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Chart Patterns

A B C WAVE BULL RUNI am looking at this unfolding. An A,B,C wave up. Most of the people commenting we are going down are trolls or uneducated. Just look at where we came from not to long ago at 13k so how is 40k a bear run, LOL. It is important to understand that reading different time charts is required to understand where we are going with price action. to find out where we are going for the hour, I look at the 4 hour , 6 hour and last 3 days. You have to zoom out to see and read the day and hours to understand the micro supports and resistance. I also hunt liquidity because thats a MM move. MM will always make money, so why not follow the MM along with reading maps and charts. we are definitely in a bull run. The ocean high and low tides have different up and down size waves, trading is like watching the ocean waves and predicting the behavior patterns of it, now translate that action in to human emotions, witch no one should trade with, but 80% do, so use it with MM. You have to follow the crowd to get in to the show, only a few selected can use the back stage doors. Cheers all. This is all just my observation and Opinion.
COINBASE:BTCUSDEducation
by walkndeadbigfoot
Decoding Simplified Wyckoff: Trding Market Trends with Clarity The Wyckoff Method, developed in the early 20th century by Richard Demille Wyckoff (1873–1934), a pioneering figure in technical analysis, which is still widely used and resonates within markets today. This comprehensive approach to trading is based on the relationship between supply and demand. Wyckoff's interest in the stock market materialized at the age of only 15 when he became a stock runner, thriving in the fast-paced, exuberant environment of the trading floor he came to love. Over the years, Wyckoff had the opportunity to observe the market and strategically study the strategies of the most successful traders of his time, notably Jesse Livermore and James R. Keene. With the finest attention to detail, these methodical extensive observations led Wyckoff to conclude that markets, no matter how old or liquid, are primarily governed by the laws of supply and demand. It was, in fact, large institutions and the monetary systems that underscored them that often influenced the markets. Believing that retail traders could identify the direction of market trends also, Wyckoff then set out on his next quest of understanding the market operations of these 'Composite Operators', a term he forged to describe the big players. Wyckoff believed that market behaviour could be predicted with a reasonable degree of accuracy by recognizing regular patterns. His method focuses on identifying the intentions of large institutional players, or "SmartMoney," and traded in harmony with them rather than the varied and numerous market participants. In 1907, Wyckoff founded "The Magazine of Wall Street," which gave him access to insights from many of the greatest traders of his day and further enriched his understanding of market dynamics. He also established a brokerage firm and later an educational institution, the Stock Market Institute, to teach his methods. There are 5 Stages or Steps that complete the Wyckoff Method: The Three Fundamental Laws. Market Cycles. Identification of Phases. Wykoff's Price Volume Analysis. Trading Ranges. 1. The Three Fundamental Laws: A) The Law of Supply and Demand governs price direction: Excess demand over supply propels prices upwards, whereas excess supply over demand drives prices downwards. B) The Law of Cause and Effect: Central to forecasting the potential range of price movements, the 'cause' is quantified by the horizontal point count within a trading range. The 'effect' is the extent of the price movement aligned with the period of either accumulation or distribution. C) The Law of Effort vs Result: A comparative analysis between the volume (effort) and the resulting price movement (result). This law declares that volume should confirm the price trend. Discrepancies between effort and result often signify a forthcoming shift in trend. 2. Market Cycles: The Wyckoff Method encapsulates the market's rhythm in a cyclical model. The model consists of four sequential stages: Accumulation, Markup, Distribution, and Markdown. A)- Accumulation: This stage is characterized by significant buying from large operators, who absorb available supply in anticipation of an upcoming bull market. B)- Markup: Post-accumulation, the ensuing demand drives the price upward. C)- Distribution: Following a sustained markup, the market witnesses distribution as large operators offload their coins (crypto) to the public, tipping the scales towards an excess supply. D)- Markdown: In this phase, prices weaken as the previously dominant demand is now overwhelmed by supply. 3. Identification of Phases: Wyckoff's method outlines distinct phases within the accumulation and distribution cycles to assist traders in determining the coin's (crypto) accumulation or distribution periods. Accumulation Phases: - PS (Preliminary Support): this is the phase where the selling pressure diminishes. - SC (Selling Climax): this phase is characterized by peak levels of panic selling. ST (Secondary Test): this phase Tests the newfound level of demand. SOS (Sign of Strength): Indicates a potent upward movement, suggesting the potential for higher prices. Distribution Phases: PL (Preliminary Supply): this phase is Where the initial signs of declining buying pressure emerge. BC (Buying Climax): this phase Represents the pinnacle of buying enthusiasm. AR (Automatic Reaction): this phase Represents The ensuing price decline post-buying exhaustion. ST (Secondary Test): this phase Assesses the established supply level. UT (Upthrust): This phase Characterizes a sign of market weakness, a potentially telltale sign of a forthcoming decrease in pricing. 4. Wyckoff's Price Volume Analysis: An essential tool in the Wyckoff Method is price and volume analysis. Wyckoff analysts look for price-volume convergence and divergence to understand the strength of a trend. They also look for specific patterns such as 'Springs' and 'Upthrusts', which are considered traps that go against the prevailing trend and indicate a potential reversal. 5. Trading Ranges: Wyckoff places considerable emphasis on trading ranges, perceiving them as critical phases of equilibrium where supply and demand find a balance. Breakouts from these ranges signal the onset of a new trend, whereas breakdowns typically indicate reversals. SmartMoneyDayTrading©️
EIGHTCAP:BTCUSDEducation
by SmartMoneyDayTrading
3
The Ultimate Strategy | ChoCh + InducementThis strategy is based on identifying a market structure, which can be bullish or bearish. In this specific case, a bullish structure characterized by rising highs and lows is considered. The expectation is for the market to change direction, creating a shock. Subsequently, the formation of a liquidity block is observed during a market consolidation phase, followed by entering a demand zone where the imbalance dictates, and the response is a downward movement, as anticipated. The target of this movement is defined graphically. Greetings and happy trading to everyone.
