All language subtitles for 3. Entry

Entry Let's now address the most
operational section by first looking at

should enter the market.

Why you shouldn't trade with limit
orders.

But before answering this question,
let's talk about how not to enter the

market. I often see Wyckoff traders use
limit orders to somehow anticipate the

entry. A very common example is when
trying to take advantage of a potential

spring, in the event it finally occurs,
of course.

What these traders usually do is
identify the low of the structure and

limit order there to buy below the
current price.

In other words, a buy limit.

In this way, when the price reaches that
level, it activates the order and the

trader enters the market long, with the
hope that the spring will be confirmed

and the price will rise.

Personally, I don't relate to this way
of trading at all, since it goes against

the reactive approach of the
methodology.

Our advantage lies in confirming the
actions as they appear.

So if we were to trade in this manner,
we would simply be gambling on the

reversal taking place at that moment
without the slightest idea of whether

will happen.

We know this is a key trading zone, a
potential bearish breakout or a

spring. Why not gamble on the potential
bearish breakout?

If the answer is simply based on the
fact that the sign suggests that we

go long, that's not good enough for me.

We know how volatile the markets can be
and how any news or the entry of traders

with a greater capacity can reverse the
sentiment at any given moment.

So being predisposed to only accept that
particular action seems too risky to

me. Also, where do you put the stop
loss?

I wouldn't be surprised if a trader
using this approach didn't bother with a

stop loss either.

What difference does it make? Well, it
makes a huge difference because you can

bankrupt your account in a single trade.

So where do you put it?

You don't have any reference.

You would have to do it arbitrarily, so
most likely it will either fall short or

be placed too far away.

Imagine something like this happens,
that the entry order is executed.

You place your stop loss at some
indeterminate point and the price hits

before reversing again.

I'm sure this happens.

Worth of all, your scenario might have
been as predicted, but by not waiting to

confirm behaviors, you will have made
bad decisions.

By placing a buy limit, you are gambling
on the price developing two movements,

the bearish one to generate the test and
the bullish one that will take the

price to the high part of the range.

The key here is that we can only really
predict the development of one movement.

In this case, we might initially predict
the bearish movement that will lead to

a potential spring, once the price
reaches the area where it should turn.

have to analyze the price action and the
volume again to see if the imbalance

that generates the bullish reversal
occurs.

But anyway, you know that the Wyckoff
method provides you with different

opportunities, so now you definitively
decide to execute the same type of

this time looking for a successful test
of the spring.

But why not even consider that said test
might never take place, and that

instead of confirming the test of the
spring, the price might continue to

which would confirm that our analysis
was not correct.

We shouldn't be biased in one direction,
let alone execute those kind of orders.

The problem is that this approach to
executing trades is completely wrong.

And what happens, although it seems
strange, is a real example.

It is very erratic behavior but can
often happen, so there is no point in

trading under the premise of trying to
guess.

Fundamentally, the idea is that we
should be continuously analyzing the

interaction between buyers and sellers,
though we may be directionally biased

towards one side based on the context.

We need confirmation when the time comes
that the approach is sound and that the

market itself confirms it.

During a potential test of the spring,
if we see that aggressive buyers appear

to push the price up, this is a sign we
need to see in order to confirm that our

analysis is correct.

In this case, it would offer us a
trading opportunity.

It is also important to remember that
even if we see our entry trigger in the

predicted zone, there is no guarantee
that our trade will end in a profit or a

loss. As we have already seen, new
information is constantly entering the

and this could change the perception of
value by participants at any time. But

at least we will be more likely to make
the right decision at all times.

This is not the only example of making
an incorrect use of limit orders to

the market.

There will also be the trader who,
believing that in the current position

spring is going to be confirmed, instead
of having previously bought with a buy

limit order, decides to launch a buy
stop order above the current price to go

long in the event the price re -enters
the range again in the hope that the

spring will be confirmed and a strong
upward imbalance will be generated.

We are in exactly the same situation as
in the previous example.

Why couldn't this be the real breakout?

We have already seen what happens, which
is activation of the entry order and

the exit due to the stop loss.

I repeat, it's true that this market
behavior is somewhat strange.

But just because it's strange doesn't
mean that it cannot appear.

