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Chart Patterns

CHOCH vs BOS ‼️WHAT IS BOS ? BOS - break of strucuture. I will use market structure bullish or bearish to understand if the institutions are buying or selling a financial asset. To spot a bullish / bearish market structure we should see a higher highs and higher lows and viceversa, to spot the continuation of the bullish market structure we should see bullish price action above the last old high in the structure this is the BOS. BOS for me is a confirmation that price will go higher after the retracement and we are still in a bullish move WHAT IS CHOCH? CHOCH - change of character. Also known as reversal, when the price fails to make a new higher high or lower low, then the price broke the structure and continue in other direction.
OANDA:XAUUSDEducation
by Snick3rSD
What is Confluence❓✅ Confluence refers to any circumstance where you see multiple trade signals lining up on your charts and telling you to take a trade. Usually these are technical indicators, though sometimes they may be price patterns. It all depends on what you use to plan your trades. A lot of traders fill their charts with dozens of indicators for this reason. They want to find confluence — but oftentimes the result is conflicting signals. This can cause a lapse of confidence and a great deal of confusion. Some traders add more and more signals the less confident they get, and continue to make the problem worse for themselves. ✅ Confluence is very important to increase the chances of winning trades, a trader needs to have at least two factors of confluence to open a trade. When the confluence exists, the trader becomes more confident on his negotiations. ✅ The Factors Of Confluence Are: Higher Time Frame Analysis; Trade during London Open; Trade during New York Open; Refine Higher Time Frame key levels in Lower Time Frame entries; Combine setups; Trade during High Impact News Events. ✅ Refine HTF key levels in LTF entries or setups for confirmation that the HTF analysis will hold the price. HTF Key Levels Are: HTF Order Blocks; HTF Liquidity Pools; HTF Market Structure.
OANDA:XAUUSDEducation
by Snick3rSD
Market Structure Identification ✅Hello traders! I want to share with you some educational content. ✅ MARKET STRUCTURE . Today we will talk about market structure in the financial markets, market structure is basically the understading where the institutional traders/investors are positioned are they short or long on certain financial asset, it is very important to be positioned your trading opportunities with the trend as the saying says trend is your friend follow the trend when you are taking trades that are alligned with the strucutre you have a better probability of them closing in profit. ✅ Types of Market Structure Bearish Market Structure - institutions are positioned LONG, look only to enter long/buy trades, we are spotingt the bullish market strucutre if price is making higher highs (hh) and higher lows (hl) Bullish Market Structure - institutions are positioned SHORT, look only to enter short/sell trades, we are spoting the bearish market strucutre when price is making lower highs (lh) and lower lows (ll) Range Market Structure - the volumes on short/long trades are equall instiutions dont have a clear direction we are spoting this strucutre if we see price making equal highs and equal lows and is accumulating . I hope I was clear enough so you can understand this very important trading concept, remember its not in the number its in the quality of the trades and to have a better quality try to allign every trading idea with the actual structure
OANDA:XAUUSDEducation
by Snick3rSD
Most Powerful Candlestick Patterns Candlestick patterns are like building blocks in understanding how the stock market behaves and how prices might change. Knowing about these patterns can really help you make smarter decisions when trading. I. Introduction to 35 Candlestick Patterns Candlestick patterns are visual representations of price movements within a specific time frame. Each candlestick represents the opening, closing, high, and low prices for that period. The body of the candlestick is the difference between the opening and closing prices, while the wicks or shadows represent the price range. II. Bullish Candlestick Patterns A bullish candlestick pattern is essentially a visual signal that appears on a price chart, indicating a potential upward momentum or trend in the market. It’s like a green light for traders, suggesting that the price of the asset is likely to go up. Traders use these patterns to time their entry into the market with the goal of capitalizing on the anticipated price increase. Bullish Single Candlestick Patterns: Hammer: A single candlestick pattern characterized by a small body and a long lower wick, signaling a potential bullish reversal after a downtrend. Inverted Hammer: Another single candlestick pattern with a small body and a long upper wick, indicating a potential bullish reversal after a downtrend. Black Marubozu: A single candlestick pattern characterized by a long black body with no shadows, representing a strong bearish sentiment. White Marubozu: A single candlestick pattern characterized by a long white body with no shadows, representing a strong bullish sentiment Bullish Double Candle Patterns: Bullish Engulfing: A two-candle pattern where a small bearish candle is followed by a larger bullish candle that engulfs the previous one, suggesting a potential trend reversal to the upside. Bullish Piercing Pattern: A two-candle pattern starting with a bearish candle followed by a larger bullish candle that opens below the previous day’s low and closes more than halfway into the prior bearish candle. Bullish Counterattack: A two-candle pattern starting with a bearish candle, followed by a larger bullish candle that engulfs the entire range of the previous bearish candle. Tweezer Bottom: A two-candle pattern occurring after a downtrend, characterized by two consecutive bearish candles with similar lows, suggesting potential support and a bullish reversal. Mat Hold: A five-candle pattern suggesting a continuation of a bullish trend. It begins with a bullish candle followed by a bearish candle, a long bullish candle, a small bullish or bearish candle, and ends with another bullish candle. Bullish Triple Candle-Sticks Pattern: Morning Star Pattern: A three-candle pattern starting with a bearish candle, followed by a small indecisive candle (often a doji), and then a bullish candle, indicating a potential bullish reversal. Three White Soldiers: A bullish formation consisting of three consecutive long bullish candles. Each candle closes higher than the previous one, suggesting a strong potential upward movement. Rising Three Methods: A five-candle pattern signaling a continuation of the current bullish trend. It starts with a long bullish candle, followed by three smaller bearish candles, and ends with another long bullish candle. Upside Tasuki Gap: A three-candle pattern involving a bullish candle, a gap up, a bearish candle, and finally another bullish candle that opens within the range of the previous bearish candle. III. Bearish Candlestick Patterns A bearish candlestick pattern is a visual cue on a price chart that suggests a potential downward momentum or