Trading Course Day 9: Identify Reversals

Summary

In this video, the creator teaches how to identify trend reversals, sharing their personal strategy and mindset behind a $200,000 profit in a single day. They explain how to spot key levels in the market, recognize bullish momentum, and use the New York session volume to make informed trading decisions. The creator emphasizes the importance of understanding price structure, waiting for correct setups, and targeting swing highs for profitable trades. They simplify the process, advocating for a straightforward, effective approach without unnecessary complexities.

Takeaways

• 😀 Understand the importance of identifying trend reversals in trading to capitalize on price movements.
• 📉 Price trends are often interrupted by corrections, and these corrections offer opportunities to enter new trades.
• 💡 The key to identifying trend reversals is recognizing the breaking of lower highs in downtrends or higher lows in uptrends.
• ⏱️ Timeframes like the 1-hour and 15-minute charts provide clarity for entry points and overall market sentiment.
• 📊 New York session volume is critical in driving price action and confirming bullish or bearish trends.
• 💰 The strategy focuses on making large profits from trend reversals rather than frequent trades throughout the day.
• 🔄 Always be open-minded about the market’s direction once a structural change happens, such as a break of lower highs in a downtrend.
• 🎯 Set realistic targets (soft TP) when entering trades, aiming for swing highs on higher timeframes like the 1-hour chart.
• 📈 Consistent trends generally move in one direction throughout a session, so timing your entry with momentum is essential for success.
• 🧠 Trading should focus on simplicity and understanding the market structure rather than using complicated strategies or indicators.
• 💬 Joining a trading community like a Telegram group can help you stay updated on setups and share experiences with other traders.

Q & A

What is the main strategy discussed in this video?

The main strategy discussed is identifying trend reversals by analyzing price action, market structure, and timing entries with the help of volume during the New York session.

How did you make over $200,000 in one day with this strategy?

By using this strategy to trade gold, specifically identifying a bullish reversal after a market correction, and entering the trade with precise timing and confirmation from the New York session's volume.

What does a trend reversal look like in terms of market structure?

A trend reversal can be identified when the price breaks a key level of lower highs or higher lows. This indicates that the current trend might be ending and a new trend could be starting.

Why is the New York session important for your trading strategy?

The New York session is key because it brings high volume into the market, which often causes significant price movements. This volume helps confirm the strength of a trend and provides better entry opportunities.

What role does the 1-hour time frame play in your strategy?

The 1-hour time frame is used to identify overall market direction and key support/resistance levels. It helps provide the larger context of the market’s movement before zooming in to shorter time frames for precise entries.

How do you decide when to enter a trade after identifying a trend reversal?

After identifying a trend reversal, the entry is made when price confirms the trend with rejections or corrections at key support or resistance levels, especially when volume from the New York session supports the move.

What is the significance of 'soft take profits' (TPs) in your strategy?

Soft TPs are important because they allow for partial profit-taking before price hits key resistance levels. Setting hard TPs can result in being stopped out prematurely due to price showing temporary resistance.

What should traders do if they miss the initial breakout entry?

If a trader misses the initial breakout, they should wait for a pullback or a retest of key levels to enter the trade. This provides a second chance to join the trend with less risk.

How do you use the 15-minute and 5-minute time frames for confirming entries?

The 15-minute time frame helps confirm the broader trend and key support/resistance levels, while the 5-minute chart is used for precise entries. Watching for rejections and price movements on these shorter time frames increases the likelihood of a successful trade.

Why do you emphasize keeping trading simple instead of using complicated strategies?

The core idea is that trading doesn’t have to be complicated to be successful. By focusing on market structure, trend analysis, and volume, traders can make informed decisions without overloading themselves with unnecessary indicators and complex strategies.