Enter the Trading Zone: The Mind-Blowing Effects of Scientific Scalper and Logic Day Trading

Summary

In this video by Indicator Vault, Ronald discusses the uptrend of the British Pound US Dollar on a four-hour chart. He uses the Scientific Scalper and Logic Day Trading indicators to identify buy signals and zones for potential trades. Ronald explains how the blue background on the Scientific Scalper indicates an uptrend and the green buy signals suggest entry points. He also emphasizes the importance of retracements and price action concepts to confirm trade setups, providing several examples to illustrate ideal trading scenarios. The video aims to help traders understand how to use these indicators for profitable trades over a six-week period.

Takeaways

• 📈 The video discusses a significant uptrend in the British Pound US Dollar (GBP/USD) on a four-hour chart.
• 🛠️ The presenter uses the Scientific Scalper and Logic Day Trading indicators to analyze price action and identify trading opportunities.
• 🔵 A blue background in the Scientific Scalper indicator signifies an uptrend, while a red background indicates a downtrend.
• 🟢 A green vertical line in the Scientific Scalper signals a buy opportunity, and a red line signals a sell opportunity.
• 📊 The Logic Day Trading indicator marks buy and sell zones, which are crucial for determining entry and exit points in trades.
• 📉 The presenter emphasizes the importance of waiting for price retracements into the buy zone before entering a trade.
• 📌 The ideal trade scenario is when the Scientific Scalper's green buy signal aligns with the Logic Day Trading's buy zone and price action.
• 📝 The video provides examples of trades that met the criteria but did not perform ideally due to various market conditions.
• 🚫 The presenter advises caution when the price action is messy or whipsaw, indicating potential trend changes.
• ⏳ Patience is key in trading, as the market needs time to show clear signals before entering trades.
• 📚 The video suggests using multiple time frames and additional indicators like the Price Action Origin for a more refined trading approach.

Q & A

What is the main topic of the video by Indicator Vault?

The video discusses price action in an uptrend on the British Pound US Dollar four-hour chart, focusing on using the Scientific Scalper and Logic Day Trading indicators.

What does a blue background in the Scientific Scalper indicator signify?

A blue background in the Scientific Scalper indicator signifies that the price is in an uptrend.

What does a red background in the Scientific Scalper indicator signify?

A red background in the Scientific Scalper indicator signifies that the price is in a downtrend.

How does the Scientific Scalper indicator provide a two-part confirmation for trades?

The two-part confirmation is provided by the background color indicating the trend direction and the vertical lines (red for sell, green for buy), which should align in the same direction as the price movement.

What is the significance of the green buy signal in the context of the video?

The green buy signal in the Scientific Scalper indicator, when combined with a blue background, suggests a potential buying opportunity in an uptrend.

What is the purpose of the Logic Day Trading indicator's buy zone?

The Logic Day Trading indicator's buy zone is used to identify potential retracement areas where traders can enter a long position, expecting the price to continue the uptrend.

How does the speaker suggest using the indicators in conjunction with price action concepts?

The speaker suggests using the indicators along with simple price action concepts such as retracements and liquidity zones to identify entry and exit points for trades.

What is the importance of the price not creating a new higher high in the context of the trades discussed?

The importance is that if the price has not created a new higher high, it indicates that the current trend may still be valid, and a retracement could be a good entry point for a trade.

What does the speaker mean by 'Wick' in the context of the script?

In the script, 'Wick' refers to the small price movement that retraces back into a previously established zone, which can be a signal for a potential trade entry.

How does the speaker suggest using the Price Action Origin indicator?

The speaker suggests using the Price Action Origin indicator to identify pin bar, double bar, and vertical bar patterns, which can provide additional confirmation for trade entries.

What is the speaker's view on the importance of multiple timeframes in refining trades?

The speaker believes in the importance of using multiple timeframes to refine trades, although in this video, the focus is on a single timeframe for simplicity.

What is the speaker's advice on setting a stop loss for trades based on the zones?

The speaker advises placing the stop loss below the zone, using an eyeballed Fibonacci retracement level as a reference, to manage risk in trades.

How does the speaker describe the market conditions during a trend change?

The speaker describes market conditions during a trend change as messy and whipsawing, with price action that is not in sync with order flow, requiring patience from traders.