trend in the market. It’s akin to a red light for traders, indicating that the price of the asset is likely to decrease. Traders pay close attention to these patterns to time their entry into the market, aiming to profit from the expected price decline. Single Candle Patterns: Hanging Man: A single candlestick pattern resembling a hanging man, signaling a potential bearish reversal after an uptrend. Learn more about Hanging Man Candlestick Shooting Star Pattern: A single candlestick pattern characterized by a small body and a long upper wick, suggesting a potential bearish reversal. Bearish Engulfing: A two-candle pattern where a small bullish candle is followed by a larger bearish candle that engulfs the previous one, indicating a potential trend reversal to the downside. Black Marubozu: A single candlestick pattern characterized by a long black body with no shadows, representing a strong bearish sentiment. Double Candle Patterns: Evening Star Pattern: A three-candle formation indicating a potential bearish reversal. It starts with a bullish candle, followed by a small indecisive candle and ends with a bearish candle. Dark Cloud Cover: A two-candle pattern starting with a bullish candle followed by a larger bearish candle that opens above the previous day’s high and closes more than halfway into the prior bullish candle. Bearish Harami: A two-candle pattern. The first candle is a large bullish one, followed by a smaller bearish candle that is entirely within the range of the bullish candle. This pattern indicates a potential bearish reversal. Bearish Counterattack: A two-candle pattern starting with a bullish candle, followed by a larger bearish candle that engulfs the entire range of the previous bullish candle. On-Neck Pattern: A two-candle pattern where the first day has a long black body followed by a second day with a small body that closes slightly above the previous day’s low. Triple Candle Patterns: Three Black Crows: A bearish formation consisting of three consecutive long bearish candles. Each candle closes lower than the previous one, suggesting a strong potential downward movement. Three Inside Down: A bearish reversal pattern. It consists of a bullish candle, a smaller bearish candle that is completely within the range of the previous candle, and a larger bearish candle. Three Outside Down: A three-candle pattern. It starts with a bullish candle, followed by a larger bearish candle that completely engulfs the previous bullish candle, and then another bearish candle. Neutral Candlestick Pattern A neutral candlestick pattern doesn’t strongly indicate either a bullish or bearish trend. It’s like a yellow light, suggesting caution and indicating that the market is uncertain or indecisive about its direction. Traders look at these patterns to assess the market’s stability or potential upcoming change in trend. Single Candle Patterns: [/b Doji: A single candlestick pattern with a small body, indicating market indecision. It suggests a potential trend reversal, whether bullish or bearish. Spinning Top: A single candlestick pattern with a small body and long upper and lower wicks, signaling market indecision and potential trend reversal. High Wave: A single candlestick pattern characterized by a long upper and lower wick relative to the body, suggesting high market volatility and uncertainty. Double Candle Patterns: Tweezer Top: A two-candle pattern occurring after an uptrend, characterized by two consecutive bullish candles with similar highs, suggesting potential resistance and a bearish reversal
Education
by Golden_Star1994
1
Trading Converging Chart PatternsWe discussed identification and classification of different chart patterns and chart pattern extensions in our previous posts. Algorithmic Identification of Chart Patterns Flag and Pennant Chart Patterns In this installment, we shift our focus towards the practical trading strategies applicable to a select group of these patterns. Acknowledging that a universal trading rule cannot apply to all patterns, we narrow our examination to those of the converging variety. We will specifically address the following converging patterns: Rising Wedge (Converging Type) Falling Wedge (Converging Type) Converging Triangle Rising Triangle (Converging Type) Falling Triangle (Converging Type) This selection will guide our discussion on how to approach these patterns from a trading perspective. 🎲 Historical Bias and General Perception Each pattern we've discussed carries a historical sentiment that is widely regarded as a guideline for trading. Before we delve into our specific trading strategies, it's crucial to understand these historical sentiments and the general market interpretations associated with them. 🟡 The Dynamics of Contracting Wedge Patterns Contracting Wedge patterns are typically indicative of the Elliott Wave Structure's diagonal waves, potentially marking either the beginning or conclusion of these waves. A contracting wedge within a leading diagonal may experience a brief retracement before the trend resumes. Conversely, if found in an ending diagonal, it could signal the termination of wave 5 or C, possibly hinting at a significant trend reversal. The prevailing view suggests that these patterns usually precede a short-term directional shift: Rising Wedges are seen as bearish signals, while Falling Wedges are interpreted as bullish. It's essential to consider the trend prior to the formation of these patterns, as it significantly aids in determining their context within the Elliott Wave cycles, specifically identifying them as part of waves 1, A, 5, or C. For an in-depth exploration, refer to our detailed analysis in Decoding Wedge Patterns 🎯 Rising Wedge (Converging Type) The Rising Wedge pattern, historically viewed with a bearish bias, suggests that a downward trend is more likely upon a breakout below its lower trend line. This perception positions the pattern as a signal for traders to consider bearish positions once the price breaks through this critical support. 🎯 Falling Wedge (Converging Type) The Falling Wedge pattern is traditionally seen through a bullish lens, indicating potential upward momentum when the price surpasses its upper trend line. This established viewpoint suggests initiating long positions as a strategic response to such a breakout, aligning with the pattern's optimistic forecast. 🟡 Contracting Triangle Patterns Contracting Triangles, encompassing Converging, Ascending, and Descending Triangles, are particularly noteworthy when they appear as part of the Elliott Wave's B or 2 waves. These patterns typically signal a continuation of the pre-existing trend that preceded the triangle's formation. This principle also underpins the Pennant Pattern, which emerges following an impulse wave, indicating a pause before the trend's resumption. 