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Inversion Fair Value Gaps (IFVGs) - A Deep Dive Trading GuideIntroduction Inversion Fair Value Gaps (IFVGs) are an advanced price action concept rooted in Smart Money theory. Unlike standard Fair Value Gaps (FVGs), IFVGs consider the idea of price revisiting inefficiencies from an inverse perspective. When price "respects" a previously violated gap from the opposite side, it creates a powerful confluence for entries or exits. This guide will cover: - What an IFVG is - How it differs from traditional FVGs - Market context for IFVG setups - How to trade them effectively - Real chart examples for clarity --- What is an IFVG? An Inversion Fair Value Gap (IFVG) occurs when price trades through a traditional Fair Value Gap and later returns to that area, but instead of continuing in the original direction, it uses the gap as a support or resistance from the other side. Standard FVG vs. IFVG: - FVG: Price creates a gap (imbalance), and we expect a return to the gap for mitigation. - IFVG: Price violates the FVG, but instead of invalidation, it respects it from the other side. Example Logic: A bullish FVG is formed -> price trades through it -> later, price revisits the FVG from below and uses it as resistance. --- Structure and Market Context Understanding structure is key when trading IFVGs. Price must break structure convincingly through a Fair Value Gap. The gap then acts as an inversion zone for future reactions. Ideal Market Conditions for IFVGs: 1. Market is trending or has recently had a strong impulsive move. 2. A Fair Value Gap is created and violated with displacement . 3. Price retraces back to the FVG from the opposite side . 4. The gap holds as support/resistance, indicating smart money has respected the zone. --- Types of IFVGs 1. Bullish IFVG: Price trades up through a bearish FVG and later uses it as support. 2. Bearish IFVG: Price trades down through a bullish FVG and later uses it as resistance. Note: The best IFVGs are often aligned with Order Blocks, liquidity levels, or SMT divergences. --- How to Trade IFVGs 1. Identify a clear Fair Value Gap in a trending market. 2. Wait for price to break through the FVG with momentum . 3. Mark the original FVG zone on your chart. 4. Monitor for price to revisit the zone from the other side. 5. Look for reaction + market structure shift on lower timeframes. 6. Enter trade with a clear stop loss just beyond the IFVG. Entry Confluences: - SMT divergence - Order Block inside or near the IFVG - Breaker Blocks - Time of day (e.g., NY open) --- Refined Entries & Risk Management Once the IFVG is identified and price begins to react, refine entries using: - Lower timeframe market structure shift - Liquidity sweeps just before tapping the zone - Candle closures showing rejection Risk Management Tips: - Set stop loss just beyond the IFVG opposite wick - Use partials at 1:2 RR and scale out based on structure - Don’t chase missed entries—wait for clean setups --- Common Mistakes to Avoid - Confusing IFVG with invalidated FVGs - Trading them in low volume or choppy conditions - Ignoring market context or structure shifts - Blindly entering on first touch without confirmation Tip: Let price prove the level—wait for reaction, not prediction. --- Final Thoughts IFVGs are an advanced but powerful tool when used with precision. They highlight how Smart Money uses inefficiencies in both directions, and when combined with other concepts, they can form sniper-like entries. Practice finding IFVGs on historical charts. Combine them with SMT divergences, OBs, and market structure, and soon you’ll start seeing the market through Smart Money eyes. Happy Trading!
Education
by Louigi_24
89
How Momentum Divergence Reveals Hidden Market Strength and WeaknMost traders watch price action closely: candlesticks, moving averages, trendlines. But there’s a deeper, less obvious layer of information that often signals shifts in direction before price confirms it: momentum. 📌 Quick overview – what you'll learn: What momentum divergence is (clearly explained) How it helps predict potential trend shifts Practical ways to spot and trade divergences 📈 Price vs Momentum: They're Not the Same! Momentum doesn't simply track price direction. Instead, it measures the strength behind price movements. Rising prices, falling momentum often signals upcoming bearish reversals. Falling prices, rising momentum often hints at bullish reversals building beneath the surface. These subtle divergences are powerful because they reveal hidden market shifts before everyone else notices them. ⚠️ How to Spot Momentum Divergence (Simple Steps): Step-by-step: - Find clear price swings: Clearly defined highs/lows on your chart. - Check momentum indicators (RSI, MACD, CCI, etc.): Does the indicator agree or disagree with the price action? - Spot divergence: Bullish divergence: Price makes lower lows, indicator shows higher lows. Bearish divergence: Price makes higher highs, indicator shows lower highs. - Confirmation: Always wait for price confirmation like a reversal candle or break of a trendline. 🔥 Why Momentum Divergence Works: Divergence highlights hidden accumulation or distribution by smart money. Helps you anticipate reversals before price confirms. Filters out weak moves and helps you avoid fake breakouts. 📊 Real Example (XAUUSD – April 2025): Recently in Gold: Price was dropping steadily, reaching new lows. Meanwhile, RSI showed clear higher lows – classic bullish divergence. Result: Price exploded significantly shortly after momentum divergence appeared clearly. 🧠 Trading Tips to Remember: Divergence signals are stronger near key support/resistance zones. Use momentum divergence with your existing strategy for confirmation, not isolation. Always define your risk clearly (set stops above/below recent highs/lows). 🚩 Common Pitfalls to Avoid: Trading divergence without confirmation: always wait for the market to show its hand. Ignoring the bigger picture: check higher timeframes for stronger signals. Overtrading: not every divergence leads to a reversal; quality beats quantity. 🚀 Your Action Plan for Next Week: Pick one momentum indicator and identify at least 3 divergences on your favorite assets. Monitor how they play out. Note down what works best in your trading journal. 💬 Question for you: What’s your go-to momentum indicator when spotting divergence? RSI, MACD, CCI, or something else? Drop a comment below! Happy trading! TrendGo Team
FOREXCOM:XAUUSDEducation
by TrendGo_Official
1
Instructional for my brother. IThis is a bad swing trade, it is under the 180 day moving average. You wouldn't enter this using a swing trading system alone, its more advanced to identify. But you can see the yellow line I drew, that is strong resistance. That means the price don't want to go below that line. I put what a trade would look like on it. You see how in this trade there is much more green than red? That is a good risk to reward ration. Now here is CBOE. See how the green and red of this projected trade are nearly equal? Yeah, that is a bad risk to reward ration. At a 1:1 (that is for each dollar you can gain, you are risking) you are at a coin toss odds. Which is better than gambling but isn't trading. You pretty much have the gist of Bravo simple trading, these are more advanced things. IF you are trading, you want to know where you will set your stop loss and where you will set your take profit BEFORE you buy anything. And then set those with the trade. That way you know beforehand what a worse case scenario looks like. If you do this, you will very likely succeed in the long run.
NASDAQ:QQQEducation
by travis84
1
LiteCoin (LTC) - Chart reading with Weis Wave with Speed Index Lesson 15 Methodology: 1. Largest up volume wave at the bottom after while (probable buyers but let's confirm using AVWAP and Weis Wave with Speed Index and it's Plutus Signals. 2. Placed AVWAP at the beginning of the previous down wave and wait for price to pullback to it. 3. Price Respects AVWAP. 4. Abnormal Speed Index 40.8 is a sign that price has a hard time to move down. 5. Enter Long on PL signal. ... and up we go!!!! Target Fib area which was reached! No entries now - Fib could risky!
Education
by TradeTheVolumeWaves
Learning The Excess Phase Peak Pattern : How To Identify/Use ItThis new tutorial video is for all the new followers I have on TradingView who don't understand the Excess Phase Peak pattern (EPP) yet. I received a question from a new follower yesterday about the EPP patterns. He/She could not understand what they were or how to use/identify them. This video should help you understand what the EPP patterns are, how to identify them, how to trade with them, and how to identify/use proper expectations with them. I hope this video is informative and clear. Remember, price only does two things... FLAG or TREND - NOTHING ELSE And the EPP pattern is the CORE STRUCTURE of price that happens on all charts, all intervals, and all the time. The second pattern, the Cradle pattern, is part of the EPP pattern, but it acts as another price construct related to how to identify opportunities in price action. Get some. #trading #research #investing #tradingalgos #tradingsignals #cycles #fibonacci #elliotwave #modelingsystems #stocks #bitcoin #btcusd #cryptos #spy #gold #nq #investing #trading #spytrading #spymarket #tradingmarket #stockmarket #silver
NASDAQ:QQQEducation
by BradMatheny
Trading A Divergence Trade (Breakdown) with Pivots and LiquidityTrading divergences was always a problem for me in the past. I did the same thing you did and got it wrong every time. I was trading divergences when i saw them instead of realizing a divergence is a flip of support and resistance levels. I just needed to know where they are. In this video: Internal vs External Pivot divergence confirmation: You can have two types of pivots on your chart. One for long term and one for short term. Using them to confirm short and long term price action is intuitive as youll be able to see the market squeezing on the short term while knowing where your long term price structure exists. Price action to Divergence Confirmation: A divergence on a short term pivot is an indication of short term loss of trend or reversal. If the short term has no divergence but the long term does, you are about to end up with some pretty large price moves. Youll be confirming the divergence by looking for highs, lows, and closes moving the wrong way from current price action. This video will give you a method you can use to draw out your support zone / resistance zone / divergence zone and use them to your advantage. The "Divergence Zone" that you draw out is the very reason why so many people fail at divergences. Bare in mind that when you have a divergence, support and resistance are on the WRONG sides as their normally are so you'll learn here how to find those zones as well. Then in the end of the video ill show you how to use lower timeframes to confirm the new move of the market. Thanks, everyone. For coming through to the CoffeeShop.
