Trading Course Day 2: Indication — Transcript

Full transcript

1. 0:00So indication basically is when price
2. 0:03breaks above a high or a low level and
3. 0:07indicates that it is going in a certain
4. 0:10direction or a trend is starting in that
5. 0:12direction. So what we have here is price
6. 0:16ranging. So we'll have price ranging for
7. 0:18a bit
8. 0:20and then there will be an indication and
9. 0:22this indication can be either big or
10. 0:24small. It doesn't really matter. I
11. 0:25normally personally like to look for the
12. 0:274 hour one hour levels to do this. So
13. 0:30like let's say if we have our swings. So
14. 0:33swings is basically when price goes up
15. 0:36to a certain point and then it rejects
16. 0:39and then heads the opposite direction.
17. 0:41So these are swing highs and swing lows.
18. 0:44So just like we talked about yesterday,
19. 0:46the lower lows, lower highs, higher
20. 0:48lows, higher low um higher highs, it is
21. 0:51the same thing just price is equaled out
22. 0:55and that consolidation. So remember I
23. 0:57said we don't trade consolidation. That
24. 0:59is because we wait for those indications
25. 1:01to play a part. So then we know which
26. 1:04direction price is going to be headed.
27. 1:06So in this lesson basically going to
28. 1:09just mainly talk about the indications.
29. 1:11The indications will be coming from
30. 1:15price having that momentum, the higher
31. 1:17time frame and just overall trading when
32. 1:19price is in session with that volume. So
33. 1:24indications can only happen so write
34. 1:27this down. Indications can only happen
35. 1:31can only happen when it's breaking
36. 1:39above
37. 1:41or below
38. 1:44swings and that is highs and lows. So
39. 1:47swing highs and lows, right? So
40. 1:52indications only can happen from when
41. 1:54price is breaking these swing levels and
42. 1:57swing levels that you should be looking
43. 1:58for most of the time is going to be on
44. 2:00the 1 hour and 4 hour time frame. You
45. 2:03can even go for daily, but most of the
46. 2:05time if you're day trading, you really
47. 2:06want to hit that 4 hour and 1 hour
48. 2:08level. I personally use the one hour
49. 2:11level. It works for me a lot. There will
50. 2:13be some times where I scale to the 4
51. 2:15hour time frame just because the one
52. 2:16hour isn't as clear as the 4 hour time
53. 2:19frame. But
54. 2:22whenever I am um looking for, you know,
55. 2:26just overall the trend, I'm on that one
56. 2:28hour time frame. And what I'm doing on
57. 2:30this one hour time frame is waiting for
58. 2:32those swings to be broken into any
59. 2:35direction. It could be up or down.
60. 2:36Swings broken into that direction.
61. 2:39And that will be my indication. And that
62. 2:41what it's telling me, what an indication
63. 2:43is basically telling you is overall
64. 2:46showing you, hey, the trend is trying to
65. 2:48push in this direction of the market.
66. 2:51And this is indicating you that price is
67. 2:54having that momentum above or below that
68. 2:57level. So that way you know exactly
69. 3:00where the volume is coming from. Now,
70. 3:04what does most of this mean? you're
71. 3:05probably asking or like how do you
72. 3:07understand it? So, think about it this
73. 3:10way. The uptrend and the downtrend that
74. 3:12we talked about yesterday,
75. 3:14this is how it starts. So, you don't see
76. 3:17the whole uptrend yet, but this is
77. 3:20letting you know this is where it starts
78. 3:22at. So, you're not always you're not
79. 3:23going to catch the the the first of it.
80. 3:26So, what I showed you yesterday with the
81. 3:29uptrends and downtrends, right? So, the
82. 3:31uptrends and downtrends. So, we're just
83. 3:32going to do this downtrend. This is
84. 3:35where that indication mostly starts.
85. 3:37This right here, this this this move
86. 3:40right here starts that indication. Then
87. 3:43this is the correction and then this is
88. 3:44the continuation. Without this
89. 3:46indication, you won't be able to know
90. 3:49when to get into the market because it
91. 3:51would just never happen, right? So with
92. 3:54this indication, it overall shows you
93. 3:56like, okay, price is going to move above
94. 3:59this level. So we're going to put this
95. 4:01down right here. price is going to move
96. 4:04in a bullish manner above these swing
97. 4:07highs and it's going to push to a
98. 4:09certain level. So think of an indication
99. 4:12as basically the starting point of a
100. 4:15trend. So you need that starting point
101. 4:17so you can be able to utilize it,
102. 4:20understand its pattern, understand its
103. 4:21movement and why it's moving so that way
104. 4:24you can get into the charts or you can
105. 4:26get into the trade later on down the
106. 4:28line. So this is basically your
107. 4:33let's say let's say it this way right
108. 4:35this is the question. So this is the
109. 4:37question. This answers the question,
110. 4:40right? So what
111. 4:42question is this answering? Okay, most
112. 4:45people they'll look at the charts and
113. 4:46they'll be like, "What is the trend?"
114. 4:48Or, "What is the trend?"
115. 4:54And they'll be like,
116. 4:58"What is the trend?
