Forex - Killing Divergence and trade it with precision | Baraq Adnan | Skillshare

Forex - Killing Divergence and trade it with precision

Baraq Adnan, Student and Entrepreneur

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7 Lessons (34m)
    • 1. Introduction to course

      0:50
    • 2. What is Divergence

      2:27
    • 3. Indicator for Divergence

      2:52
    • 4. What is Bullish Divergence - Examples

      6:13
    • 5. What is Bearish Divergence - Examples

      4:25
    • 6. What is NTL and ATL - How to Draw them

      6:40
    • 7. Combining all - How to Trade Divergence

      10:06

About This Class

This short course is all about developing a strategy that will give you edge in market. Divergence is tricky concept and trading it alone can build substantial losses. This short will address those potential pitfalls and how to avoid them but also give you extra technique to refine Divergence Trading with precision for maximum profit.

This course will take you step-by-step and build your basics and then finally address how to trade with precision. 

please do share it with others and make the most out of it.

Transcripts

1. Introduction to course: Hi there. Thanks for doing it. This short video is all about the course. But let me introduce myself first. This is me. This is what driving me on. This is what I'm trying to achieve. My goal is to build quality institution Simple. Now let's start with a course introduction in this course. First, we will understand what is diversions. Then we will look into what indicator we will Jews that will help us to identify divergence . Later on, we'll look into what is called the bullish divergence, along with some examples. Then we'll look into what is very started. I will look into some examples further we look into what is NTL and 80 l on their significance in trading with Proceed in the last will go through a complete example How to create divergence. Now let's get started. 2. What is Divergence: Okay. Welcome back. Now, let's first quickly get familiar. Rid what is called divergence. Okay. The definition will go into the definition on DA details a bit later, but try to understand the formation first. Okay, So diversions is when the price is doing opposite. So what on indicator is right? Okay to the indicator on price section is doing quite opposite. Curtis, check this one. Okay. Price is going down, making lower highs and going down. Okay, Check the indicator. The indicator at the same point is going up breaking the previous highs. Okay, so the price is doing opposite to what this indicator is doing. Don't worry about this indicator. I will explain how to draw this, and ah, I'll going to detail as well. How could read this indicator, but at the moment, just stick with the formation. Okay? First example. And they said the price is doing opposite to what an indicator is doing. Okay, so two opposite things bear with me. Let's take another example. Okay. How about this one? Check this world. Okay. Prices going up, making Lord all where we go. Okay, So the price is making hard nose, but indicator on the same point. Sorry is making lower knows it's breaking the previous laws. So the indicator is doing opposite toward Price Section is doing OK to just recognize these two examples on, you know will go into detail. So now you learn when I say the price is doing opposite to indicator I mean both are behaving in opposite direction. Okay, now let's take a look into stochastic first, the indicator that we're going to use. 3. Indicator for Divergence: Okay, we're back into this chart. Uh, if you go into this indicator tab, by the way, I'm using trading you dot com. It's a It's a free, charming website. Pretty good. Very impressive. So I mostly use this website for my technical analysis, click on indicator. No matter what charting software package you're using, there must be a list off indicator and you confined stochastic. Okay, let me show you. I just died. Mr. Constant, This one okay, stochastic are inside this one I'm going to use for this particular example. Okay, You'll probably find the same one in your charting package as well. If I click this once, it will insert the indicator. Okay, I conclude this town now the settings are default. I'm not changing any Saturday or 33 14 14 44 double click this. You can see the KD upper brand lower band information. Ok, not to read this indicator What you will see on the right hand side, there are levels from 80 to 100. These are extreme levels from 20 to 0. These are the opposite extreme levels. Okay, now this line, which is on Eddie, let me just make slightly darker. So you can do it on the bottom one as well. To 80 and Runde our threshold when the indicator goes into this 80 and 100 range, these are we called extreme levels will expect price to react. Okay, well, expect price to react. Check this one. Okay. Across the 80. Okay. The price reacted at the bottom. The price reacted. Okay, so this is this is how you read it. So above 80 and 100 extreme levels below 20 and zero. These are your extreme opposite, Lyles. This is how we're going to use it. You do not trade this indicator solely, okay? It will kill your account. I'm