🎲 Alternate Way of Looking into Converging Patterns Main issue with historical perception are: There is no clear back testing data to prove whether the general perception is correct or more profitable. Elliott Waves concepts are very much subjective and can be often difficult for beginners and misleading even for experts. So, the alternative way is to treat all the converging patterns equally and devise a method to trade using a universal way. This allows us to back test our thesis and be definitive about the profitability of these patterns. Here are our simple steps to devise and test a converging pattern based strategy. Consider all converging patterns as bidirectional. Meaning, they can be traded on either side. Thus chose to trade based on the breakout. If the price beaks up, then trade long and if the price breaks down, then trade short. For each direction, define criteria for entry, stop, target prices and also an invalidation price at which the trade is ignored even without entry. Backtest and Forward test the strategy and collect data with respect to win ratio, risk reward and profit factor to understand the profitability of patterns and the methodology. Now, let's break it further down. 🟡 Defining The Pattern Trade Conditions Measure the ending distance between the trend line pairs and set breakout points above and beyond the convergence zone. 🎯 Entry Points - These can be formed on either side of the convergence zone. Adding a small buffer on top of the convergence zone is ideal for setting the entry points of converging patterns. Formula for Entry can be: Long Entry Price = Top + (Top - Bottom) X Entry Ratio Short Entry Price = Bottom - (Top-Bottom) X Entry Ratio Whereas Top refers to the upper side of the convergence zone and bottom refers to the lower side of the convergence zone. Entry Ratio is the buffer ratio to apply on top of the convergence zone to get entry points. 🎯 Stop Price - Long entry can act as stop for short orders and the short entry can act as stop price for long orders. However, this is not mandatory and different logic for stops can be applied for both sides. Formula for Stop Can be Long Stop Price = Bottom - (Top - Bottom) X Stop Ratio Short Stop Price = Top + (Top - Bottom) X Stop Ratio 🎯 Target Price - It is always good to set targets based on desired risk reward ratio. That means, the target should always depend on the distance between entry and stop price. The general formula for Target can be: Target Price = Entry + (Entry-Stop) X Risk Reward 🎯 Invalidation Price - Invalidation price is a level where the trade direction for a particular pattern needs to be ignored or invalidated. This price need to be beyond stop price. In general, trade is closed when a pattern hits invalidation price. Formula for Invalidation price is the same as that of Stop Price, but Invalidation Ratio is more than that of Stop Ratio Long Invalidation Price = Bottom - (Top - Bottom) X Invalidation Ratio Short Invalidation Price = Top + (Top - Bottom) X Invalidation Ratio 🟡 Back Test and Forward Test and Measure the Profit Factor It is important to perform sufficient testing to understand the profitability of the strategy before using them on the live trades. Use multiple timeframes and symbols to perform a series of back tests and forward tests, and collect as much data as possible on the historical outcomes of the strategy. Profit Factor of the strategy can be calculated by using a simple formula Profit Factor = (Wins/Losses) X Risk Reward 🟡 Use Filters and Different Combinations Filters will help us in filtering out noise and trade only the selective patterns. The filters can include a simple logic such as trade long only if price is above 200 SMA and trade short only if price is below 200 SMA. Or it can be as complex as looking into the divergence signals or other complex variables.
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Education
by Trendoscope
13
Building a Solid Portfolio: Using an Index (THE CAC 40 INDEX)Hello, Embarking on the journey of creating a portfolio of stocks can be both exciting and challenging. One strategy that many investors consider is using a well-established index as a basis for their portfolio. In this article, we will explore the steps involved in building a portfolio with the CAC 40 Index, a benchmark index representing the 40 largest stocks listed on Euronext Paris. Step 1: Understand the index. Understanding an index is very key since it creates the thesis of why you should consider using it. In our case, the simplest definition of the CAC 40 index is as below The CAC 40 is a benchmark French stock market index. The index represents a capitalization-weighted measure of the 40 most significant stocks among the 100 largest market caps on the Euronext Paris. 2: Define your investment goals whether you are looking at strong companies that will provide consistent dividends for you or strong companies that will easily deliver price appreciation for your stocks will be very key in your next move. Understanding your risk horizon & tolerance is also very important at this stage. 3: Understand the components of the Index. The CAC 40 has 40 companies as its components. The companies are as follows; Air Liquide, Airbus, Alstom, ArcelorMittal, Axa, BNP Paribas, Bouygues, Capgemini, Carrefour, Crédit Agricole, Danone, Dassault Systèmes, Edenred, Engie, EssilorLuxottica, Eurofins Scientific, Hermès, Kering, L'Oréal, Legrand, LVMH, Michelin, Orange, Pernod Ricard, Publicis, Renault, Safran, Saint-Gobain, Sanofi, Schneider Electric, Société Générale, Stellantis, STMicroelectronics, Teleperformance, Thales, TotalEnergies, Unibail-Rodamco-Westfield, Veolia, Vinci, and Worldline 4: Research Individual Companies Once you have a sense of the companies you want exposure to, delve into the individual companies. Conduct thorough research on each company, considering factors such as financial health, earnings growth, competitive positioning, and management quality. This step is crucial in identifying the specific stocks you want to include in your portfolio. This will greatly help you in selecting the great companies among the components. We will look at 1 company among the components of the CAC 40 & you can try and look at the rest. The company we shall explore is DANONE . Below is its chart to show its historical price move Next understand what the company does: Danone SA engages in the food processing industry. It operates through the following geographical segments: Europe; North America; China, North Asia & Oceania; and Rest of the World. . This data can be found on Tradingview via link www.tradingview.com Next understand the financials of the company: The same can be interrogated on the link shared before. The most important metric is the Income statement because it shows you where the company derives its value from in form of income. It also will tell you how the company spends its money. You cannot however ignore the Balance sheet and the Cashflow statement. www.tradingview.com Once you have an understanding of the company as a whole now its key to look at structure to understand and pick great entry points. This is where we begin structure drawing and identification of patterns. Here is the link with clear Impulses & corrections. Very key for you to note is that the price is in a correction and close to where the 1st target would be. This tells us even though this might be a great company from all other metrics, it might not be a great company to buy from the current point. Now that we have looked at the Danone company, back to our CAC 40 index. 5: Research on all other companies that make the index. By following these above steps, you can construct a well-rounded portfolio that aligns with your financial goals and risk tolerance. All the best in your investment journey.
