Heikin Ashi Strategy **Best for Swing Trading** — Transcript

Full transcript

1. 0:00If you want to swing trade and get a long-term position in a trend
2. 0:05heiken, Ashi candles are very very good.
3. 0:08If however you are scalping, I can actually candles can be very
4. 0:12detrimental in this video, I'm going to explain how you can trade
5. 0:15heiken, Ashi candles the proper way and why you shouldn't use them
6. 0:20when your scalping
7. 0:24Welcome back to the channel, everybody.
8. 0:26My name's already.
9. 0:26And this is the moving averages, shall we discuss everything day
10. 0:30trading to keep you profitable on a consistent basis?
11. 0:3399% of my videos are based on V or requests.
12. 0:36So this is a highly requested video.
13. 0:38People want to learn how to trade heiken Ashi candles.
14. 0:42I'm going to do my best to explain how exactly to read these
15. 0:45candlesticks as well as give you a reference video that you need to
16. 0:50watch in order to fully understand it because if I did both of those
17. 0:53things in this video, it be 30 minutes long.
18. 0:55So let's get into the charts.
19. 0:57All right, so I have us30 up on the charts and I'm doing this because
20. 1:01us-30 is one of the most strongest, trending things that you can trade
21. 1:06it.
22. 1:07Stays consistent.
23. 1:08Yes.
24. 1:08Darling, wakes up and down but overall the consistency of us 30 and
25. 1:14the trend, this is literally the trend of the financial markets in the
26. 1:17United States.
27. 1:18So in comparison way less volatility to say a cryptocurrency with a
28. 1:22traditional bullish, Japanese can
29. 1:24Prices.
30. 1:25Open up here and clothes here.
31. 1:27The next candle that forms opens at the exact point that the previous
32. 1:32candle closed.
33. 1:33Most of the time, there's the rare occasion with a price jumps within
34. 1:36that one second.
35. 1:37Conversely, if you look at heikin, Ashi candles they actually overlap
36. 1:43each other.
37. 1:43There's a reason for this because of these candles aren't specific to
38. 1:48the exact price action at that time.
39. 1:51High can a she breaks down into two words, hicken and Ashi hicken is
40. 1:56average, and a, she is pace.
41. 1:59So, these candles show, the average pace of the price movement, that
42. 2:03is one of the primary reasons you should not use this for scalping
43. 2:06because when the price moves up or down, it doesn't show it concretely
44. 2:11on this Candlestick and you could go into a massive drawdown,
45. 2:15especially if you're in a short-term position.
46. 2:17You don't want that kind of drawdown.
47. 2:19When you're only trying to get a small move, however, this is one of
48. 2:23the most lethal.
49. 2:24Ways to trade with the trend to see when the trend is slowing.
50. 2:28And when a reversal is potentially going to happen.
51. 2:31So I'm going to link down below.
52. 2:33This is one of the greatest YouTube videos explaining everything about
53. 2:38heiken, Ashi candles and how they're formed and how their structured
54. 2:41absolutely everything.
55. 2:42This is one of my favorite YouTube channels as a technical analyst.
56. 2:47I watch these videos constantly to learn every aspect of trading,
57. 2:51every aspect of reading chart.
58. 2:53The secret mindset is one of my favorite YouTube trading channel.
59. 2:58So if you aren't subscribed to that channel, you definitely should be.
60. 3:01Anyway, I've got a link to his heikin-ashi candle video, down below.
61. 3:06This one, it's in the description after you're done watching this,
62. 3:10watch that.
63. 3:11So you have a full understanding of how I would place a trade and how
64. 3:15these candles are structured.
65. 3:16But essentially, you can get massive moves and really, really good
66. 3:20profits.
67. 3:21And actually hold a trade in the trend.
68. 3:24The entire direction of that trend from start to finish.
69. 3:28Okay, I've got this zoomed in as close as I can.
70. 3:31The thing that you want to look out for, there's three different
71. 3:35phases of heiken, Ashi candles that are huge body long wick candles in
72. 3:39the down Direction and huge body long with candles on the upper
73. 3:43direction.
74. 3:44If you notice the difference, however, when we are in a strong, strong
75. 3:48downtrend, there are no Wicks on the upper sides of these candles.
