Forex Technical Analysis For Beginners From Scratch
Forex Technical Analysis For Beginners From Scratch
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00:00What is up guys this is Kojo Forex aka GBP Legend aka Sniper Trader aka King of Blues
00:05I know it's been a while I shot a YouTube video you guys know it sometimes you can get washed out in this YouTube thing
00:10But sometimes I get energy to shoot again very interesting content that is gonna add value to your technical analysis
00:16And then your journey in trading today
00:18I'm back again with another YouTube video basically teaching you how to get started on technical analysis, right?
00:24So in the first video I taught you how to get started in trading where I taught my girlfriend in a manner
00:29That would have taught you how to trade right today
00:32We're gonna talk about how to do technical analysis in a way that I've taught you how to write so in this example
00:37I'm using my very good friend Rick FX Rick has been my mentee from 2018
00:42I've taught him a lot of stuff right and I keep teaching a lot so today
00:45We're gonna be doing is basically teaching him the basis of technical analysis in a manner that would have taught you
00:51How to think about the market so yeah without wasting my time. I'm gonna invite Rick over so Rick come over
00:56Let's let's get it started
00:58So basically like I told you guys what we're gonna be doing today is basically understanding the market from an aspect perspective
01:06Basically delving into technical analysis and how experts or pro traders think about a market so yeah
01:11I'm gonna be teaching Rick as if I'm teaching you a beginner Rick when you look at the market, right?
01:16What do you think about what is basically what runs to your mind when you see the market random movement?
01:21So do you think that is very easy for a beginner to predict the turning point of the micro movement to make like accurate?
01:27Predictions, okay, this thing is gonna go up. Let me buy this is gonna come down
01:31Let me sell know the movements are so random that you can't even see right right so to begin with I'm gonna
01:37Give you the basic definition of what technical analysis is right so basically before you even think about a market or its random nature
01:45Think about technical analysis of what as the study of trends and turning point in the market
01:53You know that what I mean, yeah, right
01:55So you want to understand the market as all you want to understand technical analysis is basically how to identify
02:00Trends is the market going up is it coming down and turning point right which is basically the reverse out
02:08What is it reversing from the bottom to the top was reversing from the top to the bottom?
02:12Once you would wrap your head around this you have a little bit of an edge in the market already
02:19Right now there are so many concepts that have stayed around for a long time, but most people interpret it differently
02:26So they were going to look at it from a 3d perspective
02:29What would change your mind and then your intuition when it comes to technical analysis, right?
02:34And they were going to be using most of the very popular concepts that have been around for so many decades
02:40But people still feel like there's extra things that you need to learn before they can become like, you know
02:46That profitable trader one of it is trend line and then the other is support and resistance, right?
02:53Right, so we're gonna begin with even support right now. How would you understand support in the market?
02:59So from a layman's point of view support means what?
03:03Be good
03:05So in the market, how do you see support?
03:07Well, i'll see it as a previous level
03:11That market has been no prior to knowing me. You're defining the tenacity
03:17This is going through okay
03:19support
03:20will be
03:21Man, I already know this shit so I can't even
03:24Fake it. I understand you no problem, right prior to knowing me
03:27He would have defined support as whether it continues hold up in the market where the market just goes up, you know
03:32Let's try and illustrate that so you'd have seen support as you know, come down we go up
03:37We come back to the same place. We go up. We come back to the same place
03:40We go up then you would have defined this range as support is it am I wrong or right? You're right
03:46Now
03:47After knowing me I defined support to him as any turning point in the market
03:52Yeah from the base is support and any turning point in the market from the top is resistance
03:57So that's how we define our support and resistance and then it is it makes sense to think about it from an economic point of view
04:05Not from technical analysis point of view alone in the sense that how did we define price floors and price ceilings?
04:12We define price floor as any point in which the market feels going lower and then it reversed
04:17And price ceiling is any point above which the market feels going higher and then it reversed
04:23Is the same principle when you're thinking about support and resistance, right?
04:27In the sense that support is in price floor
04:30So the market came down it hit some point for some reason which we can never know then it started going up
04:37for that very reason alone
04:39This base down here becomes what support
04:43For that very reason alone this base down here becomes a support
04:47And then any price point above which the market failed to go any higher so for this very reason alone
04:53This point right here
04:56becomes what
04:57A resistance am I wrong or right? You're right. So this place is what?
05:03support
05:05Support
05:08And then this place is called what resistance
05:15Resistance is it?
05:18Yeah
05:19Now the moment you're able to wrap your head around this then you're a step ahead in the market technical analysis wise
05:27Right. Now, let's look at an example from just support and resistance in this week's
05:33Trading right? So we're going to use an example from the support point of view on
05:38GBPJPY another classical definition of technical analysis, right?
05:42Like I said is using historical price movement to anticipate or predict future price movement
05:50Right. So if we're using historical price movement from support and resistance, right?
05:55Then we can see that what in the history of GBPJPY
05:58GBPJPY which is pound versus japanese and this area right here served as a support
06:04Right. Yeah
06:05Which was around 20th of august
06:08So technical analysis wise we know that if this market comes back to this area right here if we trace it horizontally
06:16It can also perhaps serve as what a support again. You agree with me?
06:22Now what can we see here this market served as a support here
06:28It hit this market went all the way up did its own thing came back right there. What did it serve us again?
06:36And then it went up now the moment you are able to identify this then you should be able to speculate
06:42when this market hit this zone that it can
06:46Potentially go up again and then you want to speculate there for your buy setups
06:52Okay, now the problem here is that it is not guaranteed that it can go up again
06:59But it may go up. That's why traders gotta follow proper risk management
07:06And that is what speculation is about. That's why we always advise that do not risk more than what?
