Available for Mac and PC. I installed it on both my PCs and it's awesome. All good! A very simple tool to use. I would recommend it. I haven't had time to fully assess your product yet, but it's been perfect up to now. Satisfied or your money back. Immediate download. Configuration required:. This results in a credit being received as they bought options are less expensive than the sold options.
When trading iron condors, it is crucial to have a solid grasp of implied volatility and the vix term structure. Iron condors are one of the most popular strategies with option income traders, but you really need to understand what you are doing. Disclaimer: The information above is for educational purposes only and should not be treated as investment advice.
Terms of Service Privacy Policy. The Ultimate Guide to Trading Options. Learn 25 Secrets to Win the Options Game! What's in the Guide? Spinning tops signal indecision. A spinning top is a single candlestick pattern and it can be both bullish or bearish. Similarly, a bullish spinning stop in a resistance level or in an uptrend can be considered a bearish signal as soon as the low is broken to the downside.
Example below shows what I mean: Spinning tops are faily short in length commpared to other candlesticks and their body length is a few steps wider than that of doji candlesticks which actually have none or very tiny bodies. Another notebale feauture of spinning tops is that the wicks on both sides should be almost the same length.
When I see spinning tops form on support or resitance levels, all it tells me the bears and bulls do not really know where to push the market and so when a breakout of the low or high of a spinning top by the next candle that forms usually signals the move in that direction of breakout!
So what do you think the candlestick pattern would be in the two minute candlesticks to give you a bullish hammer candlestick pattern in the 1hr timeframe? Or if you see a shooting start bearish candlestick in the 1hr timeframe, what do you think would be the candlestick pattern in the two- 30minute candlesticks that gave that 1hr candlestick a shooting star? Similarly, there is no 2hr timeframe to go with 4hr timeframe and no 8hr timeframe to go with the existing 4hr timeframe.
But unfortunately, no hammer forms in the 1hr timeframe and even though you see a bullish engulfing pattern formed, you did not enter a buy trade. You just watched as price shoots up and you wished you could have bought at the bullish engulfing signal that was given but you are only interested in trading hammers. Here are few more examples: Notice also that a piercing line pattern when blended forms a hammer. A Dark cloud cover when blended also forms a shooting star. The trick is to use Fibonacci and combine it with price action by using reversal candlesticks.
This tool is a series or sequence of numbers identified by a guy called Leonardo Fibonacci in the 13th Century. So what actually is a Fibonacci Retracement? In technical analysis Fibonacci retracement is created by taking two extreme points usually a major peak and trough on your forex chart and dividing the vertical distance by the key Fibonacci ratios of Once these levels are identified, horizontal lines are drawn and used to identify possible support and resistance levels.
I really do not focus at all on the others. In a downtrend, after price has been going down for some time, it will move back up upswing…remember? The Fibonacci retracement tool can help you estimate or predict potential price reversal areas or levels.
Similarly, in an uptrend, price will make minor downtrend moves downswings and the Fibonacci retracement tool will help you predict potential reversals areas or price levels. If used in conjunction with support and resistance levels and combined with price action, they do really form a powerful combination and do give highly profitable trading signals. I will talk more on that later. Step 3b: In an uptrend market, click and drag first on the trough up to the peak and release.
You can also see the bearish spinning top candlestick which could have been used as a signal to go short sell. Well, I think that there are traders out there that do that and you can do that. But personally, I do not like that approach. Very simple trade setups. Your risks are small compared to the profits you potentially can make.
Similarly, when the market is in an uptrend, it will form upswings and downswings as it continues to move up. The peaks that are formed by the up swings and the troughs that are formed by the down swings can be used to draw trendlines. Downtrend Trendlines Now, for a market in a downtrend, you can connect the peaks with a line and that forms you downward trendline.
What you are waiting for is for price to come back up and touch that trendline and when it does, this could mean that a down swing will start and it may be the best time to enter a short trade. The use of bearish reversal candlesticks as trade confirmation is highly recommended with this trading method.
When price comes to touch it later, you have a potential buy setup. Obviously, this trade was taken based on the setup in the daily timeframe which means it may be a week or two before the profit target is hit if the market makes a nice move up or the opposite can happen, price breaks the trendline and I get stopped out or I can walk away with some profits when my trailing stop gets hit. But the next day, price broke that upward trendline and I got stopped out with a loss.
What happens if the trendline gets intersected? There are a couple of things you need to be aware when a trendline gets intersected: 1 The first is that it could mean the trend has now changed.
There can be 2 or more downward trendlines or 2 or more upward trendlines at any one time on any chart in any timeframe. So if price breaks the first trendline, it still has yet to head to the 2nd and the third etc… So if you take a sell trade on the first trendline but price intersects it and you are stopped out with a loss and now price is heading to the 2nd trendline above, you should also look to sell if you get bearish reversal candlestick signal.
See chart below: enlarge if you cannot see clearly. I saw a shooting star so I took another short trade. Obviously, you can see how the price reacted to the trendline by forming a shooting star. That was enough signal for me to short this pair.