CME:6J1!Education
by CoffeeshopCrypto
2
The Flag Chart Pattern ExplainedHello, traders! 👋🏻 If price action had a way of saying, “HOLD MY BEER, I’M NOT DONE YET,”— it would be through a flag pattern. This classic continuation setup is where strong trends take a breather before launching their next move. Whether you're seeing a bullish flag chart pattern or a bearish flag pattern, you’re looking at a market that’s just catching its breath before running again. Let’s break down how this works and what to watch for! What Is a Flag Pattern? A flag pattern forms when the market makes a strong move (called the “flagpole”), then consolidates in a narrow, counter-trend range that looks like a flag. Eventually, the price breaks out in the direction of the original trend. Think of it like a runner sprinting, slowing down to recover, and then taking off again. That pause? That’s your flag. There Are Two Main Types: 🟢 Bull Flag Pattern (Bullish Flag Pattern) It appears after a sharp upward move. The flag part slopes downward or moves sideways. It also might signal a continuation of the bullish trend. This is the kind of setup that gets traders excited — it’s all about momentum. 🔴 Bear Flag Pattern (Bearish Flag Pattern) It appears after a sharp downward move. The flag part slopes upward or consolidates sideways. It also might signal a continuation of the bearish trend. When the market pauses in a falling trend, the bear flag pattern warns that sellers are just regrouping before the next drop. How to Recognize a Flag Chart Pattern Spotting a Flag Trading Pattern Is Fairly Straightforward — Just Look For: ✔ A Strong Price Move (the Flagpole) ✔ A Tight Consolidation That Slopes Opposite the Trend ✔ Lower Volume During Consolidation ✔ A Breakout in the Direction of the Original Trend 📊 Real Example: BTC Flag Pattern in 2024 Take a look at the chart above. From October to March 2024, Bitcoin made a massive upward move from around $40,000 to $72,000+ — this was the flagpole. Then, from March through November 2024, BTC entered a long, downward-sloping consolidation channel, forming the flag itself. Despite the lower highs and lower lows, the pullback was contained within parallel trend lines — a classic setup. Once the price broke above the top of the flag, it kicked off a second leg, surging to a new all-time high above $108,000. That breakout confirmed the bullish flag pattern and rewarded traders who recognized the structure early. This BTC move is a textbook example of how a bull flag chart pattern plays out in real markets — offering clean entry signals and strong momentum if the pattern completes. There are variations, too — like the rising flag pattern, which can appear in both bullish and bearish conditions, depending on the context. Some traders even debate whether a flag pattern is a continuation or a subtle reversal flag pattern — so CONTEXT MATTERS. Final Thoughts: Trust the Flag, Not the Noise The flag chart pattern is a reminder that not every pullback means the trend is over. Sometimes, it’s just the market catching its breath. Whether you’re spotting a bull flag pattern in a crypto rally or a bear flag pattern in a downtrend, learning to trade these setups can possibly add precision to your strategy. So, next time you see a price taking a nap in a narrow channel, ask yourself: Is this a bullish flag chart pattern gearing up for another leg up? Or is it a bearish flag pattern just waiting to drop the floor out? Let the structure tell the story and the trend do the rest. This analysis is performed on historical data, does not relate to current market conditions, is for educational purposes only, and is not a trading recommendation.
Education
by WhiteBIT
6
Examples of invalid setups | Judas Swing Strategy 07/04/2025As traders, it's crucial to spend time in the lab backtesting your strategy and exploring ways to optimize it for better performance in live markets. You’ll start to notice recurring patterns, some that work in your favor, and others that consistently lead to unnecessary losses. It might take time to spot these patterns and even longer to refine them to fit your trading system, but going through this process is what helps you evolve. In the long run, this is what you need to do to become a better trader. We spent a considerable amount of time refining our entry technique for the Judas Swing strategy after noticing a recurring issue where entering with a limit order sometimes gets us stopped out on the very same candle. After testing a few alternative entry methods and making some key adjustments, we finally found an approach that worked consistently for us. On Monday, April 7th, 2025, this refinement proved its worth by saving us from two potentially painful losses. In this post, we’ll walk you through exactly what happened and how the improved entry made all the difference. We got to our trading desks ready to scout for setups and were drawn to promising setups forming on both FX:AUDUSD and $NZDUSD. This was exciting since the previous week offered no solid trading opportunities. As price swept the liquidity resting above the highs of the zone our bias quickly shifted toward potential selling setups for the session. But before taking any trade, we always ensure every item on our entry checklist is met. Here’s what we look for: 1. A break of structure to the sell side 2. The formation of a Fair Value Gap (FVG) 3. A retracement into the FVG 4. Entry only after a confirmed candle close With the first two requirements on our checklist confirmed, all that remained were the final two and at this stage, patience is key. As price began retracing toward the FVG on both FX:AUDUSD and OANDA:NZDUSD , things got interesting. Price came into the Fair Value Gap on both pairs, checking off the third requirement. Now, all that was left was to wait for the current candle to close. But that’s where things will be clear to you now. Had we jumped in early with a limit order, we would’ve been stopped out on the same candle. This moment served as a perfect reminder of why we now wait for a confirmed candle close before taking any trade. It’s this extra step that helps us avoid unnecessary losses and stick to high-quality setups. This entry technique like any other, comes with its own set of pros and cons. At times a limit order might offer a more favorable entry price compared to waiting for a candle close and that can influence both your stop-loss and take-profit placements. On the flip side, there are also instances where waiting for the candle close gives you a better entry than the limit order would have. That’s why it’s so important to backtest. Your job as a trader is to put in the time to study and test what works best for your system. We chose this candle close entry method because we did the work. After extensive backtesting and data analysis, we found this approach aligns best with the results we aim for in the long run.
