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Alright, let's say we have a
trend that's coming down, we're
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00:00:05,783 --> 00:00:08,583
going to come up, create
resistance, come down, we're
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00:00:08,583 --> 00:00:11,063
going to come up, create
resistance, and come down,
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00:00:11,063 --> 00:00:13,823
right? So, we have a trend
that's moving down. So, we have
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00:00:13,823 --> 00:00:16,703
a bearish trend at this point.
So, whenever we have bearish
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00:00:16,703 --> 00:00:19,903
trend, what are we looking at
at this point? We're looking at
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resistances to form because
once we see a resistance
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00:00:23,023 --> 00:00:25,903
forming, then, we can identify
that okay, since we have a
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00:00:25,903 --> 00:00:30,363
resistance forming, there's a
very high probability that can
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00:00:30,363 --> 00:00:35,603
continue pushing down right so
let's say we have a bullish
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00:00:35,603 --> 00:00:40,723
candle at this point and then
boom we have a resistance form
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00:00:40,723 --> 00:00:43,563
now we have a resistance form
now let's suppose this is a 30
13
00:00:43,563 --> 00:00:46,723
-minute time frame or a 1 hour
time frame 15 maybe a little
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00:00:46,723 --> 00:00:49,603
bit tricky because as we all
know the 15 minute time frame
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00:00:49,603 --> 00:00:53,963
confirmations are weak
confirmations 30 minute and 1
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00:00:53,963 --> 00:00:58,163
hour are strong confirmation so
let's say like you know price
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00:00:58,163 --> 00:01:02,283
was coming down we made support
came up and now we're creating
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resistance to possibly continue
pushing down now this case
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00:01:06,603 --> 00:01:08,723
let's say you're looking at
this you got all the
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00:01:08,723 --> 00:01:13,083
confirmations and let's say you
also have this range and this
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is a 35 pip range and you look
okay you know what I can
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probably take a cell over here
and I can have a very very good
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trade at this point and you're
going to say okay you know what
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I'm going to take a cell right
here so you're going to take a
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sell and this is going to be
static risk so if you're using
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00:01:31,703 --> 00:01:38,023
static risk you're maybe using
your full 1% trade or you may
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00:01:38,023 --> 00:01:44,183
be using your full 2% trade and
you're taking a sell and your
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00:01:44,183 --> 00:01:47,943
stop is obviously above the
candle right your stop loss is
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00:01:47,943 --> 00:01:51,103
always above the previous
candle you're taking a sell and
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00:01:51,103 --> 00:01:54,943
you're anticipating price to go
down with your full 2% risk
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price goes down you make some
profits you close the trade
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00:01:57,743 --> 00:02:00,823
you're like perfect I use
static risk and price went in
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00:02:00,823 --> 00:02:06,063
my favorite now remember this
is very very very important.
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Whenever you're trying to use
stop losses your stops always
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00:02:10,263 --> 00:02:14,983
have to go above the previous
candle if you're taking a sell
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00:02:14,983 --> 00:02:18,823
and it has to go below the
previous candle if you're
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00:02:18,823 --> 00:02:22,223
taking a buy. So it's not about
how big your stop loss is. It's
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00:02:22,223 --> 00:02:25,023
not about where your stop loss
it's it's all about where your
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00:02:25,023 --> 00:02:27,703
stop loss is. Not about how big
your stop loss is. Like
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00:02:27,703 --> 00:02:30,623
sometimes the guys do is like
you're going to trade gold or
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00:02:30,623 --> 00:02:33,763
you can trade pound yen and you
can turn say oh man you know
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00:02:33,763 --> 00:02:36,403
what I have a very aggressive
stop loss that's just not
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00:02:36,403 --> 00:02:38,963
going to fly over here right if
you're looking at 30 -minute
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00:02:38,963 --> 00:02:41,163
time frame you're looking at a
one hour time frame you have to
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00:02:41,163 --> 00:02:45,883
make sure your stops are above
the previous candle if you're
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00:02:45,883 --> 00:02:50,243
taking a sell and your stops
are below the previous candle
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00:02:50,243 --> 00:02:54,283
if you're taking a buy because
take a look at this if this
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00:02:54,283 --> 00:03:00,843
candle has to go down it has to
respect the high of the
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00:03:00,843 --> 00:03:04,343
previous candle and that's
where your stop is going to go.
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00:03:04,343 --> 00:03:08,983
It has to respect the high. I
can't stress this enough. It
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00:03:08,983 --> 00:03:13,543
has to respect the high of the
previous candle if it has to go
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00:03:13,543 --> 00:03:15,823
down. So, that's where your
stop is going to go. If for
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00:03:15,823 --> 00:03:21,463
some reason, price does not go
down and price let's say starts
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00:03:21,463 --> 00:03:24,503
to move up from this point,
what are you going to lose,
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00:03:24,503 --> 00:03:26,703
right? If we break above this
high, what are you going to
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00:03:26,703 --> 00:03:29,063
lose? How much percentage is it
that you're going to lose?
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00:03:29,063 --> 00:03:33,563
You're going to lose 2% because
you have static risk, right?
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00:03:33,563 --> 00:03:38,083
You have static risk so you
going to lose 2% of whatever
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00:03:38,083 --> 00:03:42,443
you risked okay that's static
risk now let's talk about
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00:03:42,443 --> 00:03:46,043
dynamic risk which is very
important here and usually I
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00:03:46,043 --> 00:03:50,243
use dynamic risk when like you
know what I'm not too sure
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00:03:50,243 --> 00:03:53,123
about certain moves I'm
going to use dynamic risk
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00:03:53,123 --> 00:03:56,683
static risk most times I use
static risk because I can
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00:03:56,683 --> 00:03:59,203
manage risk and and we're
going to talk about managing
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00:03:59,203 --> 00:04:03,543
risk in the third section on
static risk so now risk.