You need to be aware of these kinds of trendlines not only on the sell side buy ton the buy side as well. This is much more advanced trendline trading system you can ever find on the internet.
Well, now we are at it! Many new traders that find it difficult to define the structure of a trending market, therefore they rely on moving averages for trend detection or identification.
The only thing I see useful in moving averages is for dynamic support and resistance levels. I will explain this concept shortly. As a matter of fact moving averages do a terrible job of predicting trends in that they only do that after that trend has already started already and price has moved a great deal already. But notice that the moving averages have not crossed yet. So you have two conflicting signals. And by the time moving average confirms what the price action has indicated, price has already made a great deal of move downward already as shown by this chart on the left.
So which are you really going to pick? Depend on moving average to tell you that a trend has changed or depend on price action? When the market is in a downtrend, you will notice that price moves up to the moving average lines upswing and then bounces back down from them downswing. That is if you put moving average lines on your charts. For those that love moving averages, what you can do is to look reversal candlesticks as price starts to go back to touch the moving average lines and these are used as your confirmation signal to buy or sell.
So you have 3 things lining up for you, here they are again: 1. Have a good and close look at it. I first drew a downward trendline and was waiting to see if price would come up to touch the trendline. And I also noticed that the previous support level that was broken could potentially act as a resistance level causing price to reverse.
Therefore now I have two things coming together. Next thing I did was to check what the fib retracement level to see if price came and hit that resistance level what the ratio would be. Surprisingly, it was So now I have 3 things coming together. So how did I take the trade then? I switched to the 1hr timeframe and waited for price to come and hit the confluence zone and saw a shooting star, a bearish reversal Candlestick pattern also sometimes called a bearish pin bar.
That was my clue to execute a short trade right there. Update: Good thing as I was stilling writing this guide this trade played out so I can show you what happened: As you can see, I managed to make pips on the first trade.
Note also that I also made a 2nd trade which made pips as well. First is to spend hours over your charts analysing what happened in the past and asking these types of questions: Why did price make a big upward move from here and why did price make a big downward move from here? What price action signals that formed there that could have given anybody an indication that this massive move was about to happen? You will be bloody surprised at what type of reversal candlesticks and chart patterns you will find!!!
Then with that knowledge, get back to the present and see if you can see these patterns unfolding in the current market. This short trade setup had 4 factors of confluence supporting it: 1. The doji had confluence with the dominant downtrend, as it formed telling you to sell the market with the trend. The doji showed a clear indecision by the sellers and the buyers therefore the breakout of the low of doji candlestick was what the sellers were waiting for to push the market down.
The doji candlestick also formed between The moving averages providing dynamic resistance. All this information here is providing you the foundation; the basic framework you need to trade price action, the learning comes from observing and doing. For getting better trade entries 2. For reducing stop loss distance so I have better risk:reward ratio which means I can also increase the amount of contracts I trade without risking more of my trading account…so if my trade direction is right, I make a lot more money!
Now, I will explain both in detail… How To Get Better Trade Entries And So Reduce Your Stop Loss Distance With Multi-Timeframe Analysis And Trading If you are trading strictly using the large timeframes like the daily chart, your stop loss distance will be huge and the issue with that is your risk:reward ratio can be reduced no necessarily all the time : Risk to Reward Ratio Explained: Simply put, investing money into the investment markets has a high degree of risk, and if you're going to take the risk, the amount of money you stand to gain needs to be big.
So in that case your risk:reward ratio will be But what if you decided that you want to minimize your stop loss distance? And even though you are trading with a setup in the daily chart, for your trade entry, you are actually switching to the smaller timeframe and watching for a sell signal in the 1hr timeframe?
Price has been pushed down twice from this level and when the third time it price reaches this level, it was pushed down again. Now, you can see the bearish harami reversal candlestick pattern and you could have used this as your sell signal by placing a pending sell stop order just a few pips under the low. And placed your stop loss outside of the resistance line as shown on the chart above.
Which means that the risk:reward of the 1hr timeframe trade is a lot better than what you would get in the daily. Now, you can do this with daily timeframe and 4hrs or even down to the 30 and 15 minute timeframes. Or you can watch trade setups in the 4hr but switch to either the 1hr, 30mins, 15min and 5mins for your trade entries. I often use the 1hr for my trade entries and can even go down to 5min timeframe for my entries.
If you are new trader, stick to 1hr or 4hr timeframe for your trade entries. So when you trade in the 1hr timeframe or much smaller timeframe you can actually trade a lot more contracts without risking more because your stop loss distance are very small compared to the larger timeframe trade.
For example, the stop loss for the 1hr timeframe trade is 20 pips but for the daily timeframe trade is 80 pips. This simple example explains why I wait patiently for trade setups to happen in the monthly, weekly, daily, 4hr timeframes and then use smaller timeframes to get good trade entries. This is the beauty of multi-timeframe trading using price action.
Two things can happen here: 1.
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