MASTERING TECHNICAL ANALYSIS IN FOREX TRADING | Gerrit Gerber | Skillshare

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MASTERING TECHNICAL ANALYSIS IN FOREX TRADING

teacher avatar Gerrit Gerber, Professional Forex Trader

Watch this class and thousands more

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Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Watch this class and thousands more

Get unlimited access to every class
Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Lessons in This Class

14 Lessons (2h 8m)
    • 1. Introduction

      1:23
    • 2. The Importance of Technical Analysis

      3:27
    • 3. Understanding Candlesticks

      9:40
    • 4. Identifying Market Direction

      7:51
    • 5. How to Draw Trendlines Correctly

      6:11
    • 6. Drawing Channels

      5:14
    • 7. Placing Support and Resistance Areas

      15:50
    • 8. Important Chart Patterns to Know

      16:58
    • 9. Analyzing Candlestick Patterns

      10:42
    • 10. Fibonacci Levels

      15:30
    • 11. Using Moving Averages

      13:10
    • 12. Popular Chart Indicators

      10:42
    • 13. Key Psychological Levels in Forex

      10:06
    • 14. Class Project

      0:51
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About This Class

Welcome to this Mastering Technical Analysis in Forex Trading class!

Whether you are a complete beginner with no background in Forex trading, or have some prior knowledge in the Forex markets, this class is sure to provide you with the necessary technical analysis tools to successfully analyze the Forex markets.

By the end of this class you will have a clear understanding of the different technical analysis tools available to help you determine a directional bias for price to move to in the near future.

You will know how to read and interpret candlesticks as well as be able to identify market direction.

This class will show you how to correctly draw trendlines and channels in the market, and how to place support and resistance areas to assist your trading.

This class also covers Fibonacci Levels in great detail, and shows you exactly how to make use of chart patterns, moving averages, chart indicators and key psychological levels in the market to improve your Forex trading abilities.

After this class you will be able to successfully analyze the different Forex currency pairs by performing technical analysis on the charts.

This class will tremendously shorten your learning curve and will help you avoid the mistakes that 90% of new traders make!

So if you are ready to take the first step on your way to mastering the art of Forex trading, then enroll in this class today!

I look forward to connecting with you inside!

- Gerrit

Meet Your Teacher

Teacher Profile Image

Gerrit Gerber

Professional Forex Trader

Teacher

Hi there, my name is Gerrit Gerber and I'm a qualified Civil Engineer and a professional Forex trader from South Africa.

I am really passionate about the world of Forex, and have been trading the Forex markets for over 4 years now.

I love to discuss and teach Forex trading to all my friends and family, and I probably drive them nuts by now with all the Forex talk to be honest.

So that is why I decided to branch out to a much larger audience on skillshare, to connect with anyone who might be interested in learning more about Forex trading.

I look forward to sharing my passion, knowledge and experience in the Forex markets with you!

