After 10 Years Trading These Are The 6 Major Must Learn Concepts I Wish Someone Taught Me - Lesson 1

Summary

In this video, the trader discusses six crucial technical analysis concepts that every new trader should master to make accurate, precise trading decisions. The focus is on 'sweeps on significant levels' — identifying key support and resistance levels and using them to time entries and exits. The trader explains how to combine directional bias with these significant levels, identifying when a market pullback or consolidation might occur. Through real-time examples, viewers learn how to spot profitable entry points and profit targets, using other factors like Divergence and open interest. This is part one of a six-part series aimed at improving trading analysis skills.

Takeaways

• 😀 Significant levels in technical analysis refer to key points where the largest pullbacks or pauses occurred in a trend, marking potential areas of interest for entries or profit-taking.
• 😀 A directional bias (uptrend or downtrend) is crucial when analyzing significant levels to determine whether a sweep of a low signals an entry or a sweep of a high signals a potential profit-taking point or pullback.
• 😀 In an uptrend, sweeps of significant lows are seen as potential entry points, whereas sweeps of significant highs are viewed as profit-taking opportunities or points where a pullback may occur.
• 😀 Combining directional bias with other factors such as divergence, funding rates, spot premium, and open interest is essential for making highly accurate and precise trading decisions.
• 😀 The speaker emphasizes using real-time trade examples rather than hindsight analysis to showcase the effectiveness of this strategy.
• 😀 Significant highs from previous downtrends serve as key levels to look for potential profit-taking, while significant lows can indicate entry points in an uptrend.
• 😀 Using a combination of factors (like regular and hidden divergence, funding rates, and open interest) helps confirm potential trade setups when significant levels are swept.
• 😀 When the price reaches a significant high, expect a pullback or pause in the trend, and this can be a key area to exit or take profits from trades.
• 😀 In the context of a downtrend, the analysis is reversed: sweeps of significant highs become potential entry points, and sweeps of significant lows are considered profit-taking levels or points for a potential reversal.
• 😀 The video is part of a six-part series covering various technical analysis concepts, with each lesson building upon the last to help traders make informed and precise decisions.

Q & A

What is the main purpose of the video series mentioned in the transcript?

The purpose of the six-part video series is to teach new traders the six most important technical analysis concepts that the speaker uses to make accurate and precise trading decisions.

What are the six technical analysis concepts that will be covered in the series?

The six concepts are: 1) sweeps on significant levels, 2) hidden divergence, 3) regular divergence, 4) directional bias, 5) momentum and funding/spot premium, and 6) open interest.

What does the speaker mean by 'significant levels' in technical analysis?

Significant levels are price points where a trend experienced the largest pullback or pause, such as a major high or low during an uptrend or downtrend.

How does directional bias influence trading decisions based on significant levels?

When the directional bias is to the upside, traders look for sweeps on significant lows as potential entry points and sweeps on highs as profit targets or areas to expect pullbacks. In a downtrend, the logic is reversed.

What is the concept of a 'sweep' on a significant level?

A sweep occurs when price briefly breaks a previous significant high or low, often triggering stop losses, before reversing in the opposite direction. This movement can signal a good entry or exit point depending on the trend bias.

Why does the speaker emphasize combining multiple factors in analysis?

Because relying on a single indicator or concept can lead to false signals, the speaker combines factors like divergence, funding rates, and open interest with significant level sweeps to increase accuracy and confidence in trade decisions.

How does the speaker suggest identifying directional bias?

Directional bias can be determined by broader trend analysis, such as observing if price is trading above or below key moving averages like the 200 EMA, along with other contextual signals.

What is the typical trader response when a significant low is swept during an uptrend?

When a significant low is swept during an uptrend, traders look for potential long entries, often supported by confirming signals such as bullish divergence, negative funding rates, or open interest flushes.

What does the speaker advise traders to do when price hits a significant high in an uptrend?

Traders should treat it as a potential profit-taking area and be prepared for a pause or pullback, rather than opening new long positions or shorting prematurely.

Why does the speaker use real-time examples instead of historical ones?

The speaker uses real-time trade examples to demonstrate that accurate technical analysis can be performed live, not just in hindsight, proving the practical effectiveness of the discussed concepts.

How does the speaker plan to expand on the topic of sweeps in future videos?

Future videos will explain how sweeps on significant levels interact with other factors like divergences, momentum, and open interest to form a comprehensive trading strategy.

What is the speaker’s stance on shorting during an uptrend?

The speaker advises against shorting during an uptrend, emphasizing that sweeps on highs should be seen as profit-taking opportunities or warning signs for a pullback, not as short entry points.