repeating. Do not trade this indicator solely. It will kill your account because some time you will see it will go into these extreme levels, but it will stay there. Check this one out. Okay. It stayed there for a while. You cannot hit sell button. You gonna need more confirmation. But, um, since I'm talking about this particular indicator, so I want to make sure that you don't take it as a Holy Grail. Okay? Right. Since we now no how to insert indicator on what are extreme levels will look into, So let's combine this with the divergence technique. Okay? 4. What is Bullish Divergence - Examples: the first example, we're going to look into its called bullish divergence like a less write it down. Okay, bullish divergence is conversions. Okay, Let me just reduce the phone. It's too big. Okay, with the price section, it's making hard nose. But the indicator is breaking. Bring this loss or get bullish divergence. Now, let me explain. This price is going up coming now and then, breaking the previous highs. Okay, so this is high low. This Harlow is confirmed once it will take out the previous highs. Okay, so the price action is making hard lows. How about the indicator? Let's check this out. This is the level. Let me just grow light, you know, or more convenience. This is a lie. This is our level. Project this out. The indicator has broken this level. So it is making a lower law. But your price action is making a higher low. This is called bullish averages. When you see this in action, you change your bias towards bullets. Okay? I could bear with me. I'll tell you how to create this. But when you see, the indicator is breaking the previous laws. But the price action is not doing the same. Expect a bullish momentum. Okay, this is gold bullish divergence. And you will see the price will go, uh, as a result. Okay. We'll talk about how to create it in a minute. So this is called Bullish Divergence. Let's take a look into another example. Okay? How about death? I'm just removing this seminal confuse you. Okay, Now, the price is breaking the previous laws, okay? That we just promote this crawl line so the price is breaking the previous lows, but the indicator is making higher, low. Okay. Can you see that? That's a level price has broken the previous lows, but the indicator has not broken the previous laws. So this is a bullish divergence. Okay, so we have another example when the price section is making laurel. But the indicator is making hard, huh? Or get so these are do example off. Bullish divergence. In either case, the price section on indicator is doing opposite. Okay. Should we take a look into another example? Okay, Next. Have a look, Lexi. Bullish divergence can receive bullish divergence. Any bear. Okay, How about this? Another example. Price bombs came back down, took the previous high Okay. How about indicator? Same point. Surprise. Couldn't break the previous the price couldn't break the previous laws. Okay, but check the indicator. Let me just removed as check this one. But on this line, the indicator did slightly. Okay? Exactly. Came down. Move up. But the price couldn't break the previous lows. Bullish divergence and price went into the open the direction. OK, which means up these are all examples off. Bullish divergence. Same thing when the price is making lower highs, but the indicator is breaking the previous. Huh? Previous laws. This is called bullish Divergence. Okay, Reject three examples off. Bullish divergence. Don't read. Bear with me. We'll go into the detail. How we gonna traded? Okay, these are just examples. Now, let's take a look into what is called the bearish divergence. 5. What is Bearish Divergence - Examples: Okay. Now, let's take a look into very sharp virgins. Check this. 1st 1 Okay. Christ came down making higher highs. Took the previous highs, but in the same point indicator is during opposite. Okay, Bearish divergence. Prices going in opposite direction on indicator is making lower. High. Let's take a That's right. It though. Thank you. Bullish divergence. Now we are talking about Barish. Averages with the price section is making high highs with indicator is making normals. Okay, plus exam. This is gold Bearish divergence. In the case off Berisha virgins, Price will try to snap back according to the indicator which mean it will go down. Okay, so in this case, Price came down. Okay, How about this Mr Moving Guest ball? Another example. Rice is making lower highs. This moving this So when are confused here but here. Same point. OK. Indicators making higher highs. So this is called Berry Staffers. Is another example. We have copy when the price section is making lower highs. But the indicator is breaking previous hearts or making sorry or making higher. So we have two examples off bish diversions. Okay, first, but in either case, have you noticed the price action is totally opposite to the indicator. Now you need to learn how to draw these lines to give your confirmation. OK, so both are Example off. Very shepherds. So should we take a look into another wall? Okay, let's try it. Okay. Hobbled this one. How about this? I'm just keeping it. Indicator is making higher highs, but the price is making