A Complete Guide to Mastering Market Analysis... (Full Course: Beginner To Advanced)

[00:00:00] Speaker 1: what's going on everybody welcome back to my youtube channel and in today's lesson i'm going to teach you how to read the markets now in my humble opinion guys a trading plan is absolutely paramount but if you're looking for entries you're looking for patterns you're looking for distinct behavior in the market you're going to be disappointed because the market is constantly changing and it's never going to do the same thing over and over again the way you would like it to happen so as an example if you're looking for a trade from a support level and you're specifically looking for two pin bars with a bullish engulfing candle before an entry it's very unlikely that that trade's going to come around often whilst what i'm going to teach you today is going to really help you to just broaden your horizons and really develop a good feel for the market so you can read the behavior and execute a lot more freely so we're going to look at one two three four examples today and we're going to go through these concepts and then later on in the video i'm going to share a live example with you where i discuss with one of my students in length the true psychology behind understanding behavior which is a lot more advanced than what we're going to go through now but i'm sure it will help you once we make sense of this so without further ado let's jump on the charts the first pair we're going to be looking at is gold now if we look at this structure of this market the first thing that we can see here is that the market is pushing to the upside how do we know this we can see the market is making higher highs and higher lows we can also see that price is respecting support areas in the market which simply means price is not breaking below these levels and you can see that price is continuing to push higher in an upward movement now something happens during this movement to the upside and you can see here as we push up price gets to a really high point now when i illustrate this some of you might say well hasn't it reached a high point already look price likes to meet ranges guys so let's say this is the highest point in the market if we're pushing from the lowest point in this market then we can expect not all the time but nothing is guaranteed in trading that the market is going to come back to this point bare minimum now it may not which is completely fine because nothing as i said is guaranteed it can do what it wants but more often than not if we have a clear up trend price is making higher highs and higher lows price is not breaking below these points which means that the bullish sentiment is still strong then there's a very high chance and this is a good indicator where you can start scaling into your trades you can start targeting more risks to reward you can be adding to your position trailing your stops whatever it may be when you see this kind of formation in this behavior then you can expect price to come back to a range what do i mean by that well if we have an area in the market where price has created a high point or a low point you can expect price to come back to here this is the range okay where to the left you can see there's a range to the downside um well this movement to the downside creates a range back to the upside again if we do that we have range which is this point this point and then a range back to the downside and it happens often okay so don't let the market shake you out the only time it becomes difficult to identify ranges and when is when prices in the middle of nowhere and then you really don't have anything to work with to the left now we're in a 15 minute time frame and this applies to the 15 minute time frame if you go down to the audi time frame then obviously the range is going to be slightly different okay anyway point made there so we can see the market is making higher highs and higher lows it's clearly in an uptrend we can also see that price has come back to the highest point so we know that the range has been met now we can't expect the market to do anything at this point until it tells us it's going to do something as you can see when we got there we had a bearish reaction but we had nothing else price peaked that point and then as you can see here we're exhausted this means nothing either we can still continue to push up and make higher highs and higher lows because technically this is a higher low but look what happens price creates a high point it comes back to the highest point and it fails to break it so what can we identify here from a behavioral perspective well originally the market was in a bullish phase we've met the range to the left as you can see here you can see that we broke that range we continue to anticipate that it will continue higher so from this point whether it be a break and retest a higher low entry a support level trade whatever you want to call it we can still buy in anticipation of a higher high but if you come to the markets and you understand this behavior and what has happened previously that aligns with the current behavior and you see that price is not breaking it then from a behavioral perspective if it's in an uptrend it's made a higher low in theory it should continue higher if it's created the highest point in this scenario and it doesn't break the high then we can anticipate or we can start to reason from a behavioral perspective that the bullish sentiment is depleting so that being said if we're not going to break this high then this is going to become what you would know as a resistance level and from a behavioral tech behavioral perspective and a technical analysis perspective we're not making any higher highs so if we start to see the behavioral shift that's developed from the trend the range being met price breaking the high the higher low being formed the higher high should be formed but it's not forming then we're tapping into the highest point now we have what we call a double top we can also say that this is a resistance level in the market we can see that the behavior is shifting from being bullish because we see the depletion with the wick rejections and now we're starting to shift bearish then what can we anticipate we can't anticipate that the market's going to continue bullish so what can we do well we can look for a selling opportunity here with a stop loss above and why is the stop loss placement a good stop loss placement well if it hasn't broken the high it's respecting the high it's creating a double top it's at a resistance level then if it breaks this high then the trade is not going down but if it doesn't break this high