How To Trade Without Indicators Webinar Part 2
How to Trade Without Indicators Webinar
How to Trade Without Indicators Webinar
Transcript Part 2 of 4
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So what were looking for we want some clean moves, right? We want some distance in the -- between the lines. We wanted to be fluid, right? We dont want this choppy, slop mess and there were so many pairs you can look at, right? So if the euro-U.S. dollar one day is a mess, check out something else, right? Look at the lines you actually move this up so we could see it better and probably cant read that because I can barely read it. But it says, Example of the spread but just keep it in context. Okay. Keep it in context to a higher time frame to the MACD etcetera.
But look at this nice spread apart, right? Same thing here, you see same thing here. Look at the price, right? Look back and forth, you can see whats going on there and this is how I personally learned how to start looking more at price. I love that this -- okay, well, thats happening here but, hmm, whats it telling? I would just think things like that and the way I look at this, this would help confirm what I was learning, right? It will -- its there. Its right in front of you. Theres no -- Im taking something thats objective, right. Objective crosses and I managed to make it into something a bit more subjective from what I saw because, you know, were looking at indicators. Indicators do one thing really well and thats lag. It doesnt matter what youre looking at, they lag, right?
I want to find out, well, through lagging, how can I get in before that? You see what Im saying? So when it starts to lag, where can I get in before that? A bigger picture direction is how were going to use it. If were going to look at our direction in a bigger picture, this is your U.S. dollar 240-minute chart, long only on lower time frames. So youre dropping, dropping nice, right? Now, is that being subjective? No. If I look at the price, lots -- it is kind of subjective, right? When I say dropping nice, the word nice is subjective. If I just drop down here to my indicator on my MACD, look at that. And that confirms what I just said, right? It confirms that its dropping nicely.
Now, were going to get these retracements in here. Now this is where you, as a trader, can say, Okay. Well, wait a second. My higher time frame, I got to -- my stochastics has turned up. My MACD is still down -- what am Im going to do? I cant tell you what to do. I cant. Youre going to have to look at the scale, Okay. Well, yeah, but look where its turned down. Its turning down on places thats, you know, theyre still nice red candles, right? Theyre not candles sucking this little one here. But overall, my MACD is down and then I spread apart. My MACD is not like its going to cross anytime soon. Its sloping down. So Im looking for one thing, Im looking to short on lower time frames. The biggest problem that a lot of traders have is they want to do both. They want to go short. They want to go long. They want to go short. They want to go long with no idea of why except because it looks good. And this is whats different when I trade a system, I have different things in mind.
For example, I dont care if a setup is happening,, you know, to go along into the high today. You know, for me, high today is going to be usually London session, right, because I trade the U.S. session. Generally, I have to say that the London session but I wont go long. It doesnt matter to me if its a, you know, 50 pip winner, it doesnt matter to me. Thats my rules because I have learned through my own thing thats when Im not comfortable doing that. Shorting -- I mean going long to the high. What Id rather do is fade it if theres a setup there, thats what Id rather do. I feel say, well, youre picking the top youre a -- youre a contributing trader. And I say, Yeah, good. I am. Thank you. Theres no harm in being that, you know, Paul Tudor Jones, thats what he does. Its good enough for him to looking for reversals. Its definitely good enough for me.
So Im going to take a couple of seconds here. We covered quickly multiple time frames, objectively determined trend and trend health and aggressive/conservative, right? The aggressive was just looking at the stochastics and if thats turned over on a higher time frame, hey, Im going to short. Thats aggressive. Conservative is waiting until the MACD is turned over, right? We know our settings now to objectively determine the trend and trend health -- 8, 17, and 9 for the MACD; 8, 3 and 3 the stochastics. These are also time frames. Look up for your four times frames up. A general rule of thumb lock is daily transfer of four hour, four hour transfer and hourly, hourly trend or 30-minute trend for something lower. Going below 30 minutes, especially in the FX market must something I would personally do but people do it. So is there anything questions. Say, well, do you see any questions there or Brian or anybody?
Okay. All right, Im seeing some (inaudible) Island. I can see a few other questions and Id like to answer them. Conservative is someone asked. When I mean conservative, I mean theres aggressive trading and then theres being conservative in the trading. The MACD, for example, will confirm a -- for example, a down trend slower than the stochastics crossover. An 8, 3, 3 stochastic cross which is the downside and youre deciding is short, thats more aggressive than waiting for a confirmation -- I hate that word confirmation, but on the MACD. Did that make any sense?