Education
by Forex48_TradingAcademy
3
How Global Market Shifts Shape the Crypto FrontierHow Global Market Shifts Shape the Crypto Frontier In the ever-evolving landscape of global finance, a keen understanding of broader market dynamics is crucial, especially when analyzing cryptocurrencies like Bitcoin. The recent tumultuous events in China's stock exchanges provide a rich context for this analysis, especially when viewed through the lens of Bitcoin's ongoing Wyckoff pattern. Today's trading session in China marked a significant downturn, halting nearly a third of all stocks and sending the CSI 1000 index plummeting by 8% in just a few hours. This drastic movement forms a stark contrast against other major indices: - CSI 1000: Tumbled by 8% - Star 50: Dipped by 5% - Beijing 50: Slid by 4% - Shenzhen Index: Dropped by 4% - Shanghai Composite: Decreased by 3% Intriguingly, the CSI 100 and Hong Kong 50 indices, which track the larger-cap stocks, have shown resilience amidst this decline, hinting at a deeper narrative. This divergence raises critical questions about the robustness of large-cap stocks during broader market downturns and what insights they can offer to the discerning investor. This market behavior aligns intriguingly with Susan Strange's theory on power structures, suggesting a potential realignment in global economic governance. The precipitous drop in the CSI 1000 index might be signaling the early stages of this shift, potentially reshaping financial landscapes across borders. For the cryptocurrency markets, these shifts are particularly noteworthy. Cryptocurrencies often capitalize on uncertainty and change, positioning themselves as alternatives during times of traditional market instability. The current market dynamics could indicate more than just routine fluctuations; they might signify a profound transformation in global power structures, a change that astute crypto investors and traders should vigilantly monitor. In the broader context of global finance, unpredictable and impactful Black Swan events, such as the recent turmoil within China's CSI 1000 index, serve as reminders of the interconnectedness and fragility of our economic systems. Cryptocurrency, especially Bitcoin, is not immune to these shockwaves, as evidenced by its performance during significant market upheavals like the onset of the COVID-19 pandemic. Despite an initial sharp correction, Bitcoin demonstrated remarkable resilience, recovering to new heights and underlining the robust narrative of cryptocurrencies. Today's market patterns echo this resilience. The Wyckoff method, a time-honored approach that marries price action with investor psychology, suggests that the current downturn might be a precursor to a robust recovery. This perspective offers a glimmer of hope amidst potential instability, reinforcing the narrative of strength and endurance within the digital asset class. SmartMoneyDayTrading©️ For investors, this situation calls for cautious optimism. While market movements remain inherently unpredictable, the amalgamation of historical insights and analytical frameworks like the TLS & Wyckoff method provides a strategic lens through which to view the future. These tools suggest that, despite short-term challenges, the long-term trajectory for cryptocurrencies is likely upward, reflecting the enduring spirit of innovation that defines the sector. In these turbulent times, staying informed and adaptable is paramount. History may not replicate itself precisely, but it often offers echoes and patterns that can guide our understanding and actions. As we witness the current shifts, it becomes increasingly clear that a profound comprehension of the past can empower us to anticipate and navigate the future, particularly in the dynamic and interconnected realm of cryptocurrency.
SSE:000852Education
by SmartMoneyDayTrading
1
Why You Should Avoid Trading Standard Patterns: Deeper AnalysisTrading based on technical analysis is a popular way for traders to identify market opportunities. One of the most common methods of technical analysis is the use of chart patterns. These patterns are recognizable formations created by price movements on a chart. Traders use these patterns to identify potential areas of support and resistance, as well as trend reversals. However, there are several reasons why you should avoid trading standard patterns: 1. Widespread Awareness and Anticipation: Standard patterns are well-known and widely anticipated by market participants. This means that they are already priced in, making trading them a low-probability strategy. 2. Potential for False Signals: The formation of a pattern on a chart does not guarantee the expected outcome. In fact, standard patterns can often lead to false breakouts and failed trades. 3. Difficulty in Trading Effectively: Trading standard patterns effectively requires a high level of skill and experience. Without a deep understanding of market structure and price behavior, traders can easily fall victim to false signals and whipsaws. Advantages of Trading Liquidity Patterns: Liquidity patterns offer a more effective and reliable alternative to standard patterns. These patterns are based on the concept of market liquidity, which refers to the ease with which an asset can be bought or sold without impacting its price. By identifying areas of high and low liquidity, traders can gain an edge in the market. In-depth Analysis of Popular Patterns: 1. Double Bottom: The classic double bottom pattern is a bullish reversal pattern that forms when the price of an asset makes two consecutive lows at the same level, followed by a rally. However, the standard double bottom pattern has a significant drawback: it leaves liquidity below the lows, which can lead to false breakouts and failed trades. A more effective way to trade this pattern is to look for a lower low. This occurs when the price makes a new low below the previous two lows. This indicates that the market is absorbing all the sell liquidity and is ready to move higher. 2. Triangle: A triangle is a consolidation pattern that forms when the price of an asset ranges between two converging trendlines. Traders often look for breakout trades in triangles, but this can be risky. False breakouts are a common occurrence in triangle patterns. This is because market makers often manipulate the price to induce traders to break out of the pattern, only to reverse the price and trap them in losing trades. A more effective way to trade triangles is to look for liquidity grabs. This occurs when the price moves outside of the triangle, only to quickly return back inside. This indicates that market makers are taking liquidity from the market and are preparing to move the price in the opposite direction. Practical Tips for Trading Liquidity Patterns: Always trade with the trend. Liquidity patterns are most effective when they are traded in the direction of the overall trend. Use stop-loss orders to protect your downside. This will help to limit your losses if the trade does not go your way. Be patient and wait for the right setup. Don't force trades and only take those that meet your criteria. Additional Considerations: Market context: It is important to consider the overall market context when trading liquidity patterns. For example, patterns are more likely to be successful in trending markets than in range-bound markets. Risk management : Always use sound risk management principles when trading, regardless of the pattern you are using. This includes using stop-loss orders and position sizing appropriately. False signals: It is important to be aware of the potential for false signals when trading liquidity patterns. Not all patterns will lead to successful trades, and it is important to be prepared for losses.
