Day Trading and Swing Trading Futures with Price Action: MARKET TREND ANALYSIS | Humberto Malaspina | Skillshare

Day Trading and Swing Trading Futures with Price Action: MARKET TREND ANALYSIS

Humberto Malaspina, Emini S&P 500 Trader.

Day Trading and Swing Trading Futures with Price Action: MARKET TREND ANALYSIS

Humberto Malaspina, Emini S&P 500 Trader.

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17 Lessons (1h 38m)
    • 1. Introduction.

      2:12
    • 2. A note about charts.

      1:31
    • 3. Setting up clean charts for trading.

      4:19
    • 4. How do you determine the trend before it happens?

      3:55
    • 5. Price resolution and the trend fractal.

      7:13
    • 6. Detect the most recent trend to make high probability trades for reducing risk.

      9:33
    • 7. Detect the long term trend for swing trading.

      3:45
    • 8. Learn how to find trading ideas, sweet spot for entries.

      10:21
    • 9. SWING TRADING. Find The Sweet Spot For Entries.

      5:35
    • 10. Every trend ends, how to find the sweet spot for exits.

      4:46
    • 11. Swing Trading, how to find a sweet spot for exits.

      6:45
    • 12. Swing Trading and Price Action: Turning Points

      6:59
    • 13. Understanding price extremes.

      4:13
    • 14. Candlesticks patterns and price action explained.

      8:06
    • 15. My day trading method FLAHCARD, DO NOT MISS IT.

      8:03
    • 16. My day trading method and price action, explained step by step.

      8:18
    • 17. Words from Humberto.

      1:56
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About This Class

A specialized skill for price discovery. At the end of this section, students will be able to identify market trend moves in order to select entries with total synchronization with the strongest trend for placing trades with the best odds.

Meet Your Teacher

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Humberto Malaspina

Emini S&P 500 Trader.

Teacher

Hello, my name is Humberto.

Working in the oil exploration industry for many years made me see many ups and downs in this business. Oil prices are a Russian roulette, each time they fall to the red zone of production cost, companies fire employees left and right, leaving a lot of people suffering. As a witness of this situation, I always looked for additional sources of income, and I found one trading the Emini S&P 500. Nowadays, after a lot of work and dedication, I managed to understand price action (the language of the markets) and money management, both important skills to have for anyone interested in trading any financial instrument. In my case, I only trade the Emini S&P 500, nothing else, all my focus is on this particular futures. This has given me the opp... See full profile

