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Version 1.1 by Drunk Monkey on 2020-11-20 17:07
Show last authors
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3 ICT: Okay, folks, welcome back. All right, this lesson is
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7 going to be on forex cross currency relationships and higher
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11 timeframe institutional order flow. This is going to be an
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15 example of precision price action theory. It's not a one
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19 video answers all questions. It relies on you having gone
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23 through a lot of the lessons that are taught on this YouTube
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27 channel.
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31 Alright, cross currency relationships and higher timeframe
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35 institutional order flow. When we talk about well, I'm going
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39 to unravel the mystery of cross pairs. I'm going to show you
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43 how to determine which pair leads how to determine which
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47 pair stalls How to use this insight in order flow and find
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51 explosive price swings as a result. How do we do that? Well,
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55 it starts with the economic calendar. Alright, so let's zoom
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59 in here and take a quick look at what this particular week
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63 is. Now the time of this recording is Tuesday, the calendar
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67 week would be September 7 2020 to September 11 2020. clearly
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71 see in the US on Monday, we had bank holidays for the US and
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75 Canada. Looking through the calendar, the only thing we have
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79 for Euro appears on Thursday. So we have Thursday's economic
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83 calendar having a large high impact event and nothing going
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87 on the cable front. Nothing really to speak of. So the only
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91 economic driver we have for Euro is on Thursday and it's hi
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95 impact and nothing on cable. So if we are looking for
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99 explosive price action moves, that means that euro is likely
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103 to be stunted. Okay? In other words held back because it's
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107 waiting on a big impact news driver on Thursday and cable
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111 has nothing so it's allowed to trade however it wants to
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115 trade euro has to wait for some impact news that comes out
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119 later in the week. So right away, there's your clue that
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123 euro is likely to be held in consolidation in later in the
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127 week allowed to be more explosive okay not mean that it will
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131 be an explosive price action, it just means that using this
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135 idea helps you focus on which pair will be strangled, okay
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139 or held in consolidation. Whereas the other pair cable which
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143 is not being seen at all in economic calendar at all. That
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147 is implies that it will be allowed to trade more freely, and
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151 less manipulation and manipulation will be where? In euro.
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155 So let's go to the charts and I'll give you a little bit
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159 more insights on this and how we can flesh it out and give
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163 it a little bit more process oriented approach. Okay, folks,
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167 we are looking at the Euro pound on the right, and the
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171 dollar index or Dixie on the left. So now when we look at
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175 price action, and we're comparing the dollar index as a
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179 barometer, if we're looking for higher prices on dollar, we
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183 would be reasonably expecting lower prices in foreign
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187 currency. And if the dollar were expected to go lower, we
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191 would expect to see bullish prices or higher prices on
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195 foreign currency. Now there isn't a simple always follow
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199 this procedure and you'll get the big price match and moves
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203 you'll you have to look at some other things and that's kind
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207 of like what gonna talk about a little bit tonight and it's
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211 the cross. So the relationship between crosses now obviously
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215 there's a cross between dollar in euro and then we have that
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219 as the euro dollar. But when I say crosses, I'm referring to
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223 foreign currencies crossed with another foreign currency not
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227 that of the dollar index. Okay. So that way we understand
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231 each other going forward. We're going to assume for the
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235 moment that we have been bullish on the dollar index, okay
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239 for the sake of discussion, my students know we were and
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243 have been now for a period of about a week or so bullish on
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247 dollar. Now, if you look at the relationship between the
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251 dollar index daily and the Euro pound daily, they both from
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255 September beginning have seen a price rally higher. Now in
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259 the simplest of determine bullish or bearish, if I'm
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263 expecting the dollar go higher, then I'm looking for shorts
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267 on foreign currency. Now there's a big jump from bullish
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271 dollar to going short all foreign currency, there's a step
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275 in the middle we have to refer to. Now, again, my students
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279 are familiar with my favorite pet pairs, that mean the euro
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283 dollar and cable or pound dollar. Now I have traded other
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287 currency pairs, and I can trade other currency pairs but I
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291 prefer to use these two as you'll see why tonight, because
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295 it's really easy to see which one is going to lead, which
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299 one's going to
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303 fall behind. And the only way you're going to be able to get
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307 that information clearly, is to use the Euro pound. Now the
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311 Euro pound is a currency pair that a lot of people just are
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315 focused on this pair as well. It makes them money per Pip.
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319 It's this sense that, and I never really trade this pair.
