive
1:41:27that is you went long as and when the
1:41:29price break out of the neckline now what
1:41:32if you took a long entry after a build
1:41:34up near the neckline then you have the
1:41:36convenience of placing a much tighter
1:41:38stop loss preferably below the build up
1:41:40which will in turn improve your water
1:41:42risk ratio now let's say you have missed
1:41:45both these entries and you have entered
1:41:47a position in the market after the
1:41:49prices from the primary pullback then
1:41:51you can set your stop loss below the
1:41:53lowest price in the group of pullback
1:41:55candles including the week or you can
1:41:57place it just above the neckline if the
1:41:59pullback is formed very close to the
1:42:01neckline and the last method is if you
1:42:03have entered after a retest in this
1:42:06scenario the stop loss can be placed
1:42:08just below the lowest week of the group
1:42:11of Rita scandals or you can be more
1:42:13conservative and place the stop loss at
1:42:1650 percentage of the distance between
1:42:17the swing low and the neckline of the
1:42:19pattern in order to save yourself from
1:42:21long X and finally we will discuss how
1:42:24to exit from our trade for maximum
1:42:27profits and as always there are three
1:42:29methods that we can make use of the
1:42:31price projection trailing stop loss and
1:42:34a combination of both the price
1:42:35projection calculates the distance
1:42:37between the swing bottom and the
1:42:39neckline so in the price protection
1:42:41method you have to calculate the
1:42:43distance between the swing bottom and
1:42:45the neckline then project this distance
1:42:47upward from the breakout point or
1:42:50neckline the projected price point or
1:42:52level is where you exceed the trade this
1:42:55technique will help you decide whether
1:42:57it is too late to enter a trade or not
1:42:59for instance if the price is close to
1:43:01reaching its price projection then
1:43:03there's probably not much meat left in
1:43:05the more and you might want to skip the
1:43:07trade but unlike the price projection
1:43:09technique a trailing stop loss method
1:43:11does not have a fixed Target instead we
1:43:14Trail our stop loss as the price moves
1:43:16in favor so that we can write the entire
1:43:18Trend so the first step is to decide on
1:43:21the type of trend you want to capture
1:43:22whether it's a short term medium term or
1:43:25long term Trend then you can Trail the
1:43:27stop loss with the appropriate moving
1:43:29averages like 20 period 50 period or 200
1:43:32period moving averages respectively and
1:43:34we will exit our trade fully when the
1:43:37price crosses below these moving
1:43:38averages the final method combines both
1:43:41these methods you exit half your
1:43:43positions the price projection level and
1:43:45write the rest using the trailing stop
1:43:47loss so that you will be able to lock in
1:43:49some profits and not lose money if the
1:43:51market reverses now same with the double
1:43:54top you can use multiple time frames to
1:43:56filter for high probability double
1:43:58bottom setups all you have to do is to
1:44:00identify a higher time frame support
1:44:02area then move down to your preferred
1:44:04lower time frame and look for a double
1:44:06bottom pattern that leans against the
1:44:09higher time frame support level by doing
1:44:11this you can take a trade from the
1:44:13absolute low of the Swing bottom but do
1:44:15keep in mind that this is a more
1:44:17professional Android technique so don't
1:44:19use it if you can't completely digest it
1:44:23if you have understood the double top
1:44:25and double bottom patterns properly then
1:44:28triple tops and triple bottoms are just
1:44:30a piece of cake these are just
1:44:31extensions of the previous two patterns
1:44:34the entry exit and stop losses are the
1:44:37same but what matters most is the
1:44:39formation of the third string high or
1:44:41swing low respectively let's find out
1:44:43what these patterns signify a triple top
1:44:46is a bearish reversal chart pattern that
1:44:48signals that the sellers are in control
1:44:50the pattern starts with bios and control
1:44:52as the price makes a swing High followed
1:44:55by a pullback but the first sign of
1:44:57selling pressure appears as the price
1:44:59fails to break out of the prior High and
1:45:02the market makes a pullback again and
1:45:04forms a consolidation this looks like a
1:45:07double top but this time instead of
1:45:09breaking below the neckline the market
1:45:11attempts to break out higher once again
1:45:13and fails again so there are three
1:45:15spikes visible or three failed attempts
1:45:18to break out higher this looks like a
1:45:20triple top and is confirmed only when
1:45:22the price breaks below the law of the
1:45:24consolidation or the neckline support
1:45:26level I won't be discussing the entry
1:45:28stop loss and Target criteria because
1:45:30you can follow the same rules as with
1:45:32the double top pattern keep in mind that
1:45:35no patterns strategies or techniques
1:45:37work all the time this includes even the
1:45:40triple top pattern but the good news is
1:45:42that before the pattern fails it usually
1:45:45leaves some clues for instance if the
1:45:47higher time frame trend is still an
1:45:49uptrend then the triple top pattern
1:45:51formed on a lower time frame is most
1:45:53likely to pay now when talking about a
1:45:56triple bottom pattern a triple bottom is
1:45:58a bullish reversal chart pattern and is
1:46:01quite the opposite of the triple top
1:46:03pattern and it signals that the bias are
1:46:05dominant now the pattern begins with
1:46:07sellers pushing the prices down as the
1:46:10price makes a swing low followed by a
1:46:12pullback but the first line of buying
1:46:14pressure appears as the price fails to
1:46:16break out of the previous swing low now
1:46:18the market made and the pullback and
1:46:20look like a consolidation this looks
1:46:23like a double the bottom pattern but
1:46:25instead of breaking above the neckline
1:46:26the market attempts to move over once
1:46:29again and fails to break the law once
1:46:31again so there are three lows visible or
1:46:34three failed attempts to break out lower
1:46:36now this looks like a triple bottom
1:46:38pattern and it's only confirmed when the
1:46:40price breaks above the high of the
1:46:43consolidation or the neckline resistance
1:46:45level the entries stop loss and Target
1:46:47criteria are similar to the rules of the
1:46:50double bottom pattern itself now moving
1:46:52to the last category of patterns the
1:46:54ventures you'll start off with a rising
1:46:57bench a rising wedge is a popular
1:46:59bearish pattern this pattern starts wide
1:47:03at the bottom and then contracts as the
1:47:05price move upwards and the trading range
1:47:07gets smaller towards the top this
1:47:09pattern forms when the price consolidate
1:47:11between upward sloping support and
1:47:13resistance lines where the slope of the
1:47:15support line is much more steeper than
1:47:18that of the resistance low one this
1:47:20implies is that the higher lows form
1:47:22much faster than the higher highs
1:47:24leading to a wedge-like formation this
1:47:27also means that the selling activity is
1:47:29gaining more traction and the buying
1:47:31activity is getting weaker also the
1:47:34contraction of the trading range from
1:47:36left to right indicates a weakening of
1:47:38the existing trading activity but the
1:47:40rising wedge can be one of the most
1:47:42difficult chart patterns to accurately
1:47:45recognize and read while it is a
1:47:47consolidation formation like most other
1:47:49patterns the laws of The Upside moment
1:47:51them on each successive swing Heidi use
1:47:54the pattern its bearish bias however the
1:47:57series of higher highs and higher lows
1:48:00keeps the Traders guessing that the
1:48:01trend is still bullish this is where a
1:48:04Contracting range helps us the most
1:48:06moreover to identify it as a rising
1:48:08wedge the price should test the upward
1:48:10sloping support and resistance lines at
1:48:13least twice each now a shocking fact
1:48:15about Rising wedge pattern is that it
1:48:17can be both a reversal or a continuation
1:48:20pattern now it depends on its position
1:48:22in the price chart but the more
1:48:24important information is that regardless
1:48:27of the pattern being a reversal or
1:48:29continuation in nature pricing images
1:48:31are bearish this is what we will focus
1:48:34on the added Advantage is that we can
1:48:36spawn this pattern at the end of an
1:48:39uptrend or as a consolidation due to a
1:48:41short-term profit booking during a
1:48:43downtrend but actually the bearish
1:48:45confirmation of the pattern does not
1:48:47come until the upward sloping support
1:48:50line is broken in a convincing fashion
1:48:52ideally we expect the volume to decline
1:48:55as the prices rise and as the wedge
1:48:57forms and there should be an expansion
1:48:59of rising volumes on the support line
1:49:01braid which can be taken as a bearish
1:49:03confirmation now you can also use
1:49:06momentum indicators like RSI or macd to
1:49:09spot the shifting momentum anyways when
1:49:12the price does break the support line
1:49:13convincingly our bias is always towards
1:49:16selling on the brake top with a
1:49:18consultation in prices Traders know that
1:49:20a big slash is on its way so they expect
1:49:23a breakout either to the top or the
1:49:25bottom so when the rising Edge is formed
1:49:27after an uptrend it is referred to as a
1:49:30bearish reversal pattern but if it is
1:49:32formed during a downtrend it could mean
1:49:34a continuation of the round move now
1:49:37that we have learned how to identify a
1:49:39rising wedge we can discuss how to train
1:49:42the pattern so I will discuss the entry
1:49:44methods where to place the stop loss and
1:49:46how to set the targets starting with the
1:49:49entry criteria as it is a bearish
1:49:51pattern we are only interested in the
1:49:53break below the upward sloping support
1:49:55dragline you can take a short entry
1:49:57following a breakout of this level that
1:50:00is you can enter at the moment when the
1:50:02price breaks below the support trend
1:50:04line or you can look this help below the