See full profile

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Transcripts

1. Introduction: Hello and welcome to this Mastering technical analysis in for extracting clause, My name is Harold Harbor and I will be your trading instructed throughout this clause. I have over three years of forex reading experience, and I look forward to sharing some of my passion and knowledge in the Forex markets with you. So let's take a look at what you will learn in this clause. Firstly, we will take a look at the importance of technical analysis. Then understanding candle sticks. Moving on to identifying market directions, I waited a market is on an AP drain down trade or moving sideways. How to draw train lines and channels correctly. Placing your support and resistance a eras in the market. Moving on to the important chart, patents do no analyzing candlestick patents. Taking a look then at the Fibonacci levels, how to successfully use moving averages to assist you if you're trading the popular chart indicators to be aware of. And then lastly, the key psychological levels in for x. So this is quite a comprehensive clause on technical analysis. And if you are interested to improve your technical analysis skill set, then I look forward to connecting with you in side of this clause. 2. The Importance of Technical Analysis: Technical analysis is a study of price movement that entails looking at past price trends and patterns in the market to discover how it can affect current price movement. So in essence, you are looking at the past and you are analyzing the past, and you are biasing your predictions of the past on the current and the near future price movements. So you are looking and you are analyzing different jot, patterns and price strings of the past. And you are looking, we can apply them in the current market conditions. So in a nutshell, that is technical analysis, or technical analysis is used to determine with relative degree of confidence I directional bias for price to move to in the near future. I can say to you, look and analyze past price movements to determine where the current price is likely to go up or down. And that is what technical analysis is used for my forex traders. Now, the study of historical price movements are used to create trading plans around idea that current price action will likely follow similar movements in the future and not. The old adage. History tends to repeat itself is so important in for X writing and it's so relevant year with technical analysis. Now, technical analysis is always performed on price charts, seeing as it's a visual representation of bossed price action. And it helps you to visualize how the past price action and patents is likely to play out in the future. Now, technical analysis can be very subjective. Meaning to people can interpret the sign thing entirely differently. Meaning to people can watch the exact same past data and have completely different opinions about the future price movement. For example, one can think that the price is likely to increase and another can think that the price is likely to decrease in the near future. So it's therefore important to learn how to apply these technical skills correctly when you start trading. And without technical analysis, you are essentially trading blind and just guessing I gambling without performing the required analysis, without doing the work. You're just basically gazing with a 50% chance of being accurate with the price will go higher or lower in the near future. And that's not what Forex trading is all about. So in the next lecture, I'm going to show you guys exactly how to read the candle sticks to apply technical analysis to. Thanks, and I'll see you guys in the next video. 3. Understanding Candlesticks: Candle sticks are an indication of price movement for a given timeframe. And the time frame can be in minutes, days, weeks, and even months. And each candlestick is made up of an IHL, sea level or an open, high, low and the clouds level. So each candlestick contains its own unique four levels of price. As you can see, for this specific green candlestick, it has high level, meaning it's the IS that price has gone for the specific candlestick. That clouds price at over a year with a candlestick closed and a new one opened. And then with this specific candlestick opened, meaning the previous one, closed over a year. And then low-level, the lowest that the scandals stick has been. So these are the four levels, the LC levels that each and every one of the candle sticks in the Forex market contained. Now, you will see when you open your forex shots that the Forex George usually contain green and red candle sticks. Now, the green candle sticks or the bullish candle sticks, means that price has increased. So let's say for example, the scandals stick opened at 1.0500. It reached a point of 0.0401 and i closing point of 1.05 to 0 and then high of 1.05 for 0. So you can see between the opening and the clouds of the candlestick, It was an increase of 20 pips. So therefore, it's a bullish candle or visual, or visually shown as a green candlestick, and vice versa. For the rape candle sticks or the bearish candle sticks, you have your open at the top and it's lower. Move with your clothes at the bottom. And you learn your eyes stays exactly the same. So let's, for example, let's just say again, your opening price was 0.1.05 to 0. Let us say it opened right off the, the closure of the scandal sticks. So away this candlestick clouds, this one opened up over here. If I, let's keep the sign of 0.051 for a close off, 1.05 and the low of 1.00 for ICT. So between the opening and the closing of the scandals stick, there was a decrease of 20 pips, meaning the price decreased. And therefore it's a bearish candlestick. And this is the essence of all candle sticks. It contained high point, opening level, a closing level, and low level on the candlestick. So we the candlestick clauses over here, the following candlestick opens up. So let's say the scandal stick over year clouds at this level. So the next one would automatically opened up over here. And then it can either be another bullish scandal or it can be a bearish candlestick. So and it will, that will be determined at the closure of the specific animalistic. Sorry, if the closure is lower than the open of here, open and close, then it will be a bearish candlestick or read candlestick. But if it closes above a via, then it's going to be an increase or a bullish candlestick. So that is the different candle sticks that you'll find in the Forex market. Now, there are two types of candle sticks, like I said, a bullish or price increase and a bearish or price decrease candlestick. And these are usually shown as green or red candle sticks. Now I'm going to show you guys some live examples of candle sticks on the meta traded for trading platform. So this is the meta tried for trading platform that I'll show you guys later on in this course. And these are all of the candles digs that we talked about. Now. Each candlestick is for a certain time period and the time periods you can choose above here. So this is a minute one timeframe, meaning that each one of these scandals Dix is a one minute. So of the one minute then, let's say after this one scribes, then often minute, the next one will open. So this is one minute candle sticks. And then you also have your five-minute candle sticks, meaning each candlestick is a five-minute time period. Your minute 1530. You're our 01. So each one hour, hour, four. So each candle sticks is for our timeframe, deny your daily weekly, and monthly candle sticks. So these are all the different timeframes that you'll be using throughout your technical analysis. And we'll get to some more data later on in this course. But just to show you guys, again, this is a minute five timeframe. And as you can see, let's, let say this bearish candlestick over here, it might a high of about 70.085. Images. Move this. It opened up at this level. Let's just say it's around 70.03. It closed at this level, 70.01 and it might an all-time low of, let's say, 69.9. So these are your four levels that each and every candlestick anya has. And we'll get into how you can analyze and interpret these different candle sticks. Lighter. But just know that price is continuously changing and continuously a battle between the bools and the base, the bulls or the green candles. And, and I want price to increase. And in the base rate Gino's Taiwan, a decrease in price. So this candle sticks are in a constant battle to push the price either higher or lower. And you can start to interpret the different candle sticks in a manner to determine where price is likely to go to in the near future. Just by reading each candlestick or a group of scandals stick on. And each candle sticks tells its own unique story and its own unique battle between the bools and the base. For example, this candle stick over a year. And you can see that after the closure of this candle stick or via the bulls to control. And I pushed priced higher to this point. But as soon as the touch this point, the base came back in control and they ultimately push the price lower than the previous open, and it closed lower. Then this candlestick. So in this example, the base one. And just like this candlestick, every candlestick has its own story and with some experience and training, you learn to read and interpret each candlestick individually. So that is how you guys can analyze the candle sticks. And hopefully that gave you guys and broader understanding of candle sticks in the Forex market. 4. Identifying Market Direction: In this lecture, I'm going to show you guys exactly how to identify market direction for any currency pay that you are busy trading. Now, there are three types of drains that you'll find in the Forex market. Namely an obtained, something like this, a downtrend moving lower and the sideways or consolidating market that's just moving sideways. Now, there are two ways to determine the specific market direction. And the first is by looking whether the market is making higher highs and lows for AP trains or making lower highs and lows allows for downturn means what I mean by this four up drains. This example over here. This over here is called a swing I, and this is called a swing low. And this is also a swing I. And the swing low, meaning that this move over a year and has a high point of day and the low point over day. So by using this analogy of the market-making, higher highs, highs, highs and lows, ILOs, islands and island. You can see that the market is on a clear up train and it's bouncing from high to low, high to low. And each time it's getting higher and higher and higher. And four down trains by following the divisors of objects with the market makes our eyes and low loads, you can see DSRI for the specific and pay is making a low, high, low, high, low, high. And then loa, loa, loa, loa, loa loa and lower level. So it's bouncing from the lowest to the eyes. And that is on a clear down with both. So just think of op chains as cutting up the stage with each step you go I and II and down trains coming down the stage. With each step, you are going lower and lower. So that is the first way to determine the market direction. And the second way is using moving averages. Now moving averages or just smoothed out representations of the market. So instead of seeing this, we use, we visually represent this move as smoothed out line or moving average like this, the scold 50 moving average. And over here, it's smoothed out representation of this move as well. And here's another 100 moving average and a 100 moving average, and the two hundred and two hundred. So as you can see. And all of these moving averages get smoother and smoother. The logic they become. Now, how we can determine the trained direction for up drains is when the 50 moving average is above the moving average and is above the 200 moving average. So it's the FFT is at the top and it's just getting bigger and bigger the lower you go. So that's a clear up train. And then four down drains. The 50 is the lowest in the unreal is higher and the 200 is the highest. So the 200 is a 150. So as you can see, all of these moving averages or just going lower and lower. And of our brains