I dont trade divergence. I dont trade it and I tell you why. Its once again itd be -- bottom line, I trade -- I trade price. I dont trade price action per se. I dont trade like, you know, and the -- you know, price action has a different -- its just different than what I trade. Trade people trade, you know, some sort of patterns. They trade, I guess thats called wedges etcetera -- I dont trade that. I dont trade those kinds of things. I dont trade divergence. and you can use this for divergence if thats something you want to do and then you can prove to yourself that you -- it doesnt make sense to me so I dont use it. If it did make sense, I -- Im sure -- so yeah, the indicators are the 8, 3 and 3 stochastics and the MACD is 8, 17 and 9, okay?
Okay. I can finally get some click connected and start late. Yeah, we started late and maybe questions at the end since you start late. Yeah, it was pretty quick to go through this PDF. No, but I believe its being recorded so were all good there. To use the same settings for the lower time frames, yes. There is no changing the settings because you drop down to a five-minute chart. I dont -- Im not the only one thats going to tell you this. You know, if I have to change my MACD to a lower time frame, how do I know what settings to use, right? Do I test that as well? No, if its going to work on a higher time frame, theres no reason why its not going to work in lower time frames and thats when we get into indicator trading. This is where everything gets so crazy and you will hear it, you know.
Im going to use a five-period EMA, five-period weighted moving average. Im going to use -- where does it end? You know, where does it end? Im going to use a 14, 3 and 3 stochastics on the four-hour chart and will use the 5, 3, 3 on a five-minute chart. To me, its like, Well, where do you end? You know what I mean? These have been proven out. For me, anyway, you have proof for yourself. But for me, its proven now, right? Its an indicator on my chart, this web emergency.
Yeah, hey, you know what? Yeah, price, yeah, of course MACD lags price. I said that all indicators like price. If it didnt, itd be great but they do. And you -- when you use it for direction, youre looking for confirmation of direction. Not everybody can look at a chart and say, Okay. Its turned here and now the trend is down, because when do you know its down, right? When do you know its down? What objective way have you chosen to say, Okay, the trend is now down? Its now turned. Its now turned. This is what this is all about. Where has it turned, right? Where has it turned?
And like I said, you know, if you dont have to agree with me, if you dont have to use this, it doesnt matter. It really doesnt because were all going to find our own way, but most people out there are just wondering around from strategy to strategy, to indicator to indicator, and tell to sit down and get their stuff together. And say, Hey. You know what, Im going to stick with this and then work through that, it doesnt happen. You know, I go to Forex stocks and sometimes you look at the news releases, right? If youre sitting there and somebody will pop up there like, you know, the feed or something or is that guy tells you what the -- I dont know the popular thread is right now, people are jumping from strategy to strategy, you know, every week. But definitely, you dont need -- you may not need it to tell you which way direction is but some people do and thats just the way it is. Yeah, its too much money and money quarterbacking. I dont know what that means, stochs 8, 3 and 3.
Oh, yeah, sorry. My name is Shane. If you ever see these videos, please be kind to share it now. There you go. Sorry about that. If you go to the, like I said, NetPicks.com to Trading Tips site, you can -- youre good. Youre good to go, okay?
All right, so I think we covered most of the questions here and yeah, fading just means to go against so on a strong up trend, Im looking short, okay? Thats why we need to hear that. Thats all it means, just fading the move and just going against. I dont trade the SST in conjunction to these indicators. When I trade the SST, I just use price levels. I have no other locators. 8, 3, 3 is the settings. Entry areas, Im going to cover that.
What time frame for ES? You know, I cant tell you that. Thats for you to decide for yourself. It doesnt what I trade or I dont trade ES but it wouldnt really matter, even more lagging or trading lower time frame? No, price terms are faster on lower time frames. Yeah, you can read these from another guy and I think Im there. Someone asked about price action. I cant really go into it on this webinar because its not about that but I could tell you right now, I dont -- when Im trading twice if youre watching my videos, I dont really concern myself too much with trend but maybe a big up turn for you is a great shorting opportunity for me. And if you go to the Trading Tips website in NetPicks, youll see a lot of those. Yes, stochastics is always aggressive. Okay. Sorry, but I know some of you guys wanted the questions later but its just easier to do it here because the way I sit this webinar up. I had no target in mind with that big turn. Okay. Okay. Lets keep going, okay? Entry areas, so let me just ask that and then were going to cover those, okay?
