How To Read A Forex Chart Part 2 | The Best Forex EA Bot

How To Read A Forex Chart Part 2 | The Best Forex EA Bot


Alan Solarsh here The Passive Income
Guru this video tutorial explains to you how to read a Forex chart. Right so
I’m going to turn my phone sideways and I’m going to show you what insanity is
okay so insanity is actually watching the prices going up and down and
basically hoping for the best and hoping that you know the currency is going to
turn around and you’re gonna get profitable. What is more important for
you to do is rather learn what the chart is how the chart operates what the
moving averages are so that you can prepare yourself rather than just flying
blind and making emotional decisions, rather than educated decisions. So how we
do this is we look at this from a the longest period to the shortest period so
I’ve turned my phone sideways so so that you can see the graph laid out in a in a
much better pictorial for you. Okay so let’s look at the month of what’s
happening with us with this chart so you’re this is the Euro cad and as you
can see here so each candle represents one month okay and as you can see here
the red candle is fucked on the white line so that is what we call a level of
support support means so when you think of it how do you know the difference
these two days to the opposite of support is resistance so how you know
that you’re on a you know the difference between the two is when you stand on the
floor the floor is supporting when you touch the ceiling you can’t go through
the ceiling because the ceiling is resisting okay you from going through
the ceiling okay I hope that helps you to distinguish between the two
differentials so over here you can see that the the growth the the candle is
stopped on the wall and it’s very interesting to note okay that the
candles follow these moving averages and they perform according to the moving
averages now the reason this is happening is because there are thousands
hundreds of thousands of traders out there
professional traders and novice traders okay intermediate traders that are
following the same principles they’re being they they watching the same videos
on YouTube and they’re setting up their charts using these moving averages
mainly the 200 the the 34 and the 50 okay now if that’s happening and they
following all these videos that are on YouTube and everybody’s doing the same
thing then it would be obvious to say and to to Samar’s
that the that the currency will perform in specific ways nothing very
complicated about it so what’s happening here is there are lots of buying and
selling orders over here so the public have basically people that are trading
Forex they put their orders in some are saying that they want to buy the
currency some are saying that they want to solve it overseas so when you say you
want to buy the currency you’re basically betting that the currency is
going to go up okay when you sell the currency you’re basically betting that
the currency is going to go down so over here there’s lots of orders that are
going off over here some people are buying some people are selling okay now
this is a very very nice indicator at the bottom of the screen it’s called the
stochastic and it basically tells you what what’s happening what the sentiment
is for that currency at the minute so right now if it’s above the 80 it means
that that currency is pretty much over bought again and people are starting to
get a little bit worried so they start selling their positions getting out of
the currency and told this this line over here reaches below the 20 then
we’re in an over sold position and then when comes up above the 20 we know that
it’s time to start by so right now we’re in a sell position okay and we’re
waiting for the currency to go above the 20 when it goes about the 20 a lot of
people will place their buying orders get back into the currency and go along
on their currency okay this is mainly for swing traders which means it’s a
long-term trader that’s going to be trading for a month two months three
months so we can see here that the currency is
being stopped on the white land you can see that little tail over here of the
currency has not gone through the white land so we know that that is a point of
support okay if it hasn’t gone through that land it will not go to the yellow
line okay so let’s look at the daily chart and let’s see what’s happening
with the date shot so we haven’t got any evidence of anything happening with the
moving averages but what we can look at is we can look at previous history of
what’s happened with this currency so let’s let’s draw a line on this chart
okay and we’re going to draw a line like over there okay as you can see yeah that
is a point of of support where the currency hasn’t really gone that much
okay underneath this line in a couple of instances on the 18th of May on I’m not
quite sure of the day this let’s just see what the day was there it is it was
the 31st of May they know the day it’s 30th of May and the 29th of May so it’s
playing in this area and it hasn’t really gone further down than this point
so the lowest point that that the currency went was over there but it’s
basically playing in this area over here so that is your support here is your
resistance if it breaks this line over here we know that the currency is going