76. 3:53Only on the Lower Side, conversely on the bullish Candles, there are
77. 3:58no Wicks on the bottom, only on the top.
78. 4:02So as you guys know, when looking at Trends on normal Japanese
79. 4:05candlesticks, the price will go up, come down, come up, come down, and
80. 4:09we are in an uptrend in this scenario.
81. 4:11Then eventually, once we get to the top, you start seeing a break and
82. 4:15structure and a new downtrend form with heiken.
83. 4:18Ashi candles, and Trend trading.
84. 4:19You actually don't get too many of these.
85. 4:22It reduces all of this noise.
86. 4:24And just shows you the clear up Trent.
87. 4:26Now in the trend starts reversing at this point right here.
88. 4:29Heiken, Ashi candles actually get you a earlier entry than waiting for
89. 4:33structure to be broken.
90. 4:35I'm going to show you exactly how this happens in the candles
91. 4:38themselves.
92. 4:38So always at the bottoms and tops of Trends, you can see that these
93. 4:43heiken Ashi candles are much smaller with Wix on the top and the
94. 4:48bottom.
95. 4:48This do g style candle is where the trend is likely to go.
96. 4:54The opposite direction than two candles.
97. 4:56After that, we get our first heikin Ashi candle where there is
98. 5:00absolutely no wick on the bottom.
99. 5:02This candle right here is the entry point for the new trend direction,
100. 5:07as the trend get stronger, and goes up, these candle bodies, become
101. 5:12absolutely humongous.
102. 5:14Then once the trend starts to slow down the candle body is reduced in
103. 5:19size and then you start getting Wicks on the tops and the bottoms.
104. 5:24Then our first opposite color candle with a wick on the top and the
105. 5:28bottom, another do g style, candle immediately.
106. 5:32After that, you get your first heikin-ashi candle without a wick on
107. 5:36the top showing the formation of a new downtrend.
108. 5:40This happens every time where you get Wicks on the top and the bottom
109. 5:43of the heiken, Ashi candles and they are much smaller than the strong
110. 5:47downtrend candles or the strong uptrend candles than the moment that
111. 5:51you get one of these non wick candles in the opposite direction, that
112. 5:54is the start of the new trend.
113. 5:56So simply by doing that.
114. 5:57Looking for these small do g style candles with a wick on the top or
115. 6:02the bottom and waiting for this first candle to form without a wick on
116. 6:07the bottom, you can place a trade at the close of that candle with a
117. 6:12stoploss below.
118. 6:13That swing low and I want you guys to be going for 221 risk-to-reward
119. 6:16ratio with this strategy.
120. 6:18But what I need you guys to do, if you are doing this is to set your
121. 6:23trade according to
122. 6:24These prices and close your trading application.
123. 6:27Let the trade play out because like I mentioned before, this is
124. 6:31absolutely horrible for scalloping.
125. 6:33If you were to enter in on this trade at this price right here, when
126. 6:37this candle closed, which is at 34417 the price range within that next
127. 6:44candle to 34388, which is nearly a 40-point, move on US 30, which if
128. 6:53your scalping.
129. 6:53Hi lot sizes with a smaller accounts eyes.
130. 6:57It's going to really really hurt you.
131. 6:59And you're going to think that the price is going the other way.
132. 7:01You're going to close it early and you're going to miss that Trend.
133. 7:04So if you're new to heiken Ashi and you want to try this out, do it on
134. 7:08demo, place the trade and literally close the trading app, you don't
135. 7:11want to see it again.
136. 7:13The price moved all the way up.
137. 7:15You started to get smaller candles, then you get the do g style candle
138. 7:19with a wick on the top and the bottom, you wait for that candle to
139. 7:22close.
140. 7:22Always wait for the candle.
141. 7:24The clothes you sent your stop-loss just above the swing high and you
142. 7:29have a risk-reward ratio of 1 to 2.
143. 7:32This one is a little bit if you're because the candle body is a lot
144. 7:36bigger than I would expect with these types of doji Candlestick but
145. 7:40you could have still gotten in on this one.
146. 7:42With the first.
147. 7:43No Wick candle going for a two-to-one.