Outlines

00:00

📈 Analyzing Uptrend with Indicators

In this paragraph, the speaker, Ronald, introduces a video from Indicator Vault focusing on the British pound US dollar four-hour chart. He discusses the use of three indicators: the logic day trading indicator, the price action origin, and the scientific scalper. The scientific scalper is highlighted for its two-part confirmation system, with a blue background signaling an uptrend and red indicating a downtrend. The speaker emphasizes the importance of aligning the indicator signals with the price direction and discusses the potential trend change indicated by the blue background after breaking above a certain high. The paragraph also touches on the concept of retracement and identifying take profit levels based on recent highs.

05:01

🛠️ Utilizing Indicators for Trading Strategy

This paragraph delves deeper into the application of the scientific scalper and logic day trading indicators for trading in an uptrend. Ronald explains how to identify buy signals and zones, and the importance of waiting for a retracement into the zone before making a trade. He provides examples of trades that met the criteria, including an 'ideal' scenario where the buy signal and zone formation coincided perfectly with a retracement. The paragraph also discusses the importance of price not having made a new higher high as a validation for the trade's continuation. Ronald suggests that with practice, traders can refine their strategies using these indicators even amidst messy price action.

10:03

📊 Enhancing Trading with Additional Indicators

In the final paragraph, the speaker discusses the potential of using a third indicator, the price action origin, to enhance trading strategies. This indicator identifies pin bar, double bar, and vertical bar patterns which can be crucial in understanding potential trend changes. Ronald provides an example of how these patterns can be used in conjunction with the logic day trading buy zones for confident trade entries. He acknowledges the current messy price action and the need for patience as the market finds its next trend. The paragraph concludes with a summary of the effectiveness of the Indicator Vault tools in capturing trades over several weeks and wishes the viewers good luck in their trading endeavors.

Keywords

💡Price Action

Price action is a trading methodology that relies on the study of price movements, rather than relying on technical indicators. It is used to make trading decisions based on the belief that all relevant information is already reflected in the price. In the video, the speaker discusses analyzing the British pound US dollar's price action on a four-hour chart, which is a key part of understanding the market trend and making trading decisions.

💡Uptrend

An uptrend is a term used in financial markets to describe a period during which the price of a security or index is rising. It is characterized by higher highs and higher lows. In the script, the speaker identifies an uptrend in the British pound US dollar chart and uses this information to discuss potential buying opportunities, indicating that the market is moving in a positive direction.

💡Indicator Vault

Indicator Vault seems to be a collection or set of trading indicators used for technical analysis. The video script mentions using indicators from the Indicator Vault, such as the 'scientific scalper' and 'logic day trading indicator', to analyze market trends and make trading decisions.

💡Scientific Scalper

The Scientific Scalper is an indicator mentioned in the video that provides two-part confirmation for trades. It uses color coding (blue for uptrend and red for downtrend) and vertical lines (green for buy signals and red for sell signals) to help traders identify potential entry and exit points. The speaker uses this indicator to discuss the uptrend and the timing of buy signals.

💡Logic Day Trading Indicator

The Logic Day Trading Indicator is another tool discussed in the video that helps identify buy and sell zones. It is used in conjunction with other indicators to confirm trade entries. The speaker refers to this indicator when explaining how to spot ideal buy zones during an uptrend.

💡Buy Signal

A buy signal is an event or condition that suggests it might be a good time to buy a security or other asset. In the context of the video, the speaker refers to green vertical bars as buy signals from the Scientific Scalper indicator, which, when aligned with other conditions, can indicate a good time to enter a trade.

💡Retracement

Retracement in trading terms refers to a price movement opposite to the prevailing trend, often seen as a temporary pause before the trend resumes. The speaker discusses waiting for a retracement back into a buy zone as a strategy for entering trades, using the logic that the trend will continue after a temporary pullback.

💡Take Profit Levels

Take profit levels are预先设定的价格目标，当达到这些价格时，交易者会关闭他们的交易以锁定利润。在视频中，演讲者提到使用最近的高点作为可能的获利水平，这意味着当价格达到这些水平时，交易者可能会选择退出他们的多头头寸以实现利润。

💡Price Action Origin

Price Action Origin appears to be another indicator mentioned in the video that helps identify various price patterns such as pin bars, double bars, and vertical bars. These patterns can provide additional confirmation for trade entries or exits. The speaker suggests using this indicator alongside the others for a more comprehensive analysis.

💡Pin Bar

A pin bar is a specific type of candlestick pattern that signifies a potential reversal in the market trend. It consists of a small real body with a long wick extending in the opposite direction of the prevailing trend. In the video, the speaker mentions that the Price Action Origin indicator can identify pin bars, which can be useful for spotting potential trend reversals.