that are just going higher and higher. So these are the two ways that you can determine the market direction. And I'm just going to jump into the large markets. And I'm gonna show you guys how to determine market direction with live shots. So over here we have the urea is D shot. It's on a one hour time frame. And as you can see, some clear up trained. And by making use of the two methods that we mentioned. I'm taking this I, we see that it makes a higher high, high, high, and higher high, low, high, low, high, low, high, low. So Moffitt each just going up the stairs and it's bouncing from low to high, clear up trained together with the three or four moving averages all going. These are two clear indications that we are on a very strong upstream. So when you see this in the market, then this would be good opportunities look for by injuries. So places like this we want to buy the or is the price to increase to over, yeah, and in salad via for some profit. Now this is, this is an example of an up trend. If we go to the US dollar, Canadian dollar, and making use of the same two methods as mentioned previously for down trains. We can see by using this I, it made a lower and lower high using this loa loa loa loa loa, loa loa sell market is just going down the stairs and is on a clear with move. And you can see as well with all of these moving averages just getting lower and lower. So this is again also really strong downstream. So you will be looking for entries to sell the small picture maybe over here, Charlotte to the prophet. And in, you'll be API. And now I'll just show you guys a quick example of consolidating market. What that looks like. Also on the US dollar, Canadian pay. And as you can see, this is what the consolidating market look like. There's just no clear indication when market is going and each just bouncing up and down, up and down. And it's not making eye or high or low. This is basically the same eyes and these are basically the same Laos as well as the moving averages or just overlapping like this. Overlapping, overlapping. So this is a sideways market or consolidating market. And you, if you know, if you have some experience of consolidating markets, then you can enter trades at the top. You can type it right to the bottom or the support area. But we'll get into some more detail later on in the schools. So that is marked directions and that is how you can identify them using the two eyes. Try shady guys. So thanks for watching and I'll see you guys in the next video. 5. How to Draw Trendlines Correctly: In this video, I'm going to show you guys how to draw trend lines correctly in the Forex market. Now if you can remember from the previous video, we discussed how to determine market direction. There were two main methods that you could use to determine market direction. For up drains. It was to determine whether the market is making a higher and higher low and four down drains whether the market was making I lower, high and a lower lobe. And the second myth, it was a visual representation of price or moving averages that gave the guys smoothed out representation of price. Now, in today's video, I'm gonna show you guys another way to visually indicate the market direction, otherwise known as train lines. And train lines can be either up trains or down drains with obtain sharing a bullish market or an increase in price and a downtrend sharing a bearish market or decrease in price. Now, as you can see for the market is making higher highs and it's making high allows as well as on a downturn in the market is making lower highs and lower lows. Now, how you go about drawing these trend lines is for updates. You draw trend line along the bottom of at least two valleys. For example, you connect at least two of these valleys of this movement. And you draw a straight line connecting these two valleys of this movement. And then for a downtrend, you draw trend line along the top of at least two weeks. So you see the two peaks in this movement and you draw trend line connecting the two peaks and you see a third OVS. Well, now train lines should have at least two touches to it with a Fed touch that acts as a conformation. And the more touches that a train line.'s, the stronger and more reliable the train line becomes in the market. Now I'm going to jump into some live examples of how to draw an upturned and a downtrend in the market. Okay, so here we have a live market of the US dollar. Swiss Franc, as you can see in the left corner, via the US dollar Swiss franc. And this is, this is a trading platform, gold trading view. And I'm gonna do a more comprehensive video about trading view. And you guys can use trading view in a later video. But for now, I'm going to show you guys just, I can draw the different train lines on this chart. Now as you can see with this jot, you probably noticed that this year is an update because the market is making higher highs and higher lobes. So that is a clear indication of an up trend. As well as you can see the moving averages, this black and blue line are all going upwards. So those are two indications that we are on an obtained. Now, like I said, are you draw a trend line, updates? Is you connect at least two of the valleys of the move like this. As you can see, I connected this valley and this valley over here. And we have a third touch over here, and the fourth, fifth touch AS well. Now, these would have been some good areas we could have into some trades over here to possibly like a long position for prices to go higher at the dutch or the third confirmation of the train line. And as you'll see later on in the scores, train lines, or really reliable technical tools that you can use in the Forex market. Now, like I say, you draw the two valleys and a third and a full value. Just show you guys that this is a really strong and reliable train line in the market. Now, I'm going to show you guys on this British Pounds, Swiss franc rate, I can draw down a downward trend line. And just like with the upward trend line, you're gonna connect two of the peaks over here. Like this. You connect the two peaks, this being the first peak and the second peak. The Fed just acting as a conformation and you could have entered a short position over here to catch this downward move. And like I said, these awesome, really reliable technical tools that you'll find everywhere in the Forex markets. And it's a, it's a really good tool to add you trading to keep. So that sums up train lines. And in the next video I'm gonna show you guys how to draw channels. Thanks. 6. Drawing Channels: Being able to draw channels as a forex trader is another important technical analysis to, to have in your trading too kit and channels or so easy to draw, you just make use of trend lines, the train lines that you learned in the previous video. As you can see, this is an upward trend line. And we connected the two valleys with the Fed being a conformation. And this is a downward trend line or bury straight line. And we connected the two peaks and a third peak acting as a confirmation. Now, drawing the two channels, the bullish channel and the bearish channel is so easy to do for bullish channels, all you have to do is you draw a trend line parallel to the upward trend line, connecting at least two of the peaks like this. And the straight line is exactly parallel to this upward trend line and you connect at least two peaks. So as you can see, this is a bullish channel with the price is just bouncing in between this channel and it's moving higher, and vice versa for berries channels, you just draw trend line parallel to the downward trend lines connecting it loose, at least two valleys like that. And the straight line is connecting at least two valleys. And price is just bouncing in this bearish channel and it's moving lava. So there is a draw channels, guys. It's really straightforward. And I'm just going to show you guys some live examples again. So this is the upward trend line I drew in the previous video. Now we're going to use the straight line to draw a bullish channel. And I'm just going to click on this trend line and you're going to make a clone of it or copy. And you're gonna connect at least two of the peaks of the top of the move like this. And as you can see, you just connect at least of these peaks. And then to worry that they on so perfectly drawn, this is more of an area of up, upward trend line area. And it's important just to connect as many of these peaks as possible. You could draw your channel bed like this awkward. Also, there is no 100% correct way to do it, but I just like to connect as many of these peaks as I can. And this is just to visually show, give me an indication that price is ranging inside of this bullish channel. Then for various channels. This is another, this is a different example. And like I said, you can see this is a clear downward trend by, by looking at the price, making lower Eyes, La, highs, love eyes and lower lows. So prices moving lower, as well as by looking at the moving averages, you can see it is a clear downward move. And we start by drawing the downward trend line by connecting at least two of these peaks in this movement, like I'm doing here, as you can see this, the first peak, second peak and the third touch, touch, touch just acting as confirmation. Now, draw I buried channel. I'm also just going to make a copy of the straight line over here. And you're going to connected to at least two of the valleys below like this. At least two touches. So it's touching the side. This is also a really good bearish channel. The rice is just bouncing up and down, up and down. And it's making a move lower. So that is channel's guys really straightforward to do, really powerful technical analysis tool to have in your toolkit. And it just gives you guys and extra visual aspect you're trading. So this is a various channel and this is a bullish channel. And they appear so frequently in the market. And you guys will be able to draw them when you spot them in the market. And I'll see you guys in the next video. Thanks. 7. Placing Support and Resistance Areas: Knowing how to play support and resistance areas correctly in the market is a really important technical analysis to, for any, for extra excited to have. And in this video I'm going to show you guys exactly how I go about drawing my support and resistance areas in the Forex markets. Now support and resistance areas indicate a given price range that the market is struggling to bright boss. And we, there is likely to be some sort of price movement. Now to give you guys an example of how support and resistance areas work, is to think about any room inside of your hours, with the flow of the room being the support area and the roof in the room being the resistance area. Now, by going inside of the room, you and taking a bouncing ball and throwing it as hard as you can against the floor area. You will see that the bouncing ball immediately hates towards the roof of the room or the resistance and actor roof. It tends to have a reaction. It struggles to break past the roof and it hits back down towards the floor of the room. Similarly at the flow or the support area of the room. This reaction, again, it struggles to break past the flow area and it hits back towards the roof or the resistance. And it continues this cycle for a couple of times. And it's important to note that support this always found below the current market price and resistance is found above the current market price. So for example, let's say we are over here in the market. Support is always found below the current price and resistance is found above the current price. And also, it's important to remember that there's consolidation isn't going to go on forever. Bryce isn't always going to react at either the resistance or the support areas in the market. And when the support is broken, it becomes a resistance area. So for example, if price decides to break, post this current support area, it becomes a new resistance area because it is now found above the current market price. Like we say, resistance is always found above the current market price. Likewise. When the price decides to break through the current resistance area, the resistance area DNS into a support area because the support is now