Education
by Yaroslav_Krasko
3
Mastering MKR Moves: A TLS System Approach Mastering MKR Moves: A TLS System Approach Looking into the complexities of MKR's market patterns, we're applying the Traffic Light System (TLS) to guide us through the ups and downs and decode potential trade setups. 🚦 TLS Analysis on MKR: MKR's daily chart shows tactical entry points and critical thresholds, similar to steering a complex intersection with traffic signals. 🟢 Green Zones - Go for Growth: Our analysis spots potential 'Green Buy Zones' where the price action suggests a strong support level. In these areas, traders might consider long positions, aligning with a bullish sentiment and a possible uptrend continuation. 🟡 Amber Zones - Caution Ahead: In the 'Amber Zones', we encounter a mix of support and resistance levels where the market's decision is pending. Here, the risk is heightened, and traders should proceed cautiously, ready to pivot based on new information. 🔴 Red Zones - Potential Pullbacks: The 'Red Sell Zones' are where we anticipate resistance that could lead to price pullbacks. Traders might look to take profits or initiate short positions, especially if other market indicators align with a bearish outlook. 🔄 Trading MKR's Current Setup: Keep a close watch on the symmetrical triangle formation for breakout signals both to the upside and downside. Place strategic trades within the TLS-identified zones, tailoring your approach to the prevailing market sentiment upon retesting the triangle structure after the breakouts occur. Utilize stop losses rigorously to safeguard against sudden market shifts. Road Ahead: In the crypto arena, MKR's path reflects the market's broader narrative. It's essential to consider global economic signals, such as the recent tremors in the CSI 1000 index, and integrate these into your crypto trading strategy. Note: This post is for educational purposes and should not be construed as financial advice. Always conduct your research and trade within your risk tolerance. SmartMoneyDayTrading©️
Education
by SmartMoneyDayTrading
3
Trading a Symmetrical Triangle with Traffic Light SystemTrading a Symmetrical Triangle with Traffic Light System: Identifying, Trading Fakeouts, and Ensuring a consistent profitable Positive Expectancy Identify the Symmetrical Triangle: Locate the symmetrical triangle pattern on the chart, formed by converging trendlines with symmetry. Implemention of TLS: Green Light (Action): Observe consolidation above or below and outside of the triangle. Amber Light (Consolidation): As the price nears key levels and the apex, signaling potential volatility and future retest areas. Red Light (Action): Beyond the triangles upper or lower border/trendline, prepare for a significant price movement in the other direction or a strong continuation of the trend prior. Identifying a Fakeout: Look for sudden and sharp price movements that seem to break the trend but lack confirmation through increased volume or strong technical signals. Trading a Fakeout: Stay cautious during the amber light phase. If a potential fakeout is suspected, avoid entering trades until there's clear confirmation. Creating Positive Expectancy: Utilize the TLS to filter out false signals and improve trade accuracy. Focus on high-probability setups, and use a favorable risk-reward ratio for each trade. Recovering from a Trap: If caught in a fakeout, implement the "Test and Break" theory. Wait for a retest of the original breakout/breakdown point. If the price fails to break past this point, consider it a false move and adjust your trade accordingly. Positive Recovery Approach: Rather than accepting the loss, adapt your strategy based on the TLS signals and the retest theory. Use this as an opportunity to learn and refine your approach for future trades. Monitor and Adjust: Continuously monitor the trade, adjusting stop-loss and take-profit levels based on TLS signals and retest observations. This active management helps to maximize gains and minimize losses. Remember to apply risk management strategies and conduct thorough analysis before making any trading decisions. Stay adaptable and leverage the TLS to enhance the reliability of your trading strategy, turning potential setbacks into learning opportunities. Navigating Breakouts and Retests: Strategies with the Traffic Light System (TLS) Discover effective trading strategies for breakouts and retests, enhanced with the clarity of the Traffic Light System (TLS). Breakouts and Retests: Understand the dynamics of breakouts and subsequent retests, crucial for seizing market momentum. The TLS provides a clear signal for favorable entry points. Identifying Fakeouts: Sharpen your skills in recognizing false breakouts by evaluating volume, market sentiment, and multiple indicators through the TLS. Trading Strategy: Wait for confirmed breakouts, use retests as entry points, and execute with confidence and risk management, guided by the TLS signals. TLS in Action: Integrate the TLS into your analysis, enhancing precision in decision-making during breakouts and retests. Mastering breakout and retest trading involves technical analysis, market awareness, and the strategic use of the TLS, leading to confident and precise decision-making.