💡Wick

In candlestick charting, a wick is the upper or lower shadow that extends from the body of the candle. It represents the high and low prices for the period, regardless of whether the candle is bullish or bearish. The speaker uses the term 'wicks' to describe price action that touches a certain level but does not close at that level, which can be a sign of potential trend continuation or reversal.

Highlights

Introduction to the video by Ronald on analyzing the British Pound US Dollar trend using indicators.

Use of the Scientific Scalper indicator for confirming uptrends and downtrends with color-coded background.

Explanation of the two-part confirmation system of the Scientific Scalper indicator.

Identification of buy and sell signals through vertical lines in the Scientific Scalper indicator.

Discussion on the importance of the background color change in the Scientific Scalper indicator as a trend change indicator.

Analysis of a six-week uptrend in the GBP/USD from September to December.

Introduction of the Logic Day Trading indicator for identifying buy zones.

Explanation of how to use the Logic Day Trading and Scientific Scalper indicators together for trading decisions.

Emphasis on the importance of price not making a new higher high for trade validity in an uptrend.

Demonstration of a trade setup with a green buy signal and a retracement into the buy zone.

Highlight of an ideal trade scenario with alignment of indicators and price action.

Discussion on setting take-profit levels based on recent highs in the trend.

Mention of the potential risks and the importance of a clean entry in trading.

Introduction of the Price Action Origin indicator for identifying pin bar, double bar, and vertical bar patterns.

Advice on patience and waiting for clearer price signals during trend changes.

Conclusion summarizing the effectiveness of using the Scientific Scalper and Logic Day Trading indicators for trading GBP/USD.