found below the current market price. So it's important to no, that price doesn't always continuing this consolidating cycle and it tends to break out of either the support or the resistance levels. Now, to draw your support and resistance levels, there's a certain promises that you need to follow to successfully place your support and resistance areas in the market. Now the first step is to select a daily candlestick, where each candlestick is equal to a one day time period. And you select a one year time period on your charts. And you can do this by making use of trading platform. Cool trading view. Laca, shady guys in a previous video. And nother step or second step to drawing the support and resistance areas is to identify the yearly eyes and lowest on the chart that you're looking at them. Any chart where each theory is d, boundary in Australian dollar, Canadian dollar, any chart is to identify the Allies in Laos and replies, support and resistance area at each level. And the fifth step is to place areas where they are at least two bounces at the same price region. So how you go about it is, let's say over here, this price is equal to 1.1 and this price is equal to one. And you see that price tasted the 1.1. region and it rejected the area, and it might've bounce lower and light on. It bounds the gain at this price level. And by taking these two bounces, you connect them, you draw a line. And you see that later on as well. There was a third bounce at the 1.1. price range, and this becomes your resistance area. Likewise, for support, you see that the price bounced at one mark, the one price level. And again, it bounced and reacted and continue the AIA. And so you connect your two bounces at the one price range and you see light on there was a third bond and a third touch as well. So that is the process of how you draw your support areas. And I'm going to show you guys exactly how to do this in the live markets. And light in this video, now, there are certain rules to follow when you draw your support and resistance areas in the Forex markets. And the first is to place the areas on candlestick closures or the candle body closure. And as you remember from a previous video, each candlestick is made up of a open, high, low, close, and low-level. And this will be a green candle or a bullish scandal. And it's important to place your area at the closure of the scandal via because there is a price close. And that is where the big financial institutions, the retail traders, decided to push the price due and to close the price. So I'm going to show you guys how to do this in the video. So that's the first rule. Now the second rule is the more recent, the bounds, the beta, so the focus on the recent price bounces. And that is why I said we are only going to stick to a one-year time period in the market, one year time period. And you don't want to go too far back in time. We don't want to draw support and resistance areas from six or ten years ago because that's most likely not going to be very relevant in today's market. So I would say one-year works very well to place your support and resistance areas. With a bit more focus being placed on the recent bounces within a month or two. But I'll show you guys light on at the live markets. Now the third rule is to only use a maximum of six to eight support and resistance areas. When you are drawing them on your choice, he didn't want to overclock your charts and make it too messy and you want to be able to read the price action as well. So six to eight support areas works perfectly. And the lost Rue of support and resistance areas is that the more bounces the East strongly support and resistance area becomes. As you can see, there's three balances. So this is a really strong resistance area. And you can, you're likely to expect price to have a reaction at this area. And this is also a really strong support area because this 23 bounces at this area. So like I said, a more bounces the stronger the support and resistance areas become. Now I'm going to jump into some live market examples and I'm going to show you guys exactly how to go about drawing your support and resistance areas. Here we have the urea is d chart on trading view. And as you can see, we are on a one hour time frame. And like I said, the privacy in the premises, you need to select a one-day candlestick. And together with a one-year time period at the bottom of a year. And that is how you start your privacy is to draw your support and resistance areas. Now the second the second rule becomes to identify the yearly highs and lows in the market. And as you can see, in this one year time period, this is the Swing Low. And the more recently is the swing, sorry, is the swing I the highest point in this one year time period and this is the lowest point this one year time period. So you identify these areas and you place a support and resistance area at each of these levels. Now you draw your support and resistance areas. I like to use the parallel channel two. At the left two bar on trading view, you just select parallel channel and you just make a area like this. And you can edit this, you can make it any color. You like. You can play around with it. I like the blue and the black combination. So like I said, you place your area at the yearly eye and I'm going to make a copy of this and you place it at the yearly low. And a rule that I also said is to place the areas at the candlestick closures. So I use this black line over here and I place it over the candlestick closure just to be a bit more accurate. As well as at top of this resistance, you can see each just at the candlestick closure over day. So again, I select the one-year period and that is the first thing that they do. You select your daily candlestick one year time period. You identify your yearly eyes. He really lousy applies an area at each level. Now, another thing is to determine we price bounced at a specific level at least two times and a good area. And the market would also be this area over here. And I'm just going to zoom in a bit and place my support and resistance area at Candlestick closure over the because it's a bit more recent. So zooming out to one year time period, you can see that price tasted this level. It's a resistance and continued lower. It almost came back and tasted it again. Over here. It had a reaction and the continued lower as SIC it yet price broke, boss the resistance and it became the area now. And more recently over here, the price bounced off the support area higher. So that is a first order is offered support and resistance area and the market. Another one would be over here. At these levels as you go, I'm going to emphasize more. Focus on the reason touches. So I'm going to put my closure, my area at the scandal closure of a year. And again in one year time period. You can see that in the past it reacted a via. And again every day and day, another bounds over day. And it became a resistance area for this move. Resistance. So this was the resistance area. It broke Boss Soviet became a support area. And that is the essence of support and resistance era, the Move, it doesn't always continue like this. It eventually breaks either through the resistance or through the support area. Now another important area that I would use is this one over here. And let me just put it that Ghana was enclosure, as you can see, priced, bounced. Yeah, they support and then again more recently over here. And just selecting the one year time period once more. We can also pick this eye of the price bounced and reacted at these levels of a year. It reacted everyday there and the more recently over here. So I would say this is efficient, we have or seek support and resistance areas. And now we can, and we can watch out for how price reacts at these levels. For instance, let's say that the price comes down to this support area. We know that it's likely to have some sort of reaction at this area. And that is what I am going to teach you guys light on in this course is how to try these support and resistance areas, how to make money off of them, and how do you identify and which direction the profit is most likely to move in. So that concludes this video on support and resistance areas. And I'll see you guys in the next video. Thanks. 8. Important Chart Patterns to Know: Let's take a look at some of the most important chart patents do now as a forex trader when you're performing or technical analysis on a specific chart. Now chart patterns helps you identify specific areas where price is likely to break out of and continue moving in the same direction or can act as a key trend reversal indicators. Now, what I mean by this is its type, for example, upstream move like this. And at a specific price level on the chart, there is formation of specific chart pattern. Now the chart pattern in question can either give you an indication that price is likely to continue higher or in the same direction as it entered. Or it can give you an indication of a possible trend reversal. So for this example, for price to continue moving lower and there are loads of different jot patterns that you find and can analyze in the market. And depending on the specific George Patton and waits located in the market, it can give you either an indication that price is likely to continue in the same chain direction or a trend reversal is likely to happen in the near future. Now, when the market breaks are these patents, it usually leads to an aggressive price move. Showing giving the example of the up trained again. Here is the formation of the specific chart pattern. Now, in this specific chart pattern is a consolidation and a bold up of price momentum and price gone consolidate for EVA in this box. And eventually it has to break out either to the top or in the same direction as the preceding direction. Or it can act as a trend reversal and continue lower. And these moves are usually very aggressive and there's a lot of volume in these moves due to the buildup of momentum and Skype of momentum when the specific shot Patton gets broken in the market. Now, there are loads of different jot Patton's, but I'm going to show you guys some of the most common patterns to keep an eye out for in the market and how to analyze and try it, the specific chart patterns when they appear in the market. Now the first George Patton and probably one of the most common short patents is called a double top or a double bottom. Now. And psi, for example, price is moving higher and it reaches a certain price point, and it makes a correction lower. Tens around iron reaches the same point over here and then acts as a reversal. Now in a previous video, we say this thing becomes a resistance zone. Or in this case, it is I Double Top Shot pattern. It touches the sine price twice, meaning it makes I double top. And a double top is usually a trend reversal indicator. So with the preceding upstream, when a Double Top appears, you can likely expect change in trained and move flower. Likewise for double bottoms, with lower move, like this, price can reach a certain point. Mike a correction, come back to the same point and continue i. And this would be support area. And as you see, it touches a certain price twice and it makes I double bottom chart pattern. So the disorder double top. And this is a double bottom shot patent to look out for when you're trading. Now another common, George Patton is the Head and Shoulders. George Patton and example of here is this. This is the shoulder, this is the head of the move and this is the shoulder. So 0V issue or neck line. And this being your left shoulder, your head and your right shoulder. And on the flip side, vice versa. You can also get an inverse here and show the way it looks like this with the shoulder, the hate, and the right shoulder, VA we often make line over the so this is the left shoulder date and the right shoulder. And these two specific chart patterns are usually trained reversal or train continuation patents, meaning that price can enter via the formation of this chart pattern can happen and price can reverse. Or price can enter via the formation of the patent can happen. And price can reverse from the. So these are also very common chart patterns to be aware of. Now another one is a