EIGHTCAP:BTCUSDEducation
by SmartMoneyDayTrading
3
DON't USE TRENDLINE FOR TRADESHello guys. I want to tell sm about trendlines and their lacks. As you know every trader has a personal thoughts about markets and strategies. So also about drawing TRENDLINES. This varietion Causes false signals for trading + smart money knows that retail traders what doing in charts. Based on this you can see various false signal when using trendlines. I suggest you do not use trendline for trades and replace it by finding best orderblocks It's big title for explaining only i want to tell briefly about it I would like to trade with BIG BOYS NOT A retails. THINK WISELY NOT SILLY
Education
by pichilotrades
2
Short Term Swing Point IdentificationUsing BTC Daily Chart for illustration purpose: Swing High - 1. Look for the most recent HIGHEST UP CLOSE candle 2. When this candle LOW violated with Down Close Candle (can be wick through) 3. The highest point between the UP CLOSE candle and the later candle that violate the UP CLOSE Candle's Low is the Short Term Swing High Swing Low - 1. Look for the most recent LOWEST DOWN CLOSE candle 2. When this candle High violated with Up Close Candle (can be wick through) 3. The Lowest point between the DOWN CLOSE candle and the later candle that violate the DOWN CLOSE Candle's High is the Short Term Swing Low This is one of the most important foundational concept to understand price acti
INDEX:BTCUSDEducation
by Saltpepperwhiteboard
High probability setupThis is what I'm going to be looking in the market for the next long term journey, this is a special setup based on patience, strategy and price action, high probabilities and high R:R, works better in high timeframes, we have just wait for the firt confirmation which is: 1. Shift of structure, after watching that we have to look for: 2. A good RESISTANCE/SUPPORT zone where the price is rejecting in Daily of 4H and search for a: 3. Chart pattern which can be a HEAD AND SHOULDERS OR DOUBLE BOTTOM, DOUBLE TOP..., if we have these confirmations, we can look for the last which is: 4. Candlestick pattern: in the shift of the structure which can be an engulfing, an evening/morning star or marubozu, also can be a doji with the wick for our direction Each one of these confirmations are 22% probabilities for our strategy, after getting all them we can enter the trade, put the stop loss a bit above or below the last structure point and take a 1:3 risk reward and the most important part is: SET THE TRADE AND FORGET, Allow the price to go where it has to go, don't change the T.P, don't change the S.L, accept the risk of the trade and take a loss if is the case or take a win if the market allows that, and continue with the plan, IT'S IMPOSSIBLE TO HAVE A 100% CHANCES, so even if you have all this confirmation, you can lose and you have to ACCEPT IT, for that: Stick to the RISK MANAGEMENT thinking in percentage, I recommend to use a 1%-2% per trade, and that's all BE PATIENT AND SMART, THINK IN LONG TERM Remember: "The market is a mechanism for transferring money from the impatient to the patient"
EIGHTCAP:XAUUSDEducation
by TraderEaglefx
15M Pro OrderFlow | A Unique and Profitable StrategyIn this approach, we will outline one of the best entry points on M15. The model involves quickly assessing a potential demand area by identifying a liquidity zone formed during the Fibonacci retracement at the .62-0.78 level. From this zone, the market initiates a physiological uptrend before retracing downward, creating a sharp movement with an internal break, followed by a bounce in the demand area. It is at this moment that a precise entry will be executed, aiming to reach the structure's peak. It is important to note that this model is also applicable to H1, H4, and Daily time frames. Greetings to everyone and happy trading.
Education
by Forex48_TradingAcademy
3
Advanced Candlestick Pattern AnalysisAdvanced Candlestick Pattern Analysis Welcome to the intricate world of advanced candlestick patterns, a realm where subtle shifts in market sentiment are captured in the form and structure of candles on a chart. This article delves into some of the more sophisticated patterns that, while less common, offer insightful signals to those who can identify them. For readers eager to try spotting these patterns themselves, FXOpen's free TickTrader platform provides an ideal canvas to practise and observe these formations in real-time markets. Island Reversal Pattern The Island Reversal pattern is a distinct formation in advanced candlestick patterns, marked by a gap on both sides of a cluster of candles. This pattern signifies a possible reversal of the current trend. It appears as a small 'island' of trading activity separated by gaps from the larger price movement, indicating a sudden shift in market sentiment. Traders often view the Island Reversal as a strong signal. They typically wait for confirmation in the form of a price moving away from the 'island' before executing trades. For instance, traders might buy once the price moves above the pattern in a bullish island reversal. Conversely, in a bearish reversal, selling occurs when prices drop below the island. Stop-loss orders are generally placed on the opposite side of the gap, limiting potential losses if the expected trend reversal does not materialise. Hook Reversal Pattern The Hook Reversal pattern forms part of advanced candlestick analysis and is characterised by two candlesticks, where the first one aligns with the trend and the second is the opposite. Also, the second candlestick opens and closes within the first one. It can indicate a potential reversal in the current trend, particularly in a highly traded market. In response, traders often seek additional confirmation before acting, such as a continued movement toward the reversal. For instance, in a Bullish Hook Reversal, they might enter a long position when subsequent candles continue to rise. Stop-losses are commonly set just below the low of the second candle in a bullish reversal or above the high in a bearish reversal to manage risk effectively. Triple Gap (San-ku) Candlestick Pattern The Triple Gap (San-ku) candlestick pattern is a notable formation in candlestick chart pattern analysis, often signalling an impending trend reversal. It emerges through three consecutive candlesticks, each marked by gaps between them, reflecting a buildup of momentum. Typically, at least two of these sessions feature notably large candles. In recognising the San-ku, traders view it as a caution against the prevailing trend's sustainability, acknowledging that such accelerated momentum cannot persist indefinitely. This pattern does not pinpoint the exact reversal moment but indicates its likelihood shortly. Prudent traders often wait for further confirmation, such as a change in direction, before adjusting their positions. Stop-loss orders are strategically placed above a swing high/low to minimise potential losses if the anticipated trend reversal does not materialise promptly. Kicker Candlestick Pattern In stock analysis, candlestick patterns like the Kicker play a crucial role. This pattern is characterised by a drastic change in market sentiment, reflected by two candles moving in opposite directions. The first candle follows the current trend, while the second moves sharply in the opposite direction with a price gap, which strengthens the reversal signal. The Kicker is considered one of the most powerful reversal indicators. For a bullish kicker, traders might initiate a buy when the second candle's upward trend is confirmed, while in a bearish kicker, a sell is considered when the market continues