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Transcripts

1. Introduction.: Introduction: Intraday Trend Analysis. A priceless skill an intraday trader needs is to place his trades along with the strongest trend. Without this ability the trader is headed into a deadly trap which will consume slowly his trading account until there is not any money left to trade. During the trading day there are many products; stocks, futures, forex, options, crypto currencies, you name it, and also there are trends at different time frames. You can go insane deciding what to trade and how to trade it, making costly mistakes along the way. This kind of behavior surely will lead you to a financial ruin. You need to focus on how to detect a leading trend within a product. Once you have mastered trend detection you can add more products to your list. For your trading account survival it is imperative for you to learn how to detect the intraday strongest trend to take your trades along with it. In this way your chances for making money will increase dramatically. The skill to accomplish this critical task is what I have called “Intraday Trend Analysis (ITA).” The ITA goal is to identify the market trend using intraday price action data in charts to select entries and exits with total synchronization with the strongest trend. You will learn to place trades with the best odds possible. The information that will be presented during this section is based on the law of supply and demand, it is applicable to any market, to any time frame, and will provide you of a strong foundation to develop or upgrade your day trading method. Let’s begin. 2. A note about charts.: A note about the type of charts. I have wanted to make this brief observation to explain something to you about the different types of charts such as candlestick charts and ticks charts. In this course I use both types of charts since, in reality, each one has individual characteristics, some people prefer to use tick charts, but others like to use time candlestick charts instead. In the end, what matters is that you make your trading decisions by analyzing the price structure of the financial instrument that you are using. The type of chart and its respective time frame helps you to detect the entry and exit points, but the essential thing is to know how to detect the main trend by analyzing the existing price structure. If you do not learn how to read the price action then it does not matter what type of charts you use, you will always make mistakes that will cost you money. Focus on learning how to interpret the price action and choose a type of chart that makes it easier for you to visually perform this task. Let's continue. 3. Setting up clean charts for trading.: Setting up clean charts for trading. When it comes to sell out charts for trading. There is only one word that comes to my mind. Simplicity. Gmos have charged as clean as possible. The less noise and distraction in a chart, the better it is for taking a trident decision. In this lecture, we will set up the Charles. Do you need to train like a professional? Let's get started. When I tray, we eliminate SAP 500. I look at three candlestick charts with different timeframes. I use a 1003 Townsend tick chart to detect the strongest trend unpriced parents and won some frantic char to select entries and exits. Sometimes I take my trades on the eighth or 3 thousand tick charts. It all depends on the price action of the moment. This is no written on stamp. You have to adapt to current market conditions and take your tray using the chart that gives you the clear view. You might need to adjust this tick parameters depending on the project trade, volume and volatility. How wonderful buys. The only technical indicators I use are moving average. They give me a quick view of the general trend. I do not use any other technical indicators. In my opinion. They are locked and send contradictory signals. You're free to check them now if you want. And just giving you my honest advice based on my experience of experimenting with them after several years. Remember, simpler is better. Here you have the parameter that I use for each chart. Let's check them in detail. Cannibalistic trend charts for spotting trends, stops and trading ideas. A thousand tick charts, movie hours, exponential 4023, Townsend fixture, moving our exponential 6040. These charts provide a general view of the market, making it easier for the human eye to detect the main trend as they include more price action in fewer Campbell's when the market is moving too fast. You can also make your interests or exits on discharge to he. You heard some examples. A town frantic charge sample. Look. Here would have jobs, price, action, and two, moving averages. No struck technical indicators. It is easy to look at this chart. Three, take charge, sample. Faster, Char, also very clean. No room for recitation. Cannibalistic entry chart for entries and exits. One found ticks char, moving our exponential 5080. This is a chart where you can see price action detail. It is useful for increased and exits. You first get your ideas in the 308 thousand tick charts and then use this chart to put retrace in an Arab market. Let's take a look. One tick charts. This is also elegant and clean with no foss. This is all I use. Simple and clean. No distractions lead to quick decisions. When you have a chart with too many technical indicators will lead you to analysis paralysis. The less information on a chart, the better. You will hesitate less and will take quicker decisions. This is a very important lecture. Taker is think about what you have learned and come back to continue when you're ready. 4. How do you determine the trend before it happens?: How do you determine the trend before it happens? This is a question that I receive frequently and I have promised to answer it with an example. Here is the answer that will clear the mind of many traders. Beware, this is a general example, is not written in stone, but it will give you an average idea. It is impossible to determine a trend before it happens. Anyone trying to do that is fishing tops, or bottoms and many fortunes have been lost, doing just that. So, stay away from that practice. What you can do, is to get on board during the first stages of a trend, when it is not an obvious “well-developed” trend. You will need to get in early based on your fine interpretation of price action. The market leaves subtle clues that you need to find in order to do that. Let´s see this example of the end of a downtrend. One of the first clues that you have to look for is a strong pullback inside an established uptrend or downtrend. The market won’t change direction immediately, most of the time it will resume, or it will try to resume its previous direction after this strong pullback, but the market has already sent you a clue. It is telling you that it wants to change direction, but not yet. Finding support and resistance is extremely important. Support and resistance are the parents of trends, they create the trends, so do not underestimate the power of support and resistance as they are the vital ingredients of trends. Without them, there will be no trends. The trend geometry repeats itself during the duration of this price behavior, when this behavior is suddenly interrupted by a price reversal, like penetrating a previous zone of support or resistance, a change in velocity, fail to go lower, then you have found your second clue. When the market does that, it is already creating the roots of a newborn trend, it is something that happens slowly, and you need to have patience and a well-trained pair of eyes to discover this price structure. Using this example, you have to wait for a new pullback inside this new uptrend that is coming out of the previous old downtrend and confirm that this new pullback does not make a new lower low, this is very important, look for a new bottom over support. Once you have confirmation that the price will resume its way upwards there you have your best opportunity to place your trade in the first stages of a newborn uptrend with very low risk. If you have the patience to wait for the price structure to form and for confirmation of price continuation, you will have a chance to make a trade with a higher probability of success at lower risk and with a higher potential for profits. Please take this with you for the rest of your trading career. 