How to read the market

I'd say market cycles are king. Trends only work between the start and end of cycles. BTC just today is case in point, everyone is screaming buy buy buy! The trend is up, but the trend is only your friend as long as you're buying from short sellers. If your buy order is filling someone else's take-profit order, you're likely in big trouble. BTC is late in a trade cycle, the time to buy was months ago. All instruments run in cycles, the key is to search for early cycle trades where you have strong tailwinds.

Good question! But no, the one thing isn't trend, simply because most days the market isn't trending. There are ranges, consolidations, etc, etc.

And there isn't just one thing that you need to know but two, at least. You need to:

1. Identify levels of support/resistance, and
2. Understand market behaviour around said levels.

The need for a level is necessary in order to be able to make some sort of risk assessment for money management purposes. And if you don't understand market behaviour, you may end up being fooled by those who move the market around, i.e. the market makers. And, of course, levels may be identified by several different means: by previous highs/lows, by chart patterns, by indicators such as moving averages, pivots of different kinds, etc, etc.

Here's a simple example in the Nasdaq100 index from yesterday, Monday 8 Jan. It's a 1 min chart, and the thick red line is the Friday high. The moving average is EMA13, and the other horisontal lines are Fibonacci pivots. Several possible entries are indicated depending on what lines you identified, and how you understood market behaviour.

And here's an example from a ranging day (Friday). Why is the first bounce off that level crossed out?

Finally an example to show that it's really not about the trend, but about levels. This is from the 20 December, where Nasdaq100 breaks above the 19 December high and then, after the New York lunch, that break is invalidated - resulting in the trade of the month, after which the uptrend happily continued. This is a 30m chart.

I agree that it should be the trend. But how to you make technical analysis for Ethereum?

Hi everyone .

In trading everything is the same forex crypto indexes stocks or commodities because all of them have these 2 candles bullish and bearish.

Let's start again by identifying the most important thing which is trading.

What is trading?

I need an answer from different people because it looks a lot of us have no idea what is trading about.

We can say trading Is buying and selling which everyone agrees.
But do you think it's the correct answer.
In my opinion it's half right half wrong.
The most professional answer would be buying low selling high
Anyone agrees with me ?

I need everyone to pay attention to these 2 magical keywords high & low as they are the backbone of trading.
I like some comments before I go deep into the trading oceon.

As we grow we begin to understand some facts that must must must happen every single day. Pay attention to the word must.
These facts we can not change them or bypass them ie every day we must have sunrise and sunset.

IN TRADING THERE ARE SOME FACTS EVERYONE NEEDS TO KNOW ABOUT THEM

Before I continue I need everyone of you to think about trading facts .
These facts if you apply them to your trading you will start printing money
Hope to continue with you tomorrow
I will use the 3 magical words for fact number 1 ( high low must )
Take care everyone

Fact no:1

Apart from crypto with 24/7 trading.

Every day every forex pair crypto coin index stock bond share MUST HIT 2 levels known as the HIGH and LOW of the day.

So we can see this MUST happen on daily basis .

So daily trading is about figuring these 2 levels that's it.

So instead of checking news or signals or moving averages, we need to redirect our focus on how to recognise the low and high levels.

Touched the low of 2022.....and the low of 2021..nice!

Are you referring to the exact H & L, or just as two levels that should be touched (and might be broken)?

No follow-through..?

An/or... after a break, you'll need another candle to close below (or above) the break?
Problem with that is; which TF...

The high and low should not be touched they must break that level
ie suppose we reached the level of 1.2000 so the high of the day must break it not touch it
So the high might be 1.2003 or 1.20025 it must break the level of 1.2000

The same applies to the low of the day say we reached 1.5000 level so the low might be 1.4998 or 1.4997 etc. It needs to be broken the level of the 1.5000.

This fact is very important because it's showing us how everything works even the algorithm of trading.
so any pair or share or...... Will start the day
Either it will come down till it hits the low of the day then it will start rising till it hits the high of the day.
Or the reverse ie going up to hit the high then falling to hit the the low of the day.

Let's have today's usdjpy under the microscope
just pay attention the chart
no need for any indicator or anything
Can you seethe pair started as follows
Coming down hitting the low of the day of 1.5026 breaking the level of 1.5030
Going up to the high of the day at 1.5175 breaking the level of 1.5170

Also pay attention
High and low levels on the daily weekly monthly yearly are like the high voltage cables.
If anyone touches them by mistake he will be throw 100 meters or more.
The same applies here
ONCE THE LOW OF THE DAY HAS BEEN HIT IMMEDIATELY WE STARTED A SCUD MISSILE 145 POINTS TO THE HIGH OF THE DAY

Could you explain the significance of the 1.5030 level? I'm not seeing it's significance with regards to recent daily weekly or monthly highs or lows?
Thanks

Sure
As you know the day finished with low of 1.5030 and high of 1.5170
So the daily range was around 140 points plus minus.
Danger-Mouse asked very serious question which h everyone should ask .
What's so special about the 1.3000 level that we rocketed 140 plus points
As well as 1.5170 that we are reversing.
Let me give you a tip 1.5170 is the high of the day and the high of the week .