trading downwards after the second candle. Stop-losses are often placed just beyond the start of the second candle to manage risk. Three Line Strike Pattern The Three Line Strike pattern, in the realm of trading candlestick analysis, is a unique trend continuation signal. It consists of three consecutive candles following the current trend (either bullish or bearish), followed by a fourth candle that strikes through the range of the first three. A bullish Three Line Strike starts with three rising green candles, followed by a long red candle that closes below the first candle's open price. This reflects a temporary pullback before the uptrend resumes. Conversely, in a bearish pattern, three falling red candles are followed by a green candle that closes above the first candle's open price, indicating a brief upward correction before the downtrend continues. Traders typically use this pattern to reinforce their confidence in the prevailing trend. Stop-loss orders are placed just beyond the fourth candle's extreme to protect against unexpected reversals. Belt Hold Pattern In the candlestick chart technical analysis, the Belt Hold stands out as a key reversal indicator. It’s characterised by a single, long candlestick that signals a shift in market momentum. In a downtrend, a bullish Belt Hold is represented by a long green candle, opening at its low and closing near its high. This reflects a possible shift to an upward trend. Conversely, during an uptrend, a bearish Belt Hold is identified by a long red candle, opening at its high and closing near its low, indicating a potential reversal to a downward trend. Traders typically look for additional market confirmation after a Belt Hold emerges before executing trades. For risk management, stop-loss orders are commonly placed just past the extreme end of the Belt Hold candle. Concealing Baby Swallow In candle technical analysis, the Concealing Baby Swallow is a rare but noteworthy bearish continuation formation. It consists of four candles in a downtrend, where the first two are black Marubozu candles (candles without shadows), indicating strong selling pressure. The third candle, also black, opens with a gap down. The fourth candle completely engulfs the third and closes within the first candle's body. This pattern may reflect a strong continuation of the bearish trend, with the fourth candle's engulfing nature indicating the concealment of any bullish attempt to reverse the trend. Traders often interpret this as a signal to maintain or initiate short positions, with stop-loss orders set above the high of the fourth candle. On-Neck The On-Neck is a bearish continuation formation in candlestick charting. It typically emerges in a downtrend and is composed of two candles: the first is a red candle, followed by a green candle. The second candle opens lower than the first candle's close and closes near the low or close of the first candle but not below it, creating a pattern that resembles a neck. This pattern indicates that selling pressure remains dominant despite a brief bullish interlude. Traders often view the On-Neck as a confirmation to continue or initiate short positions, expecting the downtrend to persist. For risk management, a stop-loss is usually placed just above the high of the second candle to protect against potential trend reversals. The Bottom Line In conclusion, mastering these advanced candlestick patterns may potentially enhance trading strategies. Each pattern provides unique insights into market dynamics, offering traders valuable tools for decision-making. To apply these concepts in real-world trading, consider opening an FXOpen account, a broker that provides robust platforms and resources to support your trading journey. This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
NASDAQ:AMZNEducation
by FXOpen
3
SMC Sell Setup: High Probability EntryGood morning everyone, today we will explore a short entry model using the concepts of smart money. This model involves entering the market in a short position after a series of specific patterns. Firstly, we start with a bearish structure where the price breaks a significant low, creating a BOS. Subsequently, we will identify the SMC zone, which is a trap zone to avoid. In this zone, the price makes a false descent before rising, creating the most important peak that we will use to evaluate a short entry. After identifying this peak, the market begins to decline, forming a CHOCH, representing an internal break. This will signal our sell point, and we could define our sell zone indicated by the POI on the chart. Once the price enters this zone, we may consider opening a short position on the security. Greetings to everyone.
Education
by Forex48_TradingAcademy
1
Boom Bust CycleGeorge Soros' theory of the boom-bust cycle, often intertwined with his concept of reflexivity, offers a unique perspective on how markets behave. Here's a breakdown: 1. Boom-Bust Cycle: Soros argues that markets tend to experience self-reinforcing cycles of overconfidence and pessimism. In a boom phase, rising prices generate positive expectations, attracting more investment and further inflating prices. This can push asset valuations far beyond their inherent value, creating bubbles. Eventually, some event triggers a loss of confidence, leading to a bust as investors rush to sell, driving prices down sharply. 2. Reflexivity: This is the crucial piece of Soros' theory. He believes that market participants' beliefs and expectations not only react to market conditions but also actively influence them. As prices rise in a boom, optimism becomes self-fulfilling, further fueling the rally. Conversely, in a bust, panic selling can exacerbate downturns. This creates a "two-way street" where perceptions shape reality and reality reinforces those perceptions. 3. Implications for Investors: Soros' theory suggests that focusing solely on market fundamentals may not be enough. Identifying market sentiment, recognizing potential bubbles, and anticipating changes in expectations can be crucial for successful investing. He famously used this approach to short the British pound in 1992, betting on its devaluation due to overvaluation and excessive optimism. Criticisms: While influential, Soros' theory also faces critiques. Some argue that it's too subjective and lacks predictive power. Others consider it a "one-size-fits-all" explanation that neglects the diverse causes of booms and busts. Further Exploration: Books: "The Alchemy of Finance" by George Soros By understanding George Soros' boom-bust cycle and its connection to reflexivity, you gain a valuable perspective on market dynamics and potentially refine your investment strategies. Remember, financial markets are complex systems, and any theory should be considered alongside other factors and careful analysis.
NYSE:NIOEducation
by Moshkelgosha
2
Perfect ChoCh : Entry + SetupWith this trading model, I aim to share with the community a particularly significant approach that has revolutionized my way of operating in the markets, especially on shorter timeframes such as 1, 5, and 15 minutes. This model involves defining a clear structure before entering the market, specifically a demand zone already present in the market. A price that reaches this zone through a double structural break (BOS) before rallying and creating an internal break (ChoCh) before returning to the demand zone. Subsequently, the price will surpass the previous high, thereby defining a new demand zone. One will then await the price to reach this zone, and once there, enter the market with the aim of reaching the supply zone depicted on the chart.
