Home Trading Strategies Price Action Trading Analysis (July 2020)

Price Action Trading Analysis (July 2020)

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Price Action Trading Analysis (July 2020)

hey hey what’s up my friend so welcome back to this month’s market analysis for those of you who you know have been watching these videos regularly you know what i do is that each month i post my price action analysis of the markets where i think trading opportunities are right now and how you can take advantage of it but first a quick disclaimer right whatever i share over here is purely for educational purposes whether you make money whether you lose money it’s your responsibility do you agree if you agree then continue watching so first thing first the first market that i want to share with you over here is aussie against the swiss franc so how i’ll break this down is that first and foremost let’s look at the big picture perspective okay so weekly time frame you can see that aussie swiss franc is in a downtrend so market making a series of lower highs and lower lows okay you can see very obvious so basic technical analysis will tell you that you know in the long run this market has been consistently heading lower over time but here is where it might catch some some of you off guard because you look at this chat but rainer you know rain look at this rainer this is a strong you know bullish move from the buyers right do you want to be selling at this point in time and yes i agree right that this over here it’s a somewhat of a sign of strength from the buyers and if you just look at this right i would say this is a possible pullback against this long-term downtrend okay and this could possibly be the pullback so now the question is do i buy or do i sell because if i buy up against the long term downtrend if i sell this pullback right might continue higher and still stop me out of my trade so what do i do okay so the answer to this is that yes you can both be a buyer and a seller it depends on your own time frame that you’re trading so for example let’s say you’re trading off the four hour time frame okay just zoom out you can see that overall this time frame is bullish on this four hour time frame so yeah if for if you are bullish right and you want to buy you can look for buying opportunities at this area of support maybe the price could hit down lower do a false break close back above support and hey you know that’s a valid setup to go long and possible uh targets at this area of resistance here okay now what about selling opportunities right so if you look at selling opportunities let’s say on an eight hour time frame all right or even daily time frame this is where things get a little bit tricky because you don’t want to be selling right as this upward trend line and this area of support they are still intact right this is where potential buying pressure could step in right you want to sell in front of this area on your chart but even though you know that longer term trend is towards the downside so how do you kind of like re-consult this conflicting information so this is where it pays to be patient okay it pays to be patient so what i’m looking for right if i’m looking to shop this market is that the market must show me signs of crack signs of weakness that sellers are stepping in and what i’ll be looking for is for this area here to break down so the market must break and close below this area of support when that happens it tells me that hey you know now the sellers are coming back in right do you know push the price lower and hopefully right to have the long-term downtrend continue lower so when that happens when this area breaks down then i’ll look for selling opportunity and this can be something as simple as for example let’s say you know nothing too complicated let’s say price breaks down okay then it re-tests back previous support that turn resistance over here i could look for price rejection right to short this market could be something as simple as a shooting star bearish engulfing pattern like this you know goes up then suddenly reverse and close near the lows of the day i’ll be looking to sell on the next candle open stop loss can go 180 are above this highs possible targets at this swing low and if you’re a bit more uh more gung-ho right you can look to have possible targets at this major swing low over here okay so i hope this makes sense right so how you want to buy and how you want to sell is a matter of time frame and a matter of patience right especially if you want to shop this market you want the price to show you weakness first before you look for selling opportunities okay moving on next one so five-year treasury note future so we spoke about this quite a number of times i think maybe even in last month’s market analysis so this is quite straightforward if you look at this market the daily time frame market is in an uptrend right just zoom out okay you can see that this is trading near multi-year highs okay maybe even at all-time highs i’m not sure yeah so you can see that this market is bullish there’s nothing to be bearish about this market so if you go down to the let’s say the daily time frame okay what i’m looking for is to buy the breakout as you know i don’t like to buy breakup when the market makes a huge parabolic move instead what i want to see is a build up before the breakout so in this case this is the build up that’s being formed on top of this area of resistance so this to me is a sign of strength it tells me that buyers are willing to buy in front of resistance they’re coming in and willing to buy at these higher prices i don’t know why maybe there’s some inside information right there you know