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323 And if you're new to my channel, it probably is very
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327 shocking. I never trade it. I use it as a selection tool.
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331 And I'll show you what I mean by that tonight. If you've
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335 been gone through my videos, you've probably seen lessons or
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339 discussions about this, but I want to give a little bit more
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343 meat to it tonight, so that we get something out of it and
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347 more value to your support of the YouTube channel. So,
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351 again, we're going to go in assuming that we have been
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355 bullish on dollar. Now, how you arrive at bullish dollar,
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359 you can get that information from studying the concepts and
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363 tutorials on his YouTube channel. This is not a silver
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367 bullet video. It doesn't answer all questions. It's
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371 specific, highly focused on one part, one segment of the
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375 process that leads to Finding explosive price action moves.
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379 Okay, so now when we look at Euro and contrast that with the
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383 dollar now for expecting a large price move, you can expect
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387 the dollar to be moving in tandem with a cross like euro
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391 pound. If it does that if it's starting to move in the same
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395 direction, that is highly indicative of a huge imbalance
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399 between otherwise closely correlated pairs. Now, that's a
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403 mouthful, I know. But what I'm saying is if the dollar is
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407 going higher, but not all foreign currencies will rally or
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411 decline the same. So if the dollar is bullish, this is how I
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415 start all my analysis. And now I teach my students, we start
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419 with the dollar. So if that's the case, and we're bullish on
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423 dollar, then we have to determine which foreign currency is
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427 more likely to go lower. So, what we're doing is we're using
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431 relative strength analysis to find out which currency is
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435 likely to stall, and which currency is likely to go lower.
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439 If we can determine that and fear that solution out by
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443 studying price action in euro pound, and using the economic
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447 calendar, as I mentioned, before going to the charts, we
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451 have a very strong likelihood, okay, or probability that
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455 we'll find the right pair to trade now. Do I always get it
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459 right? No, you're going to get it wrong too. But over a
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463 large sample size and career in trading, you're going to
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467 find it this concept this technique will help you find these
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471 really big explosive price action moves. Alright, so again,
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475 I'm not trying to draw your attention to or sell the idea
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479 that this euro pound move is to the discussion. That euro
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483 pound move is the catalysed to determine which currency pair
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487 to trade whether it be euro dollar or pound dollar. Okay, so
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491 let's go into little bit more detail THE DOLLAR traded down
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495 into its fair value gap as I mentioned in the previous
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499 discussions and I challenged everyone that was in my
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503 mentorship if I was lying about you expecting these levels
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507 to be traded to while way back over here and even before
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511 that, that there would be a large number of thumbs down. You
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515 can see there wasn't a large number of thumbs down. So if we
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519 expect price to trade higher, okay, you can clearly see we
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523 have relative equal highs in here. So it's not a stretch to
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527 imagine that it could reach up to that point now we're gonna
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531 stop and just say that is all there is for our analysis.
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535 Okay, say that was all that was possible at your level of
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539 understanding. Okay, and from trade. Down here up to here.
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543 Great, that's wonderful. You had a bias, the bias is bullish
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547 dollar, all foreign currency should go lower. But we have to
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551 use the step between just simply dollar going higher or
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555 foreign currency going lower, we want to look for the
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559 weakest of the two currencies in closely correlated pairs.
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563 Because if you look at all foreign currency, they should be
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567 declining over the last few days. But not all of them fell
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571 as much as others. There were other currencies that were
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575 extremely weak, and they lead downside draft
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579 on delivery on price versus the upside on the dollar index.