Education
by Forex48_TradingAcademy
1
Indicator Insights Part 5: Super-Wide Keltner ChannelsIn the final part of our Indicator Insights series, we explore Keltner Channels , particularly their application in identifying mean reversion opportunities known as 'snapbacks.' We reveal modified Keltner Channel settings that can help active day traders identify short-term turning points, we look at the advantages of this approach, and run through several real-world examples. Understanding Keltner Channels: Keltner Channels are a volatility-based indicator composed of three lines – the middle line representing the Exponential Moving Average (EMA) of price, and upper and lower bands calculated using the ATR. Unlike traditional Bollinger Bands, Keltner Channels use Average True Range (ATR) ATR, making them adaptable to varying market conditions and suitable for comparing different markets. Standard Settings: The standard settings for Keltner Channels involve a 20-period EMA and a multiplier of 2 for ATR. This configuration is effective for capturing trends and identifying potential reversals. However, on lower timeframes like the five-minute candle chart, these settings might produce an abundance of false signals. EUR/USD 5min Candle Chart: Keltner Channels Standard Settings Past performance is not a reliable indicator of future results Snapbacks and Adjustments: Snapbacks, or mean reversion opportunities, occur when price extends beyond the Keltner Channels and quickly 'snaps back' within them. To address the increased false signals on lower timeframes, traders can adjust the settings by increasing the moving average period, flattening the bands, and raising the ATR multiplier, widening the bands. Super-Wide Keltner Channels: Day traders using the five-minute chart could potentially benefit from 'super-wide' Keltner Channels, set with a 60-period moving average and a 6 ATR multiplier . These broader, and flatter bands are designed to identify significant price movements and distinguish meaningful mean reversion signals from transient market noise. EUR/USD 5min Candle Chart: Standard Versus Super-Wide Keltner Channels Past performance is not a reliable indicator of future results Advantages of Super-Wide Keltner Channels: Reduced False Signals: By flattening the bands with the increased period and widening them with a higher ATR multiplier, super-wide Keltner Channels filter out minor fluctuations, offering more robust signals. Enhanced Mean Reversion Signals: Snapbacks identified using super-wide channels tend to be more meaningful, indicating substantial deviations from the norm and higher potential for mean reversion. For example, should prices tough the upper band of a super-wide Keltner Channel, this means that price has moved more than six times away from its mean. Worked Examples: EUR/USD In this example, EUR/USD moves down to touch the lower super-wide Keltner Channel on the 5-min candle chart. With prices now more than 6 ATR extended from the mean on this timeframe, EUR/USD snaps back to the mean. This example also shows prices pushing into the upper Keltner Channel and reverting back to the mean. EUR/USD 5min Candle Chart Past performance is not a reliable indicator of future results Apple (AAPL) In this example, Apple’s share price presses down into the lower super-wide Keltner Channel. Notice how price forms a double bottom reversal pattern before reverting back to the mean. Combining price patterns with technical indicators in this way can help to improve timing and accuracy of trades. AAPL 5min Candle Chart Past performance is not a reliable indicator of future results Complementary Indicators: To further refine the strategy, traders can incorporate complementary indicators such as Relative Strength Index (RSI) divergence and previous day's high and low. RSI divergence helps to confirm overbought or oversold conditions, while the previous day's levels provide additional context for potential intra-day reversals. Example: EUR/USD 5min Candle Chart In this example, we can see that as price moves into the lower super-wide Keltner channel, the RSI starts to form a higher low – signalling bullish divergence. EUR/USD then climbs back above the previous day’s low (PDL) – adding conviction to the trade. EUR/USD 5min Candle Chart Past performance is not a reliable indicator of future results Summary: Super-wide Keltner Channels, tailored for day traders on a five-minute chart, offer a different approach to identifying and capitalising on potential mean reversion opportunities. By adjusting the moving average period and ATR multiplier, traders can fine-tune the indicator for their specific timeframe and tolerance, reducing false signals and enhancing the significance of mean reversion signals. Disclaimer: This is for information and learning purposes only. The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance. Social media channels are not relevant for UK residents. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 84.01% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
Education
by Capitalcom
1
SIMPLE RULE BASED Structure FOR BEGINNERS☝️The main purpose of my resources is free, actionable education for anyone who wants to learn trading and improve mental and technical trading skills. Learn from hundreds of videos and the real story of a particular trader, with all the mistakes and pain on the way to consistency. I'm always glad to discuss and answer questions. 🙌 ☝️ALL videos here are for sharing my experience purposes only, not financial advice, NOT A SIGNAL. YOUR TRADES ARE YOUR COMPLETE RESPONSIBILITY. Everything here should be treated as a simulated, educational environment.
Education
by Yelli_trades
1
5 Economic Benefits Of Interest Rate Decisions in BankingInterest rate decisions play a crucial role in the functioning of the banking sector and the broader economy. Here are five economic benefits associated with interest rate decisions in banking: 1. Monetary Policy Tool: - Central banks, such as the Federal Reserve in the United States or the European Central Bank, use interest rates as a primary tool for implementing monetary policy. By adjusting interest rates, central banks can influence the money supply, inflation, and economic growth. This helps in maintaining price stability and promoting sustainable economic development. 2. Inflation Control: - One of the primary objectives of central banks is to control inflation. Adjusting interest rates can impact consumer spending and business investment. Higher interest rates can discourage borrowing and spending, which may help to cool down an overheating economy and control inflation. Conversely, lower interest rates can stimulate economic activity during periods of low inflation or deflation. 3. Encouraging Investment and Borrowing: - Lower interest rates make borrowing more attractive for businesses and individuals. This encourages investment in capital projects, expansion, and consumption. This, in turn, stimulates economic growth and job creation. Conversely, higher interest rates may discourage borrowing and spending, which can be useful in preventing excessive borrowing and speculative bubbles. 4. Stabilizing Financial Markets: - Interest rate decisions can have a significant impact on financial markets. By adjusting rates, central banks aim to stabilize financial markets and prevent excessive volatility. For example, during times of economic uncertainty or financial crisis, central banks may lower interest rates to provide liquidity and stabilize financial institutions. 5. Exchange Rate Impact: - Interest rates can influence exchange rates, and changes in exchange rates can have implications for international trade and investment. Higher interest rates may attract foreign capital, leading to an appreciation of the currency. Conversely, lower interest rates may lead to a depreciation of the currency, potentially boosting exports. Central banks consider these effects when making interest rate decisions to maintain a balance in the external sector. It's important to note that the impact of interest rate decisions can vary depending on the overall economic conditions, including the stage of the economic cycle, inflationary pressures, and global economic factors. Additionally, the effectiveness of interest rate policies may have limitations, and central banks often need to consider a combination of monetary and fiscal measures to achieve their economic objectives. Rocket Boost this content to learn more **Disclaimer:** The information provided above or below is for educational and informational purposes only. -- It does not constitute financial advice, and trading always involves -- a risk of substantial losses, regardless of the margin levels -- used. Before engaging in any trading activities, it is crucial to -- conduct thorough research, consider your financial situation, -- and, if necessary, consult with a qualified financial advisor. Past -- performance is not indicative of future results, and market -- conditions can change rapidly. Trading decisions should be made -- based on careful analysis and consideration of individual -- circumstances. The user is solely responsible for any decisions made -- and should be aware of the inherent risks associated with trading in -- financial markets.