1:50:06low price or even at the closing price
1:50:08of the breakout candle after it closes
1:50:10the second method is to wait for a
1:50:12pullback or retest back to the breakout
1:50:15level and then take a short entry when
1:50:17the price moves lower or when the price
1:50:19moves below the breakout candle low now
1:50:21you are probably wondering which one is
1:50:24better well there is no best approach if
1:50:27you enter the break of the loss it could
1:50:29be a force breakout but if it is a real
1:50:31breakout it is the best possible price
1:50:33you can get alternatively if you wait
1:50:36for a close below the lows then you will
1:50:38reduce the chances of a force breakout
1:50:41but if the breakout is too strong you
1:50:43will end up entering at a much lower
1:50:45price the same is the case with waiting
1:50:48for a pullback or retest which may not
1:50:50happen often if the market is trending
1:50:52strongly and as a matter of fact you
1:50:54will miss out on the trade completely so
1:50:56it is up to you to decide the entry
1:50:58strategy and continue practicing it over
1:51:01a large number of Trades it is always
1:51:03recommended to confirm the validity of
1:51:06the breakout using volumes and other
1:51:08momentum indicators so a higher than
1:51:10average volume can validate a breakout
1:51:13most of the time as it shows the
1:51:14interest of the market participants and
1:51:16low volume records are most likely
1:51:18beautiful also using momentum indicators
1:51:21like macd RSI can also help you identify
1:51:24a true breakout I have made videos on
1:51:27all these topics so you can check them
1:51:28out let's now focus our attention on the
1:51:31criteria for setting B stop losses how
1:51:34to set your stop loss when trading the
1:51:36rising match now you don't want to set
1:51:38your stop loss at obvious levels like
1:51:41support and resistance swing highs or
1:51:43swing lows Etc and why is that because
1:51:46you will get stop loss hundred easily
1:51:48because these are as obvious relevant to
1:51:50you as it is to others including the
1:51:53smart money so how do you get a proper
1:51:55stop loss setup and it's very simple as
1:51:58I have mentioned over and over again
1:51:59your stop loss should be at a level that
1:52:02if crossed invalidates your trading
1:52:04setup so we are trading a rising wedge
1:52:06pattern here and the pattern is invalid
1:52:08if the price breaks and closes above the
1:52:11top trend line resistance so you have to
1:52:14keep your stop loss Above This
1:52:15resistance level so there are still
1:52:17chances of long weeks which can take out
1:52:20due stop loss and then move in the
1:52:22desired Direction so to be extra safe
1:52:24you have to give your trades more
1:52:26breathing space by setting your stop
1:52:28loss some distance away from the market
1:52:30structure using an indicator like ATR so
1:52:34you have to set your stop loss one idea
1:52:36above the most recent swing high level
1:52:38let's learn how to set a target for the
1:52:41rising wedge pattern now there are many
1:52:43ways you can cash in your winners and
1:52:45one of the most common approaches is to
1:52:48have a predetermined profit Target now
1:52:50the target can be measured by taking the
1:52:52distance of the back of the wedge or the
1:52:55widest portion of the wedge from the
1:52:57support to the resistance level and then
1:53:00extending this distance down from the
1:53:02trend line breakout point you can also
1:53:04choose to Trail your stop loss until the
1:53:07market takes you out of the trade now
1:53:08why is this a better option think about
1:53:11this price image pattern usually appears
1:53:14in a downtrending market or at the end
1:53:16of an uptrend in such conditions there
1:53:18is a lot of potential for the trend to
1:53:21continue and the only way to ride a
1:53:23piece to Trail your stop loss now to
1:53:25Trail your stop-loss in the best
1:53:26possible manner you can use moving
1:53:28averages or Chandler stops and only exit
1:53:32the trade if the market closes above it
1:53:34moreover it is much better if you use
1:53:36the combination of both the price
1:53:38projection method and the trailing stop
1:53:40loss method so that you can gauge the
1:53:42move using the price projection method
1:53:44so as to login part of your profits
1:53:46there and then write the rest of the
1:53:48position using a trailing stop loss
1:53:50thereby not impacting your psychology
1:53:52and avoiding any losses due to reversals
1:53:56now moving on to the final chart pattern
1:53:58of this video the following which
1:54:00following with chat pattern is like a
1:54:02counter pattern to the pricing wedge it
1:54:04is created when a market console dates
1:54:06between two converging support and
1:54:09resistance lines for a falling wedge we
1:54:11support and resistance lines have to
1:54:13point in the downward direction or they
1:54:16should be sloping down and the
1:54:18resistance level have to be steeper than
1:54:20the support level the pattern generally
1:54:22starts right at the top and contracts
1:54:25towards the bottom as the price moves
1:54:27lower this sort of price action forms a
1:54:29corn like shape that slows down as the
1:54:32swing highs and swing lows converge as
1:54:34the price continues to slide down it
1:54:36will momentum and it signals that the
1:54:39bias are beginning to step in and are
1:54:41slowing the rate of the price decline
1:54:43now in contrast to patterns like
1:54:45symmetrical triangles which have no
1:54:46definitive slope or bias the following
1:54:49wedges should slope down and we have a
1:54:52bullish bias now as with Rising edges
1:54:54the foreign matches is also one of those
1:54:57challenging patterns to trade the Forum
1:54:59image is seen as both a bullish
1:55:02condemnation and a bullish reversal
1:55:04pattern which gave rise to some
1:55:06confusion in the identification of the
1:55:08pattern now both scenarios contain
1:55:10different Market condition that must be
1:55:12taken into consideration but the
1:55:14differentiating factor that separates
1:55:17the continuation and reversal pattern is
1:55:19the direction of the trend and the
1:55:21following which appears a falling wedge
1:55:24is a continuation pattern if it appears
1:55:26in an uptrend and it is a reversal
1:55:28pattern if it appears in a downtrend
1:55:30however this bullish bias cannot be
1:55:33realized or confirmed until the downward
1:55:36sloping resistance line breakout occurs
1:55:38convincingly by convincing I mean the
1:55:40volume should decline as the pattern
1:55:43progresses from left to right or simply
1:55:45the volume should contract with
1:55:47Contracting prices showing a weakening
1:55:49of the existing price trend and the
1:55:52breakout above the resistance line
1:55:54should be accompanied by higher than
1:55:56average volumes indicating a rise in the
1:55:58interest among Market participants now
1:56:00you can also make use of momentum
1:56:02indicators like RSI macd Etc to confirm
1:56:06the reliability of the backdrop
1:56:09now we will talk about the entry
1:56:11criteria so how do you better time your
1:56:14entry the first approach is to go along
1:56:16when the price breaks above the
1:56:18resistance trend line all you need to do
1:56:20is to place a buy order above the
1:56:22resistance line and you will be
1:56:24immediately long when the price breaks
1:56:26out above the level and if the breakout
1:56:27is real this is one of the best prices
1:56:30to enter but this is a very risky method
1:56:32and chances are might be a pause
1:56:35breakout now this next method is similar
1:56:38to the previous approach the only
1:56:40difference is that you wait for the
1:56:41price to break and close above the
1:56:43trendline resistance you can take a long
1:56:46entry above the breakout candle highs
1:56:48once the candle process now this will
1:56:51reduce the likelihood of a horse
1:56:52breakout but if the price momentum is
1:56:55strong you will enter your trade at a
1:56:57much higher price now if you are an
1:56:59experienced Trader then you can even
1:57:01enter the market as the price pull back
1:57:04or rate test back to the upper trend
1:57:06line of the pattern this can help you
1:57:08enter the trade even if you've missed
1:57:10the breakout mode and it offers a better
1:57:12price entry than waiting for the close
1:57:14of the breakout candle but the issue
1:57:16with this approach is that market may
1:57:18not give a pullback or retest every time
1:57:21so once again you can choose the entry
1:57:23type that you like based on whether you
1:57:25are conservative or aggressive in your
1:57:27approach but make sure to validate the
1:57:29breakout good volumes and other momentum
1:57:31indicators to see if there is actually
1:57:33an interest in the market participants
1:57:35to take the prices higher now how to set
1:57:38up proper stop loss so that you don't
1:57:40get stopped out too early now it doesn't
1:57:43matter whether you are trading breakouts
1:57:45or pullbacks because the concept is the
1:57:47same your stop loss must be at a
1:57:49location that if Breeze will invalidate
1:57:52your trading setup this means if the
1:57:54market hits the stop loss you will
1:57:57automatically know that you are wrong so
1:57:59a stop loss below the resistance level
1:58:01is not a good idea where we'll spend
1:58:03think about it where is the ideal place
1:58:06to set your stop loss so that if the
1:58:08market reaches it you know the following
1:58:10match pattern is invalidated since the
1:58:12pattern forms higher swing lows and if
1:58:15the price moves below the recent swing
1:58:17low or break below the downward sloping
1:58:19resistance trend line then we can be
1:58:21sure that our analysis was wrong so this
1:58:25is exactly where you need to keep your
1:58:27stop loss that is just below the swing
1:58:29low or the support level now you can
1:58:31give the price on breathing space by
1:58:34adding one ATR buffer below the recent
1:58:36swing low for the support I hope this is
1:58:39clear now how to cash in your winners
1:58:41one of the most common approaches is to
1:58:44have a predetermined profit Target
1:58:46Target can be measured by taking the
1:58:49width of the top of the wedge or the
1:58:51wireless portion of the wedge from the