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583 So, if we look at the relationships between euro versus
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587 pound, we start with the Euro pound cross. So what causes
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591 the Euro pound to rally higher? Well, there's only two
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595 instances that will cause that euro dollar goes While at the
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599 same time, pound dollar consolidates it means euro dollar is
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603 allowed to go higher trade higher and pound dollar or cable
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607 stays in a range. Now it doesn't have to be a very clear
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611 range, it could be a muddy choppy trading session or
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615 sessions in plural or euro dollar consolidates and pound
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619 dollar drops. The same thing would be seen in this chart,
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623 with euro pound going higher regardless of which scenario
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627 over here is true. Now, as I shown on the economic calendar,
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631 the Euro dollar has strong economic news coming out. So no
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635 real indication that cable has any news this week at all. So
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639 which pair is going to be likely to wait around for the big
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643 news For the for the trading week, it's euro pound doesn't
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647 have anything really allowed to inject volatility and it's a
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651 high impact news event. And after that there's nothing cable
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655 related either a pound related. So the probabilities are
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659 euro dollar will likely be held in consolidation until its
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663 big news event for the week. That's why I teach my students
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667 he used economic calendar and how you plug that little
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671 component into the entire process. So we look for euro
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675 dollar to consolidate because of the economic calendar. So
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679 if the economic calendar hints at it's likely to
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683 consolidate, then what does that imply if we are also
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687 bullish on euro pound, the scenario is going to be euro
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691 dollar consolidates and pound dollar drops. So right away,
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695 we can clearly see that there's an advantage to Not trading
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699 short euro, not going long euro, but selling short pound
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703 dollar. So now if we take a look at Euro versus the Dollar
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707 Alright, so here's the euro dollar daily chart and you can
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711 see we are in a rather large consolidation on euro. And my
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715 students know that this whole entire time we have been
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719 really reluctant to have large intermediate term analysis
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723 calls on this pair after where we've traded to here. I
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727 wanted 120 we got 120 and now we've been sitting our hands
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731 for Euro couple that with what I'm showing you here tonight,
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735 it leads very well into shorts on cable, and you'll be able
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739 to see some of the things I've actually taught on this
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743 YouTube channel how they fall into place just perfectly. So
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747 we can see there's consolidation in here on euro we don't
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749 188
750 00:13:57,090 ~-~-> 00:13:59,970
751 have to really go through a whole lot with this, this pair
752
753 189
754 00:14:00,000 ~-~-> 00:14:08,310
755 If you break it down into a hourly chart and compress this a
756
757 190
758 00:14:08,310 ~-~-> 00:14:13,110
759 little bit, you can see while we are drifting with the
760
761 191
762 00:14:13,110 ~-~-> 00:14:19,410
763 strength in the dollar lower, it's still consolidated in not
764
765 192
766 00:14:19,410 ~-~-> 00:14:21,690
767 really expanding on the downside. In other words, there's
768
769 193
770 00:14:21,690 ~-~-> 00:14:27,720
771 not a lot of momentum for this pair eurodollar to cross a
772
773 194
774 00:14:27,720 ~-~-> 00:14:34,500
775 lot of ground on a bearish price swing. So we did take out
776
777 195
778 00:14:34,560 ~-~-> 00:14:38,040
779 equal relative equal lows, we did sweep through that. It
780
781 196
782 00:14:38,040 ~-~-> 00:14:42,330
783 just hasn't had a lot of expanse on the downside. If we look
784
785 197
786 00:14:42,330 ~-~-> 00:14:47,730
787 at the cable market in relationship to what we've seen here,
788
789 198
790 00:14:48,600 ~-~-> 00:14:51,780
791 there's a stark contrast. Right away you can see that this
792
793 199
794 00:14:51,780 ~-~-> 00:14:56,820
795 market has a lot more symmetry. That means the price action
796
797 200
798 00:14:56,820 ~-~-> 00:15:01,410
799 is much easier to read. It's much more explosive, it wants
800
801 201
802 00:15:01,410 ~-~-> 00:15:05,340
803 to reach down for lower price objectives. And I'm going to
804
805 202
806 00:15:05,340 ~-~-> 00:15:11,220
807 show you this magnified and we'll zoom in a little bit. I
808
809 203
810 00:15:11,220 ~-~-> 00:15:14,220
811 see here's Friday's price action. And I'm showing Friday's
812
813 204
814 00:15:14,220 ~-~-> 00:15:17,880
815 high in Friday's low and splitting that range in half. So if
816
817 205
818 00:15:17,880 ~-~-> 00:15:20,250
819 we were going to be bearish, the best sell scenarios are
820
821 206
822 00:15:20,250 ~-~-> 00:15:25,050
823 going to be in the lower half of that range for that
824
825 207
826 00:15:25,080 ~-~-> 00:15:28,770
827 Friday's daily range. You can see each trade here on this
828
829 208
830 00:15:28,950 ~-~-> 00:15:32,370
831 candle it's 4am New York time so that's the one that I've
832
833 209
834 00:15:32,370 ~-~-> 00:15:35,310
835 been kills on. You all are familiar with that. If you've
836
837 210
838 00:15:35,310 ~-~-> 00:15:37,290
839 been studying my content on this channel
840
841 211
842 00:15:38,610 ~-~-> 00:15:41,640
843 up close candle here that's your bearish order block price
844
845 212
846 00:15:41,640 ~-~-> 00:15:45,300
847 trades up into that close in balance trades to this candles.