triangle chart, Patton Terrell, shy guys in the live example of this video. Then you also get rising and falling wages and years. An example of how a wage loops. As you see, price is consolidating between I, upward moving support. Train line and an upward moving resistance stream lines. The price is consolidating between these two page. And as you can see this also both up of momentum and price usually follows an aggressive move to the downside. So wages or key trend reversal indicators and can also act as strain continuation patents wherever they appear in the market. And then a lost job pattern to be aware of is a flag Patton. And you get to flag patterns, namely bullish, bearish flat pattern. This over here is called bullish flag Patton. And this trend line over here is the flag pole of the flag pattern. And this consolidating area is called the flag. So you expect a continuation move when you see this chart pattern in the market. Likewise, for bearish chart patterns with a downward movement, the downward flagpole, you expect some sort of consolidation, continuation in the sign preceding train. So I'm going to jump into some live examples and I'm going to show you guys exactly how to draw and analyze the specific chart patterns when they appear in the markets. So this is the US dollar Swiss Franc shot on a one hour candlestick timeframe. And I'm going to show you guys five examples of Jot patents, how to recognize them, how to analyze them, and most importantly, how to try them when they appear in the market. Now, offers Patton over here is the double-talk that we discussed. And as you can see, price, price reaches a certain level over here. Let's say, for example, that level is 0.999 and then price makes a quick reaction. It dates back to the same level. And as you can see, it forms a double top and back assayed tabletops are usually trained reversal indicators. So meaning when a proceeding up, trained when the preceding train is upwards and the formation of a double top appears, then you can expect a move lower or down trained to take place after the formation of the double top. And how you go about trading a double top is you draw I support line over a year and you wait for the second top to break the specific area. And you enter the try it over here and you catch this move lower to the downside. So that is how you can try to double-talk. And when double bottoms appear, for example, like this, the same rules apply. You wait for price to break above the specific resistance area of here and you catch them move higher. So that is how you can try to double top, double bottom when they appear in the market. Moving on to our next chart pattern. This is the this is a Head and Shoulders pattern. As you can see, yes, the formation of the alien shoulders. Now A1 shoulders can act as either trend continuation or trained reversal indicator. And it's more common to act a strange reversal indicators as you can see the preceding movies upwards. Then you get your creation of your left shoulder, your head over here, and your right shoulder. Now how you go about trading desk A1 shoulder issue, draw your neck line of the year and you wait for the right shoulder to break this support area and you continue to move lower. And for the inverse or inverse A1 shoulders, the same rules apply way. You just draw your neck line over here and you wait for the right shoulder to break the resistance area and you continue to move higher. So keep an eye out for these chart patterns though the very common. And just draw a support area or resistance era and wait for the right child always right for the right shoulder to break the support or resistance era, and then you can enter the trade. So that is head and shoulders. Now, another good job baton to be aware of is called the rising wage. And rising, which also can act as a trained continuation or trend reversal pattern. And you go, how you go about drawing these George Patton's issue, connect a train line from the first valley and you can eat as many of the valleys as possible like we did when we discussed train lines and the upper train line, you connect as many of the peaks as possible, like we also discussed in the train line. And as you can see, prices just consolidating between both of these upward trend lines and how you go about trading a rising wage issue, rightful price to break out of this baton like this. Over here. You write for it to break out and you catch the move to the downside. And luck I say depending on the way the specific chart pattern appears in the market, it will either be a trend continuation pattern or trend reversal pattern. But as you can see, this is, this was quite an aggressive move. Lower after this buildup of maintenance price just accelerated to the downside. And that is usually what happens when specific chart patterns break. So this is the fourth chart pattern that we are going to be looking at, the British flag. And like I said, How to try the British flag. This flag patterns or usually trend continuation patents and the preceding train is upwards. So this the flagpole. Now prices consolidating over here in this bearish channel. Over here, the bearish channel, but it's a bullish flag because price goes in the same direction as the preceding trained. When it breaks out of this flag. Patton. And I got about trading this fact pattern is you write for you, right, for the most recent resistance area in the consolidating channel to break like that. And this would be your entry point and catch this move higher. And you usually target the same length as your flagpole once the price is broken out of this channel. Likewise, for various channels, when the move is lower and you have some, some sort of price consolidation in this bullish channel, but a bearish flat. You can expect the price to break lower to the downside and he wait for price to exit. The most recent support area, we catch the trait level. So that is foolish and various flags. And then our loss chart pattern is quote, I triangle chart that and I'm just going to switch to them for our timeframe via. As you can see, this is a triangle chart pattern. It contains I, increasing trend line and the decreasing and increasing trade line as support and a decreasing trend line as resistance and price just consolidates in this triangle, and it gets smaller and smaller and smaller. And momentum buildup occurs. And price can either break out of the top and continue AIA or it can break out of the bottom and continue lava. So also the painting way price breaks are of this triangle can act as a trend continuation pattern or trend reversal pattern. And in this case, price broke are off the bottom of the triangle and an aggressive move lower happened of the momentum buildup. So there is just some of the important and most commonly use job patterns to be aware of in the Forex markets and how to try the specific patents. So keep an eye out for each of these patents. They are really reliable and really the very, I went right to try them. And when this job patents or broken, that would be your indication to enter the specific tribe. So that concludes this video of the chalk patterns and our catchy guys in the next video, thanks for watching. 9. Analyzing Candlestick Patterns: As a four extra, it is your job to correctly determine the direction that price is likely to get to in the near future. And to do just that for extra lettuce, make use of a variety of different technical analysis tools, of which one of the most important technical tools is the ability to correctly analyze candlestick patents. Now in the market, there is a continuous battle going on between the Bulls and the base. The bulls being the bias and the base being the salaries. With the bias trying to push the price as high as possible and the silos trying to take the price as low as possible. And this continuous battle between the Bulls and the base is visually displayed through candle sticks. Now, as I mentioned in an earlier video, each candlestick tells its own unique story. Each candlestick has an opening price, closing price low and high, and making use of an array of candlestick, candle sticks or candlestick patents in the market. He hopes for extra ideas to determine the most likely direction of price in the near future. And in this video, I'm going to show you guys some of the important candlestick patents to consider in trading. Now, the first candlestick pattern to be aware of is the boorish engulfing Patton OVS lift. And this is formed when I bearish candlestick. There's red candlestick fully engulfs the previous candlestick. And there's previous candlestick can be either green or a rate candlestick, it can be either barriers or bullish candlestick. The important thing is just that the second candlestick over here fully engulfs the first scandals stick. As you can see, the high of the scandals stick is higher than the previous candlestick and the low is lower than the previous candlestick via. So this rate candlestick fully covers or engulfs that previous candlestick. And this, when this pattern appears in the market, it is likely that price will continue lower or decrease. And just like the barriers engulfing candle days also I bullish engulfing candle way. The reverse is true way the second candle, the bigger candle, is always the bullish scandal. And the first scandal can be either red or green candle. The important thing is just that the green candle Laguna scandal fully engulfs the first candle like that. And this candlestick pattern usually follows with upward move lot. That's another dude candlestick pattern to look out for is a shooting star. Candlestick 0V. And this, this candlestick tells a story of how the bools tried to increase price higher. And when it reached a certain point, the base just to complete control and push the price lower. And the price closed over here much lower. And what you can expect from shooting star candle sticks, or usually a move to the downside 11 move due to the shift between the Bulls? Yeah, the Bulls were in control. And a shooting star is a shift off momentum from the bools two the base usually. And the same is true with hammock candlestick pattern. We m is also weigh the bass try to tie control. But at the end of the candlestick, the bools won the battle and the candlestick closed or via. So a hammer is again a reversal of a change of ends between the base and the Bulls. So the AMA candlestick usually signals and move to the upside. Now another good and mode more recognizable candlestick pattern is to visit tops. And this is our tweezer talks loops. They give both of the weeks or to the upside, meaning that the Bulls tried to push prices up not once, but twice, and filed on both occasions. And the momentum change hands from Boole's two base. So this is also, this follows usually a move to the lower side. So of the better-off experience in the market, you will start to recognize these candlestick patents. And remember that each candlestick pattern and Candle Stick on its own tells its own unique story of way price is likely to hate to in the near future. So let me just jump into some live examples and I'll show you guys how price reacted when certain candlestick patterns appeared in the market. So yes, some examples of the candlestick patterns that I showed you on the previous slide. Left the most obvious, starting on the lift shooting stock pattern that formed via, As you can see, the booths tried to push the price higher, but at the end of file two and price may then move off to the formation of this shooting star candle via the next candlestick pectin that formed, we asked the hammock candlestick. I'm gonna zoom in a bit so that you guys can see a bit more clearly. And dam at Candlestick is the scandals stick. And as you can see, the base tried to push the price lower, but at the, in, the Bulls won the specific battle. And as you can see, price just continued. And I, after the formation of them. And just next to them, you'll also see I bullish engulfing candle or via. As you can see, this is the bullish engulfing candle with the body of the second candle fully engulfs the previous scandal. And it's just important to note the way the body's clouds. These weeks of less importance. As you can see, there aren't fully engulfed, but