1:58:53support to the resistance level and then
1:58:55extending this distance upward from the
1:58:58trendline breakout point you can also
1:59:01decide to Trail your stop loss now the
1:59:03trailing stop loss helps you ensure you
1:59:05write the entire Trend now to Trail you
1:59:08stop using the best person every manner
1:59:10you can use moving averages or Chandler
1:59:12stops and only exit the trade if the
1:59:15market closes below it and if you are
1:59:17using the moving averages use 20 50 or
1:59:20200 period moving averages depending on
1:59:22whether you have a short term medium
1:59:24term or long term trade objective
1:59:26moreover it is much better if you use a
1:59:29combination of these two methods so that
1:59:32you can gauge the potential of the move
1:59:34beforehand using the projection method
1:59:36so still locking part of your profits
1:59:38there and then write the rest of the
1:59:40position using the trailing stop loss
1:59:42method thereby not impacting your
1:59:44psychology and avoiding any potential
1:59:47losses due to reversals now that is all
1:59:50the major reversal patterns in a single
1:59:53video
1:59:58in the previous two episodes we have
2:00:01discussed the most important
2:00:03continuation and reversal patterns how
2:00:05to identify them and how to trade them
2:00:08in a very detailed manner when dealing
2:00:10with both continuation and reversal
2:00:12patterns we have a clear idea or maybe
2:00:15we have a directional bias towards where
2:00:18the breakout will happen that is in the
2:00:20case of continuation patterns we will
2:00:22look to trade in the direction of the
2:00:24previous Trend before consolidation and
2:00:27for reversal patterns we will look to
2:00:29initiate trains in the opposite
2:00:31direction of the prior Market Trend but
2:00:34the third type of pattern that we are
2:00:35going to discuss doesn't have a
2:00:37directional bias associated with it when
2:00:40it comes to the breakout or the trade
2:00:42direction or in simple terms the
2:00:44breakout of the pattern can be in either
2:00:46direction and we cannot judge the
2:00:48direction of the breakout before it
2:00:50happens this category of chart patterns
2:00:53is called as neutral chart patterns or
2:00:56bilateral chart patterns since we cannot
2:00:59be sure of a possible breakout Direction
2:01:01these patterns can be dangerous because
2:01:04of false breakouts more often than not
2:01:06you will find yourself entering a
2:01:08breakout above or below the pattern
2:01:10consolidation only to see yourself fall
2:01:13prey to a false breakout I have already
2:01:16made videos on breakouts and force
2:01:19breakouts in my price action course you
2:01:21can check those videos to know more in
2:01:23this part we are going to discuss three
2:01:25bilateral patterns how they work and how
2:01:28to take trades including the entry
2:01:30targets and stop losses now the three
2:01:33bilateral patterns under discussion are
2:01:35number one the symmetrical triangles
2:01:38followed by the symmetrical expanding
2:01:40triangles or broadening triangles and
2:01:43finally Channel patterns that is rising
2:01:46Channel and foreign Channel patterns if
2:01:48this series of videos are helping you
2:01:50become better at trading then please do
2:01:52like and share this video and support
2:01:54our efforts to build a healthy trading
2:01:57ecosystem so let us start our discussion
2:02:00with symmetrical triangles we have
2:02:02talked about ascending and descending
2:02:04triangles the ascending triangle
2:02:06indicates a weakening of sellers with a
2:02:09contraction in volatility from left to
2:02:11right of the pattern while a descending
2:02:14triangle signals a weakening of buyers
2:02:16and a decline in volatility which leads
2:02:19to a strong breakout now the working of
2:02:21a symmetrical triangle chart pattern is
2:02:24quite similar to these two triangle
2:02:26patterns the symmetrical triangle is
2:02:28also a volatility contraction pattern
2:02:31but here we are not sure who is the
2:02:34wheel player a contraction in volatility
2:02:36means that the price volatility in the
2:02:39market is shrinking and it is a strong
2:02:42signal that the market is likely to
2:02:44break out soon now before we get into
2:02:46the breakout part let's first learn how
2:02:48to identify a symmetrical triangle
2:02:50pattern in the charts I hope you are
2:02:53familiar with the fact that for an
2:02:55ascending triangle there is an ascending
2:02:57trendline support enough flat resistance
2:02:59line while for a descending triangle
2:03:01there is a descending trend line
2:03:03resistance and a flat support line now
2:03:06when it comes to a symmetrical triangle
2:03:08and as the name suggests the sides of
2:03:10the triangle slope equally which means
2:03:13the slope of the ascending current line
2:03:15support and the descending trend line
2:03:17resistance happens to have the same
2:03:19slope now it is Within These trend lines
2:03:22that the actual consolidation of prices
2:03:24happens and both of these trend lines
2:03:26meet at a common Point called the Apex
2:03:29now the triangle should comprise of at
2:03:32least two lower highs and two higher
2:03:35lows each to be considered as a valid
2:03:37symmetrical triangle pattern the pattern
2:03:39looks like a funnel with the price
2:03:41squeezing from left towards the right
2:03:44with a contraction in volatility which
2:03:46is associated with weakening of
2:03:48candlesticks and price Action Now what
2:03:51does the price action indicate it simply
2:03:53means that neither the buyers nor the
2:03:56sellers are interested in buying or set
2:03:58link this is evident from the lower
2:04:00highs forming the upper trend line
2:04:02resistance showing a lack of buying
2:04:04pressure while the higher lows into the
2:04:06lower trend line support signals are
2:04:09decline selling pressure as you can see
2:04:11the pattern started with big swings
2:04:14which got shorter and shorter as the
2:04:16pattern progressed the beauty of
2:04:18volatility contraction is that price
2:04:20cannot be squeezed Forever at some point
2:04:23it must break out and when it happens it
2:04:26offers tremendous returns now I have
2:04:29seen many experts believe that if a
2:04:31stock is rallying before the formation
2:04:33of a symmetrical triangle it will
2:04:36eventually break out to the upside on
2:04:38the other hand if a stock Falls before a
2:04:40symmetrical triangle consolidation forms
2:04:42it should continue its decline after the
2:04:45breakout now both of these assumptions
2:04:47are not right these triangles offers
2:04:50little or no indication regarding the
2:04:53direction in which the stock or the
2:04:55index will eventually break out keep in
2:04:57mind that there is a lack of volume and
2:04:59price movement which gives rise to a
2:05:02symmetrical triangle pattern and as a
2:05:04result it is impossible to assess the
2:05:06direction of the breakout another common
2:05:08mistake Traders make is chasing the
2:05:10breakout of a symmetrical triangle
2:05:12pattern only to get trapped in a false
2:05:15breakout so how do we eliminate this
2:05:17mistake a great trade tool that you can
2:05:20use for identifying breakouts is volume
2:05:22rail breakouts usually occur with high
2:05:25trading volumes and high volatility
2:05:27while fake breakouts are usually
2:05:30associated with low volumes and look
2:05:33more like a range than a breakout since
2:05:35the levels of the triangles are inclined
2:05:38it sometimes brings the price outside
2:05:40the frame of the triangle this usually
2:05:42gets Traders tempted and they assume
2:05:45that there is a breakout on the chart so
2:05:46always make sure to confirm the
2:05:48breakouts another important point that
2:05:50you can keep in mind is that The Closer
2:05:52the price gets to the effects of the
2:05:55pattern and the tighter the price
2:05:57consolidation becomes the greater the
2:05:59chances of a real breakout and the price
2:06:02will quickly move in favor of your trade
2:06:04moving on we will now focus on how to
2:06:07trade this pattern that is how to time
2:06:09your entry set your stop loss and
2:06:11determine targets or exits let's start
2:06:14with the entry criteria first now
2:06:16wherever this pattern forms we have to
2:06:18consider two scenarios first is a
2:06:21breakout about the descending trendline
2:06:23resistance and the second scenario is a
2:06:26breakout below the ascending trendline
2:06:28support level let's say the price breaks
2:06:30the upper trend line resistance level
2:06:32then you have four possible long entries
2:06:35available the first approach is very
2:06:37aggressive and the idea is to go along
2:06:40as soon as the price breaks above the
2:06:42resistance trend line and all you need
2:06:44to do is to place a limit by order above
2:06:47the resistance level and you will be
2:06:49immediately long when the price breaks
2:06:51out above the level and if the breakout
2:06:54is real this is one of the best prices
2:06:56to enter but this method is very risky
2:06:59and there are high chances that it might
2:07:01be a false breakout the second method is
2:07:04similar to the previous approach the
2:07:06only difference is that you wait for the
2:07:08price to break and close above the
2:07:11descending trend line resistance we can
2:07:13end along above the breakout candle
2:07:15highs once the candle closes this method
2:07:18reduces the likelihood of a false
2:07:20breakout but if the price momentum is
2:07:22strong then you will be probably
2:07:24entering at a much higher price now if
2:07:27you have missed both these entries then
2:07:29you can even enter the market as the
2:07:31price pulls back or re-test the
2:07:34resistance line of the pattern this
2:07:36method can help you enter a trade even
2:07:38if you missed the breakout move in this
2:07:40method we have to wait for the prices to
2:07:43form a primary pullback or even retest
2:07:45the resistance turn support level and
2:07:48then move in the direction of the
2:07:50breakout so you can take a long position
2:07:52when the price begins to move higher the
2:07:54retest entry offers a better price than
2:07:57waiting for the closed captioning not
2:07:58available
2:08:36[Music]
2:08:45[Music]
2:08:50and then go short when the price starts