This is the mindset we need. Our job is
not only to try to guess, but to try to

confirm market behavior as soon as
possible.

And of course, there is the classic
entry in favor of the breakout.

For me, a breakout does not offer a
trading opportunity.

We already know why. It is a trading
zone where anything can happen.

Gambling on the generation of a real
breakout is just as bad as gambling on

of a false breakout.

In this case, the trade would place a
sell -stop order at the lows of the

structure, waiting for the bearish
continuation of the movement.

Unless you have taken profits quickly on
the initial continuation of the

movement, chances are you will
eventually end up with a loss if you

this way.

As I said, it is not a type of execution
that fills me with trust.

since it goes against the principles of
the methodology.

If you are using any of these methods to
enter the market, unless you have them

properly back -tested, my recommendation
is that you think logically to see if

they really make sense to you.

The Entry Trigger In this part, we are
going to look at the different behaviors

that we can use as a trigger to launch
our orders on the market.

We find ourselves at the point where the
opportunity has been confirmed by going

through our trading checklist.

and we have the green light to look for
the last element we need to definitively

confirm our participation in the market.

More often than not, our main trigger
will be to wait for the appearance of a

candlestick showing intent, a
candlestick that denotes aggressiveness

direction we want to trade.

Because of the message they convey, this
is the best way of definitively

confirming the opportunity.

If we are in a trading zone where we
want to buy, and after seeing all the

necessary signs discussed previously, we
observe a candlestick showing bullish

strength, This informs us of a clear
intention on the part of the buyers.

The candlesticks that meet the
characteristics we are looking for are

a wide range, high volume, and a closing
price at the extremes, regardless of

whether or not there is a wick at the
opposite end, and always analyzing in

comparative terms with respect to the
previously seen candlesticks. We have

looked at this previously with respect
to the nature of the spring. That

made up of a single candlestick,
directly activates the trigger for us.

since it complies with the price and
volume characteristics that we would

for it to denote strength.

Moreover, regardless of the pattern
generated by the false breakout, they

all ultimately made up of a candlestick
denoting strength that ends up

confirming the pattern, and this
candlestick denoting strength is our

trigger. So the idea is clear.

If we are in the trading zone, we have
already done all our prior analysis and

some form of trigger appears, we have
the green light to launch the order.

The appearance of candlesticks showing
intent ultimately confirms a change of

control among market participants in the
very short term.

At that point, we will have everything
aligned. The context and the roadmap,

which will always refer to the longer
-term control, and the appearance of the

entry trigger, which refers to the
shorter -term control.

Here are some examples of our triggers,
both for the long and the short side.

If we look at it from the point of view
of market fractality, In essence, they

all represent exactly the same type of
reversal, with the only difference being

that some develop faster than others.

This concept of fractality is very
powerful and easy to understand.

Imagine that we observe a one
candlestick trigger on a daily chart.

Well, if we go down in time, for
example, to a four or eight hour chart,

observe that same behavior as the two
candlestick trigger.

And if we go down to the hourly chart,
we will observe the same behavior as the

three candlestick trigger, and so on.

And those last triggers would probably
represent the behavior seen on a chart

15 and 5 minutes approximately.

So you need to be aware that the
triggers that we have just seen are a

reference, and that the market can tell
us exactly the same thing in multiple

ways, depending on the time frame in
which we are working.

Here we see two very different examples
that ultimately represent the same

thing.

Ultimately, the key is to determine the
reversal by identifying a candlestick in

the opposite direction, plus another one
in favor of the movement we expect, and

preferably with the latter showing a
closing price at the opposite extreme to

the previous one.

Let's look at some particularities we
should take into account with respect to

the entry trigger.

For example, the fact that one
candlestick trigger should be composed

bullish candlestick in the event we want
to buy and that the remaining triggers

should fail to close above the last big
bearish candlestick that would establish

control. We can also use this as an
extra input that will add more or less

strength to the scenario.

This slide shows practically the same
behavior with the only difference being

the closing price of the bullish
candlestick, which would ultimately

greater or lesser aggressiveness.

In the pattern on the left, we see that
the bullish candlestick manages to close

in the upper third of the bearish one.