the fed is going to do something they’re just willing to buy at this higher prices that’s all i can see objectively at this point in time so again i’m not gonna you know uh uh fight them right the trend is up build up is being formed i have a logical place to set my stop loss i can manage my risk this is a trade that i wanna take okay so how do you trade this again nothing too complex no fancy crossovers you know indicators whatsoever the price so what i’m looking to do is to place a buy stop order above this highs okay so if the price trades above it i’m long so where do i set my stop loss okay since i see that this is the lows of the build up i can simply set my stops right uh distance below it 180 or somewhere about here okay so i have a logical place to set my stop loss as well so this is the uh potential breakout right that could occur on five-year treasury note futures of course right this is not the only game plan right if you go down to the eight hour time frame you might be able right to enter the breakout before the breakout so let me explain so on the eight hour time frame you can see uh this key level here okay where the lows of this build up is actually this area of support over here so what could possibly happen is that the market takes a swing now lower and rate that stops right below this area of support then it reverse up and close back above support okay so this way this is what i call a false break a false break down below this lows i can go along on the next candle open my stops again can just go one atr below this low somewhere here and as for trade management targets right so my suggestion is you know you can take half at this area of resistance here right take half of your your profits then you have the remaining half and this is where you can you know have the option of you know seeing right if the market can break above this area of resistance because if it does then at least you have half position left right to write the subsequent trend that could occur so you have you know options over here of course if you don’t want to take half your position you want to write the full position if the price breaks out right that’s up to you as well but bear in mind what could also happen is that the market from here it reverse down gives you a false break set up you go along next candle open it goes up and smash down lower so if you don’t take anything along the way you know you could see a winner become a loser so there’s really no right or wrong to this it really depends on you know your goals your objectives and how comfortable you are in your own trade management okay so this is just a food for taught right food for thought making me hungry as well now so okay moving on uh next one nasdaq okay so this market again amazing right just breaking out to all-time highs the technology stocks right it’s just insane so what should we be doing right now buying or selling based on this uh let’s based on this daily chart that you’re seeing over here did you say selling that’s wrong right you should be buying you should look for buying opportunities okay yes i know market is so bullish man you can’t go any higher right the prices is you know to the to the moon you can’t go any higher but here’s the thing right at this point you just look at this at this point yeah it can’t go any higher guess what continuity goes up retrace goes up and higher so if you keep having the mindset of you can’t go any higher it has to reverse it has to come down yes one day you might be right but before that day comes your account might be gone already so why not just treat what you see not what you think okay so bullish on this that’s for me so the question is you know where do i enter the trade so looking at the daily time frame nasdaq okay so let’s pull out the 20ma and see where is the area of value so you can see that this market has tested the 20ma number of times all right once twice tries four times so needless to say right to me the area of value is around the 10 200 area somewhere about here where previous resistance could become support and this has the confluence of the 20ma as well so again very simple uh you can use the daily time frame or even the eight hour time frame to time your entry what i’ll be looking for is again for the price to retest this previous area resistance that could actually support somewhere here okay price hit down lower zoom right reverse up higher close back above support looking to buy stop loss 180 below this lows possible target could be at this swing high over here looking to take profits okay very simple stuff nothing too complicated again okay and uh one last thing shall we new zealand canadian okay so this one again let’s look at the big picture all right uh daily time frame zoom out you can see that uh why not just weekly you can see this market has broke below this downward trend line this downward trend line right since uh 2016 all the way down it broke above it also it’s so broke above this uh key area of resistance so if you look at the daily time frame i am bullish on this right now the question is you know where do i buy so yes you can be bullish on the market but it doesn’t mean that it’s the right time to buy because for example if you look at this market right now if you buy on this this uh right now market order where do you set your stop loss where is a logical place to set your stop loss from the looks of things i would say this level the price has to go at least below this level below this area of resistance right because this is the nearest price structure right so let’s say a distance below it somewhere about here from here to here your stop loss is pretty wide so what other options do we have why