5. Price resolution and the trend fractal.: PRICE RESOLUTION AND THE TREND FRACTAL. In this class, I want to explain some details about price resolutions and the trend fractal when trading. I will talk about time frames first before speaking about the trend fractal. My intention is to offer you a guide which you can adapt to your own way of trading based on your personality and risk profile. During this section, I alternate talking between day trading and swing trading so you can see the difference but here I explain my recommendation for people with little experience. I recommend that you study the market with weekly and daily time frames to visualize the general trend and use the 6-hour time frame to locate entries and exits. This is better for traders with less experience. You will trade only a few times during a month but you will watch more screen looking for trading ideas, you will think more and will gain experience. Please, if you do not have experience stay away from shorter time frames, do not day trade. As you gain more experience you can use shorter time frames. Selecting time frames for trading is flexible and depends on each person's level of experience and risk profile. You must remember, as you go down to a shorter time frame the more price noise you will encounter. You must know how to choose carefully the time frame that best suits your trading method and level of experience. Beware, the price noise can deplete a trading account easily. I personally use the weekly and daily charts to see trends and then go down to 6 and 4-hour time frames, which I combine with 30-minutes charts to see more details and select entries and exits. I never go below 30 minutes time frame when looking for a swing trading idea to avoid false signals due to price noise. The trend fractal is present in any time frame. It is very important that you learn how to read the price action in the trend fractal since with this skill alone you can quickly detect swing trading ideas by reading any time frame while trading any financial product. Just to refresh the concept, the fractal of a trend is a series of consecutively up or down price movements with extreme highs (in a downtrend) and lows (in an uptrend) that are never punctured by price action. If any of these extremes are punctured in a downtrend or in an uptrend, the fractal has been interrupted and this is an indication of a possible trend change in the near future. This is a price phenomenon that is repeated all the time in the market. The understanding of it will give you a statistical advantage that can be used to define entries and exits that will let you dynamically manage the risk as the trade progresses. As you can see, every area of confirmed support is a good place for a stop order (using some degrees of liberty). Support is confirmed each time resistance is broken by a variable margin defined by the Average True Range. (Please consult the risk and money management plan). Using this criterion you can stay longer in the trades maximizing your profits and reducing your risk, which is very important to stay prosperous in this business. Next, I am going to present you an overview of how I read the price action using a 30 minutes chart. After analyzing the weekly and daily charts, the market shows an uptrend. I have visualized the price action in the 6 and 4 hours charts and switched to the 30 minutes chart to get a higher price resolution to look for a swing trade idea. Let´s see. Step 1: The first thing I notice is a strong pullback, I must wait to see where support forms. It is important to be patient and wait for the trend fractal to form. Do not act if you do not understand the price formation that you have in front of you. Step 2: I can clearly see that a double bottom has formed, which is a probabilistically good signal on this time frame. I must wait for my confirmation to be activated to take a long position. Step 3: My confirmation to take a long position was activated and I entered the market with a stop loss order just two (2) points below the candle that formed the double bottom. The price advances and a new very small pullback appears which creates a bottom that is confirmed once the price resumes its bullish trend and passes above resistance by a considerable margin. I moved my stop loss just below the confirmed bottom. I do not take partial profits during small pullbacks because demand is still very strong and there is a high probability that price will continue upwards. The price continues to advance and a pullback appears that creates a new bottom which is confirmed once the price resumes its bullish trend and passes above resistance by a considerable margin. I take profits to dynamically reduce risk and protect my time investment and moved my stop loss just below the confirmed bottom. As you can see, this process repeats itself constantly because the trend fractal repeats itself over time, causing the same decision making over and over again. Only when the fractal breaks down, which may be a sign of a trend reversal, should we make different decisions in order to maximize profits and reduce risk. I'll talk about this later. 6. Detect the most recent trend to make high probability trades for reducing risk.: Detect the most recent trend to make high probability traits for reducing risk. Before we begin, I need you to understand that. Over-complicate in a trading method can create more trouble than it's worth. The best math of the simplest. Ginny to apply the concept of simplicity to enhance trend detection techniques. During this lecture, I will explain in a very plain manner how to detect the most recent trend in order to take high probability tries to reduce risks. Please remember that all the techniques I will be sharing in this lecture can be adjusted to trade any financial instrument. All examples here are based on day trading. The mini SAP 500. For starters, One of the easiest way to make money while reducing risk is trading with the trend. So you need to focus all your attention in learning how to pace your traits with the flow of the market. Let's review the concept of a trend. In up trending market. The Bryce will move in a series of Op wave that make higher highs with any down wave, where Bryce does not drop below previous laws, the upweight will be longer than the down wave and will move with more momentum. A market is considered to be in our AP trim as long as it stays above is premise close down trends are just the opposite. For detecting the most recent trend. To take high probability traits, we need to use D3 Townsend to eight towns on tick charts. These high good time-frame charts detect meaningful intraday trends because they store more price action data in each candle or bar. I do not use a smaller time friends below 3 thousand techniques to detect trends because they are noisy and trends are not meaningful. Please note, this is now written on a storm. You might need to adjust these parameters depending on the volume and volatility of the financial instrument, your trade. We were during our trading session, do my find different trends using the hiker timeframes charts, you will be more selective to detect the most reliable trends. And you will make only a couple of trades a day, which translates into painless commissions, less slippage and will increase your chances of making morning with low risk. Once you have found it ran and spot a trading idea, G can use a smaller time-frame charts to select your entries and exits. But Let's focus only on this lecture to learn how to find reliable trans, using the tree task or a town frantic chars. Let's get us started. Sporting a trend with a line. A trend line is aligned wrong, connecting the lobe in an up trend or the heights in a downtrend. Before the market open, you need to study the three on a toughened tick charts in order to find the train. During the previous markers sections, you will draw a line to spot ran. This will give you an initial idea of the market environment. Both wires the market opens. You need to monitor price action to validate if the brain is train continues or if there is any train in place for the day, anything can happen. So you must be alert to listen what the market is telling you to make your traits along with the train ruling today. Look at the next chart to see an example. Drawing a trend line over these clear downtrend during our previous trade in Session. Remember, a trend line is drawn connecting the heights in a downtrend less. See. There you have your trend line connecting the heights inbound train. High, height and height. A channel is formed by drawing a new line that is parallel to the trend line. Birth connects the heights in an up trend and the law in a downtrend. You look at the next chart to see an example. Drawing is Chanel over this clear downtrend during a previous training session, remember, our channel is drawn connecting the lobes in add-on tram, let's see. The algebra channel, LOS, LOS Dover levels of support and resistance. Do you need to draw the levels of support and resistance during the last trading sessions. A super level is where the price dance to find support as it falls. Our assistant level is what the price tends to find resistance as it rises. This is one of the most powerful tools you can use to monitor the market for taking trading decisions. It can be used to detect and new board CRAN to measure the health of a tram and to define entries and exits. Please pay close attention to how price action behave around these levels as it reveals important clues about how to make your trading decisions. Look at the next chart to see an example. Yes. Drawer levels of support and resistance. Note for every support once broke him, become resistant and vice versa. Support level one. Resistant level one or level two, or level 330.5. Your different levels of support and resistance. Repeat the process in real time. Once the market opens, do you need to look how price action behaves around babies trend line, channel, super resistant levels. Order to find out the current trend for the day. You will also need to grow your new trend line, channel support and resistance levels for the day. This will give you an idea what the actual trainees, once you have established a trend for the day, you need to see if it is a trend continuation from the previous section. If so, you will tray in its direction with more conviction. In the other hand, if you detect a trend change in an opposite direction from the previous section, Jew will tray with the floor of this new board trend for today. Let us see an example. In this chart, we have a previous training session where we can find the first support levels are a system level, our trend line, and a tunnel. We can see here that the marker is in a clear downtrend. Now, let us see what happens in the new trading session. Okay? This is your new trend line for today, after 30 minutes of training, market is in a downtrend. So usually tray from the shore side, look, is a clear trend continuation. Now, as market advances, we need to update this trend line. Also. We have here that the previous trend line has become a channel. You look, trading with these downtrend, up trader had at least three chances for entries. Also note that it's support level number two and number three are still valid. Now, you know how to detect the most recent trend to make hypermobility traits. This is an art. You need to practice it. Only through this method. You will spot the most recent trend for the day, which you will use to take your high probability Straits with low-risk. Remember, you need to make this as simple as possible to take quick decisions. Too much information leads to analysis paralysis. Your goal is to take action to make money. 