Although it is true that it could be
taken as valid for use as an entry

the fact that it is unable to close
higher suggests that the aggressiveness

the buyers is not at its peak, which
could make us doubt whether to execute

trade or at least make us reduce our
exposure.

In the middle pattern, we see more
commitment from the buyers who have

to push the price to close above the
opening price.

This representation provides us with
greater confidence than the previous

And finally, on the right, we see the
representation that most suggests the

strength is on the buyer's side, with
the bullish candlestick closing even

the maximum of the bearish one.

These three representations should be
enough to activate the entry trigger.

Here is a specific example for the case
of a one candlestick trigger.

Can it be traded? Of course. It's
exactly the same as we saw on the

slide. As I said, Personally, I feel
more confident if the candlestick is

bullish since it represents even more
commitment from the buyers.

But let's not forget that the most
important aspect of a trading

the previous analysis that we have done.

That is, the context, the roadmap, being
in the trading zone, and observing most

of the differential inputs.

We should simply treat the inability to
close above the opening price,

ultimately resulting in a bullish
candlestick, as one more input.

Another, perhaps trickier, particularity
regarding the entry trigger is what

happens if the candlestick that
determines the last control is broken,

candlesticks that do not appear to show
intent.

Here we have two examples, one bullish
and one bearish. If we refer back to the

concept of fractality, in the end, if we
wanted to represent everything that

happened there in a single candlestick,
the result would be our single

candlestick trigger.

So, should we execute our trade in this
case?

In this situation, I would be more
reticent to trade following that type of

behavior. Although it is true that, as I
have just said, the behavior at the

aggregate level would create our entry
candlestick, implicitly I would need to

see that final element of clear intent
in the movement in favor of our

direction, which is why I wouldn't take
up a position in this case.

But that's everything.

Remember that we've previously talked
about being more conservative or

aggressive in our approach as traders.

We already looked at this in terms of
trading zones, and here we can also

the concept.

From what point of view?

Well, let's consider the last major
candlestick that we have against our

direction. Let's then also apply the
concept of a reversal movement.

That last candlestick is going to
represent the short -term control.

So, a conservative trader will wait for
this control to have been broken.

while an aggressive trader might
consider entering the market even before

change in the short -term control takes
place.

We have seen this previously and it all
has to do with the level at which the

candlestick closes.

The conservative trader will wait for it
to close at least in the final third of

the previous candlestick, while the more
aggressive trader could enter

regardless of where the current
candlestick closes relative to the

indicating the short -term control.

In other words, if we are looking for a
buying opportunity and we take a more

conservative approach, we will wait
until the price has closed at least at

upper end of the last bearish
candlestick.

This is what we have in this example.

The bearish candlestick that establishes
control closes below the trading level.

A rejection candlestick is generated
that fails to recover the level, and

subsequently our bullish strength
candlestick appears.

which re -enters above the trading level
and manages to close at the maximum of

the candlestick indicating bearish
control, establishing the definitive

trigger. Moreover, the last dynamic
established by the short -term control,

this case bearish, would already have
been broken by this point.

Could the aggressive trader have entered
in that middle candlestick with its

bottom wick?

From my point of view, it would be too
aggressive an entry.

If that candlestick had closed above the
trading level, At that point, its

closing price would at least be in the
middle third of the bearish one. And

would give us a bit more confidence.

In terms of the entry order, I always
recommend using a stop order in the

direction of the movement.

In other words, if what we want is to
buy, we will use a buy stop located

the current price.

And if what we want is to sell, we will
use a sell stop located below the

current price.

The development of a candlestick showing
intent is a clear sign of interest, but

it is worth using a stop order as a
definitive filter that suggests a

continuity in the movement started with
the trigger candle.

Continuing with the example of our entry
triggers, in the case of long trading,

we would place the order above the
candlestick. If we are going short, we

place the sell stop entry order below
the trigger candlestick.

This process will always be exactly the
same.

How far below?

at least one tick below the high or low
of the candlestick and preferably two to

avoid micro false breakouts.

Although it may seem ridiculous, it
happens. A mini false breakout on the

previous candlestick and reversal.

In this way, we can enter in favor of
the momentum and avoid these

microstructure behaviors.

The reason for using this type of order
and not any other is that it provides us

with even more confidence.