that's the main thing to look out for each ray, the bodies of the second candlestick closes and this Fourier engulfs the previous candle. And as you can see, a move higher takes place from the side there is the bullish engulfing candle. Another candlestick pattern over here is the berries engulfing candle that is formed over here. As you can see, the second candle fully engulfs the first candle over here. And at lower move follows after this bearish in Kaupthing candle. As you can see, it's a shift in momentum from the bools. And after this candlestick pattern appears, the base have control in the market. Moving onto another candlestick pattern. This one over here is another bullish engulfing candle. It's a bit more clear to see. It just fully engulfs the previous candlestick. And this is a really aggressive candlestick. And you can expect IN move the upside. One more candlestick pattern to take note of is the hanging man cannot stick and it's just like a hammer, but it's usually instead we're Hammer is a continuation pattern. I, hanging man signals price reduction or a decrease in price over the next few candles. So those are some of the candlestick patents that I wanted to show you guys in the market. And it is important to note too, not only try the scandals sticks on their own when they appear into more in the market. Because as you can see over here, is a boorish engulfing candle. And what you can, logically rough expected was that price. We would have made the move higher. Body guaranteed continued lower side. It's important to not only try the candlestick patents on their own part, to try them in conjunction with other technical analysis tools like support and resistance areas or chart patterns like the triangle, the wage with a British flag. And just to give you guys an example of where, I mean, it's a really good support area in the market. And you can expect some reaction from price. And with this formation of the hammer candlestick and the pollution golfing candlestick, together with the support area of a move, I appeared not once but twice. So it's important to use these candlestick patents in conjunction with other technical tools to get the most accurate trading entries as possible. So that concludes the candlestick patents, and I'll see you guys in the next video. 10. Fibonacci Levels: In this video, we are going to be discussing Fibonacci levels in the Forex markets. Now before we dive into Fibonacci levels and how to draw these levels on the Forex jots i for i share with you guys some background into Fibonacci. Now, Fibonacci is in this type of pasta that you can buy. He was actually a really famous Italian mathematician back in the day that came up with a certain mathematical sequence of numbers or Fibonacci. Fibonacci numbers that goes like this. We, each number in the series is the sum of the previous two numbers. For example, starting with 01 in the series of numbers, the third number being one, is then equal to the current number or the second number in the series plus the preceding number, or the first number in the series. Just like the fourth number being equal to two in the series then becomes the second number one plus the number also one. And you can repeat this process until infinity. So it's just important to remember that each number in the series is the sum of the previous two numbers. Now after the first few numbers in the Series, a ratio of 0.06 one I-it was found when you divide any number in the sequence by the succeeding number. For example, when you divide 55 by 89, you gave 0.06, 18. Likewise, when you divide 21 by 34, you get the same ratio. And it was also found that after the first few numbers, that current number in the sequence is always 1.618 bigger than the preceding number. And for example, the 34 is 1 Sichuan items beginning to anyone just as 55 is 1.618 times bigger than 34. And this 1.618 is also the inverse of the 0.618 ratio. Now this 1.618 is known as the golden ratio of Fibonacci. And this golden ratio actually appears all throughout Asia. And you can find this ratio in shells, in tree branches, and even in the human body. Now, we are going to translate this Fibonacci levels and the golden ratio into the forex markets. And the aim of Fibonacci, the transmit levels, is to find hidden support and resistance levels in the market that can act as buying or selling areas to enter tried in the trending market direction. So when you draw your Fibonacci levels in the market, all of these different Fibonacci levels can act as either support or resistance levels. For price too. Possibly react to and then either continuing the trading market direction or make a market reversal. Now these Tribonacci Leos are best used in conjunction with other technical analysis tools, like the support and resistance areas, streamlines, channels, or even jot and candlestick patents. It just makes these levels a lot more reliable when you use them with other technical tools. And the Fibonacci levels are also used by for extra days to determine where to place a stop loss and take profit areas in the market. And we'll get into what this means light on in the schools. And these areas, or the two potentially exit the trade before price thoughts to move against them. And are the three most important Fibonacci levels used by for extra writers. Or the 38.2% level, the 50% and the 61.8% levels. Now, how you go about drawing Fibonacci levels is you can either draw them on up, Jane's on down trends in the market. And, and for AP drains, you click and drag the Fibonacci two from the string low to the swing of the move. And what I mean by the Swing Low is if you take a look at three candle sticks and I'm just going to visually draw them for you. Free candle sticks and a write-off candle sticks like this. The swing low of these three girls sticks is way the middle candlestick. Mike, I lower, lower than the candlestick to its left and the candlestick to reach right. Remember I said that each candlestick has a low or high and open and close. Likewise, for swing high points in the market, it is with the middle candlestick. High point is higher than with this high level is higher than the candlestick to its left, as well as the candlestick to its right. So this is the swing I, and this is Swing Low. Now in this example, the Swing Low candlestick is over a year and it's low point is lower than the candlestick to its left and the candle sticks to its right. So likewise, the swing I can refine over a year and it's high point is higher than the candlestick to its left and a candlestick to its white. So just think of it as a peak and valley. So for op trains, you click and drag a Fibonacci two from the Swing low up to the string I. And you will find that all of these different levels of automatically given to you guys on the chart. And starting from the Swing Low, you begin with a one or 100% and the swing hiding becomes 0. And, and all of these Fibonacci levels can act as support areas for price to move to. Now the way that the market works is it has two different types of waves. And bow for updates and Fudan trains. And for our trains. The impulse wave is the wave to the upside, and that's the grace of waves that gives you guys indication of the trained direction. Then often impulse wave, they usually follows the placement or corrected wave, and then another impulse wave. So the idea is to enter by trade if price starts to stall at one of the Fibonacci replacement levels and in for price to continue moving higher. So the idea behind Fibonacci's for price to stall anywhere on this Fibonacci wave of E. And as you can see, Price told over here at 38.2% Fibonacci levels and in price continued moving higher. So that concludes our upgrades, Dane, Dane for down trains. You click and drag the Fibonacci two from the string hi to the Swing Low. And the string hi can be found over here because the high point is higher than the one to the left and one to the right with the low string. After string via it is lower than the one to the left and one to write sulfur down change, you, drag it from the string. I do the Swing Low. And the different Fibonacci levels automatically drawn. And with 100% or one level is at the string i, and you work all the way down to 0. So just locked for obtains, you also have your impulsive wave for downrange, which is downward, then you have you retrenchment or corrected wife followed by another impulse of life. And the idea is to enter the cell trait. If price thoughts, you stall at one of the Fibonacci retries and levels. And then for price to continue moving lower. And as you can see, Bryce started to stall at 78.6% Fibonacci replacement level and it continued moving lower. So that is the background beyond Fibonacci levels. And I'm gonna show you guys live market examples of how to draw these Fibonacci levels for up chains and down trends. So yeah, we have or live chart, and this is of the euro USD on a four hour timeframe. And as you can see, I indicated a stream low and the swing high of this impulse of wave. And we are going to draw or Fibonacci levels for this option. And to draw the Fibonacci levels, just go to this left hand toolbar and you choose the Fibonacci replacement option. And for updates, you drag your, drag your two from the Swing Low. All the way to the swing like this. And Lacan said, you, you want price to start stalling at any one of these Fibonacci levels on the retries meant wife, which is this wave. And as you can see, price struggled to break past this 50% Fibonacci level, and it continued to move higher in this upwind direction. Now, this is the default template of the Fibonacci two. This is how you will find it on trading view. And I'm not a big fan of how this looks. It's a bit too. I'm cluttered For me, it's a bit too bright and it's a bit of a distraction to do determine the price action. So what I did is to edit this. You just double-click on it. And I made my very own template that I use. And this is the one I use. And I think you'll agree that this just looks a lot more cleaner, lot easier to try it. And as you can see, Bryce told the 50% level continued AIA a 1000% percent. So if you want to use the same Fibonacci levels as me and the same the same layout as I do that. Then just pause your video here and you can edit your own fibonacci tools and these different variables. And then you can try it along with me and use the same setup. So that is the Fibonacci tool that I use. So this is the example for an upgrade. Now, an example for a downtrend showing you guys the string and swing level again is you drag to Fibonacci tool from the swing. I do the swing over the and as you can see, they just expanded the bed. As you can see, price stalled at 61.8% Fibonacci level on this retries and wife. And he turned around and continued lower impulse of wave following the preceding impulsive wife. So this is how we draw the Fibonacci 24 down trains. And just to give you guys some two more examples, I'm going to jump on the Australian dollar, Japanese yen shot. And as you can see indicating the swing IN Zwingli levels again for you guys just to simplify it a bit. Drawing the Fibonacci two from the swing high all the way to the swing low point over there. And you'll see that price reacted at this 61.8% Fibonacci levels on this retries when Dr and he just continued lava. And you'll probably see that I added this minus 27% level and minus 61% level as well. And both of them can act as potential target areas for price to move to. And to give you guys a conservative target price, I usually use the negative 27% area. So as you can see, price reach this area and this would have been a successful tried to type. Now, there is another example for downtrend. And let's look at this upturned move. Again, the string hello and the string I mean shown. So for the option, you just click and drag from the Swing Low toString I over there. And as you can see, again, price reacted at this 48.2% Fibonacci level moved AIA and reached our target of minus 27%. So that is how simple and easy Fibonacci levels or to use. And just remember, if you see this move, if you see this retrenchment and then just immediately intertribal when price reaches the ferry, I present all the 50 price scan. If the price breaks the Fourier parseInt, it