7. Detect the long term trend for swing trading.: The goal of the lesson is to explain how easy it is to spot a long term trend for swing trading. Remember, a trend is a fractal that can be spotted at any time frame. For swing trading we need to take as reference the long term trend as this is the one that provides direction in the market. I will not get tired of repeating this over and over. We already saw how to spot a trend in an intraday chart, well, for swing trading we need to find the trend on the weekly chart. It is exactly the same but more relaxed…. We are coming from using noisy intraday data where it is difficult to spot the real areas of long term support and resistance and the dominant long term trend. The long term trend is like the ocean current who points the general direction of prices in any market. Using intraday data makes it is difficult to see this trend among all this noise. You need to use a long term chart…. Here you have a weekly chart. As you can see it is a clean and simple chart with only a moving average. This is it. You don´t need anything else to spot a trend. Too much information on a chart creates analysis paralysis. You will use this chart only to detect the long term trend. This chart does not have enough price resolution to spot entries and exits. You will detect your entries and exits using the daily and the 6 hours charts…. Now, this is the same weekly chart but with all the information about the long term trend. You can see the horizontal blue lines which define the areas of support and resistance of most importance as they are set by weekly data that have more statistical value. There is also the trend line represented by the yellow arrow line, this is the weekly trend. You can set it joining the lowest price points in an uptrend or joining the highest price points in a downtrend. In this particular case, it is an uptrend. The weekly trend is a strong indicator of market direction from short to intermediate-term. You need to trade in the direction of this trend, never against it. This is it. This is all you need to know to define any trend in any time frame. Remember for swing trading always trade in the direction of the trend spotted in the weekly chart. 8. Learn how to find trading ideas, sweet spot for entries.: Learn how to find trading ideas, sweet spot for entries. The information presented here is based on the law of supply and demand, it is applicable to any market, to any time frame, and will provide you of a foundation to develop profitable trading skills to find low risk trades. With this approach you will only profit from the middle part of the trend, removing the guessing factor of catching top and bottoms. You will only take your trades once the market has shown you the way. You will gain less per trade, but you will be steadier. To find a trading idea you have to study past price action to discover clues about future price movement. You need patience to study what has happened to price action and momentum in order to discover market’s direction so you can place your trades with the best odds possible with minimum risk. Never guess, you have to let things happen, then act. Finding a trading idea. Step one. Detect the most recent trend to know how you will trade, if long (during an uptrend) or short (during a downtrend). We already covered how to do this in the previous lecture. Here is a short review. Let´s see a chart. Look what direction the exponential moving averages are heading, In 3000 and 8000 tick charts, moving averages must be in synchronization. It tells an idea about the market trend. Remember to draw your trend line and channel. Detecting the trend is done watching carefully price action, look at the previous intraday price data and analyze where the price is coming from and where is going to now. For longs: look at the advance of the bulls versus bears waves, (you need weak pullbacks to see the bulls winning the battle or vice versa), look for higher highs and lower lows to define the current uptrend, these can be detected at any time frames, the opposite is true for shorts. The first to win between bulls and bears is likely to define the most recent trend. Here in this chart, THE MARKET IS IN A CLEAR DOWNTREND MODE SO WE WILL TRADE FROM THE SHORT SIDE. OK, let´s move on. Finding a trading idea. Step 2. Draw levels of support and resistance during all trading day. Let's see an example. Support and resistance areas will help you to detect how strong or weak the market is at the present time. Support and resistance analysis with the help of price action interpretation are the indicators that send clues about future price movement. Finding a trading idea. Step 3. Wait for the market to show you the way then buy or sell in the first strong pullback when it shows signs of weakness near support or resistance and close to moving averages. Let’s see the next chart. Never buy the highest or sell the lowest price, always buy or sell after a STRONG pull back and only once this STRONG pull back shows signs of weakness near support or resistance and close to moving averages. Signs of pullback weakness can be seen in different price patterns, you must be aware of this all the time. As we can see here price is pulling back in a downtrend we need to use the 1000 ticks chart to look for an entry. Let's zoom in. This is the pullback zone but you need to wait and read the market in order to know when the pullback might be ending for you to take a short position. Let the market show you the way then act. Look at all these doji candles forming like a top of the pull back. This is the first clue the market sends you to begin your trade calculations. Let's see. Look at risk and reward ranges, the lower the risk and the higher the reward the better the odds to a successful trade. All professional traders are looking for a high reward and low risk trade, if you find one, do not hesitate to take action. Remember to use your risk and money management system to calculate your position size based on the present trade risk. Let’s see an example with the same previous chart to complete the whole idea. New day trading session 1000 ticks chart. Hypothetical short trade set up. You must analyze this in real time. This is the pull back zone but you need to wait and read the market in order to know when the pullback might be ending for you to take a short position. Let the market show you the way then act. Hypothetical short entry at 2776 if the market breaks below resistance. After entry a stop loss will replace at 2779. based on price action. From the hypothetical short entry at 2776 to the stop loss of 2779 there are just 3 risk points. First reward goal of 4 points from 2776 to 2772 index points and the 2nd reward goal of 10 points from 2772 to 2762 index points. In total we have a potential reward of 14 points versus just 3 risk points. This is an attractive bet. Now you can use your risk & money management system. Here you can see people that hypothetically you have $50.000 in an account just risking 1.5 percent of this total capital per trade. This is key. This is very important. Remember keep your risk under 2 percent of your total capital per trade. Also you can see that based on the present capital and risk environment you can play with 3 lots in this hypothetical trade. Remember always calculate your position size based on the present risk. Not all trades are the same. All trades are different. Let's continue with the aftermath of a hypothetical trade. New day trading section 1000 ticks chart. In this area you have the pullback but then see what happens after 10:01 Let`s make more zoom in. This is an indication of a possible pause of the pullback and continuation of downwards move. Look at all those doji candles making the top of the pullback but we still need confirmation. You have to interpret price structure to learn what the market is telling you. Once you have confirmation you can act with more conviction. Again. You need to wait and let the market talk to you before taking action. Confirmation comes when the market makes a lower low below this resisting area, This is your chance to take a short position with very low risk based on the risk versus reward analysis we just did. Resisting area was so strong and price continues downwards letting you to take a short position at 2776. Them price keeps going south reaching reward goal # 1 and partial reward goal number two. My point here is that you need to learn how to interpret price action or price structure to understand all the market calls to take high probability trades with very low risk. Price action or price structure In order to understand the market for detecting low risk trades, you have to see it as a whole, reading the combination of several price candles, as a mixture of different variables before taking action. Here you have the five building blocks of price action: pace, trend development, correction periods and support and resistance. These five blocks when acting together backed up by the law of supply and demand create price patterns that repeat themselves over time. This is what I call price structure that if understood properly will provide you of entry opportunities with very low risk. The correct understanding of price structure will become your edge for trading the markets and it will be the factor that will let you make money over the long run. As the casinos have their statistical edge that make them money off the traditional gamblers, price structure interpretation will become your edge for trading any financial instrument. Make your best effort to watch the market daily to learn more about price patterns or what I call price structure. It will pay you very well. Now go out and have a deserve rest. Come back another day to continue with this course. 