2:08:53to decline lower but make sure to
2:08:55validate the breakout first using
2:08:57volumes and other momentum indicators to
2:09:00save yourself from being trapped in a
2:09:02false breakout now how to set a proper
2:09:04stop loss so that you don't get stopped
2:09:07out too early now the concept is simple
2:09:09your stop loss must be at a location
2:09:11that if reached will invalidate your
2:09:14trading setup this means that if the
2:09:16market hits the stop loss you will
2:09:18automatically know that your analysis
2:09:21was wrong so if you talk about the stop
2:09:23loss placement for a breakout above the
2:09:25resistance level do you think setting
2:09:28your stop loss just below the resistance
2:09:30level is a good idea well I don't think
2:09:32so considering the chances of fake outs
2:09:35or even deep Wicks so where else should
2:09:37you place it think about it where is the
2:09:40ideal place to set your stop loss so
2:09:42that if the market reaches it you know
2:09:44the breakout is invalidated now since
2:09:47the pattern forms higher swing lows and
2:09:50if the price moves below the recent
2:09:51swing low and forms a lower low then we
2:09:55can be sure that our analysis was wrong
2:09:57so so it is exactly the place where you
2:10:00need to keep your stop loss that is just
2:10:02below the recent swing low you can give
2:10:04the price some breathing space by adding
2:10:06180r buffer below the recent swing low
2:10:09to compensate for the Deep stop loss
2:10:11handling Bricks now the same idea
2:10:13applies to a breakdown below the
2:10:15ascending trendline support you can
2:10:17place your stop loss just above the most
2:10:19recent swing high level formed or you
2:10:22can give one ATR buffer above the swing
2:10:24high level to be extra safe now where to
2:10:27exit your winning trades for maximum
2:10:30profits you may already be familiar that
2:10:33there are two techniques that you can
2:10:35consider the trailing stop loss method
2:10:37and the price projection method now how
2:10:40to exit your trade at the price
2:10:41projection level now price projection
2:10:44techniques helps to project where the
2:10:46price momentum will exhaust itself so
2:10:49here's how it works for a symmetrical
2:10:51triangle pattern all you have to do is
2:10:53to take the distance between the highest
2:10:56and lowest points of the asymmetrical
2:10:58triangle that is the widest distance of
2:11:00the pattern then depending on the
2:11:03breakout Direction copy and paste this
2:11:05distance or project this distance at the
2:11:08breakout point for example in case of a
2:11:10bullish breakout project this distance
2:11:12to be above the resistance level from
2:11:15the breakout point and for a bearish
2:11:17breakdown project the same distance to
2:11:20be below the support level from the
2:11:22breakdown point now this will give you
2:11:24the price projection or the expected
2:11:26Target level now the concept of trailing
2:11:29stop loss is that we have no idea how
2:11:31long the trend will last so we will
2:11:34Trail our stop loss to write the trend
2:11:36as far as possible to lock in gains as
2:11:39the market moves in our favor so how do
2:11:42you actually Trail your stop loss well
2:11:44you can use an indicator like a moving
2:11:46average for example you can Trail your
2:11:49stop loss using a 20 period 50 period or
2:11:52even 200 period moving average depending
2:11:54upon whether you are considering a short
2:11:56term medium term or for long-term
2:11:59position in the market this means you
2:12:01will hold your position until the market
2:12:03breaks and closes above or below the
2:12:05moving average depending on the
2:12:07direction of the breakout a more robust
2:12:09technique is if you make a trailing stop
2:12:12loss and price projection combo that is
2:12:15you combine both these techniques this
2:12:17means if the market moves in your favor
2:12:19but it has not reached your price
2:12:21projection level you can use the moving
2:12:24average to lock in your profits so even
2:12:27if there is a sudden reversal you still
2:12:29protect what you have and do not give
2:12:31everything back to the market moving on
2:12:34to the second category of neutral
2:12:35patterns this particular pattern is
2:12:38known by different names be it a
2:12:40symmetrical expanding triangle or a
2:12:42broadening triangle pattern or a
2:12:44broadening bottom or top pattern Etc
2:12:47pattern looks exactly like a mirror
2:12:49reflection of a symmetrical triangle
2:12:52pattern now instead of the price
2:12:53squeezing from the left towards the
2:12:56right it actually expands with each
2:12:57string this is one of the reason why
2:13:00this pattern is tougher to trade and
2:13:02other chart patterns as the lows and
2:13:05highest get taken out one by one it is
2:13:08also called a megaphone pattern because
2:13:09of the expanding shape of the
2:13:11consultation when it comes to the
2:13:13identification of this pattern the
2:13:15pattern can be formed during an uptrend
2:13:18or a downtrend and it is referred to as
2:13:20a broadening top when it is formed
2:13:23during an uptrend and a broadening
2:13:25bottom when it is formed during a
2:13:26downtrend in the two trend lines
2:13:28connecting the widening highs and lows
2:13:31of the prices diverge from each other it
2:13:33is an indicating of a broadening
2:13:35triangle pattern it shows the
2:13:37nervousness and indecisiveness of
2:13:39Traders even though the price action is
2:13:42evident after each price Wing there is
2:13:45no clear dominance by a single player
2:13:47that is the buyers and sellers are
2:13:49trying to force their dominance but each
2:13:52attempt is counted resulting in a state
2:13:54of indecision moreover there should be
2:13:57at least two price Rings along the
2:13:59sloping trend lines that is there should
2:14:01be at least two higher highs into the
2:14:04ascending trend line resistance and two
2:14:07lower highs into the descending trend
2:14:09line support to consider it as a valid
2:14:11pattern now similar to a symmetrical
2:14:13triangle pattern in the broadening
2:14:15triangle pattern to the breakout
2:14:18determines the direction of future price
2:14:20moment please note that there are a few
2:14:23categories of broadening patterns be it
2:14:25broadening wedges broadening tops with a
2:14:28flat support line or a broadening
2:14:30bottoms with a flat resistance line but
2:14:33I will not be discussing these patterns
2:14:35because most of these broadening price
2:14:37action patterns occur rarely in the
2:14:39market so I will always urge you to
2:14:42follow three to four strong patterns
2:14:44rather than running after each and every
2:14:46pattern on the charts the more focused
2:14:48you become the better the results will
2:14:50be now let's talk about the trading
2:14:52criteria and let's start with the entry
2:14:54techniques first as I have just
2:14:56mentioned the Breakout determines the
2:14:59future price Direction and dominance of
2:15:01a single player in the market this
2:15:03pattern does not come with a directional
2:15:05bias so we have to focus completely on
2:15:08the breakouts to determine our position
2:15:10so it all comes down to identifying a
2:15:13real breakout as discussed earlier one
2:15:16of the factors that will help determine
2:15:18a proper breakout is the volume so a
2:15:21higher than average volume can be a good
2:15:23indication of a probable breakout
2:15:26moreover you can make use of momentum
2:15:28indicators like RSI macd Etc to validate
2:15:32a breakout from a false breakout so with
2:15:34that in mind let's talk about all the
2:15:37possible entries when a breakout happens
2:15:39above the upper trenline resistance you
2:15:42can take a long entry as soon as the
2:15:44price breaks above the resistance as
2:15:46this will give you a good entry price
2:15:48but the downside is that it could be a
2:15:50false breakout and you could get trapped
2:15:53so a better alternative would be to wait
2:15:55for the breakout candle to close above
2:15:58the resistance trend line and then enter
2:16:00at the opening of the next candle or
2:16:03above the high of the breakout candle
2:16:05now the problem with this approach is
2:16:07that if the breakout is associated with
2:16:09a good momentum then you will find
2:16:11yourself buying at a very higher price
2:16:13in addition to this you can take a long
2:16:15position after a price pull back or rate
2:16:18test back to the ascending trend line as
2:16:20you may all know of pullback or retrieve
2:16:22test is usually associated with v
2:16:25candles so you can take a long trade and
2:16:27the price begins to move in the
2:16:29direction of the breakout once again the
2:16:31advantage of these methods is that you
2:16:33could get into a trade even if you
2:16:35missed the recount but on the downside a
2:16:37pullback or retest does not happen every
2:16:40time particularly if there was a strong
2:16:42price momentum during the breakout now
2:16:45the same entry methods are applicable in
2:16:48case the price breaks down below the
2:16:50lower trend line support of the pattern
2:16:52in that case you can take a short entry
2:16:54on the breakdown or after the breakdown
2:16:57candle losses below the support level
2:16:59you can also enter a trade after a
2:17:01pullback or retest to the lower trend
2:17:04line support now talking about stop
2:17:06losses placing stop losses for this
2:17:08pattern is actually hard task if you
2:17:11were to go by the general idea of
2:17:13placing the stop loss can be set below
2:17:16the top resistance line or below the
2:17:18lower support line in case of a bullish
2:17:21breakout and on the other hand a stop
2:17:23loss could be placed above the lower
2:17:25support line or above the upper trend
2:17:28line resistance for a bearish breakdown
2:17:31but think about it one of the stop loss
2:17:33is too tight and any price wing with
2:17:36long Wicks can take out your stop loss
2:17:39while the other stop loss is too wide
2:17:41which will give you a poor risk to
2:17:43reward so what will we do one way to
2:17:46counter this issue is to place your stop
2:17:48loss in the middle of the pattern that
2:17:50is at the center of the widest point of
2:17:53the pattern so if you are very