Education
by CleoFinance
12 Tips Every New Forex Trader Should Know!New to Forex? These 12 tips will save you months of frustration. Forex trading can be overwhelming in the beginning, but it doesn’t have to be. Whether you're just starting out or still finding your feet, these tips are designed to help you avoid common mistakes and fast-track your learning curve. ✅ Save this post ✅ Follow for more Forex insights ✅ Drop a comment with your biggest struggle as a beginner, I might turn it into the next tip! Let’s grow together. 📈💪
PEPPERSTONE:NAS100Education
by AmaWina
Fear and Greed: How Extreme Emotions Can Wreck Your TradesThere’s an old saying on Wall Street: Markets are driven by just two emotions — fear and greed. It’s been quoted so many times it’s practically cliché, but like most clichés, it’s got a thick slice of truth baked in. Fear makes you sell the bottom. Greed makes you buy the top. Together, they’re the dysfunctional couple that wrecks your portfolio, sets your confidence on fire, and leaves you staring at your trading screen, wallowing in disappointment. But here’s the good news: you’re not alone. Everyone — from the newbie scalper with a $500 account to the fund manager with a Bloomberg terminal and a caffeine drip — fights these exact same emotional demons. Let’s break down how fear and greed mess with your trades, and more importantly, what to do about it. The Greed Trap: From Champagne Dreams to Margin Calls Add some more to this one… this one’s going to the moon . Suddenly, you’re maxing out leverage on a hot altcoin because your cousin’s barber said it's “the next Solana.” This is how traders end up buying tops. Not because they lack information — we’ve got more charts, market data , and indicators than ever before — but because they chase the feeling. The high. The fantasy of catching a once-in-a-lifetime move. Safe to say that’s not investing, that’s fantasy trading. Greed doesn’t show up in your P&L right away. At first, it may reward you. You get a few wins. Maybe you double your account in a week. You start browsing the million-dollar houses. You post a couple of wins on X. You’re unstoppable… until you’re not. Then comes the inevitable slap. The market reverses. You didn’t take profits because “it’s just a pullback.” Your unrealized gains evaporate. You panic. You sell the bottom. And just like that, you’re back where you started — only now with a bruised ego and fewer chips on the table. The Fear Spiral: Paralysis, Panic, and the Art of Missing Every Rally Fear doesn’t need a market crash to show up. Sometimes all it takes is a bad night’s sleep and a red candle. Fear tells you to cut winners early — just in case. Fear reminds you of every losing trade you’ve ever taken, every blown stop loss, every time you told yourself, “I knew I should’ve stayed out.” It’s what makes you exit a long position at break-even, only to watch it rip 20% after you’re out. It’s what keeps you on the sidelines during the best days of the year. It’s what turns potential gains into chronic hesitation. And the worst part? Fear disguises itself as “discipline.” You think you’re being cautious, but you’re really just self-sabotaging under the banner of risk management. Yes, there's a difference between being prudent and being petrified. One saves your capital. The other strangles it. The Greed-Fear Cycle: The Emotional Roundabout That Never Ends Here’s how the emotional hamster wheel usually goes: You start with greed. You chase something because it looks like easy money. You get smacked by the market. Now you’re afraid. You hesitate. You miss the recovery. You get FOMO. You jump back in… late. The cycle repeats. Only now your account is lighter, and your confidence is shot. Wash. Rinse. Regret. Repeat. This cycle is what turns many promising traders into burnt-out bagholders. It’s not a lack of intelligence or strategy — it’s the inability to manage emotions in a game where emotions are everything. The Emotional Gym You can’t eliminate fear and greed — they’re wired into our monkey brain. But you can train your emotional responses the same way you train a muscle. How? Structure, repetition, and brutal honesty. Start with a trading journal . Not a Dear Diary, but a cold, clinical log of what you did and why. Include your emotional state. Were you excited? Anxious? Overconfident? Bored? (Yes, boredom is a silent killer. It’s how people end up revenge trading gold futures at 2AM.) Review it weekly. Look for patterns. Did you always overtrade after three green trades in a row? Did your losses happen when you broke your own rules? Bingo. Now you have something to fix. The Rules Are the Ritual Every seasoned trader eventually realizes this: rules are freedom. The more emotion you remove from the decision-making process, the more consistent your results. Set rules for: Entry criteria Risk per trade Stop placement When to sit out Then — and this is key — follow them even when you don’t feel like it. Especially when you don’t feel like it. If it feels uncomfortable, that’s usually a sign you’re on the right path. You’re breaking your old habits. And if you break a rule? Cool. Own it. Log it. Learn from it. No need to self-flagellate, but don’t pretend it didn’t happen. This is the emotional weightlifting that builds your trading spine. Story Time: The Trader Who Cried “Breakout” Let me tell you about Dave. Dave loved breakouts. He’d buy every single one, no matter the volume, structure, or trend. His logic? If it breaks the line, it’s going up. Simple. One week, Dave hit it big on a meme stock that doubled in a day. His greed kicked in hard. He started adding leverage, sizing up, swinging for the fences. You can guess what happened. Three fakeouts later, Dave blew half his account. So he stopped trading. Fear took over. Weeks passed. He watched from the sidelines as clean setups came and went. When he finally got back in, he was so timid he under-sized every position and exited too early. He made nothing — but the emotional damage cost him more than the red trades ever did. Dave didn’t lose because he lacked a strategy. He lost because he was letting emotions drive. And when fear and greed are in the driver’s seat, they don’t use the brakes. Be the Trader Your Future Self Will Thank (Not Tank) Markets may sometimes be chaos wrapped in noise wrapped in hype (as we’ve seen with the recent drama around Trump’s tariffs ). There will always be something to fear, and always something to chase. But if you can stay calm while others are panic-buying Nike stock NYSE:NKE or rage-selling the S&P 500 SP:SPX , you’ve already got an edge. The best traders aren’t fearless or greedless. They’re just better at recognizing when those emotions show up — and they don’t let them steer the ship. They’ve built processes to trade through uncertainty, not react to it. So next time you feel that itch to click “Buy” at the top or “Sell” at the bottom, pause. Ask yourself: Is this my setup — or is this just emotion pretending to be insight? Take another look at the Screener , scroll through the latest News , and take a minute to think it over. Final Thoughts: Feelings Aren’t Signals Trading is emotional — but trading on emotion is a fast track to regret. Fear will always be there. So will greed. But you don’t have to let them wreck your trades. Build systems. Log your trades. Know yourself. That’s how you survive the jungle with your capital — and sanity — intact. And if nothing else, remember this: Warren Buffett didn’t get rich by panic-buying breakouts on a Tuesday morning. Let's hear it from you now — how do you deal with fear and greed in your trades? Or are you still fighting them in the wild?
SP:SPXEducation
by TradingView
19
The Most Overlooked Setup in Trading: Your Own Decision ProcessTrading psychology at its finest — where the real edge begins. Over time, I’ve realized that most traders obsess over systems, setups, and signals... but very few ever stop to ask: “How do I actually make decisions?”🧩 The truth is — every trade I take is a result of an internal process. Not just some rule from a strategy, but a sequence of thoughts, comparisons, and feelings I go through (sometimes without even realizing it). And when I mapped it out, it changed the way I approached the market. 🔄 Here’s what I found: 1.There’s always a trigger. Sometimes it’s a chart pattern. Other times, it’s a shift in sentiment or an alert I’ve set. But that moment when I *start* to consider entering — that’s the spark. Recognizing that moment is the first step. ⚡ 2.Then comes the operation phase. That’s when I begin scanning. I look for setups, patterns, confluences — not just at face value, but through the lens of my experience. I start running mental “what-if” simulations, visualizing what the trade could become. 🔍 3.The test phase is critical. This is where I mentally compare the current opportunity with past winners or losers. Does it “look right”? Does it “feel like” a good trade? That moment where a setup clicks isn’t just about indicators — it’s about internal alignment. 🧠 4.Exit isn’t just a price level — it’s a decision threshold. Knowing when to act (or not) often comes down to a shift in internal state. For me, it’s usually a combination of visual confirmation + a gut signal. When both align, I act. 🎯 📌 Why does this matter? Because most failed trades aren’t just “bad signals” — they’re *poorly made decisions*. If I don’t understand my internal process, I’m flying blind. But when I do, I can refine it, track it, and improve it. If you’ve never mapped out your decision-making strategy, do it. You’ll learn more about your trading than any indicator could ever teach you. 💡 👉 Keep following me for decision-making insights and real trading psychology facts — the stuff that actually moves the needle.