9. SWING TRADING. Find The Sweet Spot For Entries.: SWING TRADING. FIND THE SWEET SPOT FOR ENTRIES. The objective of this lesson is to make you understand how to detect a market entry to start a trade with the least possible risk. Please keep in mind that the interpretation of price action has a very important role in achieving this goal. Step 1: Find the weekly trend. You already know how to do it. Draw your trend line, it does not have to be perfect, you just need an idea of the dominant current of price to trade along with it. Remember, trade in the direction of the weekly trend. If it matches the daily trend the better the odds, if not, then trade in the direction of the daily trend. Also draw your support and resistance areas on the weekly chart. These are price levels with great statistical validity and work great to select strong areas of demand and supply which are good spots to select entries and exits. Here you can see the blue lines that represent zones of support and resistance detected in the weekly chart. Step 2: Look for support and resistance levels on the daily chart. These are levels of supply and demand that are seen in the daily chart but not in the weekly chart. These levels of support and resistance cannot be spotted in the weekly chart because it is too coarse. You can also use these daily levels to locate sweet spots for entries and exits in the daily chart. Step 3: Look for a pullback on the daily chart. You need to spot a pullback in the daily chart inside a trend to see how the price behaves around support levels. You are looking for weaknesses inside the pullback to enter the market with a trade. The same is true for a short trade. Once the first bottom has been established you need to be alert to detect the second bottom or higher bottom with continuation in order to place your trade. To find this second bottom you will look into the 6 hours chart to place your trade. The 6 hours chart will have more price resolution for you to spot a less risky entry. Step 4: The sweet Spot for Entry. Next I am going to explain how to find a low risk entry zone based on the probabilities of success that analyzing supply and demand gives us. Assuming that we are planning a long play, then once the pullback is detected, we must find when the sellers (supply) begin to withdraw and when the buyers (demand) begin to dominate the market. Once we have mastered this art we will have a very important skill to select low-risk entry areas. Please pay attention to the candles inside the gray circle. We can clearly observe the pullback and how it is dominated by the sellers (red candles) but there comes a time when the moment of sellers begins to disappear little by little and buyers begin to have control of the market (white candles). Let's zoom in Step 5: The Sweet Spot for Entry. As can be seen from the chart, sellers are in control of the market in the leg identified between red candles “A” and “B”. Then sellers gradually start to lose control in the leg identified by candles “B” and “C”. Look at the closing prices of the candles in this section. In 24 hours the price does not want to go down anymore, indicating that the sellers lose control little by little and the buyers begin to gain ground. Next, in the segment identified with the white candles “C” and “D”, the buyers take almost full control of the market with just a few sellers near the support area. Here the sweet spot for entry is at the close of candle “C” after we have detected some sort of double bottom with a huge doji. You just have to wait for the market to tell you what to do. With this approach, we remove the guessing factor out of the equation. After this gradual transition of control between sellers and buyers, we can see how the latter take full control of the market in the "D" and "E" tranche. As you can see, it is a process that in most cases happens gradually, and allows us to identify the end of the pullback to take a position with the least possible downside risk. Interpreting price action correctly to locate a low-risk entry zone takes practice. Only with perseverance will you be able to master this art. 10. Every trend ends, how to find the sweet spot for exits.: Every trend ends. How to find sweet spot for exits. To enter a trade requires tuned skills of understanding trend detection and price action but it is also crucial to know when to close a position. This task demands a clear knowledge of price structure to detect when a trend is ending to take profits. In this lecture, student will learn how to close a position in a way that reduces market uncertainty to enhance profitability. There is something important that you should acknowledge. Every trend ends, no trend last forever, and it is more evident during short term or intraday trading. Most of the time a trend ends slowly leaving subtle clues in form of price patterns that you have to recognize to take partial profits as the move advances in order to maximize profitability. But beware, there is something else of importance to know. Once in a while, a trend ends abruptly. Due to occasional violent market conditions price can come against you without a warning and very fast. That is why you always must have a protective stop loss in place to take you out of the market if such an event takes place, and believe me, it will happen. In this lecture. you will use zones of support and resistance and price action patterns to reduce risk and for detecting when a trend might be ending in order to take partial profits or to close your full position in a way that will help you to maximize profits. Let´s see an example. In this trading section, we took a short position around 2796 once price continued downwards off resistance. At the same time, we placed a stop loss at 2801. We have a short position in a downtrend environment. Price made support at 2766 and once price retested it we took partial profits and kept on the rest of the position to maximize profits in case of trend continuation. Price continued south and made support at 2774, once we detected a pullback we took partial profits again around support. We also moved our stop loss at 2790 to protect our profits of the remaining position. For the first time during this trend price behavior changed, the bulls made a higher high after bears could not break previous support. This is an important reason to take partial profits or to close a position based on how many contracts you have. Price continued moving upwards but when faced resistance it retraced again and closed below this area. At this moment we moved our stop loss above the resistance area to close our position in case price breaks resistance and continues moving up. The price retested previous support and we took partial profits again. Please take note how we are scaling out of this position when the market tells us to do so. We do not guess or forecast market price ever. Price bounced off support and retested it again and we took partial profits for one more time. Scaling out. The main concept here is that you can keep scaling out your contracts until you sell all of them or you can close your position if your stop loss is hit.Briefing: 1.-Every trend ends, none last forever, acknowledge this. 2.-Set your stop loss in a logic price level and keep reducing risk. 3.-Always scale out taking partial profits, your time is worth it. 4.-If you are playing just a few contracts close your position at the first clue of change in price behavior. The correct understanding of price action will become your edge for trading the markets and it will be the factor that will let you make money over the long run. As the casinos have their statistical edge that makes them money off the traditional gamblers, price action interpretation will become your edge for trading any financial instrument. 11. Swing Trading, how to find a sweet spot for exits.: SWING TRADING. Find The Sweet Spot For Exits. The objective of this lesson is to make you understand how to detect a market exit to close your position maximizing your profits during a swing trade. Please keep in mind that the interpretation of price action has a very important role in achieving this goal. I need you to understand that the exit strategy for swing trading is similar to day trading. All is based on the same fractal which happens to appear in all time frames and it is 100% related to the law of supply and demand. The big difference is that you have more time to think when you are swing trading, and you are prone to make fewer mistakes reading price action than when you are day trading. Another important factor is that you will face more noise in day trading than swing trading. Intraday data has more false moves that lead to more bad trading decisions. On the other hand, using a 5 or a 6 hours candle charts give you a better statistical representation of the market mood to take you trading decisions along with the strongest trend or sentiment of the time being. The method that I am going to explain next, it is not written in stone, it should be adjusted for the volatility of the financial instrument you trade. That being said, let´s begin. EXAMPLE IN A LOW VOLATILITY MARKET. I am going to explain how to manage an exit strategy in a swing trade based on a low volatility market environment. This strategy can be adjusted in real-time as the volatility increases. The goal of this low volatility strategy is to stay in the trade as much as possible in order to maximize profits. Take a look at the next chart of a long play. As you can see in this 6 hours candle chart, we have a trade