hits the 50. If it breaks the 50, it can 1861 and even receiving the IPO St. And it only becomes invalid when it reaches this 100% move with the 1% level. So they tried becomes invalid. But any way, any way before this 100% level, it's a good, good place to enter a long or short setup that painting on the specific drained. So that sums up Fibonacci levels in the Forex trading markets. And as you can see, these are all hidden support levels that is defined by the naked eye and fall down drains. You have your resistance areas, good areas to enter cells and these will be good eras to enter bys. So that's it for Fibonacci levels. And it's a really powerful technical analysis to have training to keep. And big eyes learn some thing about the Fibonacci levels and we'll catch you guys in the next video. Bye-bye. 11. Using Moving Averages: In a previous lecture, we discussed how to determine market direction. I shaded are still ways that you can determine whether the market is on an upstream or downstream. With the first being with the market makes a higher, high, and higher low-flow and obtain and for downstream with the market makes a lower high and a low level. Now the second way was to use moving averages. And in this lecture I'm going to expand a bit on what is, what moving averages and how to use them in the Forex markets. Now moving averages or smoothed out representation of price action. And it's used to determine market direction or the trained within a market is in upswing over John trained. And take for example, this obtained via, and as you remember them off the market moves in way, usually moves in waves like this, impulsive and corrective waves. And moving averages are just used to give smoothed out representation of this price action. Because it's a lot easier to determine the trained direction by simply looking at this straight line thing, to look at this wave of Brice. And both of these indicate, anyway, the same thing that the market is in upward trend. So how moving averages or calculated is by taking the average closing price of consecutive candle sticks for certain period of time. Now, for example, let's draw five Gamow sticks. And this is just a rough drawing guys. Each candlestick has a different closing price. And we just take the sum of the five nano sticks divided by the total, in this case five. And that gives us the average closing price of this move. So let's just say, for example, the average closing price was over here. So by by using the, by determining the average closing price of a certain of consecutive candle sticks for certain time period, you can determine the moving averages. And good thing to remember is that the bigger the moving average, the flat and smooth at the line becomes. And the slow way is to react with price action. And what I mean by began moving averages is instead of using the five consecutive scandals that are discussed, we now use 50 consecutive candles or 100 consecutive candles or two on it, or even 200 consecutive candles. And the more candles you use, the flat and the smoother the line becomes an, the slow way is to react to any quick price movements. And as you can see over here in this picture, the red line is the smallest moving average, and it follows a bit bigger moving average. More bigger. And in the blue line is the biggest moving average. So as you can see, the blue line is the smoothest line for the smooth, smooth as moving average of all of these moving averages. And all of these moving averages indicate and obtain. Now the two types of moving averages that you can use in the Forex Market. And the first is the simple moving average, and the second is a exponential moving average. And the main difference between these two, how the moving averages are calculated. And without getting too technical into this, the trading software that you use to automatically determines the different moving averages. So you don't have to worry about the maths behind this. But just know that simple moving averages creates a smooth line, but reacts slowly to price action, therefore, is beta for longer timeframes, way exponential moving averages creates a more accurate representation of price action and can indicate false moves in the market, therefore is pitiful, shorter timeframes. So to summarize, we use exponential moving averages for shorter timeframes, do and to determine quicker price reactions. And we use simple moving averages for bigger timeframes. So scalpers, anti traders, prefer to use exponential moving averages. We swim traders and position traders usually stick with the simple moving averages because they indicate bigger timeframe. Now, I go about using moving averages is you can use moving averages to determine the current train direction in the market, like we discussed in an earlier video. And you can also use moving averages to determine when to enter and exit specific trade in the market. Now, moving averages are used to indicate the trained direction. And for up chains, you can see that smaller moving averages, or always bigger, always above the bigger moving averages. So you first get the nine Moving Average in the 2150 and it gets bigger from the, as you can see over here, we have the nine Moving Average at the top, then the 21, then the 100 moving average. And in the 200 and moving averages. All of them indicating we are in an output move. So we need goes from small to big. We are on an object. Likewise, for down trains this morning, the smaller moving averages or below the bigger moving averages. And so you'll find the nine at the bottom in the 21. And then you began moving averages like the 5100 or 200. So when it goes from big to small, it's on a clear downtrend. And moving average crossovers can also signal a change in trend direction and can indicate when you should enter or exit at tried. Now, as you can see, this is a crossover between the one hundred and two hundred moving average. And this move of year is a done a downtrend move because it is slipping from the 200 to 3212, the nine. So according to these rules, the smaller moving averages all we allow the moving below the bigger moving average. So this specific area, we are on a downtrend and as you can see, the moving averages cross over each other 0V. And we enter into an obtained via officially over here when the crossover between a hundred and two hundred happens. So the moving averages or on top of each other and ranging from big to small. So according to this definition, we are on a train. So this is just how moving averages crossover and usually at these cross over points are via this. This is usually good indications where you can probably buy the market when the market crosses over from a downtrend into an upturned, that can be a good indication to either enter bitrate or exit currency outright that you're in. So let me show you guys how to draw these moving averages and how to use them in the live markets. So we aren't trading view again on the euro-USD timeframe. And to enter the different moving averages, we just go to this Indicators and strategy oxygen over here. And you just type in moving average. And we are going to be drawing the 921, one hundred, two hundred moving averages. Now flock assayed for the smaller moving averages we are going to be using the exponential moving averages and info, or largest moving average, we are going to be using a simple moving average. So just click on the moving average exponential. And to edit that, you double-click on it inputs, you can see the length is nine. And you go to stall, you can style it any way you like. And that is the first moving average to have on your chart to into another one, we just simply type in moving averages again. Click on the moving average again. And as you'll see, the, it's automatically drawn to nine. So we just type into anyone over the Chinese the color but to a blue and a nine, we have a 21 inch or 100 exponential moving average. As you can see, the default is always safe to nine in the sky. So just click on this nine and we're going to set it to a 100 to 100, meaning 100 consecutive candles backwards. We're going to stick to orange just to make it thicker color, the bigger the moving averages becomes. See this change scholars, let's just make it great again. So now we have our nine, or 21 and or 100 exponential moving average. And lastly, LH just add 200 simple moving average. And again, as you can see, this is the simple moving average. And just look out differently is to the exponential moving average. Via the exponential moving average is a better, more reliable to indicate the recent price movements. And it's just like this, nine or 200 simple moving average. Again, I'm gonna make a, let's just make it black and the thick black line. And I'm going to zoom out a bit. So years or the front moving averages guys, ranging from the nine exponential, do the 21 exponential, the 100 exponential, and the 200 simple moving averages. And as you can see, we start from small and we go larger and larger. So this is a clear and very strong Up Train. And usually the further apart the moving averages are from each other, the stronger the train becomes. So when we change timeframe, so example from far to daily or moving averages automatically changes as well. Let's go to weekly. And as you can see, the moving averages changes because the equation that they are calculated or change now that based on the specific timeframe that we are looking at, the one hour time frame. And it also indicates that beyond obtained. So that's it for moving averages. And there's all, these are also powerful tools that you can use. And moving averages can also react as support or resistance areas in the market. As you can see over here, this nine Moving Average acted as a support line for price. And you can see price just bounces up and down this moving averages. So that's it for now for moving averages. And I'll see you guys in the next video. 12. Popular Chart Indicators: In this lecture, we will be taking a look at some of the most popular chart indicators used by forex traders when they are performing the technical analysis on a specific chart. Now, indicator's assist try this with a directional bias and provides confluence to try this trading plans now indicates also provide additional information on a chart for traders to analyze the market direction. And indicators should be used in conjunction with the overall trend of the market. So for upturns, you can make use of certain chart indicators to assist you with rights to the upside. Likewise, for down twins, there's also certain jot indicators that will add confluence deal trading idea four moves to the downside. Now, in this, in this lecture, we will be taking a look at some of the most popular chart indicators. And they are the RSSI, or the relative strength index, the stochastic indicator, the Mac D, or the moving average convergence divergence indicate the Bollinger bands, as well as moving averages that we discussed in more detail in a previous lecture. And to be showing you guys how to draw these indicators on the market and are to try them, I'm going to jump into the live market and show you guys how to analyze and draw them on new life charts will be using the euro-USD chart in this lecture. And to draw first chart indicates the RSI. You go to this function over here called the indicators and strategies on your trading view. And you just type in RSI, the relative strength index. And it automatically, as it shot like this. And you can expand it a bit, you can play around with it. And how this RSI, OR relative strength index works is it helps us to evaluate the strength of the current market conditions. And it is used to identify overboard and oversold conditions in the market. Now as you can see, the RSI gives you this different prices, right? And this dotted line or via the topple, that top line indicates the 70 price mark and the lower line indicates the price level of the RSI indicator. Now, when the RSI gives a reading of 30 or lower, for example, when this purple line is trading at 30 or lower, it can indicate an oversold market, which can lead to possible price increases to the upside. And then likewise, for Readings of 70, as you can see over here, when the price is trading at 70 or higher level, it