CRYPTOCAP:OTHERSEducation
by vagada
Falling Wedge Trading Pattern: Unique Features and Trading RulesFalling Wedge Trading Pattern: Unique Features and Trading Rules Various chart patterns give an indication of possible market direction. A falling wedge is one such formation that indicates a possible bullish reversal. This FXOpen article will help you understand whether the falling wedge pattern is bullish or bearish, what its formation signifies about the market direction, and how it can be used to spot trading opportunities. What Is a Falling Wedge Pattern? Also known as the descending wedge, the falling wedge technical analysis chart pattern is a bullish formation that typically occurs in the downtrend and signals a trend reversal. It forms when an asset's price drops, but the range of price movements starts to get narrower. As the formation contracts towards the end, the buyers completely absorb the selling pressure and consolidate their energy before beginning to push the market higher. A falling wedge pattern means the end of a market correction and an upside reversal. How Can You Spot a Falling Wedge on a Price Chart? This pattern is usually spotted in a downtrend, which would indicate a possible bullish reversal. However, it may appear in an uptrend and signal a trend continuation after a market correction. Either way, the falling wedge provides bullish signals. The descending formation generally has the following features. - Price Action. The price trades lower, forming lower highs and lower lows. - Trendlines. Traders draw two trendlines. One connects the lower highs, and the other connects the lower lows. Finally, they intersect towards a convergence point. Each line should connect at least two points. However, the greater the number, the higher the chance of the market reversal. - Contraction. The contraction in the price range signals decreasing volatility in the market. As the formation matures, new lows contract as the selling pressure decreases. Thus, the lower trendline acts as support, and the price consolidating within the narrowing range creates a coiled spring effect, finally leading to a sharp move on the upside. The price breaks through the upper trendline resistance, indicating that sellers are losing control and buyers are gaining momentum, resulting in an upward move. - Volume. The trading volume ideally decreases as the pattern forms, and the buying volume increases with the breakout above the upper trendline, reflecting a shift in momentum towards the buyers. Falling and Rising Wedge: Differences There are two types of wedge formation – rising (ascending) and falling (descending). An ascending wedge occurs when the highs and lows rise, while a descending wedge pattern has lower highs and lows. In an ascending formation, the slope of the lows is steeper and converges with the upper trendline at some point, while in a descending formation, the slope of the highs is steeper and converges with the support trendline at some point. Usually, a rising wedge indicates that sellers are taking control, resulting in a downside breakdown. Conversely, a descending wedge pattern indicates that buyers are gaining momentum after consolidation, generally resulting in an upside breakout. The Falling Wedge: Trading Rules Trading the falling wedge involves waiting for the price to break above the upper line, typically considered a bullish reversal. The pattern’s conformity increases when it is combined with other technical indicators. - Entry According to theory, the ideal entry point is after the price has broken above the wedge’s upper boundary, indicating a potential upside reversal. Furthermore, this descending wedge breakout should be accompanied by an increase in trading volume to confirm the validity of the signal. The price may retest the resistance level before continuing its upward movement, providing another opportunity to enter a long position. However, the entry point should be based on the traders' risk management plan and trading strategy. - Take Profit It is essential to determine an appropriate target level. Traders typically set a profit target by measuring the height of the widest part of the formation and adding it to the breakout point. Another approach some traders use is to look for significant resistance levels above the breakout point, such as previous swing highs. - Stop Loss Traders typically place their stop-loss orders just below the lower boundary of the wedge. Also, the stop-loss level can be based on technical or psychological support levels, such as previous swing lows. In addition, the stop-loss level should be set according to the trader's risk tolerance and overall trading strategy. Trading Example In the chart above, there is a falling wedge. A trader opened a buy position on the close of the breakout candlestick. A stop loss was placed below the wedge’s lower boundary, while the take-profit target was equal to the pattern’s widest part. Falling Wedge and Other Patterns Here are chart patterns that can be confused with a falling wedge. Falling Wedge vs Bullish Flag These are two distinct chart formations used to identify potential buying opportunities in the market, but there are some differences between the two. A descending wedge is a bullish setup, forming in a downtrend. It is characterised by two converging trendlines that slope downward, signalling decreasing selling pressure. A breakout above the upper trendline suggests a bullish move. A bullish flag appears after a strong upward movement and forms a rectangular shape with parallel trendlines that slope slightly downward or move sideways. This formation represents a brief consolidation before the market resumes its upward trajectory. While the falling wedge indicates a potential shift in a downtrend, the bullish flag suggests a continuation of an uptrend. Falling Wedge vs Bearish Pennant ​​The falling wedge features two converging trendlines that slope downward, indicating decreasing selling pressure and often signalling a bullish reversal when the price breaks above the upper trendline. Conversely, the bearish pennant forms after a significant downward movement and is characterised by converging trendlines that create a small symmetrical triangle. This pattern represents a consolidation phase before the market continues its downward trend upon breaking below the lower trendline. While the falling wedge suggests a potential bullish move, the bearish pennant indicates a continuation of the bearish trend. Falling Wedge vs Descending Triangle The falling wedge consists of two downward-sloping converging trendlines, indicating decreasing selling pressure and often signalling a bullish reversal when the price breaks above the upper trendline. In contrast, the descending triangle features a flat lower trendline and a downward-sloping upper trendline, suggesting a buildup of selling pressure and typically signalling a bearish continuation when the price breaks below the flat lower trendline. While the falling wedge is associated with a potential bullish move, the descending triangle generally indicates a bearish trend. Falling Wedge: Advantages and Limitations Like any technical pattern, the falling wedge has both limitations and advantages. Advantages - High Probability of a Reversal. The falling wedge is often seen as a strong, bullish signal, especially when it occurs after a downtrend. It suggests that selling pressure is subsiding, and a reversal to the upside may be imminent. - Clear Entry and Exit Points. The pattern provides clear points for entering and exiting trades. Traders often enter when the price breaks out above the upper trendline and set stop-loss orders below a recent low within the formation. - Versatility. The wedge can be used in various market conditions. It is effective in both continuation and reversal scenarios, though it is more commonly associated with bullish reversals. - Widely Recognised. Since the falling wedge is a well-known formation, it is often self-fulfilling to some extent, as many traders recognise and act on it, further driving the market. Limitations - False Breakouts. Like many chart patterns, the falling wedge is prone to false breakouts. Prices may briefly move above the resistance line but then fall back below, trapping traders. - Dependence on Market Context. The effectiveness of the falling wedge can vary depending on broader market conditions. In a strong downtrend, it might fail to result in a significant reversal. - Requires Confirmation. The wedge should be confirmed with other technical indicators or analysis tools, such as volumes or moving averages, to increase the likelihood of an effective trade. Relying solely on the falling wedge can be risky. - Limited Use in Low-Volatility Markets. In markets with low volatility, the falling wedge may not be as reliable, as price movements might not be strong enough to confirm the falling wedge's breakout. The Bottom Line The falling wedge is a powerful chart pattern that can offer valuable insights into potential trend reversals or continuations, depending on its context within the broader market. By understanding and effectively utilising the falling wedge in your strategy, you can enhance your ability to identify many trading opportunities. As with all trading tools, combining it with a comprehensive trading plan and proper risk management is crucial. FAQ Is a Falling Wedge Bullish? Yes, the falling wedge is a bullish continuation pattern in an uptrend, and it acts as a bullish reversal formation in a bearish market. What Does a Falling Wedge Pattern Indicate? It indicates that the buyers are absorbing the selling pressure, which is reflected in the narrower price range and finally results in an upside breakout. What Is the Falling Wedge Pattern Rule? The falling wedge is a technical analysis formation that occurs when the price forms lower highs and lower lows within converging trendlines, sloping downward. Its rule is that a breakout above the upper trendline signals a potential reversal to the upside, often indicating the end of a downtrend or the continuation of a strong uptrend. How to Trade Descending Wedge Patterns? To trade descending wedges, traders first identify them by ensuring that the price is making lower highs and lows within converging trendlines. Then, they wait for the price to break out above the upper trendline, ideally accompanied by increased trading volume, which confirms the breakout. After the breakout, a common approach is to enter a long position, aiming to take advantage of the anticipated upward movement. What Is the Target of the Descending Wedge Pattern? The target for a descending wedge is typically set by measuring the maximum width of the wedge at its widest part and projecting that distance upwards from the breakout point. This projection gives a potential price target. What Is the Entry Point for a Falling Wedge? The entry point for a falling wedge is ideally just after the breakout above the upper trendline. Some traders prefer to wait for a retest of the broken trendline, which may act as a new support level, before entering a trade to confirm the breakout. *Important: At FXOpen UK, Cryptocurrency trading via CFDs is only available to our Professional clients. They are not available for trading by Retail clients. To find out more information about how this may affect you, please get in touch with our team. 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.
Education
by FXOpen
Why you should WAIT for trades to come to YOU!In this video, we dive deep into one of the most underrated but powerful habits that separates consistently profitable traders from the rest: waiting for the trade to come to you. It sounds simple, even obvious. But in reality, most traders—especially newer ones—feel the constant urge to do something. They scan for setups all day, jump in at the first sign of movement, and confuse activity with progress. That mindset usually leads to emotional trading, overtrading, and eventually burnout. If you've ever felt the pressure to chase price, force trades, or trade just because you're bored… this video is for you. I’ll walk you through: 1. Why chasing trades destroys your edge—even when the setup “kind of” looks right 2. How waiting allows you to trade from a position of strength, not desperation 3. The psychological shift that happens when you stop trading to feel busy and start trading to feel precise 4. How the pros use waiting as a weapon, not a weakness The truth is, trading is a game of probabilities and precision. And that means you don’t need 10 trades a day—you need a few good ones a week that truly align with your plan. Patience doesn’t mean doing nothing, it means doing the right thing at the right time. And when you develop the skill to sit back, trust your process, and wait for price to come to your level… everything changes. Your confidence grows. Your equity curve smooths out. And most importantly, your decision-making gets sharper. So if you're tired of overtrading, feeling frustrated, or constantly second-guessing your entries—take a breath, slow it down, and start thinking like a sniper instead of a machine gun. Let the market come to you. That’s where the real edge is.