that lasts several days in a low volatility market. You can notice the ATR prints a value less than 25 during all this period of time. We have a stop order that has been in the market for days. The question is where to move it to continue protecting profits. As I have mentioned before, you have to let the market speak and then we take action. As the market advances it forms resistance # 1 making a pullback, and then bouncing back up to form support # 1. But we need to wait for the market to validate support # 1 before moving our stop. Days later price broke resistance # 1 and moved higher with force, validating support # 1. After support # 1 is validated we can move our stop below it using some degrees of liberty as explained in my methodology document. Moving our stop using this criteria will let us stay in the market more time avoiding being stopped out by the noise of the market fluctuations. During the following days, the market continues to rise until it forms resistance # 2. As in the previous case, the market makes a pullback, forming a support zone # 2. Also here we must wait for the market to validate this support. It happens hours later when the market continues to rise and thus validates support # 2. It is at this time when we must move our stop below support # 2 using the degrees of freedom. Remember, in this situation, our goal is to stay in the game for as long as possible to maximize our profits and by applying this method we avoid the noise of the market ruins our trade. The noise of the market fluctuations is normal, it is something that we need to deal with to avoid being stopped out of a good trade. This is the reason why we need to have the patience to place our stops once the market tells us where to do so. Let's continue with the trade in the next chart. We continue applying the same strategy until the market activates our stop and we close the position as we can see in this chart. You can see how the fractal of the trend repeats itself and the price action patterns are smooth due to the low volatility which allows us to continue applying the same strategy. We move our stop below the support levels once they are validated and we wait passively to repeat the process whenever the market allows it. As you can see, after support # 4 is validated and we moved our stop order below it, the next day the market violently retreats and triggers our stop, taking us out of the trade. However, this technique allowed us to capture much of the trend. Trading in this time frame is much more relaxed and you don´t need to spend many hours in front of the computer, this leave you more free time to spend in other activities. It is important that you keep an eye out for changes in volatility. If you detect that volatility increases, you should adopt a more aggressive risk reduction and profit-taking methodology on the fly. For this, you must study how your financial instrument behaves in periods of high volatility and determine a valid statistical advantage to implement risk reduction and take profits efficiently. Remember, what I have shown you in this course is the method that I use to trade the Emini S&P 500. Since each financial instrument can present different levels of volatility, you must adjust this methodology to the behavior of each instrument you wish to trade. This is very important advice and I beg you to take it into account. 12. Swing Trading and Price Action: Turning Points : Swing Trading and Price Action: Turning Points In this class, I want to explain a strategy that you should have in your inventory. It is one of the most important, as it helps you to position yourself in the market when a new trend is emerging. At the beginning of this section I talked about this, but here you have a new example with more details. Pay attention because this is very interesting. The goal of this strategy is to detect a valid turning point that can be used as a guide to get in the market when a trend is just emerging, which can provide us with large profits with little risk. This strategy is of multiple-use since it can help us to take partial profits, to close a position maximizing performance, and to enter the market in a new trend with the highest probability of success. The key is to wait for the market to tell us what to do, we never guess, we just have to wait for the market to speak to us. Here you will see, step by step, what you should expect in order to detect these turning points. Let´s go. We are going to analyze this chart step by step to understand what the market is telling us, and how we should act based on these subtle messages. In this case, we are seeing a chart after the fact, but it will serve us the same as if we were seeing the market in real-time since we must always wait for things to happen to be able to act. Let's get started. We are in a clear downtrend and suddenly the market slows down and starts to hesitate, the price goes up a bit and forms a support zone. This zone is called a fractal point of support. The market forms a resistance zone when the price retraces lower. This zone is called a fractal point of resistance. Little by little the market begins to form its geometry or price structure. The price pushes higher trying to extend the pullback breaking the fractal point of resistance. This is a turning point that could lead to a new born trend but we need to wait to see how large this pullback become in order to be valid. If the pullback is large, it is an indication of high demand that could lead to a change in trend to the upside, in the other hand, if the pullback is short-lived then is a signal of low demand and high supply that could trigger a continuation of the trend downwards. The market deteriorates rapidly and returns to its downtrend breaking the fractal point of support, thus showing that the pullback was very short and that supply exceeded demand. The inflection point is not valid. The downward price advance slows down, bounces off the lowest point, and a new support zone forms. Notice how the same process is repeated. We must be patient and wait for the price structure to form. The price continues up and briefly, retraces, creating a resistance zone. The price then recovers above the support zone, sending a clear message that we are in the presence of strong demand at this price level. We must wait to see if our suspicions are confirmed by the price action. Demand increases strongly and fast, pushing the price up, breaking resistance, and a new inflection point is created which must be validated. When we are in the presence of a rapid price increase, it is an indication that the collective sentiment is synchronized and that the majority of the public has the same opinion about the market value at a given moment. The price loses speed and goes back a bit forming a new resistance level. It's time to wait and see how deep this pullback can go. We must check out if the inflection point that marks a new uptrend is validated. The price falls back weakly and slowly, which indicates that there is a high probability that the supply is low at this level, which is confirmed minutes later when the supply is exceeded by the demand and the price continues upwards, indicating potentially the end of the pullback. The geometry is complete and with this evidence there is a high probability that the price will continue to rise, we are in the presence of a potential new uptrend and there is nothing left but to take action. We enter the market with a buy market order with a calculated risk according to our trading capital, our stop loss is automatically executed and we let the trade do its job. This is the way this trade should be executed, with a lot of patience interpreting the price action, and with courage once we have the evidence in hand sent by the market. This pattern is not 100% bulletproof but it works most of the time. It is important that you understand the logic of supply and demand behind this price geometry because supply and demand do not lie, in most cases, the market price follows the winner of the battle between these two factors. Your task now is to search the charts where this type of price formation is repeated so that you can learn to identify it. If you master it, you will have much of the battle won in the world of trading. 13. Understanding price extremes.: UNDERSTANDING PRICE EXTREMES. In this lecture, I want to explain a very useful topic, and it is about how to understand the message that extreme price levels send to the traders to make decisions about market entries and exits. These messages are very subtle and to detect them you must be aware of the price action. This is a technique that if you master well, you will be more selective in your trades and you will only enter the market when you have the best odds in your favor. Let's get started. The support and resistance levels are the extreme prices and we must analyze them to find the market messages. As I said before, they represent the strength or weakness of the market at any time, and if we understand their behavior, we will have discovered important information for decision making. We must always measure the distance between resistance levels or between support levels, as the price expands, it means that the market is very strong and it is very likely that the trend in that direction can continue. On the contrary, if the distance between resistance levels or between support levels decreases, it is a clear sign that the market is losing strength and that a change of direction could occur. Let's look at an example. As you can see, we have the first two levels of resistance, the distance between them is 28 points. The market moved aggressively higher, then the pullback is shorter than the previous price advance, so there is a high probability that the price will continue to rise, which happened as you can see. After this, the price breaks above resistance and continues to rise until it forms a new resistance zone. This time the distance between both resistance levels is 11 points, which is less than between the first two. This is already a sign that the market is losing momentum. Again the price continues its way upwards and forms a new resistance zone, this time the distance between the two levels is only 7 points. A clear sign that the market is losing strength. At this level, you have to be very vigilant for any sign of weakness to take partial profits and to protect the gains that you may have. At the end of the chart, you can see that there is a fractal break signal which could be used to take a short position with very little risk to explore the market. These are the messages that the market sends and that we must understand to take action. Remember, we have to let the market speak, let the market say what it is going to do and then we just follow it. Never guess. Please watch what happens next. After the market signals weakness several times, the market plunges 106 points during the morning section. These are the type of surprises that are presented in the market and that you can take advantage of if you know how to understand the language of the market which is price action. There is nothing that beats the interpretation of price action, it is the most reliable and recent reflection of market conditions. Learn to understand this language and your trading decisions will improve considerably. 