848
849 213
850 00:15:45,630 ~-~-> 00:15:51,390
851 Low what's that low 132 38 and one pet and the high on this
852
853 214
854 00:15:51,390 ~-~-> 00:16:01,380
855 candle comes in at 132 38 and seven pets. So 38 seven 38
856
857 215
858 00:16:01,650 ~-~-> 00:16:04,770
859 one, so it went six pips that's a little bit further than it
860
861 216
862 00:16:04,770 ~-~-> 00:16:08,430
863 needs to just to trade into this candle, creating the high
864
865 217
866 00:16:08,430 ~-~-> 00:16:11,070
867 in the London session, and price breaks down and then we
868
869 218
870 00:16:11,070 ~-~-> 00:16:15,420
871 start to consolidate. Now we are in a long period of
872
873 219
874 00:16:15,420 ~-~-> 00:16:19,890
875 consolidation in here, but look where it's staying. Okay,
876
877 220
878 00:16:19,890 ~-~-> 00:16:26,100
879 it's staying below the previous day's low. And the next
880
881 221
882 00:16:26,100 ~-~-> 00:16:28,920
883 trading day starts here at midnight, on the eighth of
884
885 222
886 00:16:28,920 ~-~-> 00:16:33,420
887 September, and the high forms, whereas if one is a cross
888
889 223
890 00:16:33,420 ~-~-> 00:16:39,600
891 over the Mondays 50% of the daily range No. So the short
892
893 224
894 00:16:39,600 ~-~-> 00:16:43,320
895 forms in the lower half of the previous day's range, which
896
897 225
898 00:16:43,320 ~-~-> 00:16:48,420
899 is Monday's trading. And again in London open two o'clock in
900
901 226
902 00:16:48,420 ~-~-> 00:16:51,270
903 the morning, New York time, creates the high in London and
904
905 227
906 00:16:51,270 ~-~-> 00:16:54,570
907 then we sell off aggressively. And then during this period
908
909 228
910 00:16:54,570 ~-~-> 00:16:58,170
911 here, that little shaded box that is the 830 to 11 o'clock,
912
913 229
914 00:16:59,160 ~-~-> 00:17:03,000
915 New York trade session I taught for the YouTube channel. Now
916
917 230
918 00:17:03,000 ~-~-> 00:17:06,990
919 there is a new york session kill zone. Okay and or New York
920
921 231
922 00:17:06,990 ~-~-> 00:17:11,640
923 open kill zone. Then if you watch my tutorials here, you'd
924
925 232
926 00:17:11,640 ~-~-> 00:17:16,020
927 learn about that. But this specific opportunity is limited
928
929 233
930 00:17:16,020 ~-~-> 00:17:19,080
931 to 830 in the morning to 11 o'clock in the morning. So it
932
933 234
934 00:17:19,080 ~-~-> 00:17:23,520
935 really refines it to a time window where you can literally
936
937 235
938 00:17:23,610 ~-~-> 00:17:27,270
939 open up shop and that would be your, your operating time for
940
941 236
942 00:17:27,270 ~-~-> 00:17:31,080
943 trading. only focusing on the New York session, not having
944
945 237
946 00:17:31,080 ~-~-> 00:17:33,690
947 to worry about trading London, not having to worry about
948
949 238
950 00:17:33,690 ~-~-> 00:17:40,770
951 trading Asia, nothing doing in London close or even late New
952
953 239
954 00:17:40,770 ~-~-> 00:17:43,500
955 York sessions. This is a very short window of opportunity
956
957 240
958 00:17:43,560 ~-~-> 00:17:49,050
959 that gives you a lot of potential trades. So if we look at
960
961 241
962 00:17:49,050 ~-~-> 00:17:52,620
963 this on a 15 minute timeframe, you can see the 15 minute
964
965 242
966 00:17:52,620 ~-~-> 00:17:57,060
967 timeframe. Again, very clean price action. Lots of expansion
968
969 243
970 00:17:57,060 ~-~-> 00:18:01,860
971 down we create this retracement here ahead of New York open
972
973 244
974 00:18:03,000 ~-~-> 00:18:07,500
975 this low forums at 930. So there's your dealing range, you
976
977 245
978 00:18:07,500 ~-~-> 00:18:10,560
979 have the low and the high here. So that's your optimal trade
980
981 246
982 00:18:10,560 ~-~-> 00:18:13,560
983 entry, you would pull your fit across that. And it takes you
984
985 247
986 00:18:13,560 ~-~-> 00:18:17,670
987 right up into optimal trade entry right here during the 830