FX:FRA40Education
by thesharkke
Indicator Insights Part 4: Modified MACDIn this fourth instalment of our Indicator Insights series, we delve into the Modified MACD , a refinement of the classic MACD (Moving Average Convergence Divergence) introduced by Market Wizard Linda Raschke and trading author Adam H. Grimes. This modification aims to provide traders with a more streamlined and focused tool for trend reversal identification and momentum analysis. Understanding the Modified MACD The Modified MACD maintains the essence of the traditional MACD while introducing specific adjustments to enhance its effectiveness. It comprises three key components: the Fast Line, the Signal Line, and the Zero Line. Fast Line Calculation: The Fast Line is determined by taking the difference between the 3-period Simple Moving Average (SMA) and the 10-period SMA. This shorter time frame allows the Fast Line to respond more swiftly to recent price changes, capturing short-term momentum. Signal Line Calculation: The Signal Line is a 16-period SMA of the Fast Line. It provides a smoothed representation of the Fast Line's trend, offering insights into the overall momentum direction. Zero Line Reference: The Zero Line serves as a reference point on the indicator. Crossovers above the Zero Line may indicate bullish momentum, while crossovers below suggest bearish momentum. Modified MACD Past performance is not a reliable indicator of future results Standard MACD Settings Comparison: To appreciate the modifications, let's compare the Modified MACD settings with the standard MACD settings: Standard MACD: Fast Line: 12-period EMA minus 26-period EMA Signal Line: 9-period EMA of the MACD Line Histogram: Represents the difference between the MACD Line and the Signal Line Modified MACD: Fast Line: 3-period SMA minus 10-period SMA Signal Line: 16-period SMA of the Fast Line No Histogram: Simplifies the indicator for a cleaner representation Zero Line: Reference for potential bullish or bearish momentum Modified Versus Standard MACD Past performance is not a reliable indicator of future results Advantages of the Modified MACD Simplicity and Clarity: By omitting the histogram, the Modified MACD offers a cleaner representation of the relationship between the Fast Line and the Signal Line. This simplicity aids traders in making clearer interpretations of trend strength. Faster Response: The use of a 3-period SMA in the Fast Line provides a faster response to recent price changes. This responsiveness can be advantageous in capturing short-term trends and potential reversal points. Identifying Trend Reversals with Modified MACD Using the modified MACD in combination with price action analysis can be useful when predicting the end of a trend. Bearish Trend Reversal A bearish trend reversal is when an uptrend comes to an end. If a pullback against the uptrend has the following three characteristics, it may be predictive of a change in trend: 1. New Momentum Low: The fast line prints a new momentum low on the modified MACD during the pullback. 2. Signal Line Slopes Down: The signal line starts to slope down as prices consolidate following the pullback. 3. Market Consolidates Sideways: If the pullback against the uptrend, which recorded a new momentum low on the modified MACD, is followed by a period of sideways consolidation in which the uptrend fails to resume, this is a bearish sign. Worked Example: EUR/USD Bearish Trend Reversal Here we have EUR/USD on the daily candle chart, prices had been trending higher before the market put in a pullback which printed a new momentum low on the modified MACD. It’s worth noting here that MACD is a boundless indicator so we can’t set upper and lower bounds, but recent swings are good approximations of new momentum low and highs. The slope of the signal line started to point downwards and following the pullback, the market failed to resume the uptrend – consolidating sideways instead. These factors signalled a potential change in short-term trend. EUR/USD Daily Candle Chart Past performance is not a reliable indicator of future results Bullish Trend Reversal The opposite applies to bullish trend reversals where a downtrend comes to an end. If a pullback against the downtrend has the following three characteristics, it may be predictive of a change in trend: 1. New Momentum High: The fast line prints a new momentum high on the modified MACD during the pullback. 2. Signal Line Slopes Up: The signal line starts to slope up as prices consolidate following the pullback. 3. Market Consolidates Sideways: If the pullback against the downtrend, which recorded a new momentum high on the modified MACD, is followed by a period of sideways consolidation in which the uptrend fails to resume, this is a bullish sign. Worked Example: EUR/USD Bearish Trend Reversal Keeping with the same market and same timeframe as before, we can see that our bearish trend reversal signal was followed by a bullish trend reversal signal. The market put in a pullback against the downtrend which printed a new momentum high on the modified MACD’s fast line. The market then consolidated sideways and failed to resume its uptrend – giving time for the signal line of the modified MACD to start moving higher. These factors signalled a potential change in trend. EUR/USD Daily Candle Chart Past performance is not a reliable indicator of future results Summary: The Modified MACD, pioneered by Linda Raschke, introduces a simplified yet effective approach to momentum analysis, emphasising clarity and faster response to recent price changes. During pullbacks in trends, traders can leverage new momentum highs and lows on the fast line, along with a change in slope of the signal line for actionable insights into potential trend reversals.