07:12Two percent between one and two percent per single position
07:17So if you have a hundred percent, which is like your total account size
07:20We're expecting that you do not expose more than two percent in speculating the pound
07:25Versus japonesian is going to go up when it hits this support again
07:30It's as simple as that. So that's the concept for support, right? I think that is well explained
07:35Now, let's look at the resistance perspective
07:37We're going to use the same pound japonesian, but from another historical point of view now
07:41I've explained the way you think about resistance, right?
07:44Which is what any price point above with the market failed to go any higher now
07:48We can see that during this point in the market the market failed to do what go any higher here
07:53So it's already created that point of what resistance now if you trace this
07:59Horizontally again, what can you see that?
08:02After a couple of weeks when this market came back here it failed to trade higher
08:08So again, you want to speculate at that region
08:11That it can potentially come back down
08:14When it hits those region
08:17And then what can we see specifically that the market came back down?
08:20So if your speculation was right from technical point of view, well, you have made money or not
08:25You made money exactly. It doesn't mean that the next day you're going to make money as well, though
08:29That's why risk management is very important. So that's also the first point. So we've talked about support. We've talked about resistance
08:37Now we're going to go on to the next topic, which is what?
08:40Trend line. So let's start from the basic definition of a line. What will you think of as a line?
08:45A line is something that connects
08:48from point a to point b
08:51Great as simple as that. You don't even need to complicate it connecting of two points creates a line, right?
08:58So once we can connect point a point b, then we have what a line, right?
09:04Now, can you consider just point a point b as a trend line?
09:08No, why?
09:13I will bring this in
09:18Laugh or you will laugh
09:20a trend
09:22Is formed
09:24If it misses the point repeatedly. Great. Great. Great. Great. So you'll be shackled
09:31Anyway, yeah, so if we have point a
09:34right
09:36Oh if we have point a here
09:39Right. Yeah
09:41And then we have point b
09:44Also here
09:48We'll only say this line
09:51It's potentially a trend if we have point c concurrently in that same line, is it?
09:58And then we can connect point a b and c then we say no now this line is no more just a line
10:04But it's what a trend line
10:06Potentially we can have points d also continuing on the upside like that, right?
10:11Potentially we can have point b. Do you agree with me or not? I do. Yeah, right
10:16So we say what is the trend line and then it's part of what the tools that traders have
10:22for speculation basis
10:24Right in the sense that we see the market. Let's say it starts this trend from the inception
10:30It moves on the upside it comes back down it hits point b it goes on the upside
10:35We can speculate that what it can come back to point c
10:38And then go back up again and then come back to point d and then go back up again
10:43Right because it's creating a trend in the market where we can use trend lines as a good basis to find entry
10:50for the market on the upside
10:52Now with that established means that anytime we have point a and b
10:57Then we can also anticipate that we can have what point c
11:00Which can be what the point of interest for us to find a trade setup in the market. Do you agree with me or not?
11:06I do
11:07Great. Now, let's look at that. Also another example from this perspective. We're going to use swiss franc japanese here, right?
11:13Now if you look at swiss franc japanese yen, right?
11:16You're just going to use swiss franc japanese. If you look at swiss franc japanese yen for this week, right?
11:22now
11:23I'm going to use a backtesting tool so that we can be able to have a good perspective, right?
11:27Let's look at this even from the one hour perspective, right?
11:32Now if we're using a backtesting tool remember that I said what we have
11:36Points created when we are when we can connect to
11:39You know wicks in the market, right?
11:42So if you're looking at this what we have here point one here as an inception
11:46And then point two running through the wicks. Do you agree with me or not?
11:50So we have what a line now, right it is not a trend. Yeah, is it a trend? No
11:55It is what now a line great now for speculation basis. What are we waiting for?
12:01Great, it should come hit this point and then go up right? Yeah. Now, let's look at what happens in this market
12:10Do you have the third touch or not we do so what do we want to do as traders speculate great
12:16And now how much do we want to risk in the market maximum two percent great and then we're anticipating as you go out
12:22to
12:23Possible another height is it? Yeah, great. Now with this perspective in mind
12:28We are using trend line as a basis of what speculates or anticipating next move in the market
12:34Right just using the point one point two point three rule
12:38And then if we have our setup looking like this and then we put on our lot size
12:42Then we anticipate that it should go in our favor is it yeah, let's see what happens with this market
12:50Boom boom boom literally just keeps climbing up
12:55So this is just part one of technical analysis where we just use support resistance and trend lines, right
13:03Yeah, i'm going to be teaching you more about
13:06Fibonacci i'm going to also be teaching you more about psychological levels. I'm going to be teaching you more about
13:12You know very deeper concepts that also, you know correlation cross-referencing
13:17And then candlestick patterns all of this right in the next couple of series that will make you understand exactly
13:24How pro traders keep making money on the market from this simple analysis basis, right?
13:30If you love this video and then you want to keep watching the next couple of series that i'll be doing refer to the end
13:36You know what to do smash the like button and subscribe to this channel
13:40Make sure you do that also click in the link in the description to join the kojo forest telegram community nest
13:45You can going to be dropping tons and tons of trade from this kind of analysis out here
13:49And also follow me on all social media at kojo forex follow fred also at rick underscore underscore fx
13:57So that anytime we have a video and then he's with me. You can also follow the update so without wasting much time
14:03I hope you guys enjoyed this short youtube but insane very deep content, right?
14:09And then yeah, we'll see you guys in the next one
14:12peace out
14:17In the sense that how did we define price flows in the sense that how did we
14:25Fuck
14:38Hey, let's go