14. Candlesticks patterns and price action explained.: CANDLESTICKS PATTERNS AND PRICE ACTION EXPLAINED In this lesson, I want to go straight to the point and talk about the most important aspect to consider when interpreting candlesticks patterns. Please take note of this information as it will be very useful for all your analysis of any financial instrument, not just futures. Candlesticks patterns vary from one-time frame to another. We can have double bottom candlesticks patterns on the 4-hour chart but when we move to the 30 minutes chart the candlesticks change shape. Everything is relative but the price is final. There are several patterns of candlesticks that you could learn but the most important thing is to see the context of price action and then you can use what the candlesticks patterns express as additional information. My advice is as follows: You should get used to understanding the price action by asking yourself the following questions: How has the trend fractal been behaving? Has the trend fractal been interrupted? How is the momentum between support and resistance? How far did the price go up? How far did the price go down? and how did the price close compare to how it was in the recent past? Solving these unknowns will help you spot which is the most likely trend in the market. After having answered the previous questions, you can study the present candlesticks patterns analyzing different time frames to confirm your idea. The price action (or the price structure) is what indicates the market trend and has more weight than any candlesticks patterns. In fact, candlesticks patterns only indicate a momentary change in price action but fail by a large percentage to detect major trend changes if they are not in sync with the market's price action. This is the simplest and most practical solution to the candlesticks patterns dilemma. First analyze the price action which will provide you with the real status of the market, and then integrate the candlesticks patterns into your analysis. This is the reality and it is that simple. Let's see an example: In this 4-hour chart, within the gray circle number 1, we see how the price is in an uptrend and accelerates in the last 4-hour period, but suddenly, there is a sharp price change to the downside. This looks a lot like a candlestick pattern called "DARK CLOUD COVER", which is a "Reversal pattern". The important thing here is to understand the price action, notice how the price after an aggressive rise cannot make a new HIGH and the price goes back more than 50%, this sends a very clear message of momentary weakness. But be careful, the price can strengthen again and continue upwards as it happened hours ago indicated in circle number 2. For a trend change to start, there must be a break in the trend fractal but a candlestick pattern cannot guarantee it. At this time frame, we cannot see if there was indeed a break in the trend fractal caused by price action. To see the fractal in more detail we must use a shorter time frame, you can try different time frames less than 4 hours, in this case we will use the 30 minutes time frame. The gray circle number 1 shows the same price zone that we previously cataloged as “DARK CLOUD COVER”, but now there is a different candlestick pattern, here we can see more detail in the price action and the uptrend fractal break can be clearly distinguished, there is the presence of a double top and a short entry zone with minimal risk. As you can see, all this analysis is done based on the interpretation of price action and the “DARK CLOUD COVER” candle pattern has nothing to do with decision making. Price action is the key factor for your trading decision. Let´s see another example: Here we have the 4-hour chart again and let's look at the circle identified with the number 2. The price structure is very similar to the previous one, we see how the price is in an uptrend and accelerates in the last 4-hour period but suddenly, there is a price change to the downside. This creates a candlestick pattern very similar to the one called "DARK CLOUD COVER". After the pattern, the price weakens in a pullback and later it gets stronger and continues its uptrend path. On this occasion, the “DARK CLOUD COVER” candlestick pattern has announced a partial change in price action, but it does not mean a trend change. We wonder, what happened? The answer is found by zooming into the 30-minutes time frame, let's see. By looking at the price on a more detailed time frame inside circle number 2, we can see that there was indeed a momentary weakening, but if you look closely, the trend fractal was never compromised. The price, after weakening, created a support zone, it remained there for several hours until demand exceeded supply, and the price continued to rise within the uptrend. As you can see, the candle pattern "DARK CLOUD COVER" announced a momentary price weakening, but it was not strong enough to create a trend change. A candlestick pattern without considering price action offers no edge in making a trading decision. Now, a trading decision based on price action and supported by candlestick patterns offers a better chance of having a successful outcome with low risk. Our main objective is to find those key moments of a trend change, where that transition of control between supply and demand occurs, to make an entry into the market with a new trend that provides us with the best chances of making a successful trade to maximize profits at low risk. 15. My day trading method FLAHCARD, DO NOT MISS IT.: Flash Card. Day Trading Method. I have wanted to do this class with the intention of helping people who are already day trading or thinking about starting. Here I am going to share several important keys to improve your day trading method and I hope you can incorporate them and put them into practice. However, before I start I want to ask people who are totally new do not day trade until they have gained experience with at least paper money. You can also try swing trading which is slower and you don't have to see price quotes during the day. Let me tell you why… Today, day trading in futures is a game of speed measured in milliseconds. It is an environment dominated by extremely fast trading algorithms providing liquidity but it is proven that they do not necessarily improve the market. It is important that you know that day trading in this type of environment things can happen very quickly, almost impossible for a human being to react, even more using very short time frames, such as 1 minute. This is the land of High Frequency Trading where you will find the wildest volatility. This day trading method that I am going to present to you is a totally different ball game from swing trading. Day trading today has become a cruel and savage battlefield, much more than before when there were no supercomputers doing high-frequency trading. My recommendation is that you adapt your trading method to longer time frames than 1 minute. I suggest 10 minutes charts. Previously I used 15 minutes but the speed of the price movements has increased a lot and I have had to adapt to 10 minutes. Remember, markets change, you have to adapt to survive. The concepts of trend detection apply the same for day trading as for swing trading. The trend is a fractal phenomenon that can be detected on any time frame. You have to use the price resolution of 10 minutes to detect your market entries and exits based on the trend analysis that I have taught you in this course. The basic principle of my day trading technique is based on entering the market in a single order and then reducing risk and making a profit, both aggressively. During the day the Emini S&P 500 moves extremely fast and we must secure profits using a scale-out approach, and reduce risk in a synchronized manner as the market can turn against our position without prior notice. This is one of the best ways for a human trader to survive day trading futures. More than 70% of intraday trading orders are placed by supercomputers. You are competing against the best of trading, so you must think and act fast to survive in these troubled waters. This method of day trading is selective, you have to be patient, and you will only take the trades where you have the highest probability of being successful. With this method, you will place from 1 to 2 round trip trades a day on average. Here are the events during which you should not