Education
by Capitalcom
Turning Traps into Profitable Opportunities ! TOP 3 PATTERNSTrading traps are a common occurrence in the cryptocurrency market. They can be created by a variety of factors, including market manipulation, technical analysis, and psychological biases. While traps can be dangerous for traders who are not prepared, they can also be a source of profit for those who know how to trade them effectively. In this article, we will discuss three common trading traps and how to trade them profitably. We will also discuss how traps are created and how they can be used to your advantage. What Are Trading Traps? Trading traps are false movements in the price of a cryptocurrency that are designed to trick traders into taking a position in the wrong direction. They can be created by a variety of factors, including: Market manipulation: Market manipulators may create traps to trick traders into taking positions that are in their favor. For example, they may buy a large amount of a cryptocurrency to drive up the price, and then sell it off quickly to create a sell-off. Technical analysis: Technical analysts may use traps to take advantage of traders who are following technical indicators. For example, they may create a false breakout of a support or resistance level to trigger stop-loss orders. Psychological biases: Psychological biases, such as fear of missing out (FOMO) and fear of loss (FUD), can also lead traders to fall into traps. For example, a trader who is afraid of missing out on a potential bull run may be more likely to buy into a false breakout. In the example above, LINK was trading in a horizontal range for several months. The price then broke below the lower range boundary, which was a sign of a potential bear trap. However, the price quickly reversed and re-tested the lower range boundary. This was a good opportunity to enter a long position, as it showed that the trend was still in place. How to Identify Trading Traps There are a few things you can look for to help you identify trading traps, including: Volume: A sudden increase in volume can be a sign that a trap is being set. This is because market manipulators or technical analysts will often need to buy or sell a large amount of cryptocurrency to create a false movement in the price. Price action: A false breakout or fakeout is often accompanied by a sharp reversal in price action. For example, a false breakout of a support level may be followed by a sharp sell-off. Technical indicators: Some technical indicators, such as the Bollinger Bands, can help you identify potential traps. For example, the Bollinger Bands may widen before a false breakout, which can be a sign that a trap is being set. How to Trade Trading Traps Once you have identified a trap, you can trade it in one of two ways: Long trap: If you believe that the trend will continue, you can enter a long position on the re-test of the breakout level. Short trap: If you believe that the trend will reverse, you can enter a short position on the break of the breakout level. Examples of Trading Traps 3.1 Triangular Trap Unveiled: Discuss the bearish implications of descending triangles in technical analysis and their potential use as manipulation tools. Explore how market manipulators engineer these patterns to trigger artificial stop-losses. Case Study: NEAR's Triangular Intricacies: Analyze NEAR's descent within a descending triangle and its unexpected breakout. Offer insights into the motives behind orchestrating such traps and how traders can leverage these market dynamics. Here are some examples of how trading traps can be created and traded: Shakeout trap A shakeout trap is a false breakout that is designed to trick traders into taking a position in the wrong direction. For example, a cryptocurrency may be trading in a horizontal range for several months. The price then breaks below the lower range boundary, which is a sign of a potential bear trap. However, the price quickly reverses and re-tests the lower range boundary. This is a good opportunity to enter a long position, as it shows that the trend is still in place. Fakeout trap A fakeout trap is similar to a shakeout trap, but it occurs after a trend has already begun. For example, a cryptocurrency may be in a bull market. The price then breaks above a resistance level, which is a sign that the bull market is continuing. However, the price quickly reverses and re-tests the resistance level. This is a good opportunity to enter a short position, as it shows that the bull market may be coming to an end. Reversal trap A reversal trap is when the trend of a market changes direction. For example, a cryptocurrency may be in a bull market. The price then breaks below a support level, which is a sign that the bull market is ending. However, the price quickly reverses and re-tests the support level. This is a good opportunity to enter a long position, as it shows that the bull market may be resuming. The Art of Spotting Fakeouts: Define the concept of fakeouts and unveil their potential as precursors to bullish movements. Offer insights into distinguishing genuine breakouts from manipulative traps set by market actors. Case Study: ZIL's Quick Turnaround: Uncover the Zilliqa (ZIL) chart, examining the deceptive fakeout beneath a pivotal horizontal level. Emphasize the strategic importance of waiting for a retest post-fakeout as a confirmation signal. Conclusion Trading traps can be a dangerous but profitable part of cryptocurrency trading. By understanding how traps are created and how to identify them, you can increase your chances of trading them successfully. Additional Tips for Trading Trading Traps Use stop losses: Stop losses can help you limit your losses if you are wrong about a trade. Be patient: Do not rush into a trade just because you see a trap. Wait for the
Education
by Yaroslav_Krasko
2
Harmonics don't work...Here's how I find my set ups I thought I'd share with you guys the process I use to find my shark setups, this is a strategy I've back-tested and tested several times. I must say textbook harmonic talk poop, the values I use work but the set-up I see written for the shark uses different values. I noted this and thought about it for a minute - then I said so can I break the rules or amend it, because what I see is making sense but following the book is frustrating me lol... I mean it got through to me through multiple accounts including personal and funded accounts - (side note I'm not rich) hopefully this helps to to understand how I spot moves. As long as you journal then you have a chapter to start from and that 1!!!!!
Education
by LifeWithRyFX
Best Trading Confirmation. Learn 95% Accurate Entry Signal I have analyzed 1300 forecasts and signals that I shared on TradingView last year and found 95% accurate trading confirmation. In this article, we will discuss multiple types of confirmations and their winning rate on Forex, Gold, Indexes, Crypto & Commodities. First, let me introduce you to the types of analysis that I provided. 1 - Structure based forecast I have shared more than 55 trading setup with key levels analysis: Where the price is approaching a key daily horizontal support and resistance. Here is the example of such a post. Test of a key horizontal or vertical support/resistance turned out to be a poor trading signal. Total accuracy of structure based forecasts is 38% . Please, note that if we consider the market trend in our calculations, the trend-following structure based setup will be 42% accurate, while a performance of a counter trend setup drops to 35% 2 - Structure breakout based forecast I analyzed and posted 73 posts with a key structure breakout as a confirmation on a daily. Above is the example of a such a forecast. Key levels breakout turned out to be a strong bullish or bearish confirmation with 59% accuracy. Trend direction did not affect the efficiency of a key structure breakout that much, with a 60% accuracy of a trend following setup versus 57% of counter trend. 