Education
by Road_2_Funded
7
Trump's Tariff Wars : Why It Is Critical To Address Global TradeThis video, a continuation of the Trump's Tariff Wars video I created last week, tries to show you why it is critically important that we, as a nation, address the gross imbalances related to US trade to global markets that are resulting in a $1.5-$1.8 TRILLION deficit every fiscal year. There has been almost NOTHING done about this since Trump's last term as President. Our politicians are happy to spend - spend - spend - but none of them are worries about the long-term fiscal health of the US. (Well, some of them are worried about it - but the others seem to be completely ignorant of the risks related to the US). Trump is raising this issue very early into his second term as president to protect ALL AMERICANS. He is trying to bring the issue into the news to highlight the imbalances related to US trade throughout the world. When some other nation is taking $300B a year from the us with an unfair tariff rate - guess what, we need to make that known to the American consumer because we are the ones that continue to pay that nation the EXTRA every year. Do you want to keep paying these other nations a grossly inefficient amount for cheap trinkets, or do you want our politicians and leaders to take steps to balance the trade deficits more efficiently so we don't pass on incredible debt levels to our children and grandchildren? So many people simply don't understand what is at risk. Short-term - the pain may seem excessive, but it may only last 30, 60, 90 days. Long-term - if we don't address this issue and resolve it by negotiating better trade rates, this issue will destroy the strength of the US economy, US Dollar, and your children's future. Simply put, we can't keep going into debt without a plan to attempt to grow our GDP. The solution to this imbalance is to grow our economy and to raise taxes on the uber-wealthy. We have to grow our revenues and rebalance our global trade in an effort to support the growth of the US economy. And, our politicians (till now) have been more than happy to ignore this issue and hide it from the American people. They simply didn't care to discuss it or deal with it. Trump brought this to the table because it is important. I hope you now see HOW important it really is. Get some. #trading #research #investing #tradingalgos #tradingsignals #cycles #fibonacci #elliotwave #modelingsystems #stocks #bitcoin #btcusd #cryptos #spy #gold #nq #investing #trading #spytrading #spymarket #tradingmarket #stockmarket #silver
AMEX:SPYEducation
by BradMatheny
19
Learn 3 Best Time Frames for Day Trading Forex & Gold If you want to day trade Forex & Gold, but you don't know what time frames you should use for chart analysis and trade execution, don't worry. In this article, I prepared for you the list of best time frames for intraday trading and proven combinations for multiple time frame analysis. For day trading forex with multiple time frame analysis, I recommend using these 3 time frames: daily, 1 hour, 30 minutes. Daily Time Frame Analysis The main time frame for day trading Forex is the daily. It will be applied for the identification of significant support and resistance levels and the market trend. You should find at least 2 supports that are below current prices and 2 resistances above. In a bullish trend, supports will be applied for trend-following trading, the resistances - for trading against the trend. That's the example of a proper daily time frame analysis on GBPCHF for day trading. The pair is in an uptrend and 4 significant historic structures are underlined. In a downtrend, a short from resistance will be a daytrade with the trend while a long from support will be against. Look at GBPAUD. The market is bearish, and a structure analysis is executed. Identified supports and resistances will provide the zones to trade from. You should let the price reach one of these areas and start analyzing lower time frames then. Remember that counter trend trading setups always have lower accuracy and a profit potential. Your ability to properly recognize the market direction and the point that you are planning to open a position from will help you to correctly assess the winning chances and risks. 1H/30M Time Frames Analysis These 2 time frames will be used for confirmations and entries. What exactly should you look for? It strictly depends on the rules of your strategy and trading style. After a test of a resistance, one should wait for a clear sign of strength of the sellers : it can be based on technical indicators, candlestick, chart pattern, or something else. For my day trading strategy, I prefer a price action based confirmation. I wait for a formation of a bearish price action pattern on a resistance. Look at GBPJPY on a daily. Being in an uptrend, the price is approaching a key resistance. From that, one can look for a day trade . In that case, a price action signal is a double top pattern on 1H t.f and a violation of its neckline. That provides a nice confirmation to open a counter trend short trade. Look at this retracement that followed then. In this situation, there was no need to open 30 minutes chart because a signal was spotted on 1H. I will show you when one should apply this t.f in another setup. Once the price is on a key daily support, start looking for a bullish signal. For me, it will be a bullish price action pattern. USDCAD is in a strong bullish trend. The price tests a key support. It can be a nice area for a day trade. Opening an hourly chart, we can see no bullish pattern. If so, open even lower time frame, quite often it will reveal hidden confirmations. A bullish formation appeared on 30 minutes chart - a cup & handle. Violation of its neckline is a strong day trading long signal. Look how rapidly the price started to grow then. In order to profitably day trade Forex, a single time frame analysis is not enough . Incorporation of 3 time frames: one daily and two intraday will help you to identify trading opportunities from safe places with the maximum reward potential. ❤️Please, support my work with like, thank you!❤️ I am part of Trade Nation's Influencer program and receive a monthly fee for using their TradingView charts in my analysis.
TRADENATION:XAUUSDEducation
by VasilyTrader
15
Swing Trading: Unique Features and StrategiesSwing Trading: Unique Features and Strategies Swing trading stands out as a dynamic approach in the trading world, blending elements of both short-term and long-term strategies. In this article, we will explore the unique features of swing trading, including its reliance on technical analysis, the use of chart patterns, and the strategic timing of entries and exits. Whether you're new to trading or seeking to refine your approach, understanding the nuances of swing trading can provide valuable insights into navigating the financial markets. The Basics of Swing Trading Swing trading meaning refers to a style that involves holding short- and medium-term positions - usually from a couple of days to a few weeks - with the aim of capitalising on the “swings” in the market. What is a swing trader? A swing trader’s definition is simple: swing traders are those who typically enter and exit markets at significant support and resistance levels, hoping to capture the bulk of expected moves. These traders tend to look at hourly to weekly charts to guide their entries, although the timeframe used will depend on the swing trader’s individual approach and the asset being traded. Swing trading can be used across all asset classes, from stocks and forex to cryptocurrencies* and commodities. In the stock market, swing trading can be especially effective, as stocks tend to experience high volatility and are subject to frequent news and events that can drive prices. Swing traders predominantly use technical analysis to determine their entries and exits, but fundamental analysis, like comparing the interest rates of two economies, can also play a significant role. It can help determine a price direction over the course of days or weeks. Swing Trading vs Other Styles To better understand the unique features of swing trading, let’s compare it with our styles. Position trading involves holding trades for weeks and months, focusing on capturing long-term trends. Position traders are less concerned with short-term fluctuations and are more likely to use fundamental analysis, such as economic data and company earnings, to make their decisions. This style requires patience and a long-term perspective, with fewer trades but potentially larger returns per trade. Swing trading involves holding trades for several days to a few weeks, aiming to capture short- and medium-term price movements within a larger trend. This style balances the need for active market participation with the flexibility to not monitor trades constantly. Swing traders primarily rely on technical analysis to identify entry and exit points, focusing on chart patterns and indicators. Day trading requires traders to buy and sell assets within the same trading day, often holding positions for just minutes or hours. The goal is to capitalise on intraday price movements, and traders close all positions before the market closes to avoid overnight risk. This style demands constant market monitoring and quick decision-making, with a strong reliance on real-time technical analysis. Scalping is an ultra-short-term trading style where positions are held for seconds to minutes, aiming to make small profits on numerous trades throughout the day. Scalpers rely almost entirely on technical analysis and need to act quickly, often executing dozens or hundreds of trades daily. The focus is on high-frequency trading with very tight stop-losses, requiring intense concentration. Swing Trading: Benefits and Challenges Although swing trading provides numerous opportunities which makes it popular among traders, it comes with a few challenges traders should be aware of. Benefits: - Lower Time Commitment. One of the most significant benefits for swing traders is the reduced time commitment. This style can be adapted to suit a trader’s individual schedule. - Flexibility. It is often more flexible than other styles. Not only does it offer time flexibility, but it allows for a wider range of tools to be used to determine price swings. Also, it can be applied to many assets. The most common is swing trading in forex and swing trading in stocks. - Technical Analysis Focus: Utilises technical indicators and chart patterns to identify entry and exit points, providing clear criteria for decision-making. - More Opportunities Compared to Long-Term Techniques. Because swing traders usually hold positions for a few days to a few weeks, they have the ability to take advantage of shorter-term market movements that might not be reflected in longer-term price trends. Challenges: - Exposure to Overnight Risk. Positions held overnight or over weekends can be affected by unexpected news or events, leading to potential gaps or adverse price movements. - Requires Patience: Effective swing trading requires waiting for trades to develop over days or weeks, which may test a trader's patience. - Market Volatility: Performance can be impacted by periods of low volatility or choppy markets, where price movements may not align with your expectations. Popular Tools to Use When Swing Trading The effectiveness of a swing traders’ strategies will ultimately depend on their ability to correctly identify price movements. For this, traders use different chart patterns and technical indicators. Here are three common tools that can be used as part of a swing trading strategy. Channels Traders can use channels to take advantage of well-identified price trends that play out over days and weeks. To plot a channel, you first need to identify a trending asset that’s moving in a relative zig-zag pattern rather than one with large jumps in price. Traders will often use the channel to open a swing trade in the direction of the trend; in the example above, they might look to buy when the price tests the lower line and take profit when the price touches the upper line of the channel. Moving Averages Moving averages (MAs) are one of the commonly used indicators and they can help swing traders determine the direction of the trend at a glance. The options here are endless: - You could pair fast and slow moving averages and wait for the two to cross; this is known as a moving average crossover. When a shorter MA crosses above a longer one, the price is expected to rise. Conversely, when a shorter MA breaks below a longer one, the price is supposed to decline. - You could stick with one and observe whether the price is above or below its average to gauge the trend. When the price is above the MA, it’s an uptrend; when it’s below the MA, it’s a downtrend. - You could use an MA as a support or resistance level, placing a buy order when the price falls to the MA in an uptrend and a sell order when it rises to the MA in a downtrend. Fibonacci Retracements Lastly, many swing traders look to enter pullbacks in a larger trend. One of the most popular ways to identify entry levels during these pullbacks is the Fibonacci Retracement tool. Traders typically wait for a shift in price direction, then apply the tool to a swing high and swing low. Then, they enter at a pullback, usually to the 0.5 or 0.618 levels, to take advantage of the continuation of the trend. As seen above, this strategy can offer entry points for those looking to get in early before a trend continues. The Bottom Line Swing trading stands out for its ability to balance the demands of active trading with the flexibility of longer-term investing. The unique features of swing trading, such as its moderate holding periods and strategic use of technical indicators, allow traders to potentially manage risk and adapt to various market conditions. Embracing swing trading strategies can help traders refine their approach. As with any trading style, continued learning and disciplined execution are key to achieving consistent results. FAQ What Is Swing Trading? Swing trading is a style that involves holding positions over a period of several days to weeks to take advantage of price movements within a trend. Swing traders use technical analysis, including chart patterns and indicators, to identify potential entry and exit points, balancing the need for active participation with a longer-term perspective. What Is Swing Trading vs Day Trading? Swing trading and day trading are distinct methods. The former focuses on capturing price movements over several days to weeks, allowing for less frequent trading and requiring less constant market monitoring. In contrast, the latter involves buying and selling assets within the same trading day, often holding positions for minutes or hours, and requires continuous market observation and quick decision-making. What Is the Downside of Swing Trading? The downsides of swing trading include exposure to overnight and weekend risks, as positions held outside market hours can be affected by unexpected news or events. Additionally, this method requires patience and discipline, as trades may take time to develop, and performance can be impacted by periods of low volatility or choppy markets. *Important: At FXOpen UK, Cryptocurrency trading via CFDs is only available to our Professional clients. They are not available for trading by Retail clients. To find out more information about how this may affect you, please get in touch with our team. 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.