then technically the only other direction it can go is down i mean it can move sideways but if it's not going to go up then it's not up is it so then you can look for an opportunity here which is makes reasonable sense right from a behavioral perspective you can also take the trade on a break of this low with a stop loss above if you want more confirmation in the sense that you are waiting for price to take out the uptrend and truly turn to be embarrassed or you can wait for price to be broken look for that break below this level to indicate that the uptrend has now ended and the new downtrend is now being formed and potentially look for an opportunity something like this as a break and retest pattern however you enter the market is not as important as the process and that is what i'm trying to explain here well on top of understanding behavior if you develop a very good storyline behind every trade that you take then guess what when you come to the markets you are less likely to continue to make up stories and if you make it a habit then they will become so concrete in your analysis that you will end up taking higher probability trades all of the time okay not all of the time but 95 90 of the time and that's better than having conflict all of the time or having to question or doubt your decisions to enter a trade or not because you don't know if it's doing this or if it's doing that but if you practice this you make it a habit to develop a story behind every trade you take then sooner or later guys it's going to become second nature to you so this is a great example let's move on to another one now we're looking at pound usd we're looking at another example here and you can see that the market has pushed really strong to the upside now this means nothing to us right but let's follow along with the same theme price has created its highest point we have this push to the downside we are in an uptrend maybe not the clearest uptrend and this is why i said if you're looking for clean uptrends clean patterns clean development of structure all of the time it's not going to happen so that is why it's so much better for you to start to really understand the market sentiment by understanding the behavior and developing that storyline around each trade now every trade setup you take may look different and totally different but the process and the storyline behind it will not change you might have free storylines because you're looking for free different setups as you will see in a minute but the process and the storyline will not change now we could say that we are developing a market whisperer type of analysis here okay fine but i want to make this very clear it doesn't mean you're going to be right all the time but it means that if you develop this you're going to be more right than you are wrong and even if you're not more right than you're wrong you're going to be less wrong than you're right which simply means you're going to be more selective you're going to be able to identify trace ups that you're confident with that's going to allow you to execute with confidence that's going to allow you to hold your trades for longer that's going to allow you to scale into your trades to stop micromanaging your trades to remove those impulses and foam and those kind of fear of missing out executions and so much more but we're not here to talk about the psychology of how a trader will develop we're here discussing the behavior of the market so let's look at this price has created its highest point here is a higher low we should make a higher high we know this now but you can see price didn't we came into this level price tapped into it we rejected it what does this mean well the bullish sentiment is clearly depleting now we don't know it's depleted yet because guess what we're waiting for the market to break this low now if it comes back to respect this flow we're going to buy this all day long simply because the market is respecting the low in an uptrend and if it doesn't break the low it must go higher but it didn't it continued bearish where did this stem from this behavior that we've picked up on this market did not stem from the fact that it broke the low it hasn't even stemmed from the fact that it came back to retest this level it stemmed from the fact that the market was bullish it made a high it made a higher low it failed to make the higher high and then the sentiment changed from being bullish sentiment to bearish sentiment we can only assume that if it's not going up it must go down so what happens here price breaks the low so now we invalidate the downtrend and we come back to the retest level in the market and as you can see here we continue down now some of you might be saying well rocks what if you take the trade here well okay fantastic we take the trade here and we lose okay fine the storyline still remains the same though the behavior of the market has not changed because if we take the fact that this is the high price failed to break this high if it's not coming up it must go down and then we take this trade because we have a strong feeling it's going down which we're not wrong in this instance and even if it went up we still wasn't wrong because that's the behavior of the market we take this trade and it loses and then we see that the market comes back to this level doesn't break the high and respects it is that not the same behavior here is the market still not weighted more to the downside than it is to the upside well the answer is yes so let's say you took this on a monday and you lost and you came back to the market and there was a very similar setup which is this one here now and then you decide to take this trade on the break of this low okay yesterday we lost one r we come back to the markets we do the same thing again and guess what we make two r or wherever the market goes it doesn't matter here all we're doing is rinse and repeat in a very very consistent approach to our analysis by simply understanding the behavior of the market let's move on to another example we're looking at euro jpy here and for me i love trading trading ranges i don't personally look for trends per se from a higher time frame perspective like this i don't look for trends on any higher time frames i'm the type of trader that likes to identify the behavior from a high time frame perspective as you will see in my previous video and then i like to scale down and look for the trends on the lower time frames higher highs and higher lows okay to support that bias but if we look at euro yen a slightly different example here but we have a high in the market and remember what i said if price creates a highest point and a lowest point