988
989 248
990 00:18:17,670 ~-~-> 00:18:21,000
991 to 11 o'clock in the morning timeframe. And then you can
992
993 249
994 00:18:21,000 ~-~-> 00:18:23,940
995 expect price to trade lower this line right here, I'll take
996
997 250
998 00:18:23,940 ~-~-> 00:18:25,650
999 you out into a daily chart and show you what that is. But
1000
1001 251
1002 00:18:25,650 ~-~-> 00:18:28,380
1003 it's just a liquidity pool very easy, obvious level that
1004
1005 252
1006 00:18:28,380 ~-~-> 00:18:32,640
1007 reach for using higher timeframe price action. So now if we
1008
1009 253
1010 00:18:32,640 ~-~-> 00:18:38,550
1011 look at how price has delivered one cable in relationship to
1012
1013 254
1014 00:18:38,610 ~-~-> 00:18:41,970
1015 everything I've shown so far, which is bullish dollar,
1016
1017 255
1018 00:18:43,110 ~-~-> 00:18:46,980
1019 looking at the economic calendar determine Is there any
1020
1021 256
1022 00:18:47,010 ~-~-> 00:18:52,650
1023 clues to which pair of a closely correlated group of markets
1024
1025 257
1026 00:18:52,680 ~-~-> 00:18:57,150
1027 for instance, euro and pound, they're very, very correlated.
1028
1029 258
1030 00:18:57,150 ~-~-> 00:19:01,350
1031 They're highly correlated. So when they trend higher, they
1032
1033 259
1034 00:19:01,350 ~-~-> 00:19:04,980
1035 usually tend to trend together. But there's times when that
1036
1037 260
1038 00:19:04,980 ~-~-> 00:19:08,790
1039 won't happen. There's a crack in that correlation. So by
1040
1041 261
1042 00:19:08,790 ~-~-> 00:19:12,420
1043 using economic calendar first determine Is there any real
1044
1045 262
1046 00:19:12,420 ~-~-> 00:19:15,960
1047 heavy hitting news for one currency over another, and then
1048
1049 263
1050 00:19:15,960 ~-~-> 00:19:20,160
1051 you study price action when the new week starts, which one's
1052
1053 264
1054 00:19:20,160 ~-~-> 00:19:23,400
1055 having a lot of struggle to go in the direction that the
1056
1057 265
1058 00:19:23,400 ~-~-> 00:19:28,290
1059 dollar index implies. So if we're bullish on dollar, that
1060
1061 266
1062 00:19:28,290 ~-~-> 00:19:32,610
1063 means euro dollar should go lower cable or pound dollar
1064
1065 267
1066 00:19:32,610 ~-~-> 00:19:37,170
1067 should go lower. But if we see bullishness on euro pound,
1068
1069 268
1070 00:19:37,500 ~-~-> 00:19:39,900
1071 then we go through the scenario as I outlined at the
1072
1073 269
1074 00:19:39,900 ~-~-> 00:19:43,080
1075 beginning of this video, looking for which one is likely to
1076
1077 270
1078 00:19:43,080 ~-~-> 00:19:47,670
1079 occur in terms of scenario. As you can see here, cable has
1080
1081 271
1082 00:19:47,670 ~-~-> 00:19:50,970
1083 led on the downside. And we're gonna look at this little
1084
1085 272
1086 00:19:51,540 ~-~-> 00:19:55,800
1087 portion of price action right there. I'll add the fib so you
1088
1089 273
1090 00:19:55,800 ~-~-> 00:19:59,790
1091 can see without having to trade in London session. Not that
1092
1093 274
1094 00:19:59,790 ~-~-> 00:20:02,670
1095 there isn't Anything wrong with trading on this session?
1096
1097 275
1098 00:20:03,030 ~-~-> 00:20:11,520
1099 Because it's, to me, it's the biggest opportunity for the
1100
1101 276
1102 00:20:11,520 ~-~-> 00:20:16,470
1103 day. You don't need the biggest opportunity. You can do New
1104
1105 277
1106 00:20:16,470 ~-~-> 00:20:19,980
1107 York session trading every single trading session and do
1108
1109 278
1110 00:20:20,190 ~-~-> 00:20:24,330
1111 very, very well because you have the advantage of knowing
1112
1113 279
1114 00:20:24,330 ~-~-> 00:20:28,050
1115 what London did. And this actually didn't go where I wanted
1116
1117 280
1118 00:20:28,050 ~-~-> 00:20:34,980
1119 it to go right there. All right. So I'll zoom in here and
1120
1121 281
1122 00:20:35,040 ~-~-> 00:20:37,410
1123 let you take a look at what cable did.