can give an indication of overboard market conditions which can lead to a possible price decrease and move to the downside that happened. The so that is our first major chart indicator known as the RSI. So let me just remove it, moving on to our second indicator. Similarly, you just type in the stochastic indicate and it immediately pops up over the day. And just like the RSI, it automatically visualized on the chart over here. And our stochastic indicator works is, it's another useful technical indicated at the straightest determined possible trained reversals in the market and is used to measure the momentum of price action in the market. Just visualize for moment any object that you throw up a now before the object can then lower, it can turn lower and here down with, it must fit, slow down, and change in momentum must take place at the top. And this change in momentum can signal a possible trained reversal in the market. And just like the RSI indicator for stochastic, indicate also identifies overboard and oversold conditions in the market. And the stochastic indicate them makes use of the IT price range for the top line and the 20 level for the bottom dotted line. Now, when the stochastic lines like this or above the IT, reading on the stochastic, it means that the market is over bought. Likewise, when the stochastic lines of below the 20 Price area of the stochastic jot pattern, then it can indicate an oversold market conditions. And the overboard and oversold conditions usually can indicate a trend reversal for the market. So that concludes of stochastic Indicator. Next, we will be taking a look at the Mac DEA chart indicator and it's over a year. And it also just automatically calculates the different levels and visualizes itself on the chart. Now, the mac, the otherwise known as the moving average convergence divergence indicator, is to use a tool that makes use of different moving averages to determine and indicate a possible trained by a trend reversal in the market. Now, how you go about using this Mac D is when the Moving averages crosses over below the histogram like this, for example. Then it's likely to indicate the start of a possible upturned move to the, to the upside. Sharing or via. So the Mac teach crossing over below the histogram, the histogram over here. And it's can possibly signal and trim to the upside. Likewise, when the mat di lines are crossing below each other, above this histogram, then it can possibly indicate a move. Downside would start off down to in-flight test that happened via. So. To end off this lecture, I'm going to draw or lost shot indicate otherwise known as the Bollinger bands. And as you can see that these are the Bollinger bands, each visualised in the chart. Now, Bollinger bands or used to measure market volatility and identifies overboard or oversold conditions in the market. And you probably noticed of the, now that all of these short indicators roughly indicates our boat or oversold conditions in the market. And these conditions are used together with other chart patterns like support and resistance areas, train lines and triangles or wages to create a trading plan and execute your trials with a high degree of accuracy. Now, when volatility is low in the market, the bands of clouds dedicated, the Bollinger bands are close together, as you can see, they are relatively close over here. This is also, the market is also consolidating a better via. And then when volatility picks up and increases in the market, the bands expand like it does here, as you can see. Now, we moved from a consolidated market to an up trend market in an aggressive way and the Bollinger Bands expand like that. So this is a volatility indicates that is used by traders to determine the specific market direction. And these bands automatically adjust to changing market conditions. So it's automatically adjusts and changes as price action changes in the market. Now, Bollinger, Bollinger bands also act as dynamic support and resistance levels in the market. For example, this lower band can act as support for price to bounce. Likewise, this upper band can act as a resistance for price to bounce off and move higher or lower depending on the train. Now, price change to return to the middle of the bands when it bounces off of one of the support or resistance bands. And as you can see, the system middle band, that is June. And together with the upper Bollinger band and the lower Bollinger Band. And when price bounces of either one of these support or resistance bands like this, it tends to pay it back to the middle band. Like you can see, the pulses which back balances at the supports its back. So that is Bollinger bands in a nutshell. And that is the most popular chart indicators that is used by forex traders in the market. 13. Key Psychological Levels in Forex: Another useful technical analysis too for you guys to have available in your trading to get on your way to mastering the art of forex trading is to know all about the key psychological levels in forex. Now, this archaeological levels or certain price levels in the market that are likely to draw a big market attention from, from central banks and financial institutions. So when this specific price levels are reached, it is likely to have some sort of movement at these levels. And key psychological levels that you'll find in the markets include weekly, monthly, yearly, highs and lows. All time highs and lows, meaning that the entire time of the existing currency pay the highest and the lowest it's ever been. Also keys archaeological levels, way financial institutions are likely to push price to in the future. And another key psychological level to look out for all rounded numbers, nice and rounded numbers in the market is in easy numbers like one or 1.20.60.95, something like that. It's easy for financial institutions and central banks to use these big numbers that aren't one I struggle with numbers like 0.89573 side. They tend to target these nice and round numbers for quarterly or yearly financial goals. Now, these archaeological levels tend to yield the reaction by price when they tasted. And this is due to the fact that the big financial institutions and a lot of retail try this, place, the triads at these psychological labels and back and say these levels are used for its simplicity as stop and take profit levels and adds confluence to your trading plan. Meaning these are very important target areas for a lot of forex traders and institutions are the. So it's likely for price to taste these psychological levels. And some important rounded numbers in the market is as follows. For the dollar Sheffield, it's one nice and round one year is the 1.1 is very important. The Australian dollar, US dollar is 0.7. and gold, it's 102,300, usually 50 to a $100 increments for gold. And it just recently reached the $200 thousand mouth down and it's the eyes that's gold ever been. So immediately when gold reached the $2 thousand Region. It created a lot of volatility in the market. So there was a lot of orders at that specific rounded number in the market. So let me jump into a live example of how to look out for the psychological levels and how print out price tends to react when they reach these levels. To show you guys the cycle, the psychological levels I'm using the urea is teach shot and I'm gonna use a daily timeframe together with one year time period. And I'm going to focus on mostly the rounded numbers and the psychological effect that it has on price on this specific area is the chart. Now a rounded number on this euro-USD chart would be, I would say it would be 1.08. And let's just visualize that. I'm going to draw a horizontal line at 1.08. And you can even praise in any coordinate value that you want on here for trading view. And as you can see, at 1.00 I, that's one of the psychological levels. And immediately you can see that price bounds that this level once, twice, three times, and recently four times. So this is a very good psychological level that you can implement an add, you can add your trading to Kate and be aware of for when future, when price reaches this level in the future again, now another really good psychological level would be the 1.1 mark. And I'm going to add another via another horizontal line or via edited 1.1. And as you can see, look out, good price reacted at this level in the past as well. And then more recently, this was resistance for year is the support area. And then it broke through and continue the AIA. So that's another good rounded numbers psychological level to have. So without boring you to death, I'm just going to quickly add some more important levels and I'll catch you guys in a sick. All right, so here is some of the major psychological levels on the Euro, USD. And as you can see, there's quite a few of them. And the area is this really nice for experts to try it? And it really pains to buy these psychological levels really well. So as you can see over here, this height of the year, this low point of the year, together with this rounded number, is also a good psychological area and you can see price reacted at this level and made him move higher. Then I also added the 1.1 to area via way. Price taster it via the day again, some few spikes up. And then recently it acted as a support for this move higher. The 1.14 was also a good psychological level of day over day. Small bounds came from here. So as you can see, it was also tasted of the day. And then the 1.17 was pasted via price, broke through GYN back, tasted it, and continued on up to 1.19 more recently. And as you can see, I'm just going to zoom in a bit on the spear and just look at all these spikes that scurrying to the 1.19 price level. And this is usually called liquidity spikes. And this is where a lot of financial institutions place, sell or buy orders. And usually they push the price up into this psychological level with the orders. And immediately when price heats this level, it immediately as a reaction. And usually it can either Which surprise logo or push the price I aggressively. And as you can see over here, look at this bearish rejection candle when it touched the 1.1. nine psychological level. So that is the power of psychological levels. Now I added this purple psychological rounded number of 1.16 as well. And on a daily time frame, it might not look like price reacted at this level. But if we zoom in a bit, I'm just going to draw a quick rectangle at this area. So if we zoom in a bit on the one hour time frame to this area, let's see if price reacted to this psychological level. And let me just delete this again. And as you can see, price going up to this level had immediate rejection, taste to let again, immediate rejection again and broke through. And it acted as a support for this move up higher. So it might not look like either had an effect on the daily timeframe. But if you zoom out to a smaller time frame, then you can see that all of these levels are likely to have some sort of effect on price in the market. So that concludes of psychological levels. And as I said, the urea is this really good pay to try these levels. And they also appear throughout the forex markets on all major currencies and all equity-based. So keep an eye out for them and you can make some serious money if you know how to add the psychological levels in conjunction with other tools that you have in your toolkit. So that's it for this video and I'll see you guys in the next one. 14. Class Project: So for this clause project, I'll provide you with this multiple choice quiz that you can use to test your knowledge on the different technical analysis tools carpet throughout this gloss. So you can have a look at different questions and you can share on says gloss discussion. And I will let you know whether you are correct or not. Also, please feel free to provide me with some feedback regarding how you found this gloss. And really you'd like some additional multiple-choice questions for the gloss project. I'm happy to provide them to you. So I really hope you found this gloss enjoyable and insightful. And if you want to broaden your knowledge of the Forex world a bit more, you can have a look at my other clauses, as well as keep an eye out for any additional clauses provided by me.