to go bullish for a period of time and if it breaks if the currency breaks this
land we can just minimize it and all that and we can see where the next point
of support is in the next points of support where the currency could go
there’s the currency at the moment and stopped over yeah so the next point of
support could be over here and the next support under that is under that you
could basically see where the currency is playing for those tampura so it’s
playing in this area over here you can see that it’s on the slides and lots of
lots of movement over here on on these lands ok so if we take it why not
down to there you can see that all the currency stopped at that specific point
okay so they stopped over there okay and where am I looking I’m looking over
here and let’s bring the line down a bit to there today and you concede that it
stopped over yeah it has stopped over there and it stopped over there so
history repeats itself and you can pretty much rely on these statistics so
let’s get rid of its deadline let’s go forwards and let’s discuss more about
what’s going to happen with this currency so as you can see we’ve hit a
point of support and this was Friday okay it’s Monday today and the currency
has been in a bullish position the whole day okay it’s been up and down and up
and down but right now it’s still it’s in a polished position which means that
we’re expecting this currency because that it’s on it on that level of support
we’re expecting the currency to carry on going north so let’s look at another
time frame which will be the 4-hour chart okay so as you can see this was
Friday over here was Friday and then today sorry this was Friday here’s the
line for Monday and this is Monday the first for our second four hours etc etc
and this is where we are at the moment as you can see it’s just starting to
accelerate going in in the upward position but you can see what’s
happening and what lands it’s caught on so it’s caught between the blue line and
the eight exponential exponential moving average so remember we’ve got two moving
averages to blue moving averages we have got the marked blue which is the 5
minute moving average for the far far period moving average and then we have
the this one over here which is the 100 moving average okay so if the scandal
breaks above the 8 exponential moving average we can expect it to go to the
white line so let’s look to see if this candle is
held back by another moving average and you’ll see that there is a commonality
there so we’re on the 4 out let’s go to the the one hour talking as
you can see it’s held up by the yellow line which is the mood 34 moving average
so the Lautner net is a quite an important moving everything remodel
professional traders out there using this moving average as a point of
whether they should buy or whether they should sell so rock now if you look at
the stochastic at the bottom of the screen you’ll see that we were in a
position of oversold okay too many people were selling and now people
they’re they’re buying orders kicked in and now the currency is starting to go
up okay when it gets to above the eighty will be in an overbought position and
then people will start selling that their currency and it’ll start coming
down and hopefully there won’t be too many selling orders and this currency
will carry on going okay so let’s look at the 30-minute shot so here’s the
30-minute chart and this is very interesting over here let me show you
why so this is called a hip and shoulders so with the people that follow
the candlestick regime you can see here’s the head he has a shoulder and he
has a shoulder okay now usually on the bottom side of a
trend so what I’m talking about is if you can see yeah the whole the trend for
the last week okay for this currency has been going south okay now what the
technical traders people that analyze the chart using technical analysis which
is what we’re doing okay they look for certain signals so this signal is called
a head and shoulders I get reversal which means that we’re expecting the
currency to go in the opposite direction how we know that is because of this
pattern that has been shown so we’ve got the head over here shoulder over yeah
and the shoulder of the end here the troughs or the troughs on yeah okay
and so the troughs have not been able to go lower than this point so let’s draw
in lon do I have a land there so it’s just get along okay so that’s that is
the point of support against not really going lower than this it’s actually a
little bit higher it’s about there on the odd occasion a very odd occasion
because below there but it’s not really able to break through this land over
here okay on on either of those occasions on any of these occasions but
that’s where it seems to be stocked so yeah we’ve got the hidden shoulders and
now we’re expecting the currency to go north so why did it stop over there it
stopped there because it hit the Bollinger Band okay and they were
obviously other orders at that level okay saying that not we want to sell the
currency so that with more selling orders then buying orders okay this is a
supply and demand industry where they’re more people wanting to do something then
people wanting to do something else then the currency will behave in a certain
manner okay so over here you can see that there were more people that wanted