1124
1125 282
1126 00:20:41,700 ~-~-> 00:20:45,600
1127 So here's that range the high to the low with the 79%
1128
1129 283
1130 00:20:45,600 ~-~-> 00:20:49,320
1131 retracement level trading up into it here. And yes, we
1132
1133 284
1134 00:20:49,320 ~-~-> 00:20:53,670
1135 consolidate a little bit before breaking down. If recall in
1136
1137 285
1138 00:20:53,670 ~-~-> 00:20:55,800
1139 the last few videos I've been talking about. This is the
1140
1141 286
1142 00:20:55,800 ~-~-> 00:20:59,700
1143 reason why I am never in a hurry to move my stop loss.
1144
1145 287
1146 00:21:00,000 ~-~-> 00:21:02,490
1147 Because this is what can happen, the algorithm can keep
1148
1149 288
1150 00:21:02,490 ~-~-> 00:21:06,870
1151 priced in a range longer than it's comfortable for you to
1152
1153 289
1154 00:21:06,870 ~-~-> 00:21:10,020
1155 stay in the trade or without moving your stop. See, the
1156
1157 290
1158 00:21:10,020 ~-~-> 00:21:13,380
1159 first impulse you have as a retail trader is, I want to
1160
1161 291
1162 00:21:13,380 ~-~-> 00:21:16,290
1163 protect my open profits and I don't want to get a loss. I
1164
1165 292
1166 00:21:16,290 ~-~-> 00:21:18,720
1167 don't want to have a losing trade. And that's one of the
1168
1169 293
1170 00:21:18,720 ~-~-> 00:21:21,450
1171 things you're going to have to grow into allowing,
1172
1173 294
1174 00:21:21,870 ~-~-> 00:21:24,510
1175 happening. If you're going to lose, you're going to have a
1176
1177 295
1178 00:21:24,510 ~-~-> 00:21:27,720
1179 stop out. If there's nothing wrong with that. I stop at a
1180
1181 296
1182 00:21:27,720 ~-~-> 00:21:30,690
1183 trades. Sometimes the trade doesn't work for me and it runs
1184
1185 297
1186 00:21:30,690 ~-~-> 00:21:34,050
1187 right to my stop when I first get in. I'm not infallible,
1188
1189 298
1190 00:21:34,200 ~-~-> 00:21:37,170
1191 you're not going to be infallible. So it's important to
1192
1193 299
1194 00:21:37,230 ~-~-> 00:21:40,500
1195 welcome that in your development because you learn a whole
1196
1197 300
1198 00:21:40,500 ~-~-> 00:21:44,130
1199 lot about doing it wrong in the beginning, but some of you
1200
1201 301
1202 00:21:44,460 ~-~-> 00:21:47,340
1203 only really most of you are trying to avoid that
1204
1205 302
1206 00:21:47,550 ~-~-> 00:21:53,130
1207 uncomfortable period of struggling and fumbling and just not
1208
1209 303
1210 00:21:53,130 ~-~-> 00:21:56,280
1211 knowing what you're doing. So if you can just allow yourself
1212
1213 304
1214 00:21:56,280 ~-~-> 00:21:59,040
1215 and give yourself permission to make mistakes in a demo,
1216
1217 305
1218 00:21:59,040 ~-~-> 00:22:01,110
1219 where you're not hurting yourself. Financially, and you're
1220
1221 306
1222 00:22:01,110 ~-~-> 00:22:05,190
1223 not really scoring or measuring up, you know, to whether or
1224
1225 307
1226 00:22:05,190 ~-~-> 00:22:08,580
1227 not you're making money in a demo account or not. The first
1228
1229 308
1230 00:22:09,150 ~-~-> 00:22:15,900
1231 objective is to not show a huge draw down, okay? If you can
1232
1233 309
1234 00:22:15,900 ~-~-> 00:22:18,300
1235 go back and forth, you know, make a little, give it back,
1236
1237 310
1238 00:22:18,300 ~-~-> 00:22:20,850
1239 make a little and not really make money or not make up a
1240
1241 311
1242 00:22:20,850 ~-~-> 00:22:24,270
1243 huge decline in the equity for your demo. That's actually
1244
1245 312
1246 00:22:24,270 ~-~-> 00:22:27,510
1247 very good. That's a good goal to have initially try to aim
1248
1249 313
1250 00:22:27,510 ~-~-> 00:22:30,240