2:17:54aggressive with your stop loss you could
2:17:56even place the stop loss with respect to
2:17:58the breakout candle provided you give
2:18:01enough breathing room for the price
2:18:02action to happen this can be achieved if
2:18:05you place your stop loss by adding some
2:18:07buffer with anywhere from one to three
2:18:09times the ATR value now finally we will
2:18:12be talking about the targets for this
2:18:15pattern I won't be really interested in
2:18:17trading my targets I am satisfied with
2:18:19the projected targets so you can set two
2:18:22Targets using the price projection
2:18:24method the first Target would be equal
2:18:26to the distance of the smallest swing
2:18:28between the top and bottom trend lines
2:18:31this distance is further projected above
2:18:34or below the trend line depending on
2:18:36whether it was a breakout or a breakdown
2:18:38the second target level will be equal to
2:18:40the distance of the widest swing between
2:18:43the trend lines which is projected from
2:18:45the record point now let's move on to
2:18:47the final type of bilateral pattern
2:18:50which are Channel patterns namely the
2:18:53rising and foreign channels the channel
2:18:55pattern is also known as the price
2:18:57channel the formation of the pattern is
2:18:59quite interesting and it is related to
2:19:02market trends you can learn all you need
2:19:04to know about market trends in my price
2:19:06action course now let's talk about the
2:19:09rising Channel first the rising channel
2:19:11is formed by two lines a bottom trend
2:19:15line support and an upper Trend channel
2:19:17line resistance so clearly the price is
2:19:20in an uptrend and as you may already
2:19:22know during an uptrend price forms
2:19:25higher swing highs and higher swing lows
2:19:27and when we connect all the swing lows
2:19:30together using a line prevent the
2:19:32uptrend line which will act as a support
2:19:35for the prices and if we connect all the
2:19:37higher highs it will give us the trend
2:19:39channel line which will act as a
2:19:41resistance level for the future prices
2:19:43moreover we need at least two price
2:19:45rings on each of these lines to consider
2:19:48it as a trend line and to confirm it as
2:19:51a wireless line we need at least three
2:19:53swings on each of them now another
2:19:55important thing to keep in mind is that
2:19:57the lines should be parallel to each
2:19:59other or in simple terms the slope of
2:20:01both the upper and lower lines should
2:20:04almost be equal and if the slopes are
2:20:06different we know what it means right it
2:20:09will be a different price action
2:20:10altogether and it will form a rising
2:20:12wedge pattern let's now talk about the
2:20:14following Channel pattern the existing
2:20:16trend is a downtrend with lower highs
2:20:19and higher lows by connecting all the
2:20:21lower highs together you will get a
2:20:23downtrend line which will act as a
2:20:25resistance level for the future price
2:20:27movements on the other hand if you
2:20:29connect all the lower lows you will get
2:20:32a trend channel line which will function
2:20:34as a support level for prices also keep
2:20:37in mind that the slopes of both these
2:20:39lines should be almost equal or in
2:20:42simple terms the line should be parallel
2:20:44now let's talk about how to trade a
2:20:46rising Channel pattern so you can take
2:20:49two types of Trades when it comes to
2:20:51Rising Channel patterns you can either
2:20:53take breakout rates when the price
2:20:55breaks out of the channel or else you
2:20:57can trade the impulse price rings in the
2:20:59direction of the existing trend from the
2:21:02trend line when it comes to breakout
2:21:04trading the rising Channel pattern is a
2:21:06bilateral pattern meaning that a
2:21:08breakout can happen in either direction
2:21:10but what I have observed is that the
2:21:13slope of the channel to some extent
2:21:15gives us the information on whether it
2:21:17will be a breakout or a breakdown let me
2:21:20explain a Channel with a very high slope
2:21:23or a very steep price action will mostly
2:21:26break down below the support trend line
2:21:28while a Channel with a medium or lower
2:21:30slope will have equal chances of
2:21:33breaking out or breaking down anyway
2:21:34this is just an observation but we
2:21:37should enter a trade only after a
2:21:39breakout has happened let's say the
2:21:41price broke below the support trend line
2:21:43now if you are very aggressive you can
2:21:46take a short position as soon as the
2:21:48price breaks below the support trend
2:21:50line but this is risky as it could end
2:21:52up being a false breakout and you will
2:21:54get trapped so it is always ideal to
2:21:56wait for the breakout candle to close
2:21:58below the trend line and then enter on
2:22:01the opening of the next candle or below
2:22:03the low of the breakout candle now the
2:22:06downside is that if the breakdown is
2:22:07strong you will end up selling at a much
2:22:10lower price so yet another method would
2:22:12be when the price puts back or rate US
2:22:15back to the trend line so both the
2:22:17pullback and retest are associated with
2:22:19small boarded candles so when the price
2:22:21starts to move lower after the pullback
2:22:23or retest you can take a short entry
2:22:25sometimes there could even be a price
2:22:28build up near the support trend line
2:22:29which is a very good signal that that
2:22:31the price would break down lower and it
2:22:33provides a much better reward to risk
2:22:36because of a tighter stop loss now all
2:22:38these breakdown entry techniques are
2:22:40applicable even if the price manages to
2:22:43break out above the resistance trend
2:22:45line in such a scenario you will look
2:22:47for long trading opportunities either
2:22:49after the breakout and close above the
2:22:51resistance or after build up near the
2:22:53resistance run channel line or even
2:22:55after a pullback or retest back to the
2:22:57trend channel line after the breakout
2:22:59the one of the most important factors to
2:23:02check out is the volume so if you want
2:23:05to know more about analyzing volumes you
2:23:07can check it out in my free Price action
2:23:09playlist anyway there should be a higher
2:23:12than average volume during breakouts you
2:23:14can even use momentum indicators like
2:23:16RSI to validate the breakout moving on
2:23:19let's learn how to place your stop loss
2:23:21we will discuss the stop loss for a
2:23:23breakdown below the support level the
2:23:26stop loss of the channel pattern will
2:23:28depend upon the width of the channel if
2:23:30the channel is too narrow then we can
2:23:32think about placing the stop loss just
2:23:34above the upper Trend channel line but
2:23:37if the channel is too wide then we need
2:23:39to think about a different stop loss
2:23:41because if we place it above the trend
2:23:43channel line like before the reward to
2:23:46this ratio will be severely affected so
2:23:49what can be done for a breakdown entry
2:23:51we can place the stop loss just above
2:23:53the midpoint of the channel from where
2:23:55the breakout happened but if you have
2:23:57taken a short entry after a build up
2:24:00near the support trend line then you can
2:24:02keep your stop loss just above the
2:24:04buildup or consolidation and finally if
2:24:06you have taken a position after a
2:24:08pullback or retest then you can set your
2:24:10stop loss above the highest week of the
2:24:13pullback or later scandals with some
2:24:16buffer for Price action now in case of a
2:24:18breakout above the resistance trend line
2:24:20similar stop loss conditions can be
2:24:22applied there also but in this case
2:24:24we'll be placing the stop loss below the
2:24:27midpoint of the channel from the
2:24:29breakout point if you have taken a
2:24:31breakout entry or you can place the stop
2:24:34loss below the consolidation for a
2:24:36breakout after build up entry and
2:24:38finally you can set your stop loss with
2:24:40some buffer below the lowest week of the
2:24:42pullback or rated scandals for a
2:24:45pullback or retest entry now let's
2:24:47discuss the targets and as always we can
2:24:50follow three methods price projection
2:24:52trailing stop loss and a combination of
2:24:55both for Price projection we follow a
2:24:58price exhaustion concept for a channel
2:25:00pattern we measure the distance between
2:25:02the upper and lower trend lines and
2:25:05project this distance above or below the
2:25:07line depending on the direction of the
2:25:10breakout this will give you your
2:25:12projected price Target now one
2:25:14interesting observation of the rising
2:25:16Channel pattern when the price breaks
2:25:18down below the support trend line is
2:25:20that all the previous swing levels will
2:25:23act as price action areas so you will
2:25:25have to closely watch what type of price
2:25:28action is occurring and then decide
2:25:30whether to hold your trades for more
2:25:32profitability or just exit your
2:25:34positions now the other method is to use
2:25:36a trailing stop loss using moving
2:25:39averages of different periods depending
2:25:41on the type of trading style that you
2:25:43follow the central idea of this concept
2:25:45is that when a price breakout or
2:25:47breakdown forms a Channel or simply a
2:25:50consolidation there is a good chance
2:25:51that the trend will continue for a
2:25:53longer period and you can benefit
2:25:55enormously if you Trail your stop loss
2:25:57you will accept the trade only when the
2:26:00price crosses the moving average so for
2:26:02short-term Trends you can use 20 period
2:26:04moving average for medium term Trends
2:26:07you can use 50 period moving averages
2:26:09and for longer term Trends you can use
2:26:11100 or 200 moving averages but it is
2:26:14always a good practice if you use a
2:26:16combination of both price projection and
2:26:18trailing stop loss methods so that you
2:26:20will be able to log into profits
2:26:22whatever the outcome is now let's look
2:26:25at the second method of trading a rising
2:26:27Channel pattern this idea is only valid
2:26:29if the channel form this wide enough
2:26:31that is there should be enough points
2:26:34between the support and resistance line
2:26:36the idea here is to trade the impulse