Sometimes we will see the development of
what initially looks like a candlestick

showing intent and right after it
closes, the price reverses sharply in

opposite direction.

What happened here is that an absorption
process has been carried out internally

at all those price levels and traders
with greater capacity were positioning

themselves on the opposite side.

By using this type of order, although we
won't be saved from this potential

situation, On many occasions at least,
it will prevent us from entering the

market where this has happened.

Any movement that tips the balance of
the market will have strong momentum,

pushing it in the same direction. With
this type of limit order, we will be

entering in favor of the momentum of the
imbalance.

If the order is not triggered on the
next candlestick, what can we do?

The ideal behavior would be the
activation of the entry order in the

candlestick due to the aforementioned
momentum.

So here we have several options, from
basically eliminating it and discarding

the opportunity, to waiting for the
subsequent price development.

Personally, I would hold the order for
two or three candlesticks maximum, after

which I would cancel it.

Something that would also make me
discard the opportunity and cancel the

is when the price reaches the opposite
extreme.

Our position was in favor of that short
-term momentum.

So the non -activation of the order and
of course the reversal in the opposite

direction leads us to think that there
really was no directional interest

that first impulse.

So it is best to stay out of the market
and look for a new opportunity later.

Going back to the example we saw
earlier, since we are considering an

opportunity to buy, we would use a buy
stop and place it just above the high of

the trigger candlestick. This is the
location we will always work with.

We will look at some tips regarding the
location of the stop loss later, but I

can tell you now that it will be on the
other side of the entry trigger.

Another important particularity involves
breakout trading, and more

specifically, those situations where our
entry order would be relatively close

to the breakout of a liquidity zone, be
it a simple prior pivot or the extreme

of a structure.

Imagine that we are trading this
structure and we observe that after a

evident spring in sign of strength, We
are in trading zone number 5.

Continuation strategy within the range
in phase D and the market generates that

pivot plus the subsequent false
breakout.

As we see, the trigger candlestick is
also the candlestick that generates a

false breakout of the previous low and
even manages to close at the upper end

the last big bearish candlestick. We
have a 2 candlestick trigger.

But what happens? If we look closely, we
are relatively close to the high of the

structure.

If this trade had been taken, the result
would have been a win, but that is not

what this is about, because on this
occasion it has gone well, but on many

others it won't, and our main objective
should always be to favor the

preservation of capital over and above
the search for profit.

This is about applying the knowledge
that we have acquired throughout the

course, that we know that this area, the
end of the structure, is a very

important trading zone that will
generate major interaction between

participants.

and we do not know what will happen. The
breakout could be real and continue

upwards, or an upthrust may be generated
and the price may fall.

And since we don't know what might
happen, once the price reaches this

must at least carry out the most
defensive position management possible.

And this basically means setting the
stop at break -even, that is, just a bit

above the entry level.

We will talk about this in more depth in
the section about position management.

For now, Simply keep in mind that if the
entry order is located relatively close

to a liquidity zone, we have two
options.

Either we enter but manage the position
with a stop at break -even when the

price reaches that zone, or we don't
even enter and we look for a position

on. In this example, if we have entered
and carried out the proper management,

we would have quickly been ejected from
the market at the break -even point.

We might also find ourselves in this
situation.

where the entry trigger closes above the
trading level.

This would require us to place the entry
order right in the liquidity zone.

What do we do?

Well, the rationale is exactly the same
as in the previous situation.

We find ourselves in a situation where
there are two highly possible scenarios,

and we have no way of knowing what will
happen. This means that buying in that

area would be too risky.

We would be gambling on the market
continuing to rise.

But at that point, we do not have any
clear signs indicating whether the

breakout is going to be confirmed or
not. For this reason, the most sensible

thing would be to discard that
opportunity in the first instance and

monitoring it in the event that it
offers up a second opportunity to enter.

Something else to bear in mind is that
there will be occasions when, even

seen the genuine entry trigger on the
trading zone, we may see an excessively

wide candlestick which we need to be
careful with.

especially if it is accompanied by very
high volume.

This is because the type of candlesticks
which manage to travel a long distance

and generate a large volume of trading
generate doubts about the real intention

behind those trades.

