Pilar Ketiga "Method" (Analisa Trading) || The Third Pillar "Method" (Trading Analysis)
Be discipline with the target and the trading system. If we do all of them discipline, we'll get the profit consistently I hope it can be useful for the trading system preparation. Next, we enter the technical material *Opening Music* There are many ways to do technical analysis. We can use indicator, price action, and etc. Technical which will be discussed is by using Price Action Technical Analysis Technical Analysis which is based on the price movement. or using the price as the reference to do analysis Is candle pattern a part of technical analysis which use price action? Yes, that's a part of it. But, we don't use it. Price action is based on past price then we combine it with current price.
Remember that current price will always go back to the past price memory How do we know it? We know it from the history When we sell meatball in a day, we can get IDR 1 million. Monday: IDR 1 million. Tuesday: IDR 1 million. Wednesday and Thursday: IDR 2 million. Meanwhile, on Saturday and Sunday: IDR 5 million. If we do it continuously, we get knowledge from the history That's why when we sell meatball on Saturday, we make lot of meatballs than another days On weekday, we sell 20 kilos meatballs. On weekend, we sell 40 kilos meatballs. How do I know that I prepare 40 kilos for weekend? It's based on the history. If I sell it on weekend, it's always crowded. But, if we know that we usually make 20 kilos meatballs on weekday, suddenly, we make 40 kilos for weekday Meanwhile we knew the history Experience which taught us that we sell 20 kilos of meatballs on weekday. But why we make 40 kilos?
So, what will happen is.. The meatballs that are sold are 20 kilos only Why it could be like that? Because this cycle became our daily history So, where is the rest? That becomes history. It's a part of our future decision So, we knew that we always make 40 kilos of meatballs for weekend. Why I can be sure? Because I can sell more meatballs on weekend Maybe there are many people on vacation and buy the meatball. It's also same like the market. We use the past price history and current price So, we use Price Action What I use is candlestick price action. We don't have indicator hint.
Maybe, it's just 1 or 2 indicators It means that we use Naked trading or we only use candlestick. There is no many indicators. The more indicators, the more confused in making decision. But, it doesn't mean you're wrong in using indicator but all of people have limitation. If you used to it and enjoy it, that's ok. But, before we use many indicators, it will be easier if we use less indicators. If you still want to use indicators, that's up to you The point is I teach you using price action technical analysis method which can use chart and candle patterns But, it's not priority. Our priority is the price movement
Well, we discuss the technical The first thing we must understand in technical is understanding the candlestick first. How's the candlestick formed? How's the pressure? What's the meaning of the wick? Then, what's the meaning of short body and long wick? We must understand the candlestick first. Then, we must also understand the candle character first. Because we use candlestick as the analysis, not indicator. Don't only focus on candle pattern. Thousands candle patterns won't solve the problem if we don't know the concept.
If we only memorize the pictures, when the market shows up, our mind will be blank. And candle pattern won't guarantee our analysis. Because there are still lots of aspects which must be paid attention to. Candle pattern can't stand alone. Well, we discuss about candlestick now How's a candlestick formed? There are 2 candles; red and green candle Red candle represents Seller. Green candle represents Buyer.
This is Buyer This is Seller This one is Buyer This one is Seller Then, how's the candle formed? There are 4 main components in candle First, there is Open price If it's red and closed by red. The Open price is always on top If the Close price on top, the Open price is at the bottom. If the color is green or Bullish is as dominant, the Open price is always at the bottom.
If it's closed by Bearish or Seller is dominant, the Open price is always at the top of body That's the thing which must be understood. When It's closed by green, the Open price is always at the bottom When it's closed by red, the Open price is always on top So, if the Open price is on top and there is tail, it rises first. It's green first. Then, it's rejected by Seller It was green at the beginning It was green Then, until this end, it's rejected again When it's at the end, it's rejected by Seller It's rejected and pass the Open price. It becomes red. At first, it was green. It changes to be red.
Then, it goes down continuously until this Low price Then, it's rejected again by Buyer The bottom wick is Buyer rejection. The top wick is Seller rejection. The most bottom is the Low price Then, the axis is wick (shadow) Then, the bottom body is Close It's close. It's also same like green candle dominant The Open is always at the bottom of body It's opened here then it goes down first until the Low price. After that, it's rejected by Buyer. The bottom tail is buyer rejection The top tail is Seller rejection when it's rejected to up and pass the Open price, it changes to be green. Then, it reaches the High price Then, it's rejected again by Seller. the top tail is Seller rejection It's closed here as the Close price We must know the process. So that we'll do right analysis
Then, pay attention to this. There are wicks and body There are wicks and body To read the candle characteristic, pay attention to the body first. First, pay attention to the body length Second, the wick length If the wick is on top, it's Seller's rejection The bottom wick is Buyer rejection We compare the body and the wick.
If the green body is much longer, Buyer is still dominant. If the wick is much shorter than the red body, Seller is still dominant Except if the body is small then the tail is long If we compare the wick and the body, the wick is much longer than the body. The top is Seller rejection So, market potential will move down again That's the basic thing which must be understood. Especially for newbie.
So that, you won't feel hard in reading the market movement Next, there are many examples of candles and we must know each character There is thick candle with wick. There is wick here There is thick candle with up and down wicks The first thing we pay attention is the body length Second, compare it with the wick length If the body is longer, body will continue. If the top wick is longer, the potential is it will go down the top wick means Seller rejection The candle features which has potency as the clue or information is the candle which doesn't have wick or it has wick but it's short. It's just small correction. It doesn't have big impact. So, the candle characteristic is it still needs confirmation candle If the candles are small and the color changes, it needs confirmation candle It's different when the confirmed candle or clear clue candle, Here's the example. There are long rejections If the long rejection is on top, it's Seller's pressure If the wick is at the bottom, it's Buyer pressure Pay attention to it. Although there are wicks on top, the bodies are still dominant So, it becomes 1 direction signal Although it's red candle. But, pay attention to the wick
Pay attention to the rejections The bottom rejections Even though they're confirmed, but it shows 1 direction movement Including the bottom. There are lots of confirmations. There are green candles All of them are rejections Then, there are red candles here with rejections There are 3 lined up red candles with their rejections. That's down signal. It will go down again I hope these candles part can be useful. At least, you have an overview there At least it can help you in analyzing the market Now, we discuss Technical material The previous material was about the introduction of candlestick characters and components We discuss how to read the market movement direction potential Although we understand candlestick but we don't know the technique, we can't read the order opportunity So, we must know the step by step We must have trading rules We must have clear trigger When we want to order, what's the reason? When we want to exit, what's the reason? So, we can't always enter the market Sometimes, the market could be slow, sideways, and it doesn't support us to order there.
Because it doesn't qualify our rules. The first step is reading the last 3 candles We read the impact by not ignoring the main trend direction. But, we can see the last 3 candles to test the closest from running candle We'll find it later If we understand this, whatever the market movement is, there will always be clue. Because it will form candle structure here Second, pay attention to the last candle before running candle Third, pay attention to the psychology level If it's on top, it's resistance. If it's at the bottom, it's Support.
Fourth, pay attention to the retracement area or correction It's located in 50% of the previous dominant candle structure If we use Fibonacci, it's in 50 - 61.8% Fifth, determining the trigger to be continued...