2:26:38move or simply to trade in the direction
2:26:41of the trend all you have to do is to
2:26:43look for buying opportunities from the
2:26:45trendline support level to write the
2:26:47impulse moves because impulse modes are
2:26:50associated with stronger momentum
2:26:52candles and you will be trading along
2:26:54with the market price flow you can also
2:26:56make use of bullish reversal
2:26:58candlesticks like bullish pin bars from
2:27:00the support level to take a long entry
2:27:03you can place your stop loss below the
2:27:05support trend line with ample buffer or
2:27:08below the lowest week of the rejection
2:27:10candle from the support level your
2:27:12target will obviously be the resistance
2:27:15Trend channel line you can also treat
2:27:16the correction move from the uptrend
2:27:18line but I don't generally recommend
2:27:20doing so now let's briefly discuss the
2:27:23trading criteria for a following Channel
2:27:25pattern similar to a rising Channel you
2:27:28can take two types of trays when it
2:27:30comes to foreign Channel patterns you
2:27:32can either take breakout reads when the
2:27:34price breaks out of the channel or you
2:27:36can train the impulse price wings in the
2:27:38direction of the existing downtrend from
2:27:40the trend line when it comes to breakout
2:27:42trading the following channel line is a
2:27:45bilateral pattern indicating that
2:27:47breakout can happen in either direction
2:27:49but same as before the slope of the
2:27:52channel to some extent gives us the
2:27:54information on whether it will be a
2:27:56breakout or a breakdown so a falling
2:27:58Channel with a very high negative slope
2:28:01or a very steep price action will most
2:28:03probably break out above the resistance
2:28:06trend line well a Channel with a medium
2:28:08or lower slope will have equal chances
2:28:11of breaking out or breaking now anyway
2:28:13this is just an observation but you
2:28:16should enter the trade only after the
2:28:17breakout has been confirmed let's say
2:28:19the price broke above the resistance
2:28:21trend line now if you're a very
2:28:23aggressive Trader you can take a long
2:28:25position as soon as the price breaks
2:28:27above the resistance trend line but this
2:28:30is a risky business as it could end up
2:28:32being a false breakout and you will be
2:28:34trapped so it is always ideal to wait
2:28:37for the breakout candle to close above
2:28:39the trend line and then enter on the
2:28:41opening of the next candle or above the
2:28:43high of the breakout camera the downside
2:28:45is that the breakout would be too strong
2:28:47and you will end up buying at a much
2:28:49higher price so yet another method would
2:28:52be when the price pulls back or returns
2:28:54to the trend line so when the price
2:28:56starts to move higher after the pullback
2:28:59or retest of the consolidation you can
2:29:01take a long entry sometimes there could
2:29:03even be a price built up near the
2:29:05resistance trend line which is a very
2:29:07good signal that the price could break
2:29:09out higher and it provides a much better
2:29:12reward to risk because of a tighter stop
2:29:14loss all these breakout entry techniques
2:29:16are applicable even if the price manages
2:29:19to break below the support run channel
2:29:21line in such a scenario we will look for
2:29:23short trading opportunities either after
2:29:26the breakout and close below the support
2:29:28and channel line or after build up in
2:29:31support line or even after a pullback or
2:29:34retest back to the trend channel line
2:29:36after the breakdown one of the most
2:29:38important factors to check out is the
2:29:40bowling you can validate a real breakout
2:29:43using higher than average volumes during
2:29:45the breakout and you can even use
2:29:47momentum indicators like RSI Mac B
2:29:51Etc to validate the breakout moving on
2:29:53let's look at how to place your stop
2:29:55losses so we will discuss the stop loss
2:29:57for a breakout about the resistance
2:29:59level as mentioned earlier the stop loss
2:30:01of the channel pattern will depend upon
2:30:04the width of the channel the channel is
2:30:06too narrow we can think about placing
2:30:08the stop loss just below the lower Trend
2:30:10channel line but if the channel is too
2:30:12wide then we need to think about a
2:30:14different stop loss because if we place
2:30:16the stop loss below the trend channel
2:30:18line like before the reward tourists
2:30:20will be poor so for a breakout entry you
2:30:23can place the stop loss just below the
2:30:25midpoint of the channel from where the
2:30:27breakout happened but in case you have
2:30:29taken a long entry after built up near
2:30:31the resistance trend line then you can
2:30:34keep your stop loss just below the build
2:30:36up or consolidation and finally if you
2:30:38have taken a position after a pullback
2:30:40or retest you can set your stop loss
2:30:43below the lowest week of pullback or
2:30:45latest scandals with some buffer for
2:30:47ample price movement now in case of a
2:30:50breakout below the support run channel
2:30:52line similar stop loss conditions can be
2:30:55applied there also but in this case we
2:30:57will be placing the stop loss above the
2:30:59midpoint of the channel from the
2:31:01breakdown point if you have taken a
2:31:03short entry or you can place the stop
2:31:05loss above the consolidation for a
2:31:07breakout after build up entry and
2:31:10finally you can even set your stop loss
2:31:12with some buffer above the highest Wick
2:31:14of pullback or later scandals for a
2:31:16pullback or retest entry now finally
2:31:19let's discuss the targets setting the
2:31:21targets can be done the same way as with
2:31:24the ryzen channel pattern could be price
2:31:26projection trailing stop loss or a
2:31:28combination of both so please do refer
2:31:31the previous session if you have any
2:31:33doubts now let's look at the second
2:31:34method of trading the following Channel
2:31:36pattern as mentioned earlier the idea is
2:31:39only valid if the channel formed is wide
2:31:41enough there should be enough points
2:31:43available between the support and
2:31:44resistance trend lines now the idea here
2:31:46is to trade the impulse move or simply
2:31:49to trade in the direction of the
2:31:50existing Market Trend so all you have to
2:31:53do is to look for selling opportunities
2:31:55from the trendline resistance level to
2:31:58write the impulse move because the
2:32:00impulse moves are associated with
2:32:02stronger momentum candles and you will
2:32:04be trading along with the market price
2:32:06flow you can also make use of bearish
2:32:08reversal candlesticks like bearish pin
2:32:10bars from the resistance line to take a
2:32:13short entry you should place your stop
2:32:15loss above the resistance trend line
2:32:17with ample buffer or above the highest
2:32:20Wick of the rejection candle from the
2:32:22resistance line your target for this
2:32:24case will obviously be the support Trend
2:32:27channel line so you can also trade
2:32:29correction move if you want from the
2:32:31lower rank channel line but I generally
2:32:34don't recommend doing it now there are a
2:32:37hell lot of other patterns that you can
2:32:39find with the markets from rounding
2:32:41bottoms and tops or saucer patterns
2:32:43followed by Diamond tops and Diamond
2:32:45bottoms we taught three bottoms
2:32:48broadening wedges Island reversal
2:32:50patterns Etc the patterns that I have
2:32:52discussed over the course of three
2:32:53videos are more than sufficient to try
2:32:56profitably in the market if you follow
2:32:58them correctly now it doesn't mean that
2:33:00all the trades will become profitable
2:33:02but the probability of your trading
2:33:04success can be vastly improved moreover
2:33:07the time frames that you select for
2:33:09trading these patterns also form an
2:33:11integral variable for the success of
2:33:13these patterns and mostly the win rate
2:33:16of chart patterns tends to improve quite
2:33:18a lot if you train them at higher time
2:33:20frames
2:33:25we went from discussing continuation
2:33:27chart patterns followed by reversal
2:33:30chart patterns and finally we have
2:33:31talked about Neutron or bilateral chart
2:33:34patterns now I am assuming you know how
2:33:37to identify and rate these chart
2:33:38patterns on the market but one of the
2:33:40hardest things about chart patterns is
2:33:43sporting them on charts across different
2:33:45stocks and indices think about it chart
2:33:48patterns shop in different time frames
2:33:50from intraday time frames to daily or
2:33:53weekly or even monthly time frames and
2:33:55that too across different stocks and
2:33:57indices so as a Trader you have two jobs
2:34:00first you have to identify suitable
2:34:03patterns of your liking maybe you like
2:34:05trading triangle patterns or maybe you
2:34:07like panels and flags and so on so
2:34:10identify the pattern of your liking I
2:34:13will suggest you follow 2 to a maximum
2:34:15three reliable patterns rather than
2:34:17going after every pattern you find in
2:34:19the books trust me it will do more harm
2:34:22than good and if you ask me my personal
2:34:25favorites then I would say triangles
2:34:27rectangles channels and sometimes I even
2:34:30bet on Head and Shoulder patterns also
2:34:32now the next step is to filter out the
2:34:35good trades from the not so reliable
2:34:37ones but trust me it is an exhausting
2:34:40job to look for chart patterns over each
2:34:42and every stock draw them analyze them
2:34:45and finally filter them for trading so
2:34:48in this video I will discuss three
2:34:50methods that you can use to spot chat
2:34:53patterns in the market so watch the
2:34:55video till the end because the methods
2:34:57for finding the patterns get easier as
2:34:59we proceed through the video
2:35:01before we discuss the different methods
2:35:03let me make something clear up front let
2:35:06me explain the reasons why spotting
2:35:08chart patterns is a difficult task
2:35:10number one most charts are uneven and
2:35:13noisy most dogs and index chart consist
2:35:16of D weeks price caps false breakouts
2:35:19overshoots and undershoots all resulting
2:35:22in making the pattern determination a
2:35:24hard task this is particularly true when
2:35:27we move to the lower time phase what