and then it starts to move towards that area what does it do more often than not it will come back to that area to fill that range that's exactly what's happened price is not clearly trending and in terms of the movement back to this level is a very slow grind but it's besides the point the market has pushed from a low point to a high point which means there's a bullish sentiment and when it got back to the highest point after filling the range we see a behavioral shift what is that behavioral shift well you can clearly see here guys prices come back we have a very strong bullish candle into this level the sentiment of the market and the behavior is still bullish we're making higher highs and higher lows we're respecting the trend line however you want to look at this and then all of a sudden what happens we start to see a bearish sentiment right we start to see a bearish sentiment what is that telling us well the behavior is shifting everything lines up it's the same process as over here highest point highest point back over here prices create a lowest point highest point and what do i anticipate the price to do come back to the lowest point i don't know if it did it didn't but that's what we anticipate right so once we see the behavior we take the trade with the idea now here we can see that price create is the highest point the lowest point come back to the highest point and we see a behavioral shift what does that mean let's go in for the trade stop us above this level and then go for your targets it's just mind-blowing guys it's only mind-blowing if you don't come into the market with a consistent process if you come into the market and you say i'll take any break and retest i'll take any support and resistance rate i'll take any pattern that develops without really understanding why you're entering those trades and developing those storylines behind it you're just going to find trading very difficult if not impossible you have to understand as human beings guys our minds and our bodies work much easier with patterns so if you think about songs how do you remember songs but there's a pattern there's a rhythm why do you remember images more than you do words or names because they're patterns they're images if you understand the patterns and the images and the storylines and the processes that go into your trades how much more do you think that you're going to develop as a trader massively and look we can remove this and we can use the theory of a range we know that in a range price bounces from the high and bounces from the low but we can also understand the behavior again we have a massive strong shift to the downside what do we see here prices reacting to the previous low the behavioral shift is going from bearish to bullish however you enter this it doesn't matter again price comes here okay whoopty do we take a loss we don't give up on this because the behavior is still not breaking the lows there is a lower high we anticipate a lower low it fails to make a lower low which means that if it's not going down it must go up and we see from previous prices reacted and created a bullish sentiment so what can we do take the trade bob's your uncle lose one win one doesn't matter all we're doing is following the process let's look at the final example here on aussie dollar cad and i really like this one i like all of them to be honest with you but here we can see an uptrend in the market price is failing to break the structural highs we also have an area in the market which is a higher high a higher low we anticipate a higher high and we do not get it what can we do look for that selling opportunity here here it doesn't matter stop loss above this high which is this week stop loss above this high which is this week and then look for our trading opportunities all right we might get stopped out by spreads who cares whatever doesn't matter if you're focused on winning and losing then you're losing period here we go again price comes back in where can we look for an opportunity here doesn't matter stop loss above again bam another trading opportunity okay we get stopped out by spreads i doubt it very much we have another opportunity bam there we go why because the behavior was bullish it creates a higher higher low fails to make a higher high the behavior shifts from bullish sentiment to bearish sentiment and we continue to respect that error if it's not going higher it must go lower and look what happens it falls off okay i'm not happy from taking it from this high because there's too much taps okay well let's do this let's wait for the market to break and retest and give us some sort of trend change in the market take the trade here stop loss above here go for a target okay fine i'm not happy taking at the immediate retest i want a pattern okay fine here we have a level in the market where prices created evidence and here's confirmation what can we do we can take the trade here bam and take the trade like this guys look this is not made up this is what happens in the market markets every single day on every single time frame and i want to make this very clear for those that don't understand what i'm talking about i'm not teaching you a strategy i'm encouraging you to think differently to approach your trading with a consistent theme creating a story around your trading criterias and your entries because once you understand the behavior of the market and you become consistent in developing that it will then become a habit it would then become second nature and then you will just start reading the market like a market whisperer i hope this was beneficial guys if you enjoyed it make sure you smash that like button subscribe turn on notifications and until next time as i always say trust the process now guys i did say i was going to share something with you next up is a live example of one of my students who was sharing their trades and i decided well i didn't decide it was decided that we'll go through his trades and talk about the thought process this is a lot more advanced than what we've spoken about because now we really delve into the psychology of trading so if you don't understand it don't worry go through this one a few times practice it yourself and then come back to this video but without further ado guys i hope you enjoy [00:17:32] Speaker 2: it and again until next time trust the process talk to me ross so come back to respect its own iowick for a continuation uh looking at this now in front of you all i'd probably say i set my entry a bit too below structure um uh i believe it where my tp was there'd be no traffic for it to hit that's basically the downside and yeah this one was a winner if i remember