Education
by FXOpen
1
Ultimate Guide to Smart Money ConceptsWhat Are Smart Money Concepts? Introduction: If you’ve been trading for a while, you’ve probably noticed that sometimes the market moves in ways that just don’t make sense. You’ve got your technical analysis all set, but the market seems to go in the opposite direction. That’s where Smart Money Concepts (SMC) come in. At its core, SMC is all about understanding how big players in the market (think hedge funds, institutions, and banks) move prices. These players have massive amounts of capital and information, and they don’t trade like the average retail trader. Understanding their behavior can help you see where the market is going next before it happens. What is Smart Money? In the world of trading, smart money refers to the institutional investors who move markets with their huge orders. Unlike retail traders, who might be relying on indicators or patterns, smart money trades based on liquidity, market structure, and order flow. While retail traders are typically reacting to price movements, smart money is the one causing those moves. They’re out there seeking out places where they can accumulate positions or distribute them. The tricky part is that they’ll often make the market go in one direction just to trap retail traders and get them to take positions before flipping it back to where they wanted it to go in the first place. Key Concepts in Smart Money Trading 1. Market Structure Market structure refers to the way price moves in a trend. It’s essentially a pattern of higher highs and higher lows for an uptrend, or lower highs and lower lows for a downtrend. Smart money uses these patterns to their advantage. When they see the market creating a series of higher highs and higher lows, they’ll take advantage of that momentum to push prices further, knowing retail traders will follow along. But when they want to reverse the market, they’ll push it in the opposite direction, creating a market structure shift or a break of structure, which signals that the trend is over and a new one is starting. 2. Liquidity Liquidity refers to the amount of orders available to be filled at different price levels. Smart money knows exactly where retail traders are likely to place their stops or buy orders. They’ll often push the price to these levels, triggering those stops and collecting the liquidity. Once that liquidity is grabbed, they’ll reverse the price and move it in the intended direction. A common way to spot liquidity is by looking for equal highs or equal lows, where traders often place their stop-loss orders. These are often areas smart money will target. 3. Order Blocks Order blocks are areas on the chart where institutions have placed big orders. These are key levels that represent where price might return to later, and they can act as areas of support or resistance. Order blocks are usually found after big price moves. Institutions place these orders to either accumulate positions or offload them, and price often comes back to these levels to fill orders that were left behind. 4. Fair Value Gaps (FVG) Fair value gaps, or imbalances, are price areas where the market moves quickly, leaving gaps between candlesticks. These gaps represent areas where the market has moved too fast for regular orders to fill, and price tends to return to these levels to fill the gaps. Smart money knows that these imbalances are critical areas for future price action, and they’ll use them to re-enter the market after a move has been completed. Why Does Smart Money Matter? Understanding smart money concepts is like learning to think like an institution. Instead of chasing after price based on typical retail indicators, you start looking for the big moves that smart money is making. You begin to notice when the market is setting traps for retail traders, and how these large players accumulate positions before pushing price in a big way. With SMC, you stop guessing and start anticipating. By looking for liquidity zones, order blocks, and market structure shifts, you can get in sync with the big players and follow their moves, not fight them. Conclusion Smart Money Concepts are all about shifting your perspective. Instead of thinking like a retail trader looking for quick breakouts, oversold/overbought conditions, or chasing trends — start looking at the market as the big players do. Pay attention to where the liquidity is, identify key order blocks, and use market structure shifts to guide your trades. By learning to spot these key signs, you’ll stop being the one who’s trapped and start being the one who’s in sync with the smart money. Ready to trade smarter? Keep an eye on those order blocks and liquidity zones — they’re where the real money is made. Next Steps - Start practicing by reviewing charts through the SMC lens. - Keep refining your understanding of market structure, liquidity, and order blocks. - Stay patient, smart money trades aren’t about quick wins, but about positioning yourself for big moves. __________________________________________ Thanks for your support! If you found this guide helpful or learned something new, drop a like 👍 and leave a comment, I’d love to hear your thoughts! 🚀 Make sure to follow me for more price action insights, free indicators, and trading strategies. Let’s grow and trade smarter together! 📈
Education
by TehThomas
78
Why Support and Resistance are Made to Be Broken ?Hello fellow traders! Hope you're navigating the markets smoothly. As we go through the daily dance of price action, one thing becomes clear support and resistance are just moments, not walls. They're temporary. Momentum and trend strength? Now that’s where the real story lies. This publication dives into how these so-called key levels break and more importantly, how to position yourself smartly when they do. Stay flexible, trade with confidence, and let the market lead. Let’s get into it. Why Support and Resistance Levels Break Support and resistance are some of the most talked-about tools in technical analysis. But here's the truth they’re not meant to last forever. No matter how strong a level may appear on your chart, it eventually gets tested, challenged, and often broken. Why? Because the market is dynamic. The real edge for a trader lies not in hoping a level holds, but in reading when it’s about to fail and being ready for it. No Resistance in a Bull, No Support in a Bear Ever seen a strong bull market pause just because of a resistance line? It doesn’t. Price keeps pushing higher as buyers keep stepping in. Same goes for a strong bear market support levels collapse as fear takes over and selling snowballs. Instead of clinging to lines on a chart, think bigger: Where is the momentum? What’s the trend saying? That’s where your trading decisions should come from. Support and Resistance: Not Fixed, Always Shifting Yes, these levels matter but only as zones, not exact prices. They’re areas where price has reacted in the past, where traders might expect something to happen again. But they’re not magic numbers. When traders treat these levels as absolute, they fall into traps false confidence, poor entries, tighter than-needed stop losses. Always remember: market sentiment, liquidity, and institutional activity are constantly changing. So should your interpretation of the chart. The Temporary Nature of These Levels Markets move on supply and demand. A level that acted as resistance last week could easily become support next week. Or break completely. Take the classic example support turning into resistance. When support breaks, former buyers might now be sellers, trying to get out on a bounce. That flip happens because behavior and sentiment have shifted. And as traders, that’s the real pattern we need to track not just price levels, but the psychology behind them. “Strong” Support? It’s Mostly an Illusion We all love the idea of a strong level something we can lean on. But large players? They don’t think like that. Institutions don’t place massive orders at a single price point. They spread across a zone building positions slowly without moving the market too much. What looks like a strong level to us might just be an accumulation or distribution range for them. Always think beyond what’s visible on the surface. How to Spot Breakouts Before They Hit Here’s what separates seasoned traders from the rest the ability to spot potential breakouts before they explode. 🔹 Volume Confirmation: If a resistance level is tested repeatedly on rising volume, that’s a big clue buyers are serious. 🔹 Structure Shifts: Higher highs in an uptrend or lower lows in a downtrend signal that the old levels are being challenged. 🔹 Liquidity Traps: Watch out for fakeouts. These are designed to trap impatient traders just before the real move. 🔹 News & Events: Never ignore macro triggers. Earnings, economic data, or geopolitical surprises can fuel breakouts that crush technical levels. 🔹 Break & Retest: A solid strategy — wait for the level to break, then get in on the retest. 🔹 Momentum Tools: Indicators like RSI, MACD, or even EMAs can offer extra confidence that a move has legs. 3 Practical Trading Setups 1. Breakout Trading Mark key levels on daily or weekly charts. Watch for volume and momentum confirmation. Enter after a clear breakout or retest. Stop-loss: Just below resistance (for longs) or above support (for shorts). 2. Range Trading If price is stuck between support and resistance, trade the range. Look for price rejection (wicks, pin bars, etc.). Use RSI or Stochastics to time entries. 3. Trend Following Identify the dominant trend using moving averages or price structure. Avoid going against the trend unless reversal signs are very clear. Let profits run use trailing stops instead of fixed targets. Mind Over Market: Psychology of S&R One of the biggest traps in trading? Overtrusting support and resistance. We get emotionally attached. We want the support to hold or the resistance to reject. And that bias clouds our judgment. How many times have you seen price break a level — and you freeze because it “wasn’t supposed to”? To break free of that: ✅ Trade with a plan. ✅ Set your risk before the trade, not after. ✅ Don’t treat any level as sacred. ✅ Stay open to what the market is telling you not what you want it to say. Final Thoughts Support and resistance are great tools but they’re just one part of the puzzle. The real power lies in reading price action, watching volume, and understanding market sentiment. Don’t ask, “Will this level hold?” Ask instead, “What happens if it breaks?” That shift in thinking? It can make all the difference. Stay sharp, stay adaptive, and keep evolving with the market. Wishing you green trades and growing accounts! Best Regards- Amit Rajan.