3 - Structure based forecast with a single intraday confirmation I shared more than 500 setups with a test of a key structure on a daily and a single price action based bullish or bearish confirmation on a 4h/1h time frame. My intraday confirmation is a formation of a price action pattern with a consequent breakout of its neckline/trend line in the projected direction. Please, check the example of such a signal. Just a single intraday confirmation dramatically increases the accuracy of a structure based setup. Average winning rate is 66%. 4 - Structure based forecast with multiple intraday confirmations I spotted and posted 200+ forecasts with a test of a key structure on a daily and multiple price action based bullish or bearish confirmations on a 4h/1h time frame. Multiple confirmations imply the formation of multiple price action patterns on 4/1h t.f. Here is the example of such a setup on EURGBP. Two or more confirmations on a key structure increase the average winning rate to 72%. Among multiple confirmations, I found a 95% accurate bearish signal: The market should be in a bearish trend. The price should test a key daily structure resistance. The market should form a rising wedge pattern on a 4h/1h time frames and the highs of the wedge should strictly test the key structure and should not violate them. After a test of structure, the price should form a bearish price action pattern on the highs of the wedge. Above is a setup with the best trading confirmation. A bearish breakout of the neckline of the pattern and a support of the wedge was a 95% accurate trading signal this year. Of course, there are various confirmations, depending on a trading style. The ones that I shared with you are structure/price action based. And I am truly impressed by their accuracy. ❤️Please, support my work with like, thank you!❤️
OANDA:XAUUSDEducation
by VasilyTrader
1
Using price action & tradingview tools to trade betterHello, Price action is a vital aspect of trading, and analyzing candlestick patterns is key to understanding market dynamics. The size of candles, representing the range between opening and closing prices, is crucial for traders. Large candles signal strong momentum and potential trends, while smaller candles suggest indecision or lack of clear direction. Traders use candle size to identify entry and exit points, manage risk, and gauge market sentiment. By examining the relationship between candle sizes and volume, traders can make informed decisions based on visual representations of price movements. In summary, candle size is a valuable tool in price action analysis, helping traders interpret market behavior for better decision-making. A key tool you can use to measure the momentum of an asset is the Date & price range tool . This tool allows users to place points vertically on two different prices. A Text appears along the box displaying the total size of the price moving in terms of actual share price, percentage and time the move took. E.g the chart below shows the move took 3234 days and was +1024.43% in terms of increase. Once you've got the hang of price action and figured out which way the trend is going, the next big thing is spotting patterns that tell you when to jump in. We focus on two things: motive moves, which show the trend, and corrections, which give us good entry points . Motive moves are like the big, important moves we want to trade, and corrections are where we can get in on the action. Recognizing these patterns helps us know when it's smart to join the market and increases our chances of making successful trades. a good example of these can be identified below Once you've identified patterns, the next step is deciding when to get in. There are two main types: risk entries and risk-averse entries. Risk entries often align with motive moves, indicating a trader's willingness to take on more risk for potentially higher rewards. Below is a great way of looking at both of this Risk taking entry Risk averse entry This is where the correction has already been broken and a trend determined. The Risk to reward ratio is lower and therefore less profit can be achieved here. Next we shall be looking at how to look at the indicators to support your trading hypothesis and make better trades. Good luck and all the best.
Editors' picks
NSEKE:SCOMEducation
by thesharkke
5
Flag and Pennant Chart Patterns🎲 An extension to Chart Patterns based on Trend Line Pairs - Flags and Pennants After exploring Algorithmic Identification and Classification of Chart Patterns , we now delve into extensions of these patterns, focusing on Flag and Pennant Chart Patterns. These patterns evolve from basic trend line pair-based structures, often influenced by preceding market impulses. 🎲 Identification rules for the Extension Patterns 🎯 Identify the existence of Base Chart Patterns Before identifying the flag and pennant patterns, we first need to identify the existence of following base trend line pair based converging or parallel patterns. Ascending Channel Descending Channel Rising Wedge (Contracting) Falling Wedge (Contracting) Converging Triangle Descending Triangle (Contracting) Ascending Triangle (Contracting) 🎯 Identifying Extension Patterns. The key to pinpointing these patterns lies in spotting a strong impulsive wave – akin to a flagpole – preceding a base pattern. This setup suggests potential for an extension pattern: A Bullish Flag emerges from a positive impulse followed by a descending channel or a falling wedge A Bearish Flag appears after a negative impulse leading to an ascending channel or a rising wedge. A Bullish Pennant is indicated by a positive thrust preceding a converging triangle or ascending triangle. A Bearish Pennant follows a negative impulse and a converging or descending triangle. 🎲 Pattern Classifications and Characteristics 🎯 Bullish Flag Pattern Characteristics of Bullish Flag Pattern are as follows Starts with a positive impulse wave Immediately followed by either a short descending channel or a falling wedge Here is an example of Bullish Flag Pattern 🎯 Bearish Flag Pattern Characteristics of Bearish Flag Pattern are as follows Starts with a negative impulse wave Immediately followed by either a short ascending channel or a rising wedge Here is an example of Bearish Flag Pattern 🎯 Bullish Pennant Pattern Characteristics of Bullish Pennant Pattern are as follows Starts with a positive impulse wave Immediately followed by either a converging triangle or ascending triangle pattern. Here is an example of Bullish Pennant Pattern 🎯 Bearish Pennant Pattern Characteristics of Bearish Pennant Pattern are as follows Starts with a negative impulse wave Immediately followed by either a converging triangle or a descending converging triangle pattern. Here is an example of Bearish Pennant Pattern 🎲 Trading Extension Patterns In a strong market trend, it's common to see temporary periods of consolidation, forming patterns that either converge or range, often counter to the ongoing trend direction. Such pauses may lay the groundwork for the continuation of the trend post-breakout. The assumption that the trend will resume shapes the underlying bias of Flag and Pennant patterns It's important, however, not to base decisions solely on past trends. Conducting personal back testing is crucial to ascertain the most effective entry and exit strategies for these patterns. Remember, the behavior of these patterns can vary significantly with the volatility of the asset and the specific timeframe being analyzed. Approach the interpretation of these patterns with prudence, considering that market dynamics are subject to a wide array of influencing factors that might deviate from expected outcomes. For investors and traders, it's essential to engage in thorough back testing, establishing entry points, stop-loss orders, and target goals that align with your individual trading style and risk appetite. This step is key to assessing the viability of these patterns in line with your personal trading strategies and goals. It's fairly common to witness a breakout followed by a swift price reversal after these patterns have formed. Additionally, there's room for innovation in trading by going against the bias if the breakout occurs in the opposite direction, specially when the trend before the formation of the pattern is in against the pattern bias. 🎲 Cheat Sheet