not be patient why not let the market come to you so what i’m looking for instead now is for the market to come to me so on the eight hour time frame again this is the 88 cent level where i would uh expect right previous resistance that could act as support let the market come to you retrace back towards this area right then it can give you a bullish confirmation like a bullish engulfing pattern close strongly back above this area of support now right you have this uh price structure that you can lead against which is much uh tighter so let’s say your stop loss is again at this level the distance of your stop loss is now from here to here so much tighter so much smaller right better risk to reward on your trade okay so yeah so that’s how you know i’ll be looking to trade this again possible targets is again at this swing high okay look to you know book some of your profits at this swing high and then you know to see if the price can take this level out and then continue higher from there okay so this is new zealand canadian and just one last thing before before we conclude okay so aussie canadian okay so just a lesson to share with you over here so this is something that i shared with a pro traders age member so if you’re watching this you might not be a member but still i want to share with you this this important lesson anyway so aussie canadian right is a market that uh yeah i’ve been watching for a while mind if i’ve even covered in last month’s video i can’t remember that so at this point i want to share with you is that you know yes market broke out of resistance market is bullish right you can see over here market is bullish okay and and here’s the thing many traders right are looking to chase this market all right and some smarter ones they would know man rainer i shouldn’t be chasing the market you just said to let the price come to you so what i’m going to do is i’m going to wait at this previous area of resistance where previous resistance could become support and that’s a fair argument in fact that’s what i just shared with you earlier on new zealand canadian and what happened is that the market somehow seems to know what you’re thinking in fact it knows what you’re thinking and it starts to consolidate instead and it doesn’t retest the level that you’re looking at which is at this area over here now so what now okay yes you can wait at that level forever and if it doesn’t come you’ll miss the subsequent move if the price breaks out higher so what can you do okay so this is where you know you gotta be you gotta have to have multiple plan of effect you can’t just be a one-trick pony yes you can but you’re kind of limiting your trading potential right if you’re a one-trick pony so what you want to do is to ask yourself right in what other ways could possible trading setups unfold itself so let me share with you two over here right the first one is as the market consolidates over here all right it forms a consolidation and in fact if you pull out the 20ma the price actually touched the lows of the 20ma so this again is an added confluence so what you can do is you can go down to a lower timeframe like the four hour time frame and look for a false break setup and this is what happened right on the four what time frame you can see that over here this is the the lows of the build up you’ve seen earlier there’s a false break over here where the price get down lower taking out this lows and then closing back near the highs of the candle this is what i call a force break setup again it can go along the next candle open stop loss one atr below this lows possible targets first target could either be here or even here okay and after which you have the remaining half of your position to write the move up higher okay so this you can see right how this market can unfold itself originally you’re waiting for the price to re-test this previous resistance that could actually support it didn’t so what now what’s your next game plan all right so you want to have multiple plan of effect now let’s say you missed this move over here so what now so again right now all hope is not lost because there’s another trend continuation trade that could look to trade right so this is like kind of like a blue flag okay when the price breaks above this heist can look to go long stop loss now will be 180 below this lows so clearly in this case your stop loss is much wider but still that’s another valid plan of attack so the key lesson the key message that i’m sharing over here is that you know uh for those of you who are new to 20 trading yes you will be a one-trick pony but as you progress as a trader as you’ve been trading for you know months to years you want to develop multiple plan of attack because the market won’t necessarily always behave in a way that you wish you would be so you need to you know have different plans you know what if this doesn’t happen and that happens what will you do right so plan uh plan have a trading plan and you know anticipate right what the market the possibilities that the market could do and you have different uh setups right to trade different market scenarios make sense sounds good now if you have enjoyed the market analysis right then i want to welcome you to join pro trader sage right this is my premium membership right where you will get such market analysis every single week right i usually publish this type of videos on a weekend to share with you my my insights of the market the trading opportunities i’m looking at the trades i took and much more so that’s not all right because as a pro trader sage member you get many benefits that come along with it so for example you 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