your nose agree. You know it. This is bearish example where the price is making lower highs came down. Uh, and don't, But the indicator is breaking the previous size is your life. Okay, here's your low. If it has clearly broken the previous highs. So this is another example off Berisha virgins. Now, since we have learned how to identify no trade, okay, we have learned how to identify Divergence. Do practice on this. Okay, Now we are going to talk about what is gold and yell on it, yell or get creme lines. Let's take a look 6. What is NTL and ATL - How to Draw them: Okay. What is nd l right? Let's write it down and yell. Is gold normal crinoline? Okay, At least do bounces naked girl, this for you. Okay, swing points. We're talking about the price swing points. Okay, let me make it easy for you. This boy in this point, Price came up. Woops down. Help! That's not reasonable reading. Second, our this, uh, Christ came down, Uh, came down. Move up. Well, that's what this. Okay, do you may not cursed me. Rock. You forgot this. Okay, Right. This one. Okay, so we're talking about extreme points, so the normal trend line is you connect two points. Okay? This point on this boy, Andi, we just stretch it, okay? Or you can use Ray line if there is any. Yeah. Yeah, This one. Okay. Do you connect this and you connect this and it will extend the line for you and make it bigger for your chickens? Billy, what you were saying? Event. Okay, I'm deleting these arrows. Want any inconvenience? This is normal current line. The price came down, It bounces. Now. We're expecting another bound sort. Confirmed. It sets of eloquent Colonel, I hear it's broken. Okay, but the normal trend lines must have to bounce is this is a traditional way off drying. Uh, trendline. Okay, there is another approach, which, which is called HTM. Okay, what does a TL ideal is called aggressive trendline. Okay, lows or highs off the candle candles. Okay, let me explain this. So this is your normal turn light. This is your aggressive Colonel genius. OK, just one Know what this aggressive turned on? Just connecting the laws off the candle for bullish divergence, okay? Or not the bullets. Governance in a bullish trend. Aggressive current line. Okay, aggressive parent line. Okay, we're connecting. The lows in a bullish market in the British market will be connecting the highs like this one, Colonel. Aggressive. Okay, let me just delete this one. Aggressive. Aggressive, Okay, Aggressive. I think I'm made it missed. Okay, you can imagine that I was wasting my drawing classes. Okay? I made it massive. Let me just remove these old growing things. What you got to concept? Okay, so the normal trend line is basically swing bounces, swing, bounce, swing, bounced string, bounce. Okay. Or check this one or check this one. Okay, swing swing broken. But then you know this one? That's not the classic. Won't let me just give you some reasonable Okay, See that? Swing, bounce, bounce. See that bounce, bounds bounds and finally broken. So this is this is a Roman trendline. This is how we draw it. Okay, but four divergence. We used aggressive timelines. Okay, When the divergence take place, we use aggressive term lines. This is aggressive. Let me just delete this one. Okay? This is aggressive. Okay? This is aggressive. Nice, bro. So now you learned what is aggressive trendline on what is normal trend line. Now let's combine trendline concept with the divergence and see how it can help us to eliminate false signals or jumping into the market without knowing what exactly we moan. Okay, let's start it. 7. Combining all - How to Trade Divergence: Okay, we're back. Right? So we're going to combine divergence with trend lines. Okay. And, uh, this is I called Precision. It will stop you taking trades aggressively. It will protect your capital many times. We're not taking the room signals off the market. Okay, I'll explain this, OK? Bear with me. Let's take a look. Right. This one. We said the price is making lore highs, but the indicator is making higher highs. Berisha emergence. So what exactly happened? This is a banning food or find side. Okay, Lex, it we we were Yeah, this one. Okay, we noticed this indicator has making higher highs broken the previous high, but the prices way down. Okay, so what do you do? You draw your trendline aggressive current line extended to a gag that come through the move. This Let's draw the rail line. We're just in okay. And wait for the market to break this trend line and close below. Okay. Can you see the significance? Although the indicator is making higher highs, and so the price too. But price is still way down. Uh, then the previous highs. However, the indicator is keep breaking this previous highs as well Okay. So unless until the market does not break your aggressive trendline and clothed below at this scenario you check this camel this kind of game all the way down on, you know, give you an impression of market wants to go down, but snapped back up, closed above this trend line on the market is keep bouncing on this on this life. Another thing. Guys never conduct your analysis on the running candle. Okay, this is a daily chart. We are talking. Okay. Unless