117. 5:01And where
118. 5:04is price?"
119. 5:09So, they normally ask both of these two
120. 5:12things, right? What is the trend? Where
121. 5:14is price headed? And the best way to
122. 5:16answer these two questions is overall
123. 5:19looking at those swings. One second.
124. 5:23The best way to answer this is what is
125. 5:26the trend? So what is the trend
126. 5:28currently? Looking at the swings, are
127. 5:30your swings going higher or lower or are
128. 5:33they getting lower and lower? So best
129. 5:36way to answer it is are your swings
130. 5:39getting higher or are your swings
131. 5:41getting lower? So if your swings are
132. 5:43getting higher, most likely price is
133. 5:46becoming into an uptrend. If your swings
134. 5:48are going lower, then most of the times
135. 5:50your trade is going into a downtrend.
136. 5:53Not most of the times, but all the times
137. 5:54your trade is going in a downtrend. So
138. 5:57the best way to overall
139. 6:00look at an indication is
140. 6:03is my swings getting is is this making
141. 6:06my swings go higher or is it making my
142. 6:08swings go lower? So, in this case, if
143. 6:10we're looking at it, these are our
144. 6:12swings. So, I'm gonna mark it out for
145. 6:14you so you know what swings are. Swings.
146. 6:18And because our swing, we have our um
147. 6:21swing highs right here. So, swing high,
148. 6:23swing high, price,
149. 6:26think of a high as the highest point it
150. 6:29can go. And if we have those swing
151. 6:32highs, if anything goes above those
152. 6:34swing highs, then we have new swing
153. 6:35highs. And if we have new swing highs
154. 6:38that means we have a uptrend starting or
155. 6:40price has bullish momentum. So also with
156. 6:44that indication this also shows at a
157. 6:47certain price point. So let's say this
158. 6:49is 500. Let's say this gray area is 500.
159. 6:52Right?
160. 6:55What this goes to show this 500 level.
161. 6:58So this level of 500 price breaks above
162. 7:01that 500 level. So then this means
163. 7:04anything above 500 will have the same
164. 7:07momentum as it had before. So the same
165. 7:10momentum that's driving it up to let's
166. 7:13say
167. 7:14600, right? So let's say this goes up to
168. 7:17600.
169. 7:20So that indication is now going to show
170. 7:23this is where that momentum started. It
171. 7:26started anywhere above 500. So, anything
172. 7:29above 500 has the potential to go to
173. 7:32600, right? That's basically what an
174. 7:34indication is showing you. So, it's
175. 7:36showing you where your entry is going to
176. 7:37be and it's showing you where the exit
177. 7:39is going to be because when price gets
178. 7:42to a certain level. Um, we're going to
179. 7:44talk later on about time frames, but now
180. 7:47price is going to go and time frames and
181. 7:50corrections because those are both
182. 7:52important. But what price is going to
183. 7:53end up doing is having that correction,
184. 7:55which we'll talk about in another video.
185. 7:57But that indication will later on have a
186. 8:00correction which then you'll look for
187. 8:02price to switch the trend, switch the
188. 8:04market structure and come back above
189. 8:06this level. And that will be your entry
190. 8:08point for the next go around. And you
191. 8:10know, like I said, there's going to be
192. 8:12more videos. There's going to be more
193. 8:14videos down the line to basically show
194. 8:16you like the the the correction, the
195. 8:19continuation, how to seek those
196. 8:21reversals, how to find those reversals
197. 8:23based off the swings. But the most
198. 8:25important part is finding that
199. 8:27indication and understanding indications
200. 8:30can only happen from when it's breaking
201. 8:32swing levels. So with this being said,
202. 8:35since our swing highs are broken, now we
203. 8:38have a new high. And after a new high or
204. 8:40after any new market structure is um
205. 8:43shown to the market, normally price ends
206. 8:46up grabbing liquidity. But I'm not going
207. 8:48to confuse you just yet. But
208. 8:52after price makes a new high, just
209. 8:54prepare to see price have some type of
210. 8:58correction, some type of movement to
211. 9:00shake the people out because the reason
212. 9:02why we don't trade this is because of
213. 9:05that liquidity that comes after. It
214. 9:06could be very strong, it could be
215. 9:08subtle, it could be, you know, not the
216. 9:10biggest or it could be no liquidity
217. 9:12grabbed at all, but most of the times
218. 9:14after price makes a new high, it ends up
219. 9:16grabbing liquidity in the market, taking
220. 9:18people out and then having that second
221. 9:20goround, you know. So in this case, we
222. 9:24already know what an indication is. Let
223. 9:25me show you what it looks like on the
224. 9:29charts. Um let's see here. We can go to
225. 9:32a 30 minute time frame and we can kind
226. 9:35of just start from here from this week.
227. 9:38So this 30 minute time frame as well,
228. 9:41you can use 1 hour, 4 hour, 30 minute,
229. 9:44right? So in this case, we have
230. 9:47that swing high level, right? So, we're
231. 9:49going to focus on this swing high level,
232. 9:51and I want you to see the indications
233. 9:52that happened above this level that
234. 9:54showed you that above this level, price
235. 9:57was going to have that bullish momentum,
236. 9:59right? So,
237. 10:01first we have our swing high. Swing high
238. 10:04is holding up a level. So, we have our
239. 10:05swing high, swing low, just like we seen
240. 10:07in the picture that I just showed just a
241. 10:09couple seconds ago. Swing high, swing
242. 10:11low, and then price has that indication.