correctly okay it was yeah okay so remember [00:18:14] Speaker 1: this means nothing at this stage okay in this in this in this scenario this means nothing at the stage because there's nothing to the left to work with ross yeah okay so it means nothing at this stage it only becomes something at this stage okay so if the previous candle let's say was bullish and i want you to think like this if the previous candle was bullish we can expect the next candle to be bullish right we've in the trader we're not the praise if the trade creates the high wick and then fails to continue bullish and continues bearish and then price comes back to it and creates and respects it then clearly even if the previous candle was bullish the current candle is bullish it's still and it's made its highest point it's still failing to break the highest point meaning that if it's not going up it must go down so now the idea has you know crossed your mind we now look for the evidence of that so the first sign of evidence that we're looking for is to price to respect the highest point then what we're looking for next is we're looking for price to create kind of rejections bearish candle closes just something to illustrate a depletion in that bullish sentiment once we have that information all we need is a shift in our direction here's the question it breaking this low versus it breaking this low or this low does it change the idea that we have that is going down no uh-huh so then understand this right once you have the evidence you don't need extra confirmation an extra confirmation in this in this scenario would have been oh i want to see price break this low to see if we can go lower maybe don't know but that's what it looks like from how it's set up okay or i want price to really push in my direction so that i know for certain the candles going bearish and or i want the one hour candle to have flip bearish in order to feel comfortable it's continuing bearish as opposed to still being green now they're all valid reasons okay but here is and and this is a great trade by the way but here is how you're going to capitalize and start really getting your you know your money's worth i have the evidence i can see everything i need i can see blah blah blah blah blah blah blah blah cool getting it bam out done okay let's make it a little bit bigger i tried it there but you get the point out done bam that's what i would have ended now you're not asking for this candle to come all the way down wherever it needs to go you're saying yeah just do that baby done now that's one way to approach it and that's how i personally would trade it if you need the now you need to understand this you're going based on the process and all the evidence that you get in or you go based on what you're comfortable with which is i want the one hour to be red so that i can jump on the train and it continue red or you say to yourself i identify everything i need to identify i'm more than comfortable with that be it bullish or bearish and i'm selling it up to you but i don't want you guys to have any sort of reservations as to why you're entering that trade because you need something more specific as opposed to seeing what is actually happening on the chart so you're just you're basically becoming a principle-based behavioral trader a market whisperer as it were yeah that's what you're doing that will build in time of course right it's not going to happen overnight but if i raise your if i raise your awareness to it then hopefully you can start thinking about it at least okay cool next trade [00:22:27] Speaker 2: okay tell me about this one so this one was coming to a level it failed to break before essentially the same as before [00:22:39] Speaker 1: okay so it's failing to break this level um how did you how would you describe this trade what was [00:22:46] Speaker 2: the development of it it i took it as so on this i didn't wait for price to leave and come back i took this as plenty of wit rejections to the top indicating price will probably go down okay so [00:23:04] Speaker 1: in this situation you're not trading off the previous candle closes rejection which it did do okay so price came into this level it reacted and then went bearish yeah okay so you're basically trading extended candle into a weak projection area that rejected okay even come down as much as this before it went back up and closed okay towards the close of the candle the new candle opened right at the key level that it's been rejected that it previously created the high at and based on the rejections it's failing to push higher if it can't push higher must go lower so the development of this setup is price creates a top wick it has flipped bearish and i anticipate it to do what continue bearish please please please adopt that in your analysis with your trading because what you'll do guys is this okay is you will see this everywhere oh look price is pushing bearish it's created this bottom wick it's not continuing bearish then the new candle opened oh look that previous candle that pushed bearish that couldn't continue bearish has created the lowest point the new candles opened it's respecting that lowest point on the one minute time frame and i'm seeing it shift in a bullish direction so if it hasn't broken it before it can't go down it means that this next candle must be bullish even though it's currently bearish does that make sense and then you'll just keep doing that everywhere else remember because we're only trading one candle at a time if in theory it's not difficult again oh look this current can the previous candle was bearish it's created its lowest point the new candle opened pushed bearish into that lowest point again i'm seeing on the one minute time frame it's failing to break the previous candle rejected this is failing to break if it's not going down it must go up i'm getting the wick rejections oh this candle must be bullish bam here again oh look the previous candle created a high the new candle's opened it's failing to break it there's multiple wick rejections if it's not going to go bullish it must go bearish oh and i have all the evidence it's bam you see how it just continues to carry forward into the process and then you take a trade now here's what you've got to accept not every trade will win just because that's the process but you've got to develop the process that way in order for you to be like sharp on the ball being sharp does not mean right it just means you understand your process which which you did you explain clearly um and i i personally i mean i don't know how i would would have been in the market with this one to be honest with you but i think it's a phenomenal trade