until the candle is not closed or formed, but shaped final shape. You do not conduct your analysis on that. So running candle can be, you know, take this example. It was very bearish. Candle were turned into the bullish by the end of today. So the market is keep bouncing up. Okay, Going up, up, up. Check this one. Now the market has broken this turn line. Now you can see the price has broken the trend light okay. And closed below. Your stop loss will be above the swing high. Okay. Another of dew point aggressive critter can pull the trigger by placing stop loss above this point, we just heard like Andi can go for At least Let's see if this is the risk they are taking. Make it down. Agreeing. Okay, That's if this is the risk they are taking. They will go for at least 2 to 1. Okay, this is one person will need to shoot down. At least want to under 221 depending upon your strategy. Are normally cooperative One. Okay, that's the one strong, Did you? The second strategy is, since the trend line has been broken wait for the market to come back around this trend. Line the game because most of the time you will see, you know, over the practice a price normally come back on, test the turn line before it goes down. So in this case, it came back. Now you can take Ah, now your risk is reduced. Okay? You can take the short entry with the same stop loss above. It has reduced your risk, and you go for 1 to 1 or 2 to 1. You know, whatever you're trying to target, this is a way you can create the very star virgins. But unless until your trendline is not broken, it will prohibit you to take the short entry. Okay. As a first example. Now, let me remove the drawing tools. Let's take a look into another example. Okay, How about this one? The price is making higher Highs. Indicator is making lower highs. This is very star virgins. So you draw your aggressive ground line, connect the laws, wait for the market, connect the laws, wait for the market to close below. Okay. As I said, you can wait for the the retracement, then to take your short entry, place your stop close above. Go for 1 to 1 or 2 to 1. In this case, yes. It gave you at least tutor. Well, I guess, yeah. You're wonder one. Yeah. Okay. You know, you waited a while for this, but wrenching. But this is how you created this. These are the bullish examples. Sorry. The bearish examples. More trying tools. Let's take a look into the bullish example. Okay. You said this one. Yes, but Okay, let's go for the clear one. Okay. How about this one? Okay. How about this one? We said prices making laurels, but the indicator is making har cars. Okay, so wait a second. My wife, She's texting road cap. So the price is making laurels, but the indicator is making higher highs. Okay, Bullish divergence. So what do you do? You are expecting price to go up. What do you need to do, Mr Draw your aggressive line? This is your aggressive line or this gang. Byork aggressive line constricted. Okay, you're connecting. Ah, the the highs off the candle. Now, at this point, the price close above this aggressive timeline at this level for this pretty good example, the risk is not big. Okay? You can hit long are placing your stop loss below the previous spring low. Okay. On a shoot for that case, wanted one or two would want it like safe. If that was your risk, then you're going for at least one 1 to 1 or 2 to 1 year, As I said, depending upon your patients level. Okay. So in this way, the market has luxury More than that. But there's a bullish example. Good for what I did again. This one Let me just remove this. Okay, Now let's take a look into another example, but may just remove this. This and that's OK. How about this one? Okay, so the price is making higher highs with the indicator is making lower laws, but they're breaking the previous laws. How do we treat it? Okay, benefit of hindsight. Let me just over there. Okay, so indicator has broken s previous lows, but the price is hanging there. Okay. So, again, this is the bullish divergence. How we're gonna treat this will draw our aggressive trendline connecting the high. Okay, Now wait for the market to break the line. It has broken the like. Okay, this kind of actually closed above this aggressive timeline, this one broke above and close above. We can take long from this candle by placing our stop loss below this one. Okay? Or as they said, sometimes come down and test the current line. There you go. Test. You know, we can take long from here and go for one or tow whatever. You know, personage. We're trying to to Tonga. Okay, That's another example. How you can create the police. Divergent. Right, guys. So we have learned today what is called divergence. What is bullish on bearish averages? How to draw a trendline. What is aggressive turn line and its significance on how we can combine trendline with the government to make a really good strategy. I'm sure you have enjoyed this course. I learn new concept. This technique is very powerful. If you use this with maximum strategy riches again available for you guys on, uh, this None of this practice is, um I appreciate your comment Situations, feedback until I see you the next course. Have a good time. Bye bye.