Such a high volume puts us at least in a
position to wait for a later test to

verify the intention of the
participants.

In this example, we see two similar
situations.

We are in a range context where we have
previously seen a potential spring and a

good sign of strength, so we are ready
to look for any opportunity to enter the

market long, and we can observe a large
candlestick showing bullish intent with

a closing price at the top and a huge
wick at the bottom, denoting the

aggressive entry of buyers.

The key is that it is accompanied by a
really high volume, so the market is

forced to perform a test in that
direction to be able to assess the

towards it.

After a new false breakout, the market
develops upwards.

An entry with a very tight stop loss
would probably be triggered.

And a little higher, there is another
trading opportunity.

Small sideways movement and the
appearance of a large bullish

accompanied by another large volume peak
and with exactly the same result.

The key is to observe the big difference
between the size of the previous

candlesticks and that of the trigger
candlestick.

You just have to be alert to this
potential situation.

Entry by the context.

Since we're now looking at more advanced
content, it is worth looking beyond the

classic types of entry and explaining a
more complex type, which I have called

by the context.

This type of entry is based on the idea
of prioritizing the development of the

context and the roadmap over any other
element.

This is why decision making based on
this idea should meet the recommended

characteristics that any trading
approach should have, based on the

the structures.

And what I am referring to is nothing
more than the trading checklist that we

have previously defined, as we mentioned
earlier.

The more of these inputs we have in our
favor, the greater confidence we will

have in the trade.

In this case, for entries by context, we
need the market to follow almost the

perfect textbook behavior.

Applying this concept should be almost
exclusively limited to a situation in

which we are looking for the potential
test after the breakout, whilst waiting

for the confirmation and subsequent
development of the trend outside the

Imagine that you are somewhere in the
orange box, trying to find the

entry trigger.

And herein lies one of the problems we
might come across when trading in real

life. What can we do if we aren't in
front of the screen at that moment?

Perhaps the most logical thing to do
would be to discard the trade and not

the market since we cannot verify the
appearance of our trigger.

A second option would be to prioritize
the development of the general context

over the appearance of the trigger
specifically.

This is the rationale behind the type of
entry by the context.

If we perform our analysis and identify
all of these signs, this suggests we are

in the best possible context.

and all this should carry more weight
than the latest action represented by

trigger. Well, this would be an example
of which we could enter by context.

What inputs do we have in our favor?

We have the context, determined by the
potential accumulation pattern.

We have the roadmap, which suggests to
us that the price will most likely

develop a test after a bullish breakout
before continuing a trend movement out

of the range.

Obviously, we are in a trading zone. The
overall volume during the development

of the range is declining.

The false breakout travels a significant
distance and reverses quickly.

The impulses and corrections follow a
harmonious pattern, both in price and

volume, evidenced by the increase in
volume in the impulse breakout movement

the decrease in corrective test
movement.

There are no significant movements
against our scenario.

The price has not re -entered the range
and there is proportionality between the

breakout and test movements.

In short, There are a large number of
inputs in favor of the bullish scenario,

so we would consider it highly likely to
develop as expected.

From here, we must determine what type
of risk management we perform, since it

is an entry by context and it is not
clear what the trigger is.

It may be best to reduce the risk a
little, since you never know what might

happen. In this case, we are looking at
an example of a distribution pattern.

Right at the point where we're looking
for the test after a bearish breakout,

what do we have?

context, roadmap, trading zone, volume
increase during part of range

development, a very clear display of
weakness stemming from a minor false

breakout, although it breaks through
several previous highs, decreased volume

after the breakout, no re -entering of
the range, and no big bearish movement

volume against the scenario.

All this means we should consider the
significance of the structure when

assessing our entry trigger.

We should simply enter with a market
order, and that's that.

If we enter without having identified
our entry trigger in advance, this can

lead to doubts about where to place the
stop loss. In this case, the most

sensible thing would be to place it at
some point within the structure, at

which, if reached, could turn out to be
a false breakout rather than a real

breakout.

Like I said, you don't have to allocate
all the risk to it.

One way to manage it is to enter with 50
% of the position and add the other 50

% if you see the definitive trigger.

candlestick or enter expecting a
continuation as happens in that

thrust