2:35:29this means is that on a higher time
2:35:31frame like daily weekly Etc the short
2:35:34pattern determination is fairly easy and
2:35:37forms slowly so that we get enough time
2:35:39to plan our trades appropriately but
2:35:42this is not the case in lower time
2:35:44frames like 5 minutes or 15 minutes or
2:35:47even 30 minute charts where the chart
2:35:48patterns get formed very often but it is
2:35:51always tricky to mistake one pattern
2:35:53from another as it happens quickly and
2:35:56often we won't be able to plan our
2:35:57trades adequately another point to keep
2:36:00in mind is that the more fluid the
2:36:02market price movements the easier it is
2:36:04to spot these patterns the point that I
2:36:07want to make is that Forex markets which
2:36:09are open all week law are one of the
2:36:12best markets for pattern trading unlike
2:36:14Indian indices like Nifty or Bank Nifty
2:36:17where there are big price gaps and
2:36:19backlashes due to aftermarket sentiments
2:36:22due to this very reason you can get good
2:36:24entries and exits due to regular price
2:36:27moves in Forex unlike stocks or indices
2:36:30which can sometimes affect your trades
2:36:32due to unpredictable price gaps but most
2:36:35of us like trading in stocks and indices
2:36:37so it is important that we identify the
2:36:40pattern correctly and plan our trades
2:36:42beforehand so let's discuss the very
2:36:45first method of doing this
2:36:47the first method uses the inbuilt
2:36:49trading view indicators for spotting
2:36:52chart patterns this feature is only
2:36:54available in trading view charts so make
2:36:57sure you have at least a free account in
2:36:59trading view all you have to do is to
2:37:01select the chart of your liking be it a
2:37:04stock or an index or a currency pair and
2:37:07then select the time frame that you
2:37:09intend to trade the patterning so if you
2:37:12are an intranet Trader select an
2:37:14intraday time frame anywhere between 3
2:37:16minutes to 30 minutes or if you are a
2:37:19swing Trader go with a much higher time
2:37:20frame like 4 hours or one day time frame
2:37:23once you are done with these steps go to
2:37:26the indicator section on the top toolbar
2:37:28section of trading view click on it and
2:37:31as you can see on the left hand side
2:37:33there are different options like
2:37:35favorites Community scripts my scripts
2:37:39Etc and you need to select the technical
2:37:41section and once you do that you will
2:37:43find a lot of indicators to choose from
2:37:46but the ones that we we are looking for
2:37:48are related to chart patterns on the top
2:37:51section of this pop-up you can see
2:37:53multiple options like indicators
2:37:55strategies volume profiles Etc so click
2:37:59on the one that says Auto now as soon as
2:38:02you scroll down you'll be able to see
2:38:04most of the chat patterns that we have
2:38:06already discussed from Flags Penance
2:38:08rectangles both bullish and bearish to
2:38:11double and triple tops and double
2:38:13entroper bottles two triangles and
2:38:16finally we have head and shoulders and
2:38:18inverted Head and Shoulder patterns now
2:38:20you might be wondering where are the
2:38:22ascending descending and symmetrical
2:38:24triangle patterns don't worry because
2:38:26all the triangle pattern variants are
2:38:29included under the same indicator but
2:38:31unfortunately this indicator section
2:38:33actually lacks patterns like channels
2:38:36broadening wedges and triangles Etc
2:38:38the next step is to click on the pattern
2:38:41that you want to check on the chart let
2:38:43us say I want to check triangle patterns
2:38:45then I will simply click on the triangle
2:38:48patterns and if we zoom out a little you
2:38:50will be able to spot all the triangle
2:38:52patterns which are formed and as you can
2:38:54see there is no triangle formation as of
2:38:56now but there was a triangle formed
2:38:59sometime back which gave decent enough
2:39:01returns even though the indicator plots
2:39:04the patterns automatically you are the
2:39:06one who is ultimately in control so in
2:39:09order to change the parameters just go
2:39:11to the settings of the indicator and
2:39:13click on it now a pop-up appears which
2:39:16gives a parameter called permissible
2:39:18deviation and by default it is set to
2:39:2210. and if you want to know what this is
2:39:24just place the cursor over the I symbol
2:39:27just to the right of the parameter now
2:39:30this particular parameter is used to
2:39:32determine how accurate the pattern form
2:39:34should be so if you reduce the
2:39:36permissible deviation to let's say c 0
2:39:39or even 5 then the number of triangle
2:39:41patterns displayed by the indicator
2:39:43reduces and if you increase the
2:39:46deviation to let's say 25 or 40 then the
2:39:49number of patterns displayed will be
2:39:51more but some of them will be inaccurate
2:39:54so either stay with the default value or
2:39:57just play with the numbers and see what
2:39:59works best for you now just below the
2:40:01deviation parameter you will find a tick
2:40:04box saying in progress once again move
2:40:07the cursor over the I symple what it is
2:40:10asking you is that do you want the
2:40:12indicator to spot incomplete patterns or
2:40:16those patterns which are the process of
2:40:18formation now it is most important to
2:40:21always turn this checkbox on only then
2:40:24you will be able to track the upcoming
2:40:26patterns and plan and trade them with
2:40:28ease and another thing is that when you
2:40:31move from a higher time frame to a lower
2:40:33time frame the number of patterns
2:40:36spotted increases but the accuracy of
2:40:38the patterns working out in your favor
2:40:40actually reduces now let us look at one
2:40:43more example this time we will consider
2:40:45a double top pattern and as you can see
2:40:48once we have clicked on the pattern it
2:40:50automatically displays all the potential
2:40:52double top formations and another
2:40:55interesting thing to note is that this
2:40:57indicator will also give you the
2:40:59projected profit Target beforehand we
2:41:02know that the projected Target is equal
2:41:04to the height of the double top pattern
2:41:06from the neckline to the top now this is
2:41:09exactly the target being displayed now
2:41:12let's select the setting icon of this
2:41:14indicator and as you can see there are
2:41:17more options available like the trend
2:41:19height second top and finally the
2:41:22permissible deviation now the trend
2:41:24height parameter is asking you for the
2:41:26minimum height of the prior uptrend
2:41:28since we know that double top is a trend
2:41:31reversal pattern particularly a bearish
2:41:34trend reversal pattern so on a strong
2:41:36uptrend or double top could be a minor
2:41:40retracement while during a week up Trend
2:41:42it could be the start of a potential
2:41:44reversal so play with the values to find
2:41:47the best combination now the next
2:41:49parameter is the second top which means
2:41:52where do you want the second top to be
2:41:55formed do you want it exactly at the
2:41:57same height or higher or lower depending
2:42:00on this parameter different double tops
2:42:03will be displayed on the chart now the
2:42:05final parameter is the permissible
2:42:07deviation which refers to the extent to
2:42:09which the second top should vary from
2:42:12the first stop now more this deviation
2:42:14the more results will be displayed by
2:42:17the indicator but with a lower accuracy
2:42:19so try to maintain a Time deviation and
2:42:22always make sure to tick the in progress
2:42:25box to display ongoing pattern
2:42:27formations so it is clear that different
2:42:30patterns have different settings or
2:42:33parameters so it is your job now to
2:42:35select the indicator based on the
2:42:37pattern of your liking and fine-tune the
2:42:40parameters to achieve the best results
2:42:42now this method works well it helps to
2:42:45identify patterns faster on different
2:42:48time frames and on different charts but
2:42:51it is still a manual job and let's say
2:42:53you need to check all the Nifty hundred
2:42:55stocks for potential chart patterns how
2:42:58long do you think this process will take
2:43:00maybe hours right so this is exactly the
2:43:03drawback with these trading view
2:43:04indicators as it has limited
2:43:07applications shows lesser results on the
2:43:10chart because sometimes the indicator
2:43:12can be seen missing out on some of the
2:43:14patterns so it is less reliable so how
2:43:17to counter this problem of finding all
2:43:19the patterns on different charts on
2:43:21different time frames now one of the
2:43:24great Contender for this spot is our
2:43:26method number two which is top stop
2:43:29research pattern scanner this is an
2:43:31automatic screener that looks both chart
2:43:33patterns once you're in the website go
2:43:36to the option that says press screened
2:43:39and a drop down menu appears from the
2:43:41drop down select chart patterns this
2:43:44will take you to the Chart pattern
2:43:46screens and when you scroll down you get
2:43:48a lot of patterns from double and triple
2:43:51tops double and triple bottoms Head and
2:43:54Shoulders inverse Head and Shoulders
2:43:56triangle patterns but unlike trading
2:43:59view chart patterns indicators here you
2:44:01get the variants of triangle patterns
2:44:03sorted under different sections followed
2:44:05by rectangles and channels but here also
2:44:09a few patterns are missing like Flags
2:44:12Penance wedges broadening patterns Etc
2:44:15but I think this is more than enough
2:44:17because I majorly focus on triangles
2:44:20channels rectangles and sometimes Head
2:44:23and Shoulder patterns so if you are
2:44:25someone who is interested in the
2:44:27patterns not mentioned in this Craner
2:44:30then you can skip to the next section of
2:44:32the video but trust me this scanner will
2:44:34make life easier for you as you can see
2:44:37each pattern has subsections based upon
2:44:40different trading periods like short
2:44:43term medium 12 and long term and under
2:44:46each subsection there are different time
2:44:48frames from 5 minutes to daily through
2:44:51monthly now depending on your trading
2:44:53style that is how long you intend to