Editors' picks
Education
by Trendoscope
14
THE METHOD : A RELIABLE, REPEATING, CONSISTENT CRYPTO PATTERN I have an archive of screenshots of this, going back years. After my crypto baptism of fire, using all the money I'd earned from my first international art sale, knowing nothing and choosing leveraged trading for it's potential returns, I initially set out to find the perfect pattern that I thought I sensed when I looked at a financial chart for the first time.. And yes.. To recover my initiation fees also.. I lasted all of 4 hours.. But I was hooked.. This is my ongoing account of what I found and how it all fits together to explain visually and without any "it kinda works" theories. It's clear as day, and it blows my mind every time I see it. Will keep posting new ones as they occur. Please note that I'm not on a pattern hunt. I'm only tracking them on the coins I'm interested in at the time.. Currently: BIGTOE
Education
by Rebelmedia
Imbalance Expert : Guide for mastering imabalance'sCryptocurrency trading is an intricate dance, where understanding and interpreting market imbalances can provide traders with a competitive edge. This comprehensive guide aims to demystify the art of trading imbalances, catering to both beginners and seasoned traders. Through a detailed exploration of strategies and considerations, we'll delve into the world of market dynamics, emphasizing the importance of a holistic approach to trading. First example has cool reason to go higher ( EQUAL HIGHS ) and big liquidity pool below Section 1: Understanding Imbalances 1.1 Defining Market Imbalances: Explore the concept of imbalances in the cryptocurrency market. Differentiate between bullish and bearish imbalances. 1.2 Reading the Signs: Learn to identify imbalances on various timeframes. Utilize technical indicators and chart patterns to confirm imbalances. Section 2: The Anatomy of Imbalance Trading 2.1 Spotting Imbalances in Price Action: Analyze real-world examples of imbalances using provided screenshots. Understand how imbalances manifest in different market conditions. 2.2 Tools of the Trade: Explore popular tools like volume analysis, order flow, and market profile to complement imbalance trading. Highlight the role of moving averages and trendlines in confirming imbalances. Section 3: Strategies for Imbalance Trading 3.1 Swing Trading with Imbalances: Discover how to swing trade using imbalances as entry and exit signals. Explore risk management techniques tailored for swing trading. 3.2 Scalping Opportunities: Uncover strategies for intraday trading based on short-term imbalances. Discuss the importance of quick decision-making and tight risk control. Section 4: Advanced Considerations 4.1 Macro and Micro Analysis: Emphasize the need to consider both macroeconomic trends and micro-level price action. Discuss how macroeconomic events can create imbalances with lasting effects. 4.2 Market Sentiment and News Analysis: Incorporate sentiment analysis and news events into the overall imbalance trading strategy. Understand how sudden shifts in sentiment can create imbalances. Section 5: Risk Management and Psychology 5.1 Risk Management Strategies: Explore risk management techniques specific to trading imbalances. Discuss the importance of position sizing and setting stop-loss orders. 5.2 Mastering Emotional Discipline: Address the psychological aspects of trading and how emotions can impact decision-making. Provide practical tips for maintaining discipline during trading. Conclusion: The Art and Science of Imbalance Trading In conclusion, mastering the art of trading imbalances requires a combination of technical expertise, strategic thinking, and emotional resilience. Whether you are a beginner looking to enter the world of cryptocurrency trading or a seasoned trader seeking new insights, this guide aims to equip you with the knowledge and tools necessary to navigate the dynamic landscape of imbalance trading. Remember, success in trading is an ongoing journey that requires continuous learning and adaptation to evolving market conditions. 💡 Imbalances Decoded | 📊 Tools of the Trade | 🚀 Strategies for Success | 🧠 Risk Management Mastery 💬 Share your insights: What are your experiences with trading imbalances, and what additional strategies have you found effective? 🌐✨
INDEX:BTCUSDEducation
by Yaroslav_Krasko
DWEB levels and local price trends #BTC This chart is for intermediate DWEB users for learning purposes and or for followers to use for trading this local price action. If trends fail look for the next trends and levels for confluence against a system you already trust. Trends are #1 and levels are #2. Trade this chart with more trust as the price respects the lines and or this chart aligns with your other charts (confluence). By using the nodes and trends from DWEB , I was able to cast some unique visuals in terms of trends and levels. Using different candle intervals can often provide some hidden data. Often when you inverse the default intervals and indicators , you unhide even more data that is unseen by most. DWEB is very strict in it's parameters and often only makes minor adjustments between macro and micro charts. The thresholds of ranges where DWEB makes wider changes to its parameters is listed below. 1 to 314 minutes 314 to 888 minutes 888 minutes to 1444 minutes 1D TO 3 D 3D to 1W 1W to 9D. With DWEB on
COINBASE:BTCUSDEducation
by CaptBlackBeard
The Golden Rules of Investing ! Below, we have compiled a set of golden rules for investing that we personally follow in real life. These principles are not technical in nature, but they serve to keep our vision clear. We encourage you to share your own additions to this list in the comments section :) 1. Avoid heard mentality - Sheep get slaughtered 2. Do not invest in what you don't understand - The fear of uncertainty will keep you from a sound good night sleep 3. Take an informed decision - When you understand your actions, you do it with confidence. 4. You can never precisely buy the bottom and sell the top - It is what it is. 5. Discipline and consistency pay the highest - Compounding Works wonders 6. Be an emotionless machine while investing - adhere to your investment blueprint 7. Be realistic and reasonable with your expectations - Rag to riches takes time 8. Diversify your portfolio - All Eggs in one basket is a No No 9. Do not invest your Bread and Butter - Essentials first. 10. Monitor and churn your investments with time - Because 'Heera hai sada k liye' is not true either. What are your thoughts? Feel free to comment. If it helped, Do Leave us a boost 🚀 Disclaimer: We are not registered advisors. The views expressed here are solely personal opinions. Irrespective of the language used, Nothing mentioned here should be considered as advice or recommendation. Please consult with your financial advisors before making any investment decisions. We like everybody else, have the right to be wrong :)
NSE:NIFTYEducation
by TheChartereds