1251 for breakeven is most traders when they first start, they
1252
1253 314
1254 00:22:30,240 ~-~-> 00:22:33,690
1255 have no ability to trade like that. It's always like a train
1256
1257 315
1258 00:22:33,690 ~-~-> 00:22:36,900
1259 wreck where it just completely blows out the account and
1260
1261 316
1262 00:22:36,900 ~-~-> 00:22:39,990
1263 have to reset and restart a new demo. You don't want to
1264
1265 317
1266 00:22:39,990 ~-~-> 00:22:42,330
1267 learn those lessons on a Live account. The only thing that's
1268
1269 318
1270 00:22:42,330 ~-~-> 00:22:46,530
1271 going to do is teach you to be fearful of trading. And there
1272
1273 319
1274 00:22:46,530 ~-~-> 00:22:54,510
1275 should be no apprehension, no reluctance, no fear, or
1276
1277 320
1278 00:22:54,510 ~-~-> 00:22:57,870
1279 uncertainty about why you're putting the trade on and using
1280
1281 321
1282 00:22:57,870 ~-~-> 00:23:02,040
1283 a hard stop, not mentally Stop, pretend stop. If it goes
1284
1285 322
1286 00:23:02,040 ~-~-> 00:23:04,890
1287 here, I'll get out. There's never work. Okay, they always do
1288
1289 323
1290 00:23:04,890 ~-~-> 00:23:08,490
1291 more damage than they help. So by looking at the things I've
1292
1293 324
1294 00:23:08,490 ~-~-> 00:23:11,730
1295 taught you, on this YouTube channel, using the concept that
1296
1297 325
1298 00:23:11,730 ~-~-> 00:23:15,360
1299 I just walked you through here, you can clearly see that
1300
1301 326
1302 00:23:15,360 ~-~-> 00:23:19,320
1303 everything still works. We have the range, optimal trade
1304
1305 327
1306 00:23:19,320 ~-~-> 00:23:21,840
1307 entry. This candle is the highest one in here and it's still
1308
1309 328
1310 00:23:21,840 ~-~-> 00:23:25,380
1311 10 o'clock in the morning. You have until 11 o'clock to find
1312
1313 329
1314 00:23:25,380 ~-~-> 00:23:30,240
1315 the setup. And the 11 o'clock hour is here. So it's this
1316
1317 330
1318 00:23:30,510 ~-~-> 00:23:36,120
1319 candle right there. So you have that range. From here to
1320
1321 331
1322 00:23:36,120 ~-~-> 00:23:40,950
1323 here, it retraces, and then you let it go. Stop above here,
1324
1325 332
1326 00:23:41,130 ~-~-> 00:23:44,730
1327 and you just let it trade. It's going around sideways always
1328
1329 333
1330 00:23:44,730 ~-~-> 00:23:47,190
1331 always. Does it break this low yet. No, it doesn't break
1332
1333 334
1334 00:23:47,190 ~-~-> 00:23:50,820
1335 that low until this candle. Then and only then would you be
1336
1337 335
1338 00:23:50,820 ~-~-> 00:23:54,210
1339 considering moving your stop but not before then. Because
1340
1341 336
1342 00:23:54,210 ~-~-> 00:23:57,960
1343 you have to give the market time to gyrate move around and
1344
1345 337
1346 00:23:57,960 ~-~-> 00:24:02,280
1347 then leave the dealing room See, the problem with most
1348
1349 338
1350 00:24:02,340 ~-~-> 00:24:05,970
1351 traders is that they look at these candles and they
1352
1353 339
1354 00:24:05,970 ~-~-> 00:24:09,120
1355 attribute much more significance to them than they really
1356
1357 340
1358 00:24:09,540 ~-~-> 00:24:15,450
1359 have. The algorithm trades on time and price. Okay? Not
1360
1361 341
1362 00:24:15,450 ~-~-> 00:24:21,810
1363 price and time it's time and price. So, the most significant
1364
1365 342
1366 00:24:21,810 ~-~-> 00:24:26,220
1367 factor is the element of time. The algorithm can stay in a
1368
1369 343
1370 00:24:26,220 ~-~-> 00:24:29,880
1371 predetermined range longer than traders are comfortable
1372
1373 344
1374 00:24:29,880 ~-~-> 00:24:33,810
1375 holding. And this entire time it stays within this low and