to sell the this currency so they won on the price went down very simple so let’s
look at the next the next time frame which is the 15-minute time frame so on
the 15-minute time frame you can see now that we’re very much in a bullish trend
over here but we have a level of resistance and that level of resistance
is over there so what did I say about resistance it means that when you get to
the top and the ceiling you can’t push through the ceiling the ceiling is
resisting you so over yeah here is that resistance over there we’ll just bring
it down a little bit so that’s tickets yeah we go it’s bring it up a bit okay
so that’s basically it and as you can see that’s the top of the candle and
then the top of the weeks over again hasn’t been able to break that point and
we’re waiting for more more buyers again then sellers to come into the market and
to to correct the service current seem to go more polish than bearish so over
here very important that we are above the eight exponential moving average
this is key so as long as the candles are above the eight exponential moving
average we know that we’re in a Bullock bullish trend as soon as that candle
goes and closes below thus moving average and the next camel
opens below the eight exponential moving average we know that the sentiment has
changed and we’ve gone into a bearish a period and a bearish market so yeah it’s
hitting the five this is the far moving average and here is another very
important LAN remember it is the blue line which is the MA 100 so this is the
closeout of the last 100 candles on the 15-minute chart it is a quite an
important candle where is the 200 there’s the 200 and that is another
reason why why we want so getting stuck them getting very close to the mi 200 so
there are lots of orders there so this is a point of resistance rather be as a
point of resistance hopefully we will get into a bullish position later on in
the day okay so now let’s look at the next the next moving average which is
the 15 minutes I’m sorry the 5 minutes L moving average and you can see how with
depth below the 8 that the eights moving exponential okay if this K if a candle
the next candle opens below you will then be in a bullish market a bearish
market again with the currencies gonna go down it’ll probably come down to the
white line as you can see the camera hasn’t managed to come all the way down
got a little bit further down past the watts this is the Bollinger Band the mid
on the Bollinger Band okay and then if it carries on going down will come down
to the red line and then hopefully will come back up again and go back into a
bullish market so let’s look at the m1 okay and this is where we are so we’re
again on the blue line this is the blue 100 it’s the closeout of the last 100
moving 100 candles on this time frame and this is the M 100 so you can see
that there are lots of common entities of why they gather the graph ok the
chart the candles and the process are behaving in a specific manner and not
going through price points because they’ve been stopped on those moving
averages and everybody around the world is using those moving averages so you
can you can bet on it with a fair amount of
that the currency is going to behave in a certain manner so these moving
averages are not lagging indicators there are more predictive indicators and
give you and you know something some information predictive information that
can tell you in advance of what the currency is going to do so you can see
how we are below the eight exponential okay and we stuck on the 100
moving average and also to note we are stuck between here and yes so there is
your point offer of resistance okay we hope that it’s going to be a point of
support that if the scandal again doesn’t break through the salon and does
not go past the the 100 moving average we have a fair amount of certainty that
the currency is going to do thus and carry on going in a northerly direction
if you look at the the sentiment and the direction on the one-minute chart you
can see that then it is in the Polish trend right now so we’re hoping as you
can see I stopped on the blue line this one stopped on the red line which is
your point it was if it came up to the top it would have been a point of
resistance now that it’s coming down we’re hoping that that resistance
becomes a point of support and the currency keeps on going north okay so I
hope that gives you a little bit of information and clarity and a little bit
of sanity instead of just watching your prices IVR moving up and down and
freaking out again that you are a certain amount of percentage of your
capital is involved in trades and you worried again rather learn why the
currency is performing performing the way it’s performing and how to read the
chart your life will become a lot more easier you’ll be comma and you’ll
understand the currency is going to react in a certain way and your account
your deficit will now go into more of a profit rather than losses okay so I hope
that you found this video interesting and educational if you like this video
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One Comments

  • Jenni Walker

    August 12, 2018

    A definite video to watch. I just can't find Part 1!

    Reply

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