2:44:56hold a position and what time frame you
2:44:59trade on select an option that suits
2:45:01your requirement so it may be a
2:45:04short-term trade on a 15 minutes time
2:45:06frame or a medium term trade on a two
2:45:09hour time frame or even a long term
2:45:11trade on a daily or weekly time frame so
2:45:14once you have fixed the duration and
2:45:16time frame select it on the chart
2:45:18pattern you wish to scan for and once
2:45:21you click on it you will get a list of
2:45:23stocks that satisfies the criteria but
2:45:26in the free version you will only get a
2:45:28maximum of three results and if you want
2:45:31more results you need to purchase the
2:45:33Premium plan which cost around 2000
2:45:36rupees for anywhere but I suggest
2:45:38testing use the free version for a while
2:45:40and see if you really need it now let's
2:45:42get back to the discussion once the
2:45:44result comes up we get to see all the
2:45:47necessary details regarding the pattern
2:45:49namely the prices at which the pattern
2:45:51formation took place this is
2:45:53particularly useful because it helps you
2:45:55check for the pattern in the charts
2:45:57quite easily as you already know the
2:46:00price points to look for but there is
2:46:02already a built-in chart feature in the
2:46:04screener you can find this to the
2:46:06extreme right on the table once you
2:46:08click on the icon it will take you to
2:46:10the Chart which is by default a line
2:46:13chart which shows the patterns necessary
2:46:15price point with orange stars which
2:46:19makes it easier to spot you can change
2:46:21the charts to Candlestick by simply
2:46:24selecting from the drop down menu on top
2:46:26you even get the option to change the
2:46:29time frames and also the periods under
2:46:31consideration you can also find some
2:46:33useful indicators like volumes moving
2:46:36averages RSI fibonac Archie Etc which
2:46:39you can make use of or else you can
2:46:42always go back to your preferred
2:46:43starting tool like trading view which is
2:46:45much more powerful and easier to operate
2:46:48on so this is how you can use this
2:46:50scanner for spotting potential chart
2:46:52patterns you can check all other pattern
2:46:55screens in the same manner also keep in
2:46:57mind that this scanner will only scan
2:47:00for ongoing patterns and it will not
2:47:02show any data of previous patterns
2:47:04formed which is necessary for back
2:47:07testing now the drawback that I found
2:47:09out was that top stock research is not
2:47:12flexible enough to sort which category
2:47:15of stocks to consider for example I can
2:47:18just run a scan on only nifty 50 or
2:47:21Nifty hundred stocks due to this the
2:47:23scanned result can sometimes come out to
2:47:26be penny stocks or small gaps which is
2:47:28very risky and illiquid also it lacks
2:47:31some good patterns but it is somewhat
2:47:33compensated by the pattern breakout
2:47:35scans which give result of those pattern
2:47:38returns which have just broken out of
2:47:40the consolidation range okay now let's
2:47:43get on to the final method which
2:47:45revolves around screeners itself but
2:47:47here you have more control I am talking
2:47:50about charting and zero the streak both
2:47:53these are powerful screeners which are
2:47:55easy to use as there is no need to learn
2:47:58any custom codes but you still need to
2:48:01input the logic that you want to run on
2:48:03the chart but this process is quite easy
2:48:05and user-friendly let me talk about
2:48:08charting first one advantage with
2:48:10charting is that it has been around for
2:48:13a while so most of the chart pattern
2:48:15screens are already available so all you
2:48:18have to do is to search for the
2:48:19particular chart pattern that you want
2:48:21to scan on the chart now how should you
2:48:23do this I will explain in the top of the
2:48:26home page of charting you will find a
2:48:29screener menu just click on that option
2:48:31now a lot of scans just show up from
2:48:33fundamental scans to top Cloud to
2:48:36Candlestick pattern scans but the one we
2:48:38are looking for are chart pattern scans
2:48:41but we won't find any in this section so
2:48:44what you can do is that you can search
2:48:46for the required scan let's say I want
2:48:48to scan for a descending triangle
2:48:50pattern just type it and hit search a
2:48:53large number of scans show up now which
2:48:55one to select usually the ones shown the
2:48:58start of the results are the most loud
2:49:00scans so always try to stick with the
2:49:03first top 10 scans for now let me just
2:49:06click on the first result and it will
2:49:09take me to another page where I can see
2:49:11the logic written in simple and
2:49:14understandable manner now if you notice
2:49:16the first line says stock passes all of
2:49:20the below filters in Cache segment now
2:49:23this is where you can filter out stocks
2:49:25based on your requirement all you have
2:49:27to do is to click on the word before
2:49:29segment which in this case is cache and
2:49:32you will see a drop down list of all the
2:49:35available segments that you can choose
2:49:37from so so if you want only those stocks
2:49:40from future segment or only from Nifty
2:49:43hundred or Nifty five hundred just
2:49:45select it and move down the cursor to
2:49:48the Run scan button and click on it a
2:49:51new scan will run and it will give us
2:49:54the required shortlisted stocks under
2:49:56the segment that we have considered you
2:49:58can analyze every chart by clicking on
2:50:01the stop name but I am not really big
2:50:03fan of charting's charting tool so I
2:50:06would rather do my analysis on trading
2:50:08view or my trading terminal now if you
2:50:11have noticed the charting free version
2:50:13data is delayed by some 15 minutes so
2:50:17intraday chart pattern trading
2:50:19opportunities using the free version of
2:50:21charting won't really work out because
2:50:23the signals come late but if you are
2:50:26someone who is inducing trading or
2:50:28someone who uses end of the day data
2:50:30then this is not a big deal if the data
2:50:32is delayed also other features like
2:50:35alerts are only available on the premium
2:50:37version where you can set a lot of
2:50:39anodes for the setup you are looking for
2:50:41but I don't feel like you should pay
2:50:43money for premium version because first
2:50:46of all the charting is poor and you have
2:50:48to run the scans manually for new stocks
2:50:50and you can't do an automated trading
2:50:52and so on now that brings us to our next
2:50:55screener from strategy duster come I'll
2:50:58go trading site by streak which is a
2:51:00part of the saroda ecosystem you need to
2:51:03have an account with any of the
2:51:05following Brokers I already have an
2:51:08account with zaroda so I will login with
2:51:10zaroda and once you log in you will be
2:51:13welcomed with a neat homepage where you
2:51:15can see a discover section with the well
2:51:18performing strategies but for now we are
2:51:21only interested in Scanners so on the
2:51:23top click on the option that says
2:51:26scanners and a drop down appears just
2:51:29click on the Discover option and it will
2:51:31take us to a new page and as you scroll
2:51:34down you will be able to see a lot of
2:51:36custom scans now we will have to look
2:51:39for chart pattern scans for that click
2:51:41on the search scanner box on the left
2:51:44side then you can search for the pattern
2:51:47that you like but the problem with
2:51:49streak is that there aren't much chart
2:51:51pattern scans available a few of those
2:51:54already available scans in groups
2:51:56triangle patterns double dots double
2:51:59bottoms triple bottoms rectangle
2:52:01patterns and that is very much it so the
2:52:04only way to get other patterns is to
2:52:06make them by your own you can do this by
2:52:09going to create new on the right side
2:52:11panel or you can even find this on the
2:52:13top scanners drop down which goes by the
2:52:16name create scanners just click on any
2:52:19of them and you will be taken to a new
2:52:21scanner creation page it gives you the
2:52:24option to select the segment of stocks
2:52:26that you want to run the scan on now the
2:52:29interesting thing is that you can even
2:52:31scan options contracts of different
2:52:33expiries now the next option is to
2:52:36select the time frame that you want to
2:52:37run the scan for you get time frames
2:52:40from one minute to one day the next
2:52:42option is to juice the chart type you
2:52:44can select between candlesticks and
2:52:46hikanashi then there is a condition
2:52:49section where we will enter the required
2:52:51conditions for the pattern so what I
2:52:54recommend is that you go to charting
2:52:56search for the pattern you wish to trade
2:52:58then select the most load scan of that
2:53:01particular pattern copy or screenshot
2:53:04the code logic and then come back to
2:53:06string and fill the conditions into the
2:53:08condition section and once you are done
2:53:11give it a name and run the scan right
2:53:13now I don't have a Premium plan for
2:53:15streak so I can't run a scan but if you
2:53:18have a regular or ultimate plan you can
2:53:21run a large number of scans every day
2:53:24and you can even do a lot more than that
2:53:26you can backtest most of your trading
2:53:29strategies analyze them and even trade
2:53:32these strategies virtually using paper
2:53:34trading or you can do real time trading
2:53:36using your broker I think it is a value
2:53:39for money so you can check it out but
2:53:41this is not a recommendation or
2:53:43promotion I'm talking based on my
2:53:45experience because I have used this for
2:53:47back testing my strategies and paper
2:53:50trading automatically before I trade
2:53:52with real money so I think that is all
2:53:55the three methods that I wanted to share
2:53:57all of them have their own pros and cons
2:53:59so try all of them and choose the one
2:54:02that works well for you and if you have
2:54:05enjoyed the video please don't forget to
2:54:07like and share also make sure to
2:54:09subscribe to the channel and enable the
2:54:12Bell icon so that you won't miss out on
2:54:14any upcoming videos I will see you guys
2:54:16with another video till then bye

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