148. 7:46Risk-to-reward ratio at the close of that candle stop-loss below the
149. 7:51swing low and these are the three back-to-back, perfect trades.
150. 7:55Know what I really want you to focus on is, look at the size of this
151. 7:59first candle, that shift the momentum in the opposite direction.
152. 8:02It is substantially larger than that doji candle here and hear what I
153. 8:08want you to avoid is things like this.
154. 8:11You get your do g style candle and then these subsequent candles are
155. 8:16very, very small.
156. 8:18These are not momentum moving candles and can actually keep you in a
157. 8:22period of consolidation for
158. 8:24Write an extended.
159. 8:25Of time.
160. 8:25If you want to try this strategy, only do it on demo.
161. 8:29You need to get comfortable with it first.
162. 8:31You been reading the standard Japanese candles for a long time and now
163. 8:35you're completely changing it up to heiken.
164. 8:37Ashi candles, it's a different way of looking at Kendall.
165. 8:41That's why you need to watch that other video fully explaining it.
166. 8:44I can explain it to you too but he does it way better than I would and
167. 8:47he's already done it.
168. 8:48So why reinvent the wheel that being said using heiken?
169. 8:51Ashi candles is one of the strongest ways to actually hold a trade
170. 8:55through a trend if you just want to start out and do this one to two
171. 8:59risk-reward ratio, that's completely fine.
172. 9:01But if you have time and you sit on the charts all day and you've
173. 9:06marked up your support and resistance zones.
174. 9:08And you see these heiken, Ashi candles coming up and getting smaller
175. 9:11and smaller and smaller with Wix on the top.
176. 9:14And the bottom, you can actually hold this entire move until you see
177. 9:18candles like that.
178. 9:19Getting you a massive profits.
179. 9:21This was a 477.
180. 9:24Move with a 150 points.
181. 9:27Top lock, this is a great trade, 123 risk-to-reward ratio.
182. 9:31This one would have stayed about where it was at a 1 to 2.
183. 9:34And this one, you could have gotten a few more points out of a 234
184. 9:38points with a 91 Point.
185. 9:40Stop-lossed heiken, Ashi candles are very very powerful when intraday
186. 9:44trading as well as swing trading.
187. 9:47But if you are, scalping, I'm going to say this again, do not trade
188. 9:50heiken Ashi candles, because for scalping, the difference between what
189. 9:54the candle is showing and what that price is actually doing at that
190. 9:58exact second is huge, so you need to have those way bigger.
191. 10:01Stop-losses to catch the entire Trend.
192. 10:04Keeping your stop-loss below that swing high or swing low.
193. 10:08Now, do you guys think that I'm cherry-picking?
194. 10:10Some random examples?
195. 10:11Look doji candle swing, low doji, candle of Swing High Doja candle,
196. 10:16swing, low doji, candle swing high.
197. 10:18Like it's consistent time and time again.
198. 10:21Doji candle, swing, low doji, candle swing High.
199. 10:24Big fat bodies, big momentum move.
200. 10:27Once these candles, get smaller, momentum slows down, and the price is
201. 10:31probably going to go in the opposite direction.
202. 10:32Then you start seeing the big candles up, they get smaller doji
203. 10:37candle, swing down, it's literally every single time.
204. 10:40And I only want you guys to do this on a high time frame, nothing less
205. 10:45than the one hour chart.
206. 10:46The one hour chart is very ideal for us 30.
207. 10:49I've been back testing this throughout the last few hours and it's
208. 10:52absolutely nuts.
209. 10:53So, if you want to trade and set it and forget it, this is the way to
210. 10:57do it.
211. 10:57But if your scalping, don't even touch this with a 39 and a half foot
212. 11:00Bull.
213. 11:01Now, if you guys do want to learn how to scalp on traditional
214. 11:04Japanese, candlesticks going with the trend, or looking at
215. 11:07counter-trend trades, check out this video right here.
216. 11:10And if you guys got some value out of this video, you like the way
217. 11:13that I teach and you want to see more videos like this, make sure your
218. 11:16subscribe to the channel by clicking this button right here.
219. 11:18Thanks so much for watching and we'll see you in the next.