Education
by lubosi
What is the best XAUUSD trading strategy?When it comes to trading XAUUSD (Gold/US Dollar), there’s no one-size-fits-all strategy. The “best” approach is highly individual, depending on your trading style, risk tolerance, and personal preferences. In this article, we will explore four popular trading strategies for XAUUSD: Trend Trading Breakout and Retest Trading Swing Trading Scalp Day Trading We will consider strategy pros and cons, trader personality factors, highest potential yield, stop losses and other lifestyle factors. 📈 Trend Trading The concept of this strategy involves identifying and following the prevailing trend in the XAUUSD market. Traders buy when the trend is upward (bullish) and sell or short-sell during a downward (bearish) trend. The main focus is to capture gains through large movements rather than small fluctuations. Trend Trading uses technical indicators like moving averages, trendlines, or MACD to identify trends and enter trades. Pros: Following the dominant trend in XAUUSD can lead to significant profits, especially in strong, sustained market movements. It’s relatively easier to identify and follow trends, making it suitable for both beginners and experienced traders. By trading with the trend, traders potentially reduce their risk exposure. Cons: Trend traders might enter a trade after a trend has been established, potentially missing early profits. Misidentifying a trend can lead to losses, especially in volatile markets. This strategy requires patience, as holding positions for longer periods can lead to substantial drawdowns during retracements. Suited personality: Ideal for patient individuals who are comfortable with holding XAUUSD positions for longer durations. 📈 Breakout and Retest Trading For breakout and retesting, traders look for moments when XAUUSD price breaks out of its typical trading range or surpasses a significant resistance or support level. This strategy capitalizes on the momentum that follows a breakout. A retest phase, where the price returns to the breakout point, often serves as the entry point. Breakout and retest trading use chart patterns and volume indicators to identify potential breakouts and confirm their strength. Pros: Traders can capitalize on new trends early, potentially increasing profits. This strategy provides clear signals for entry (breakout) and exit (retest failure). It works well in various market conditions, especially during high volatility periods. Cons: Traders may encounter false signals, leading to premature entries and losses. This strategy demands rapid responses to market changes, which can be stressful. Setting stop-losses can be challenging, particularly in volatile markets. Suited personality: Breakout and retest trading is best for decisive traders who can act quickly and are comfortable with a higher level of risk and uncertainty with Gold. 📈 Swing Trading Swing traders hold positions in the XAUUSD market for several days or weeks to capture gains from short- to medium-term price movements or “swings.” This approach balances between the longer-term view of trend trading and the short-term nature of day trading. Swing trading uses a combination of technical analysis and a basic understanding of market fundamentals to identify potential swing opportunities. Pros: Requires less screen time than day trading, allowing for a more balanced lifestyle. Swing traders take advantage of market “swings” or short-term trends, often leading to substantial gains. Allows for diversification of trades over different time frames and assets. Cons: Positions might have to be held through periods of adverse market movements. This strategy needs a good understanding of market fundamentals and technical analysis. Holding positions overnight can expose traders to unexpected market events. Suited personality: Ideal for gold traders who have the patience to wait for the right opportunity, and are comfortable with holding positions for several days. 📈 Scalp Trading Scalping involves making numerous, rapid trades on small price changes in the XAUUSD market, accumulating profit from these minor fluctuations. Scalp trades are held for a very short duration, often just minutes, and require quick decision-making and execution. This strategy has a strong focus on liquidity, volatility, and using smaller time-frames like one-minute to fifteen-minute charts for precise entry and exit points. Pros: Scalpers can make numerous trades in a day, accumulating profits from small price movements. Short holding periods reduce exposure to large market movements. Offers an engaging and dynamic trading experience Cons: Requires constant market monitoring and quick decision-making throughout your trading period, however your trading period could be as little as 1 hour a day. Risk to reward per trade are typically smaller as many scalping strategies aim for a 1:1 to 1:3 risk to reward Suited personality: Scalping is best suited for people who can make quick, decisive moves. It’s most suitable for personalities who like to do highly focused work in small burst time periods and for traders who don’t want to hold positions overnight. Which XAUUSD Strategy Gives The Highest Yield? Determining which XAUUSD trading strategy can provide the highest yield and profits is a complex question and highly dependent on market conditions, the trader’s skill level, risk management, and the ability to consistently execute the strategy. However, we can explore theoretical scenarios for each trading style using a $10,000 trading account over a 6-month period, with each trade risking 1% from a stop loss. We will also consider the compounding effects of growing a trading account and trading Gold exclusively. 📈 Trend Trading Yield Potential: Moderate to High Trend trading can yield substantial returns over time, especially in strong, consistent market trends. Scenario Example: Assuming a conservative estimate of 3% profit per successful trade. With 10 good trend-following trades over 6 months and compounding gains, the overall profit could be substantial. However, the growth rate would be slower compared to scalp trading due to fewer trades and a longer holding period. 📈 Breakout and Retest Trading Yield Potential: Moderate This strategy can be profitable in volatile markets, but it may offer lower compounding effects due to fewer trades compared to scalping. Scenario Example: Assuming an average profit of 2% per successful trade and around 15 trades over 6 months. The compounding effect would be present but less dramatic than scalping due to fewer trades and potentially more varied outcomes. 📈 Swing Trading Yield Potential: Moderate Swing trading can offer good returns, especially if large swings are captured, but the compounding effect is less pronounced due to the longer duration of trades. Scenario Example: With an average of 4% gain per successful trade and about 8 trades over 6 months. The compounding effect would contribute to growth, but the overall yield would be less compared to scalp trading due to the lower number of trades and slower turnover of capital. 