All right, where to enter. Everyone talks about this where to enter and it seems funny because I choose the first question over here. You dont use reward risk management first, its always where do I get this trade? Theres couple of ways enter, right? Break out entries or retracements. And breakouts, they can work. They definitely can work. I cant cover it here but when you find them in the right spot, they definitely can work. One word about retracements is just simply it allows you to buy cheaper, sell high, and at retracements. And what youre looking for is an objective area to watch for retracements. It can be a support with business level. It can be Fibonacci, congestion levels and I love congestion levels like you would not believe and it all depends on you. It really does with what youre comfortable with. Some people cant look at chart and go This is support resistance, for some people just pulling pips from a high and low was great.
Were going to cover that as we go and Ill show you some examples of that. So theres so much we can cover in these webinars, okay? So if Ive seen Im going pretty fast is because I am. Let me see if I can make this a little bigger and I hope that works. Okay. Well, if you look at -- you can look at, you know, the trend line you got to have a couple of places to draw your trend line, right. You can trade third pullbacks of trade lines but look at the problem with that. The old price will come down to it all the time, right? Pullbacks into areas that ended with big moves away, this well touch on it now.
The one thing about joining Fibonacci levels are a lot of Fibonacci traders theyll do and a lot people are just learning how to trade fibs onto. Those thrusting moves, those big thrusting candles are great spots to pull fibs from and once I saw that, thats how got it -- got into more of looking at price and the big moves and where they occurred and taking those trades. That those areas are key thats why Im talking about here of pullbacks into areas that -- with big moves away. This should actually be a couple of levels to pull fibs from like uncover fibs just to -- I ramble sometimes. Its just how I want to go. Pullback and support resistance areas, right here. You know, price broke through here. Price pulled back to fill the orders, right, and grew here -- all down, right?
Break every trend -- trace and trend lines. If you decided that you were in a down turn, like however, you know, it means youve decided on it, you know, draw or trace some trend line. And once it breaks through, you know, you can sell that away for you to pullback on a lower time frame and theres just different ways that you can trade those. And of course, fibs, these might be really hard to see. These are some of the different fib levels, right? 38, 23, 50, 61, 76 or the best thing to do if youre going to be trading fib levels is look where they line up with natural support resistance areas. This level right here, were pulled up in fibs. These little ones here didnt really go anywhere, this pull up to the 50 level, right? Also where price had already previously bounced from and I believe thats a key level sitting there as well on this chart. So its stocks -- I dont mean stocks. Fibonaccis worked and especially when they line up -- when they line up with market structure, you know.
Okay. Im trying this chart right here. Third back in the trend line, pullback confluence areas. Its the same chart. We covered this well, actually, this is where its lining up with the stochastics, okay. This is where Im taking okay. Find an objective way to enter a trade. Dont just trade and pullback, thatd be just silly, right? Find a reason to enter it. Have a couple of things. Okay, here. This is ignoring any higher time frame, okay? This is, for example, say third pullback into a trend line, right? It would go along here, some people would. Most people dont know why theyre entering. Wait until the stochastic crosses. Pullback into areas and with fib move away. Heres where it comes up.
Now some people will say, Well how do you know, it is not going to go all the way through? Great question. Its all this blue line down. What happens here? Stochastic crosses over. What that means for you? Its objective to enter a trade. You need to short, right? It will free. Pull back and support resistance areas. Same idea but this is a little messy, right? That was congestion up here, right? This is going to be a trickier one because you see its going to cross a few times. Wheres your stop going to be? Youre not going to cover stop placement here but think of that as well, okay?
Will the price really get up in there? No, the price really do get up into this area. It depends on how you trade. Are you an aggressive trader? Do you think you needed to go over the area? Some traders do. Unless it touches that area, some traders wont trade it. Thats fine. Over here, break up your trends and trace sand trend lines. The cross happens here. When its breaking through, this is crossing down, thats your trigger to what, to short, Fibonacci levels.
We have to pullback here at your 38.2 level. Does it show when it hits it? No. Our confirmation is our fast stochastics, right? Our 8, 3, 3 level settings. When it crosses, short so it will be all up here. Crosses, short, you see. Its got a really great way of trading into a trade without you thinking, Oh, will I pull the trigger now? Do I wait until I pull the trigger? Most traders dont pull the trigger. Most traders never get in the game, right? They just dont. This is telling you when to do it, when to do it.
Multiple time frames, we covered that. Objectively determine trend and trend health, we covered that. Aggressive/conservative trading, right, MACD and stochastics, entry areas, oh, thats kind of and entry trade and entry areas starting with, What are you looking for? What area are you looking for? Are you looking for a pullback int
by: John Jay
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