NASDAQ:TSLAEducation
by AMIT-RAJAN
1
Why I Only Buy Dips / Sell Rallies When I Trade GoldWhen it comes to trading Gold (XAUUSD), I’ve learned one key truth: breakouts lie, but dips/rallies tell the truth. That’s why I stick to one rule that has kept me consistently profitable: I only buy dips in an uptrend and only sell rallies in a downtrend. Let me explain exactly why this approach works so well—especially on Gold, a notoriously tricky market. ________________________________________ 1. 🔥 Gold is famous for fake breakouts Breakouts on Gold often look amazing… until they trap you. You enter just as price breaks a key level—then suddenly it reverses and stops you out. This happens because Gold loves to tease liquidity. It breaks highs or lows just enough to activate stop losses or attract breakout traders, only to reverse. Buying dips or selling rallies protects you from these traps by entering from value, not hype. ________________________________________ 2. ✅ I get better stop-loss placement and risk:reward When I buy a dip, I can place my stop below a strong level (like a support zone or swing low). That gives me tight risk and allows for big reward potential—often 1:2, 1:3 or more. Breakout trades, on the other hand, often require wider stops or result in poor entries due to emotional execution. ________________________________________ 3. ⏳ I get time to assess the market False breakouts happen fast. But dips usually form more gradually. That gives me time to analyze price action, spot confirmation signals, and even scratch the trade at breakeven if it starts to fail. This reduces emotional decisions and increases my accuracy. ________________________________________ 4. 🎯 Gold respects key levels more than it respects momentum Even in strong trends, Gold often retraces deeply and retests zones before continuing. That means entries near key levels—on a dip or rally—are more reliable than chasing price. I’d rather wait for the zone than jump in mid-air. ________________________________________ 5. 🔁 Even in aggressive trends, Gold often reverts to the mean Lately, Gold has been trending hard—no doubt. But even during explosive moves, it frequently pulls back to key moving averages or demand zones. That’s why mean reversion entries on dips or rallies continue to offer excellent setups, even in fast-moving markets. ________________________________________ 6. 🧠 I benefit from retail trader mistakes Most traders get excited on breakouts. But what usually happens? The breakout fails, and the price returns to structure. By waiting for the dip/rally (when others are panicking or taking losses), I can enter at a discount and ride the move in the right direction. ________________________________________ 7. 🧘‍♂️ This strategy forces patience and discipline Waiting for dips or rallies requires patience. You don’t jump in randomly. You plan your entry, your stop, your take profit—calmly. That mental discipline is a trading edge on its own. ________________________________________ 8. 📊 I align myself with probability, not emotion In an uptrend, buying a dip is logical. In a downtrend, selling a rally is natural. Trying to “chase the breakout” is emotional—trying to get in on the action, fearing you'll miss the move. I trade with the trend, from the right zone, and with a clear plan. ________________________________________ 9. 🕒 I can use pending limit orders and walk away One of the most underrated benefits of trading dips and rallies? I don’t need to chase the market or be glued to the screen. When I see a clean level forming, I simply place a buy limit (or sell limit) with my stop and target predefined. This saves time, reduces overtrading, and keeps my emotions in check. It’s a set-and-forget approach that fits perfectly with Gold’s tendency to return to key zones—even during high volatility. ________________________________________ 🔚 Final thoughts There’s no perfect trading strategy. But when it comes to Gold, buying dips and selling rallies consistently keeps me on the right side of probability. I avoid the emotional traps. I get better entries. And most importantly, I protect my capital while maximizing reward. Next time you see Gold breaking out, ask yourself: “Is this real… or should I just wait for the dip/rally?” That question might save you a lot of pain.
TRADENATION:XAUUSDEducation
by Mihai_Iacob
6
How Can You Use the STRAT Method in Trading?How Can You Use the STRAT Method in Trading? The STRAT method is a unique trading approach that is supposed to simplify market analysis by breaking price action into clear, actionable scenarios. Developed by Rob Smith, it focuses on candlestick patterns, scenarios, and timeframe alignment to help traders better understand market structure. This article explores the key components of the STRAT method, its practical application, and how it can potentially refine trading strategies. What Is the STRAT Trading Method? The STRAT method is a trading strategy created by Rob Smith. It’s designed to simplify technical analysis by focusing on price action and breaking down market movements into clear, actionable steps. At its core, the STRAT strategy categorises price behaviour into three scenarios—inside bars (1), directional bars (2), and outside bars (3)—helping traders identify potential opportunities and understand the market structure. One of the STRAT’s standout features is its emphasis on timeframe continuity, where traders examine how price movements align across different timeframes, such as daily, weekly, and monthly charts. This alignment helps traders gauge the broader market direction, potentially improving their analysis. The STRAT trading method also uses specific candlestick patterns to signal potential reversals or continuations. For example, an inside bar (Scenario 1) indicates price consolidation, often preceding a breakout. A directional bar (Scenario 2) suggests trending movement, while an outside bar (Scenario 3) reflects heightened volatility by capturing both higher and lower price ranges. Unlike some trading approaches that rely heavily on indicators, the STRAT focuses on raw price action, giving traders a clearer, no-nonsense view of market dynamics. It’s an accessible and structured way to analyse charts and make decisions based on what the market is doing right now. Key Components of the STRAT Trading Strategy The STRAT trading strategy stands out because of its straightforward approach to breaking down price action. As mentioned above, inside bars, directional bars, and outside bars are central scenarios. These scenarios categorise how the price behaves within a given timeframe, providing a framework for traders to interpret the market. Let’s delve into each component in detail. Scenario 1: Inside Bar An inside bar forms when the current candlestick's high and low remain within the range of the previous candlestick. In other words, the market is consolidating, showing no breakout beyond the prior candle’s extremes. Traders often interpret this as a pause or a moment of indecision in the market. What makes inside bars significant is their potential to precede larger price movements. For example, after a series of inside bars, a breakout often occurs when the price breaks above or below the consolidation range. While this pattern alone doesn’t confirm direction, it signals the market is storing energy for a potential move. Scenario 2: Directional Bar A directional bar, also called a “2” in STRAT terminology, occurs when the price breaks either the high or low of the previous candle but not both. This creates a clear directional move—either upward (2 up) or downward (2 down). These bars are essential because they indicate that the market has picked a direction. A “2 up” shows bullish momentum, while a “2 down” signals bearish activity. These movements are especially useful when aligned with other factors, such as larger trends or support and resistance levels. Scenario 3: Outside Bar The outside bar is the most volatile of the three. It forms when the current candlestick's high exceeds the previous candle’s high, and its low breaks below the previous low. Essentially, the price covers both sides of the prior range, capturing significant market activity. Outside bars often suggest a battle between buyers and sellers, leading to volatility. These bars can provide insights into reversals or continuing trends, depending on their context within the broader market structure. Expanding and Contracting Markets The STRAT method also places significant emphasis on understanding the expanding and contracting market phases, which offer critical insights into market dynamics. These phases reflect shifts in volatility and price behaviour, helping traders interpret broader market conditions. Expanding markets occur when price action creates both higher highs and lower lows compared to previous bars or ranges. This phase often signals heightened volatility as buyers and sellers battle for control, creating larger swings. Scenario 3 (outside bars) typically appears during this phase, capturing the market’s attempt to push in both directions. Expanding markets can provide potential opportunities for traders who are prepared to navigate rapid price movements. Contracting markets, on the other hand, are characterised by shrinking ranges, with lower highs and higher lows. This consolidation phase often results in inside bars (Scenario 1) and suggests indecision or reduced momentum. Traders