1376
1377 345
1378 00:24:33,810 ~-~-> 00:24:38,100
1379 this high. All kinds of ideas have changed from being
1380
1381 346
1382 00:24:38,100 ~-~-> 00:24:40,860
1383 bullish to bearish trade has been put on trades have been
1384
1385 347
1386 00:24:40,860 ~-~-> 00:24:43,770
1387 taken off. trades have been stopped out moving them too
1388
1389 348
1390 00:24:43,770 ~-~-> 00:24:48,030
1391 tight because most people do not know how to trade. So
1392
1393 349
1394 00:24:50,010 ~-~-> 00:24:53,640
1395 looking at this example here and then thinking about how you
1396
1397 350
1398 00:24:53,640 ~-~-> 00:24:56,250
1399 seen live examples where I'm executing, entering and
1400
1401 351
1402 00:24:56,250 ~-~-> 00:24:59,820
1403 managing the trade, this is a reason why I do not rush to
1404
1405 352
1406 00:24:59,820 ~-~-> 00:25:04,410
1407 move Stop Loss because I understand this component and price
1408
1409 353
1410 00:25:04,410 ~-~-> 00:25:08,580
1411 action, it can stay in a range or a consolidation before
1412
1413 354
1414 00:25:08,580 ~-~-> 00:25:14,070
1415 moving into my expected you know, move below this low here,
1416
1417 355
1418 00:25:14,370 ~-~-> 00:25:17,970
1419 and then we would see it reached below this low here, that
1420
1421 356
1422 00:25:17,970 ~-~-> 00:25:19,770
1423 blue line, I promised I would tell you what that is, let's
1424
1425 357
1426 00:25:19,770 ~-~-> 00:25:23,940
1427 go out to a daily chart. And let's take this off for a
1428
1429 358
1430 00:25:23,940 ~-~-> 00:25:26,160
1431 moment. Daily.
1432
1433 359
1434 00:25:31,440 ~-~-> 00:25:36,030
1435 Okay, and you can see this low rate there, you see that. So
1436
1437 360
1438 00:25:36,030 ~-~-> 00:25:40,530
1439 we have this low, all up to here. So this is the dealing
1440
1441 361
1442 00:25:40,530 ~-~-> 00:25:43,140
1443 range, we've been working on a daily chart, so liquidity
1444
1445 362
1446 00:25:43,140 ~-~-> 00:25:45,990
1447 rest below that low, and I'll add annotations back on and
1448
1449 363
1450 00:25:45,990 ~-~-> 00:25:48,750
1451 you'll see it there's that low, that blue line and it's
1452
1453 364
1454 00:25:48,750 ~-~-> 00:25:52,110
1455 trades down into it and below it. Alright, so I'm certainly
1456
1457 365
1458 00:25:52,110 ~-~-> 00:25:54,750
1459 not saying that's the actual end of the move. I'm not
1460
1461 366
1462 00:25:54,750 ~-~-> 00:25:57,450
1463 implying that at all. I'm just saying that that was a level
1464
1465 367
1466 00:25:57,840 ~-~-> 00:26:00,450
1467 that you could reasonably expect to see it draw to Alright,
1468
1469 368
1470 00:26:00,480 ~-~-> 00:26:04,200
1471 so alright, so hopefully you've got something out of this. A
1472
1473 369
1474 00:26:04,200 ~-~-> 00:26:07,890
1475 lot of things I've provided here. If it went over your head,
1476
1477 370
1478 00:26:07,890 ~-~-> 00:26:12,780
1479 I promise if you've spent more time in the tutorials on this
1480
1481 371
1482 00:26:12,780 ~-~-> 00:26:15,900
1483 YouTube channel, it'll fill in the gaps, not all the gaps,
1484
1485 372
1486 00:26:15,900 ~-~-> 00:26:18,330
1487 it won't fill in everything. But it will give you have a
1488
1489 373
1490 00:26:18,330 ~-~-> 00:26:21,270
1491 greater understanding about why these pairs do what they do,
1492
1493 374
1494 00:26:21,570 ~-~-> 00:26:24,000
1495 and how to use the crosses to find the explicit price action
1496
1497 375
1498 00:26:24,000 ~-~-> 00:26:27,330
1499 moves. I'll talk to you next time. I wish good luck and good
1500
1501 376
1502 00:26:27,330 ~-~-> 00:26:27,720
1503 trading.