Transcripts

hello welcome to another video by

indicator Vault this is Ronald and in

this video we're going to go over

the price action here in this big

uptrend on the British pound US dollar

four hour chart

you see here I've got hidden at the

moment the logic day trading indicator

and the price action origin and then the

scientific scalper down here on the

bottom

and so

with the starting with the scalper

it's the two-part confirmation that this

indicator provides when the background

is blue it is indicating price is in an

uptrend when it's red indicating in a

downtrend and the second part is you see

these bars these vertical lines here

you know the red is going to be a sell

signal with the green being a Buy Signal

so you want this these two line up uh

you know showing the same direction that

price is going to go

now we're not going to go through the

replay tool with this but I do want to

say you know during all of this the

background was red except maybe here it

turned blue for like a quick move up and

then continue down

but right here is when it changed to

blue background when it broke Above This

High here and this High indicating

possible you know Trend change it did

turn red here you know it could have

gotten this move down then quickly

changed back to Blue and pretty much

stayed blue this entire way up here

so there's obviously quite a move that

lasted for

end of September

to about the Midway Point through

December so about six weeks or so so

quite an up move where you could have

been catching a lot of these here and

we're going to go over a few

I'm not going to bring in the price

action more than just yet that's just

going to be a quick thing later on but

what you can use these two indicators

alone the scientific scalper and lots of

day trading for is

you know very as far as visually seeing

it's going to be quite easy if you just

couple it with you know

Pro Concepts that are very simple with

price action

so

we're going to go through most of these

green by zones right because again the

background's telling us it's in an

uptrend and of course seeing on this

time frame if we are believing the trend

is going to continue for a while we can

look at these recent highs where

liquidity is going to rest and expect

them to be some take profit levels

um as far as the long term as far as

near-term trades we're just looking at

the most recent highs to be taken out

and have new highs created

so a simple thing

this one doesn't quite

give it there's an ideal one later on

but I want to start here

when we see obviously the blue

background the green Buy Signal we

ideally want the green bar

to show up inside of the logic day trade

buy Zone okay

however you know the buy zone is only

going to form after

this shows right so even if this green

bar was inside of these candles

the green or excuse me the the logic day

trade buy Zone forms after this candle

close

but that's all right because we're

waiting on the retracement back into the

Zone before we buy

so of course we see it move up here and

the reason we can take this retracement

is because price has not created a new

higher high yet it hasn't done its job

all right now like I said this one isn't

super clean but I wanted to start with

it here

this one

probably would have resulted in a loss

you know just to be transparent because

this is probably news related

took the low and then it ran higher but

we had the criteria met here

let's go to this next one

again just looking for buys because

we're in an uptrend

we see the green Buy Signal not inside

of

the buy Zone but

we do not see price yet make a new

higher high we see it Wick above this

one

but it hasn't done its job as far as

taking out this one so we can bind the

retracement back into the zone

and then watch price continue higher

great trade there

and now here's here is probably the most

ideal one that I wanted to get to

blue background

green Buy Signal green vertical bar with

the blue background

and then on this candle close is when

the buy Zone the Buy Signal forms for

the logic day trading indicator and what

does that very next candle do

Wix write perfectly into what looks to

be the open of this demand Zone

so that was a perfect one

to get in on and of course great take

profit levels as far as this first high

for some parcels quickly gets there

and then of course takes out this high

after you know probably another week or

so

so this was a perfect example here kind

of the ideal scenario

and if you get comfortable with price

action you can work with some of these

other ones because they are still kind

of grouped together and again the main

thing you want to filter out with

something like this

in something like this one is that if

price is in an uptrend we needed to make

higher highs and so it hadn't done that

yet so the trade is still valid

but again this is going to be the ideal

one

that you're looking for

logic day trade marks out the Buy Signal

in the zone and then the very next

candle or at least soon after you're

going to see price retrace back into the

zone and then fly up all while the

scientific scalper is lining up with

that zone as well

and then we have one here it didn't play

out in the sense that we did not have a

retracement back into it soon after

price just flew up

um

if this candle did not close above here

I probably would have been more uh

comfortable getting into a trade because

price did not create a higher high yet

however it just really did not give us

time at all prices had this super strong

impulsive move up didn't give a super

clean entry if maybe price just closed

right you know maybe here halfway

do this next high would have been a

little bit better but of course again

the ideal scenario is price within the

next you know maybe one two three

candles Wicks back down into the Zone

before continuing up but we had that

same criteria met here the Buy Signal is

inside

of this Zone

here we have

another good example

not ideal because the green bar is not

inside of this Zone but we still have

the criteria met to take this up move

we have the Buy Signal here at the

scientific scalper

right after this candle closes we then

get the buy Zone

for the logic day trading and then let

me zoom in on it

same thing the very next candle wicks

into the Zone here and we're comfortable

taking that trade because it has not

created a higher high according to its

most recent highs right

after this candle closes

you know we haven't taken out this this

or this high so those are all you know

can be take profit levels obviously

these are super close together you might

as well just have one parcel here maybe

at this High then with another one here

and then maybe your third would be the

more recent higher highs

excuse me the more long-term higher

highs right

so look at that

perfect

I mean that that's a not again not the

ideal scenario but it still meets the

criteria to get into a buy we're in an

uptrend blue background

green bar

Zone forms without taking out the highs

yet so we can get in

on this Wick back into the zone

maybe take take profit one take profit

two and then hold for this take profit

three which we can see

just goes right into it

and

great trade there

of course you would typically want to

put your stop loss below the zone

we have here just eyeballing it looks

like a nice fib retracement

yeah Wix just below the 70.5

this would still have been kind of a

risky one to take one because we don't

have the green bar

anywhere near this price action

um it would have been nice to have this

candle probably Wicked back down into

this down close candle

but we don't get that either

however you know still strong impulsive

move again this is just the one time

frame I'm going off of the four hour you

know I really like to include multiple

different time frames to refine the

trades but this video I just wanted to

go over just how even one time frame can

give some good entries

so that's mostly the idea I want to go

with just you know some simple price

action as far as retracements and you

know uh going back into the zones at the

logic day trading indicator marks out

and then I just also want to bring up if

you want to use a third indicator price

action origin could be a good one to put

in as well and so

let me bring up the settings of it

and this is going to draw out the pin

bar double bar and vertical bar patterns

on your chart

and so when you see

one of these

you know for instance we've got

price might be changing as far as going

to a downtrend we've seen a lot of these

lows now broken and so we're probably

going to see a lot of ranging so it's

it's kind of figuring out where its next

trend is going to be but just an example

here

yeah the

buy Zone with the logic day trade

right with a vertical bar inside of the

zone and of course if we had a green bar

here inside of the zone as well we could

feel very comfortable taking a buy here

but price action has been kind of messy

lately and that's just what happens when

it's going to change a trend before it

kind of gets in sync with order flow

again you're going to see just very

squirrely back and forth some whipsawing

price action so that's why you just have

to be patient and let you know price

start to show its hand more and more

um you know we could get into a

downtrend like I said

uh coming into this near future but just

right now we're letting it play out but

again just with these couple indicators

like I said some great trades to ride

all the way up for a good five six seven

weeks with the British pound US dollar

all in here just with these uh indicator

Vault indicators the scientific scalper

and the logic day trading so I hope this

video was helpful and until next time

best of luck Trading