frequently watch for potential breakouts as the market transitions out of contraction. Combining Scenarios and Context Ultimately, there are many combinations of these bars under the STRAT method, each with names like the 3-2-2 Bearish Reversal, 2-2 Bearish Continuation, 1-2-2 Bullish Reversal, and so on. For traders new to this system, it might be easier to start with a handful of patterns and practice them before adding others to their arsenal. Some of the basic starting patterns include: 2-1-2 Reversal 3-1-2 Reversal 2-1-2 Continuation 2-2 Continuation However, each of these scenarios becomes even more meaningful when paired with other market data, such as higher timeframes or candlestick structures. For instance, patterns like hammers or shooting starts often emerge within these scenarios, offering specific signals to traders. Timeframe Continuity: A Core Pillar Timeframe continuity is a fundamental aspect when interpreting the STRAT candle patterns, offering traders a way to align their analysis across multiple timeframes. It’s about ensuring that the price action on smaller timeframes complements what’s happening on larger ones. When all timeframes “agree,” it can provide a clearer picture of market direction and potentially improve the decision-making process. In practice, traders using the STRAT in stocks, forex, commodities, and other assets often look at three primary timeframes: the daily, weekly, and monthly charts. Each represents a piece of the puzzle. For example, if a trader sees a bullish “Scenario 2” (directional bar) on the daily chart, but the weekly chart shows a bearish pattern, this misalignment might signal caution. However, when the daily, weekly, and monthly timeframes all show bullish directional movement, it creates a stronger case for a trend continuation. Timeframe continuity also helps traders filter out noise. Shorter timeframes, like the 15-minute or hourly charts, can produce conflicting signals, leading to overtrading or confusion. By focusing on the larger timeframes first, traders can ground their analysis in broader market trends and avoid reacting impulsively to minor fluctuations. Practical Application of the STRAT Method Applying the STRAT method involves a systematic approach to analysing charts and identifying potential opportunities. While every trader may adapt the method to their own style, the process generally follows a logical flow. Here’s how it can be broken down: Step 1: Understanding the Current Scenario Traders typically start by identifying the active scenario (1, 2, or 3) on their chosen timeframe. This initial classification helps to set the context. For instance, in the EUR/USD daily chart above, we initially see an outside bar (Scenario 3), followed by two inside bars (Scenario 1)—a 3-1-1 Bullish Reversal pattern; this transitions into a 1-2 Bullish Reversal before a 2-2 Bullish Continuation. In other words, the market is seen as entering a bullish phase. Step 2: Aligning Multiple Timeframes The next step involves assessing how the current scenario fits within the larger market structure by checking higher timeframes. In the EUR/USD example, the monthly chart shows three consecutive bullish directional bars (Scenario 2), also known as a 2-2 Bullish Continuation. This is supported by the weekly chart. Initially, there are two bearish directional bars before a bullish outside bar (Scenario 3) and a bullish directional bar. This indicates an alignment of bullish momentum, indicating a higher probability for the daily chart setup. Step 3: Identifying Supporting Patterns and Signals Within the scenario, specific candlestick patterns, like hammers or shooting stars, alongside key support and resistance levels, often provide additional context. These signals are believed to be more effective when they align with the broader market direction and timeframe continuity. In the EUR/USD example, the weekly chart shows a candle resembling a hammer (the outside bar), while the daily chart shows a pattern resembling a Three Stars in the South formation (the 3, 1, 1 candles). While rare, the three stars in the south pattern can signal sellers are losing momentum, when: The first candle features a long body and long lower wick. The second candle has a shorter body and closes above the first candle’s low. The third candle has another short body with minimal wicks and a range inside the second candle. While both formations don’t meet the technical criteria for their respective patterns, a trader might consider them to add weight to the bullish idea. The weekly chart also shows the price breaking past a previous resistance level, which adds confluence. Step 4: Entering and Exiting A trader would typically enter as the candle on their chosen timeframe closes. A stop loss could be set beyond the entry candle or a nearby swing high/low. Some traders prefer to close the position depending on the next candle close and corresponding scenario, while others might target a particular support/resistance level or use multi-timeframe analysis to find a suitable exit point. Advantages and Challenges of the STRAT Method The STRAT method offers a unique, structured approach to trading, but like any strategy, it comes with both advantages and challenges. Understanding these can help traders decide how to integrate it into their approach. Advantages - Clarity in Analysis: By categorising price action into simple scenarios, the STRAT’s patterns simplify market behaviour, reducing ambiguity. - Focus on Price Action: The method relies on raw price data rather than indicators, offering a direct view of market dynamics. - Adaptability Across Markets: Whether trading equities, forex, or commodities, the STRAT applies universally to any market with candlestick data. - Improved Consistency: Its rules-based framework helps traders avoid impulsive decisions and stay aligned with their analysis. Challenges - Learning Curve: Understanding the nuances of scenarios and timeframe continuity requires time and practice. - Patience Required: Waiting for alignment across multiple timeframes may lead to fewer trade opportunities, which may frustrate active traders. - Context Dependency: While structured, the STRAT still requires interpretation, and outcomes depend on how well traders incorporate broader market factors. The Bottom Line The STRAT method offers traders a structured way to analyse price action, combining scenarios, candlestick patterns, and timeframe continuity to navigate markets with confidence. While it requires discipline to master, its clear framework can potentially improve decision-making. FAQ What Is the STRAT Strategy by Rob Smith? Rob Smith developed the STRAT strategy, a trading method that simplifies technical analysis by categorising price action into three STRAT candle scenarios: inside bars, directional bars, and outside bars. It focuses on understanding market structure, using timeframe continuity and actionable signals to interpret trends and reversals. What Is the STRAT Method of Trading? The STRAT method is a rules-based approach to trading that prioritises price action over indicators. It uses specific candlestick patterns and scenarios to identify potential trading opportunities and aligns multiple timeframes to provide a cohesive market view. What Is a Rev Strat? According to Rob Smith, a “rev strat” refers to particular setups. First is a 1-2-2, initially with an inside bar, then a directional bar in one direction, and finally a directional bar in the opposite direction, marking a possible reversal. The second is a 1-3 setup, with an inside bar followed by an outside bar. This signals an expanding market in the STRAT, meaning a period of heightened volatility, and is considered bullish or bearish based on the outside bar’s direction. 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.
Education
by FXOpen
3
TESLA Always Pay YOURSELF! Tsla Stock were you PAID? GOLD Lesson ⭐️I want to go into depth regarding the this topic but it is a long one with PROS & CONS for doing and not doing it. Every trader must choose what's best for them but you will SEE when I finally get to the write up that MANY OF THE PROS are NOT FINANCIAL but PSYCHOLOGICAL❗️ Another of 🟢SeekingPips🟢 KEY RULES! ⚠️ Always Pay YOURSELF.⚠️ I know some of you chose to HOLD ONTO EVERYTHING and place your STOP at the base of the WEEKLY CANDLE we entered on or the week priors base. If you did that and it was in your plan GREAT but... if it was NOT that is a TRADING MISTAKE and You need to UPDATE YOUR JOURNAL NOW. You need to note EVERYTHING. What you wanted to see before your exit, explain why not taking anything was justified to you, were there EARLY exit signals that you did not act on. EVERYTHING. 🟢SeekingPips🟢 ALWAYS SAYS THE BEST TRADING BOOK YOU WILL EVER READ WILL BE YOUR COMPLETE & HONEST TRADING JOURNAL ⚠️ 📉When you read it in black amd white you will have YOUR OWN RECORD of your BEST trades and TRADING TRIUMPHS and your WORST TRADES and TRADING ERRORS.📈 ✅️ KEEPING an UPTO DATE JOURNAL is STEP ONE. STUDYING IT IS JUST AS IMPORTANT👍 ⭐️🌟⭐️🌟⭐️A sneak peek of the LESSON after will be HOW & WHEN TO ENTER WHEN THE OPEN BAR IS GOING THE OPPOSITE WAY OF YOUR IDEA.👌 🚥Looking at the TESLA CHART ABOVE you will see that we were interested in being a BUYER when the weekly bar was BEARISH (GREEN ARROW) and we started to consider TAKE PROFITS and EXITS when the (RED ARROW) Weekly bar was still BULLISH.🚥
NASDAQ:TSLAEducation
by seekingpips