trade. Generally, these events create wild price movements in the market that are difficult to trade, and that generally leads you to make mistakes and lose money. Please take note of this information and always have it handy. It is important to remember that a clean chart with the fewest technical indicators is a valuable tool when it comes to day trading. Too many indicators lead to analysis paralysis, something counter-productive when doing day trading. With a clean chart like this, you are free from distractions and possible confusion, focusing only on what really matters: "Interpretation of price, supply, and demand". The key is to learn how to detect supply and demand imbalance to spot the most recent trend, fast entry, tight risk control, and fast profit taking. Here are some general recommendations for day trading, today, it is more valid than ever. The Exponential Moving Average (30) only gives you an idea of price direction. But beware, this is a lagged indicator. Look at how price action behaves near support and resistance levels to spot trend, entry, and exits. Look for a price structure to trade from it. Go long or short based on the most recent trend in the 10 minutes chart. Real-time risk control is one of the most important things you must remember to have the best chance of being successful in this business. Here I explain how I adjust the risk as the trade progresses. Order to entry long or short at 10 minutes candle close. Put stop loss 3 points below the low (if long) or above the high (if short) of the 10 minutes entry candle. Move the stop loss 3 points below the low (if long) or above the high (if short) of every 10 minutes candle after your entry, only if you will move your stop loss at a higher price level (for long) or a lower price level (for short). The gradual profit taking process is essential in day trading as you have very little time to make these profits. Here I explain how I do it. Take 1 lot of profits at every 10 minutes candle close if the price goes your way 4 points or more. Take 1 lot of profits near support or resistance areas, 2 points before price reaches them. Do not take profits if you already took profits in the same candle near support or resistance levels. If you have 1 lot left then let it ride until you are stopped out. Final Thoughts Day trading is tough, too much high frequency trading during intraday. It takes a lot of energy out of you. It is not for everybody, but if you like it and can make money from it then go ahead. Only a few skilled individuals can make money day trading. The risk control explained here is tight but it will give you a chance to survive and also it will be giving your trades some space to breathe without risking too much. First, test this method with a virtual account, then if you feel comfortable with it you can use it with real money. GO AHEAD AND DO IT. 16. My day trading method and price action, explained step by step.: In this class, I want to explain step-by-step, how another day trading strategy works in addition to the method that I have presented in this course. This is a demonstration that there can be different strategies to trade in the markets depending on the present conditions. For this strategy, I use 10 minutes candles chart in order to try to get a better appreciation of the price action during the intraday by removing much of the noise found in this time frame. The 10-minutes charts also give you enough price resolution to spot timely entry and exit signals. However, if the speed at which prices change increases too much it is necessary to adjust this parameter to a shorter time frame. Remember, flexibility, we must be flexible because of the market changes. I want to remind you that although we must always analyze the price environment on the weekly and daily charts, for day trading the most important thing is the trend of the day, what is happening on the intraday. Let's get started. The first thing we watch is a 10-minutes chart, clean, with only a moving average, which I only use as a reference, without other statistical indicators. You should only use the interpretation of price action to make trading decisions, it is the most faithful representation of what is happening in the market. Now, after the market opens, we must wait for the price structure to form, we must look for our support and resistance zones. During the first minutes, we can already see the first resistance zone, we must draw it. Later during the morning we have already found the first level of support. There is a price range, now we must detect where the greatest force in the market could be, either in supply or demand. Some minutes after we see how the price breaks resistance, forming a new resistance zone very close to the previous one, the price does not advance much and goes back a lot, making a deep pullback, disregarding the previous resistance that is now support. This is suspicious and could be a sign of weakness on the demand side. The price tried to rally upwards but hardly made any progress and was held back by a strong supply present at the same level where the new resistance zone was formed, thus creating a clear double top price pattern. Here you can see an area of high supply and low demand, ideal for a short play with a high probability of success. We must calculate the risk we would take if we decide to take a short position due to what is presented in the price action. Additionally, we must have an estimate of what the potential profit of this trade could be to decide if it is worth the risk assumed. Because the potential gain is much greater than the risk assumed, we took our short position just at the close of the 10 minutes candle that created the double top. We placed the stop loss above the high of the 10 minutes candle that created the double top using the parameters of the methodology. The price is moving aggressively downwards, and at the close of this candle we took our first partial profit. You must decide what portion of profit you will take depending on the size of your initial position. Immediately after taking partial profits, we move the stop order over the high of this 10 minutes candle based on the parameters of the methodology, this is a dynamic risk reduction. We must update our stop order with the number of contracts left in the position after taking partial profits. The price only moved down a bit, we do not take partial profits here due to this reason, but we do move the stop over the high of this new candle. As you can see, thanks to the dynamic stop adjustment, this is already a zero risk trade. Our stop is below the entry and we already have partial gains. The price continues to lower and we take partial profits at the close of this new candle. We immediately move the stop over the high price of this candle where we took partial profits. Here we are also protecting paper gains from our short position. The price moves down only a little, and like the case above, we do not take partial profits here, but we do move the stop over the high price of this new candle. Suddenly the price moves aggressively down where we take partial profits again near support. You should notice how we have taken partial profits justifying the time we have invested in this trade. Price continues to slide rapidly downward breaking support and we take profits again at the close of this candle. Immediately, we move the stop over the high price of this candle as indicated by the methodology. A huge doji is created that could indicate a change in price action, which moved back up a bit. We do not take profits here but we do move the stop over the high of this candle. Minutes later the price goes back up and activates our stop, closing our position. As you saw, this is a trade with 10 minutes candles, where there is enough time to think about the intraday battle. Things can be done without much pressure. This is another type of configuration that I recommend for day trading, something that removes a bit of price noise and at the same time offers you the opportunity to think and make trades with a greater probability of success, take partial profits and reduce risk. If you manage to make even one play like this a day, it is more than enough. There are days when there are no entry signals, but that's okay, it is better to be out of the market protecting capital than to be in the market losing money. Please, now it is your turn, study this information and verify it with your charts, practice with a demo account and start gaining experience. The best way to learn is by doing it yourself. Go ahead and take action. 17. Words from Humberto.: hi i want to congratulate you for finishing this chapter because you have reached a very important topic let me explain something to you trading or reading price action is is an art it's like painting a picture it's a skill you can master but if you focus on it, practicing, with time you will reach a high level of reading ability about price action phenomena in time with focus and perseverance you can master this skill but a lot of effort is needed from your part there are many people that ask me about what is better day trading or swing training okay let me tell you something in my case it's my personal decision i prefer swing trading, why? because when you're doing swing trading you have time to think to look at the chart to make all the drawings to analyze the market in a calming fashion you are not in a hurry so you have the time to think and take the best decisions i know that a lot of people prefer day training because of the avoiding the overnight risk but in time you will realize the advantages of swing trading again that is from my point of view i prefer swing trading you have to practice and discover what is best for you remember the best learning is the one you live yourself through trading through practicing that's the best you can do keep going.