243. 10:14That indication pushes above the swing
244. 10:16highs that we have. And since that did
245. 10:19that, it had that correction, took
246. 10:21people out of the markets just a tad bit
247. 10:23and then continued to go up and make a
248. 10:26new high. So now we have a new swing
249. 10:28high. So overall, we can see that price
250. 10:30continues to break it swing highs and
251. 10:32keeps getting higher. So this means
252. 10:34price is in a uptrend, right? And as
253. 10:37well, I want you to take note as well
254. 10:39that price when it's making these swing
255. 10:41highs is making supports too as well. So
256. 10:44this is our previous support and then we
257. 10:46can see price goes up and we can count
258. 10:48this as support. It's a very subtle um
259. 10:52support. Y it's a very subtle support
260. 10:57but you can still count it as support.
261. 10:59Overall price was holding this level
262. 11:01which made this whole movement in
263. 11:03general but you at the time you would
264. 11:05have never seen that price was going to
265. 11:08just make this subtle support and then
266. 11:10continue. But you knew that this was the
267. 11:12push up. So once again, we have that
268. 11:15support. Price retested that support. So
269. 11:17overall, not breaking any structure to
270. 11:20make us think otherwise than our
271. 11:22uptrend. And then if you want to count
272. 11:24this as a support too as well. So if we
273. 11:26count this as a support, I'm going to
274. 11:27kind of show you what I mean. If we
275. 11:29count this as a support, right, then we
276. 11:32have that push off the support and then
277. 11:34we can see that price ends up making
278. 11:35that new high and then breaking the
279. 11:38structure that we had on that support.
280. 11:40If we mark this as support. So if we
281. 11:42looked at as this as support then we can
282. 11:46see that oh price is breaking the trend
283. 11:49or price is trying to reverse which I'm
284. 11:52going explain later on down the line in
285. 11:54the other videos is if we have this so
286. 11:58if we have if if we have price showing
287. 12:01us like hey price is breaking the
288. 12:03support the reason why we wait that
289. 12:05second time around is to avoid these
290. 12:07fakeouts because this will not bother us
291. 12:10because we don't have that second push
292. 12:12down. It broke once but eventually came
293. 12:15right back above that same level that we
294. 12:17had the indication in the first place
295. 12:19and bought even more. Right? This
296. 12:22happened only because price has a new
297. 12:25high. So, that's what I'm trying to get
298. 12:27you guys to understand is like when it
299. 12:29comes to trading based off those
300. 12:31breakouts, you want to be very, very
301. 12:33careful because price can sometimes
302. 12:36liquidate you and you won't even know it
303. 12:37because you're just trading based off
304. 12:38the breakout instead of trading based
305. 12:41off the market structure. So, you can
306. 12:42trade long term. You don't want to trade
307. 12:45where you're, you know, in a trade for a
308. 12:47bit and you're not able to capitalize
309. 12:49off the whole trend. You want to be able
310. 12:51to put yourself in a good position where
311. 12:53you can capitalize off the whole trend,
312. 12:55not just a little bit of it. And it is
313. 12:57very possible to be able to catch a
314. 13:00bigger piece of the trend than just a
315. 13:02small day out of the trend. So you don't
316. 13:04want to constantly try to keep looking
317. 13:06for different days where you can get
318. 13:08into the trend when you can only trade
319. 13:09one day and be able to hold for the next
320. 13:11three, four and maximize your profits
321. 13:14based off that. So once again, that low
322. 13:18was made and it respected the It didn't
323. 13:21break any further than what it did, but
324. 13:23this movement down was based off it
325. 13:25having a new high. I guess you could say
326. 13:28a new indication. And a new indication.
327. 13:31So, new
328. 13:34indication will cause price to drop
329. 13:38dramatically or drop in a certain way
330. 13:40because of all that liquidity that the
331. 13:43market can grab. If it sees that a lot
332. 13:46of people are getting into the markets
333. 13:47on a breakout, then price is going to
334. 13:50make a subtle movement to the opposite
335. 13:52direction to wipe out as much money as
336. 13:54possible. And also as well, this was
337. 13:56news as well. But
338. 13:59those this just goes to show when it
339. 14:01comes to the indication, you want to
340. 14:02avoid trading the indication, but more
341. 14:05so of looking at it as information. So,
342. 14:08the whole point of this video is to look
343. 14:10at the indication as a as a I guess you
344. 14:15could say a blueprint up to what you're
345. 14:16going to do, right? So, look at it as
346. 14:19where your entry is going to be, where
347. 14:20your exit's going to be. And after the
348. 14:23correction, that's when we'll go over
349. 14:25the stop-loss levels and where you need
350. 14:27to set your stop levels. But the
351. 14:28indication is overall to provide you the
352. 14:31entry and the takerit that you're going
353. 14:34to use.