HOW TO IDENTIFY STOPLOSS HUNTER AND TAKE PART ON IT - SETUP - HI BIG PLAYERS! Today I want give you smart WAY to take part on stoploss hunters. I know everyone of us hate it to be stopped out. But to be honest, stoploss levels means a huge volume level, that institutions use for cheap entries. This is why I want explain how I take part on stoploss hunting. I look on 4h chart for high demand and supply zones. On touching these area we all can expect more trade exchange and more volume. If the price bounce of this zone and break with CHOCH (change of character ) the last trend, a lot of trader try to trade early as they can and the stoploss becomes calculatable . As soon as the old trend is resumed, but in a narrow form, so that it is almost a sideways phase, then I identify stoploss hunter. The setup looks similar like this structure: The good news: the stoploss to the last local point is very close and Risk-Return-Ratios of 1:3 are possible. Comments are welcome! Best regards NXT2017
Education
by NXT2017
1
Advanced Forex Trading Strategy M15The trading strategy under examination is tailored for the M15 timeframe in the forex market, focusing on identifying supply and demand zones to make well-informed trading decisions. Let's delve into the key steps to successfully implement this strategy. Step 1: M15 Chart Analysis Position yourself on an M15 timeframe chart to gain a more detailed view of the market. This shorter time frame allows for capturing swift movements and identifying potential trading opportunities. Step 2: Identification of Supply and Demand Zones Utilize technical analysis tools such as supports, resistances, and volume indicators to clearly pinpoint supply and demand zones. Demand areas represent points where price is expected to rise, while supply zones indicate potential downward reversal points. Step 3: Confirmation of Demand Zone Breakout Wait for the breakout of a demand zone, accompanied by a bounce. This confirms the strength of the movement and suggests a potential change in the price direction. Step 4: Waiting for Price Bounce Above the Broken Zone After the demand zone breakout, observe price behavior and wait for it to return above the same zone. This confirms the effectiveness of the breakout and suggests a potential entry opportunity. Step 5: Identification of Supply Zone Once the price has surpassed the demand zone, identify a possible supply zone. This is the level where price is expected to encounter resistance. Step 6: Market Entry and Goal Planning Enter the market when the price reaches the identified supply zone, aiming to capture the downward movement. Set the target corresponding to the minimum that led to the last uptrend, intending to capitalize on the potential downward movement. Conclusions: This advanced forex trading strategy on the M15 timeframe is based on analyzing supply and demand dynamics. Always remember to manage risk carefully and adapt the strategy to evolving market conditions.
Education
by Forex48_TradingAcademy
1
Trend Trading Strategy - Trend Continuation Master the Market Rhythm: Trend Continuation Strategy with Fibonacci Precision Ready to ride the market waves with confidence? This video unlocks the secrets of a powerful trend continuation strategy, designed to capture momentum and maximize gains. Here's what you'll discover: * Identifying the Trend: Learn to spot bullish (higher highs, higher lows) and bearish (lower highs, lower lows) trends like a seasoned pro. * Support & Resistance: Leverage key price levels where the market reverses, creating exploitable entry points. * Timeframe Harmony: Start from the bigger picture and zoom in, pinpointing the ideal entry zone on lower timeframes. * Fibonacci: Harness the power of the 61.8% retracement to identify high-probability trade zones within the trend's ebb and flow.
Education
by tradingwithanthony
Mastering Support & Resistance This video dives into the fundamentals of support and resistance, the cornerstones of technical analysis. We'll cover: ** Identifying trends:** Learn how to spot bullish and bearish trends using higher highs/higher lows (HH/HL) and lower highs/lower lows (LH/LL). ️** Support & Resistance Levels: Discover how to pinpoint key price levels where the market may bounce or reverse, creating potential trading opportunities. ** Fibonacci: Unlock the power of the Fibonacci retracement to identify high-probability trade entry points at the 61.8% level.
Education
by tradingwithanthony
Top Trading BooksLiterature is one of the best ways to share and spread knowledge and information around the world, here are my top picks of the most informative, knowledge packed trading books that can help improve and transform your trading approach for the better. 1. Market Wizards - by Jack Schwager, 1989. this consists of a series of interviews from a couple of the world's renowned traders including Paul Tudor James, Bruce Kovner, Richard Dennis and several others as they share tips and insights on what makes them the best from the rest. It reveals to traders/investors some of the traits it takes to become a successful trader. "the elements of good trading are (i) cutting losses, (ii) cutting losses, (iii) cutting losses. 2. Trading In The Zone : master the markets with confidence, discipline and a winning attitude - by Mark Douglas, 2000. this is mostly a trading psychology book that explores the significance of the right mindset when pursuing trading success as well as ways to maintain and gain emotional intelligence in the fast-paced trading environment and how emotional control is an essential part in any trading plan. "do not let past loses influence your future" 3. Reminiscence Of A Stock Operator - by Edwin Lefèvre, 1923. published almost 100 years ago, inspired by the life of stock trader Jesse Livermore. This book highlights tons of experience he gained in the stock market from the failures to success that even present day traders face. "there is nothing like losing all you have in the world for teaching you what not to do, and when you know what not to do in order not to lose money, you begin to learn what to do in order to win" 4. Technical Analysis Of The Financial Markets : a comprehensive guide to trading methods and applications - by John Murphy, 1999. given the name "the bible of technical analysis" updated from his landmark best seller "technical analysis of the future markets" if you want to learn how to track market behavior this is the book for you. if also offers from basic trading concepts to advanced trading concepts covering also different technical indicators and over 400 chart illustrating different market techniques. after reading i am sure you will be able to create a trading system that fits oneself. "it should be stressed here again, however that basic trend analysis is still the overriding consideration" 5. One Up On Wall Street - by Peter Lynch, John Rothchild, 1989. this book focuses more on the importance of research, study and analysis to go from beginner to expert trader as well as the different investment opportunities in our everyday life's that expert investors are not even aware of. Most importantly the effective investment techniques, strategies and guidelines that aided Peter to become one of the best fund mangers of all time. "the trick is not to learn to trust your gut feeling, but rather to discipline yourself to ignore them" 6. When Genius Failed - by Roger Lowenstein, 2000. this book tells the story of the rise and fall of one of the most impressive hedge funds Long-Term Capital Management which has more than $120 Billion under management before its downfall in 1998. The book is written in 2 sections, the first focuses on the 'genius' business model of the hedge fund that delivered more than 40% between 1994 and 1998 and the second segment explores the firm's downfall. "investors long for steady waters, but paradoxically the opportunities are richest when the markets turn turbulent" but together by : Pako Phutietsile ( @currencynerd )
OANDA:XAUUSDEducation
by currencynerd
2