“Regardless of what you may think, all traders are forecasters, just like the weatherman.”
Trade when these odds are in your favour:
Trading with the trend
Trading With Price Action Using reliable chart patterns and candlestick patterns.
Trading using Support and resistance levels.
Making your winners larger than your losing trades
Trading only in larger timeframes
Waiting patiently for the right trade setups and not chasing trades.
Price is value and its value is dependent on supply and demand.
If the demand is more, price increases as more traders start buying and driving prices up.
Demand zones on your price charts are around support levels, that’s where buyers come and start buying
and driving prices up!
If there is an oversupply, price falls as there are more seller and less buyers.
Supply zones on your charts are on and around resistance levels where sellers come in and drive the
prices down due the fact that there are very few buyers.
The candlestick:
Traders prefer to set green candlesticks as bullish and red candlesticks as bearish.
All these candlesticks shown below are bullish candlesticks
All these candlesticks shown below are bearish candlesticks
,There are bullish candlesticks that are considered bearish and bearish
candlesticks that are considered bullish:
Every candlestick that is formed tells you a story about the battle between the bulls and the bears-who
dominated the battle, who won at the end, who is weakening etc. All that is reflected in any candlestick you see.
The length of the body of the candlestick as well as the shadow (or wick) tells you a story about the buying and
selling pressure.
Look at the first green candlestick on the left chart, it’s a bullish candlestick right? Yes. But you can see that it has
a very short body and very long wick (tail). It tells you the sellers (bears) were dominant. If this candlestick was to
form after hitting a resistance level, it will be considered a bearish signal even though it’s a bullish candlestick.
Now, you can apply the same sort of logic to all the other candlesticks above and read the story each one is
telling you.
If the upper wick is very long, it simply tells you that there’s a lot of selling pressure. It means price opened
and got pushed higher by the buyers but then at the highest price, sellers got in and drove it back down.
If the lower wick is long, it tells you that there’s a lot of buying pressure. Sellers drove the price down, but
buyers got in and drove the price back up.
If the lower wick is short, it tells your there’s very minimal buying pressure.
If the upper wick is short, it tells you that there’s very minimal selling pressure.
What is the Significance of Candlestick Wicks?
Candlestick wicks with long upper shadows commonly occur when an uptrend is losing strength.
Long lower shadows occur when the downtrend is losing steam.
,TRENDS:
There are 3 types of trends. In simple terms, a trend is when price is either moving up, down or sideways.
So when price is moving up, it’s called an uptrend.
When price is moving down, it’s called downtrend.
When price is moving sideways, it’s called and sideways trend.
When price is in an uptrend, prices will be making increasing higher highs and higher
lows until a higher low gets intercepted, then that signals the end of the uptrend and the
beginning of a downtrend.
For downtrend, prices will be making increasing lower highs and lower lows until a
lower low is intercepted and that signals an end of the downtrend and a beginning of an
uptrend.
Structure of An Uptrend (Bull) Market Structure of A Downtrend (Bear) Market
In reality, the market is not like that, it’s more like this chart shown below:
, The chart above shows an initial downtrend and along the way there is a false uptrend which does not last and
price moves down and then eventually another uptrend moves is happening because another lower high has
been intersected(which signals end of downtrend).
Structure Of A Sideways/Ranging Market
Trade when these odds are in your favour:
Trading with the trend
Trading With Price Action Using reliable chart patterns and candlestick patterns.
Trading using Support and resistance levels.
Making your winners larger than your losing trades
Trading only in larger timeframes
Waiting patiently for the right trade setups and not chasing trades.
Price is value and its value is dependent on supply and demand.
If the demand is more, price increases as more traders start buying and driving prices up.
Demand zones on your price charts are around support levels, that’s where buyers come and start buying
and driving prices up!
If there is an oversupply, price falls as there are more seller and less buyers.
Supply zones on your charts are on and around resistance levels where sellers come in and drive the
prices down due the fact that there are very few buyers.
The candlestick:
Traders prefer to set green candlesticks as bullish and red candlesticks as bearish.
All these candlesticks shown below are bullish candlesticks
All these candlesticks shown below are bearish candlesticks
,There are bullish candlesticks that are considered bearish and bearish
candlesticks that are considered bullish:
Every candlestick that is formed tells you a story about the battle between the bulls and the bears-who
dominated the battle, who won at the end, who is weakening etc. All that is reflected in any candlestick you see.
The length of the body of the candlestick as well as the shadow (or wick) tells you a story about the buying and
selling pressure.
Look at the first green candlestick on the left chart, it’s a bullish candlestick right? Yes. But you can see that it has
a very short body and very long wick (tail). It tells you the sellers (bears) were dominant. If this candlestick was to
form after hitting a resistance level, it will be considered a bearish signal even though it’s a bullish candlestick.
Now, you can apply the same sort of logic to all the other candlesticks above and read the story each one is
telling you.
If the upper wick is very long, it simply tells you that there’s a lot of selling pressure. It means price opened
and got pushed higher by the buyers but then at the highest price, sellers got in and drove it back down.
If the lower wick is long, it tells you that there’s a lot of buying pressure. Sellers drove the price down, but
buyers got in and drove the price back up.
If the lower wick is short, it tells your there’s very minimal buying pressure.
If the upper wick is short, it tells you that there’s very minimal selling pressure.
What is the Significance of Candlestick Wicks?
Candlestick wicks with long upper shadows commonly occur when an uptrend is losing strength.
Long lower shadows occur when the downtrend is losing steam.
,TRENDS:
There are 3 types of trends. In simple terms, a trend is when price is either moving up, down or sideways.
So when price is moving up, it’s called an uptrend.
When price is moving down, it’s called downtrend.
When price is moving sideways, it’s called and sideways trend.
When price is in an uptrend, prices will be making increasing higher highs and higher
lows until a higher low gets intercepted, then that signals the end of the uptrend and the
beginning of a downtrend.
For downtrend, prices will be making increasing lower highs and lower lows until a
lower low is intercepted and that signals an end of the downtrend and a beginning of an
uptrend.
Structure of An Uptrend (Bull) Market Structure of A Downtrend (Bear) Market
In reality, the market is not like that, it’s more like this chart shown below:
, The chart above shows an initial downtrend and along the way there is a false uptrend which does not last and
price moves down and then eventually another uptrend moves is happening because another lower high has
been intersected(which signals end of downtrend).
Structure Of A Sideways/Ranging Market