📈 Scalp Trading Yield Potential: Very High Scalping, with its high frequency and quick profit opportunities, offers the highest yield potential, especially when compounded. Scenario Example: Assume an average gain of 1.5% per trade, with 2 trades each day. Trading 20 days a month, this results in 40 trades per month. With compounding, each win adds more to the account balance, which then increases the amount risked (and potentially gained) in each subsequent trade. Over 6 months, this compounding effect, coupled with a consistent win rate, could significantly amplify the initial $10,000 investment, potentially doubling it or more, depending on the exact win rate and consistency of the trader. Considering all of the above strategies, scalp trading shows the highest potential for compounded yield due to its high frequency, larger per-trade gains and ongoing compounding effects. It also requires a high level of skill and consistency. Each XAUUSD trading style has its own risk-reward balance and compounding potential, and the choice should align with the trader’s capabilities, risk tolerance, and trading goals. Stop Loss Considerations for XAUUSD Trading Strategies These trading styles each have its unique characteristics that can influence the likelihood of hitting a stop loss. When a stop loss is hit, your current position is closed instantly, ending the trade, resulting a loss. Understanding these following factors is crucial for effective risk management and XAUUSD strategy selection. 📈 Trend Trading Delayed Entry Trend traders often enter a trade after a trend is established, which can increase the risk of a reversal hitting the stop loss. Length of Trends If a trend unexpectedly shortens or reverses, stop losses may be hit more frequently, especially in highly volatile markets. Drawdowns During Retracements Trends often have retracements. If the XAUUSD retracement is deeper than expected, it might hit the stop loss before resuming the trend. 📈 Breakout and Retest Trading False Breakouts A common risk in breakout trading is the occurrence of false breakouts, where the price breaks a key level but then quickly reverses, often hitting the stop loss. Volatility Spikes Around breakout points, volatility can spike, which can cause prices to fluctuate rapidly and hit stop losses unexpectedly. Re-test Failure If the price fails to re-test successfully and instead reverses quickly, it can lead to hitting the stop loss. 📈 Swing Trading Overnight and Weekend Risk XAUUSD swing trades are often held for several days, exposing them to overnight and weekend risks where gaps can occur, potentially hitting stop losses. Market News and Events Swing traders might be more exposed to the impact of scheduled economic events or unexpected news, which can cause sudden market moves. Changing Market Sentiment As swing trading involves a longer time frame, a shift in market sentiment or trend can lead to stop losses being hit before the anticipated move materializes. 📈 Scalp Trading Rapid Price Fluctuations Given the short time frame of XAUUSD scalp trades, rapid and unexpected price movements can easily hit tight stop losses. Spread and Slippage In scalp trading, the cost of the spread and potential slippage can be significant relative to the trade size, increasing the likelihood of hitting the stop loss. It’s important to trade with a broker with low spreads Market Noise Scalp trading is often affected by market noise (random price fluctuations), which can trigger stop losses more frequently compared to other styles. Each trading style has its specific factors that can lead to the triggering of stop losses. Understanding these can help in refining stop loss placement, strategy selection, and overall risk management. Best XAUUSD Strategies Based On The Trader So we’ve finally made it to our key breakdowns and suggestions based on trader preferences. Based on the various aspects of XAUUSD trading strategies we’ve explored above, here are some suggestions tailored to different types of traders and objectives. 👤 What is the best XAUUSD trading strategy for beginners? Trend trading is generally the most suitable for beginners. This style’s relative simplicity in identifying trends and its emphasis on patience and discipline provide a solid foundation for new traders. It allows beginners to understand market dynamics without the pressure of making rapid decisions. This is not to say that beginner traders can’t start their trading journey with other strategies. 👤 What is the best XAUUSD trading strategy for advanced traders? Scalp Trading is the most suited gold trading style for advanced traders. It requires quick decision-making, an in-depth understanding of market movements, and the ability to handle high-stress situations effectively. Advanced traders are typically better equipped to handle the fast movements of scalp trading, including the rigorous discipline and risk management it entails. Scalp trading XAUUSD often becomes the natural progression of a gold trader. 👤 What is the best XAUUSD trading strategy for the highest potential yield? When executed effectively, scalp trading offers the highest potential yield. It capitalizes on small, frequent price movements, allowing skilled traders to accumulate gains rapidly. However, it’s important to note that this high potential yield comes with increased risk and requires a significant amount of skill, experience, and psychological fortitude. 👤 What is the best XAUUSD trading strategy for people who want structure in their day? Scalp trading can provide a structured trading day due to its high-frequency nature. It requires a trader to be active and focused during specific market hours. If you prefer a structured environment, and want to “work” only during certain hours and in short bursts, scalp trading offers this consistency. This can also provide freedom off the charts outside of your main scalping hours. 👤 Best XAUUSD trading strategy for people who want freedom away from screens? For individuals seeking more freedom and less time glued to the screen, swing trading is suitable. It doesn’t require constant market monitoring and allows for trades to be held over several days or weeks. This approach provides more flexibility and free time, fitting well for those who value a less intense trading lifestyle. The downside is that there are far less trades meaning you could experience weeks or months with no profits, and also illiquid access to any profits made. Scalping is a second alternative for freedom away from screens, especially for scalpers who aim to make 1 to 2 trades a day over a short time period then spend the rest of their day doing non-trading related activities. 📈 Best Overall XAUUSD Trading Strategy Scalp trading stands out to us as the best XAUUSD trading strategy for these reasons: Highest potential yield based on compounding gains Ideal for both advanced traders and beginners (who are committed to learning) Ideal for structure of your day and trading during specific hours Ideal for traders seeking freedom outside of their screens by not holding on to open positions while they are away from their screens Ideal for full-time job salary replacement in terms of liquid access to profits due to more frequent trades (Of course, this is performance dependent!) For traders who have the necessary skills, discipline, and experience, scalp trading can be extremely rewarding and profitable. It offers a dynamic trading environment and the potential for high returns. If you’re looking to scalp gold, it’s crucial that we emphasize that it requires a high level of education and mentorship before you commence scalping. Beginners are advised to start with the right foundations which we can teach you and provide a solid and stable learning curve to your scalping journey.
OANDA:XAUUSDEducation
by opes_trading_group