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00:04:03,543 --> 00:04:07,063
Dynamic risk, let's say you
have or you want to risk 2
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00:04:07,063 --> 00:04:09,303
percent. You're risking
twopercent and you're going to
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00:04:09,303 --> 00:04:11,383
say, okay, you know what I'm
going to do? I'm going to break
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00:04:11,383 --> 00:04:15,663
this 2%, my risk down into two
positions. So, you're going to
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00:04:15,663 --> 00:04:22,983
break this down into 1% and 1%.
That's what you going to do.
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00:04:22,983 --> 00:04:25,703
You going to break this down
into 1%, 1% and now you have
72
00:04:25,703 --> 00:04:27,703
two position. The first
position, you're going to say,
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00:04:27,703 --> 00:04:29,183
okay, you know what? I'm
going to take the first
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00:04:29,183 --> 00:04:32,983
position. Now, these are all
hypothetical situations, right?
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00:04:32,983 --> 00:04:36,903
Can move up make a wick or
candle can move down right so
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00:04:36,903 --> 00:04:41,103
what happens in this point is
that you're taking a sell as
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00:04:41,103 --> 00:04:45,383
soon as the candle starts so
this is where your first
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00:04:45,383 --> 00:04:49,623
position goes 1% you're using
dynamic risk now if price goes
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00:04:49,623 --> 00:04:53,663
up this is where your stop loss
now if price hits your stop how
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00:04:53,663 --> 00:04:56,743
much are you losing at this
point out of your 2% you're
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00:04:56,743 --> 00:05:00,863
losing 1% okay because maybe
you're not sure about this
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00:05:00,863 --> 00:05:04,723
position your new trader this
is a that you've been watching
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00:05:04,723 --> 00:05:07,283
for a long time and you're
executing on this for the first
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00:05:07,283 --> 00:05:09,763
time. So you're being very
cautious of the risk you're
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00:05:09,763 --> 00:05:13,283
taking. So if price hits the
stop you're losing one percent.
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00:05:13,283 --> 00:05:16,163
Now these are there are
different variations. Sometimes
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00:05:16,163 --> 00:05:22,003
what guys tend to do is that as
price retraces they will add
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00:05:22,003 --> 00:05:25,163
another position and this is
going to be another one
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00:05:25,163 --> 00:05:28,323
percent. They're going to add a
position. Right? And the stop
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00:05:28,323 --> 00:05:33,943
is going to be at the exact
same place. Now what's the
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00:05:33,943 --> 00:05:38,983
difference between the first
position stop loss and the
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00:05:38,983 --> 00:05:42,783
second position stop loss the
first position stop loss is
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00:05:42,783 --> 00:05:47,063
wider right the second position
stop loss is smaller at this
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00:05:47,063 --> 00:05:51,143
point but now you have an
opportunity to get a better
95
00:05:51,143 --> 00:05:55,183
price for this potential sell
right now let's say price goes
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00:05:55,183 --> 00:05:59,303
up it does not break the high
it respects the high and starts
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00:05:59,303 --> 00:06:04,603
to go down now you're in the
money at this point, you don't
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00:06:04,603 --> 00:06:07,723
know many. How many people have
like, you know, executed on
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00:06:07,723 --> 00:06:11,163
candles that have been that
have been moving up and you're
100
00:06:11,163 --> 00:06:14,403
anticipating the candle to make
a top wick and you're
101
00:06:14,403 --> 00:06:16,883
anticipating the candle to make
a top wick and then price
102
00:06:16,883 --> 00:06:20,483
starts to go down in your
favor, you're like, oh yeah.
103
00:06:20,483 --> 00:06:23,563
Isn't that a great feeling?
When price starts to go in your
104
00:06:23,563 --> 00:06:26,483
favor at this point without
breaking the high so we respect
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00:06:26,483 --> 00:06:29,243
the high, you took your second
entry right here, price move
106
00:06:29,243 --> 00:06:31,923
and prophecy and like, okay,
you know what? Perfect. I won
107
00:06:31,923 --> 00:06:38,963
the trade. Awesome. Right? Now
the second scenario here second
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00:06:38,963 --> 00:06:42,923
scenario that happens at this
point is going to be let's say
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00:06:42,923 --> 00:06:46,843
you have taken a sell right and
this sell is a dynamic risk
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00:06:46,843 --> 00:06:51,123
that you've taken just as soon
as this candle opens you took
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00:06:51,123 --> 00:06:55,483
1% now price retrace right
price retrace and you're like
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00:06:55,483 --> 00:06:58,603
okay you know what price is
retracing I don't want to enter
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00:06:58,603 --> 00:07:01,883
a position as price is
retracing because I find it
114
00:07:01,883 --> 00:07:05,603
very risky because if I enter a
position and price hits my stop
115
00:07:05,603 --> 00:07:09,363
loss I'm going to lose 2% so if
it hits my stop loss I'm okay
116
00:07:09,363 --> 00:07:13,163
with losing one percent the
number one rule of managing
117
00:07:13,163 --> 00:07:19,763
risk is to always be okay with
how much you're going to lose
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00:07:19,763 --> 00:07:23,363
that's the number one rule
write it down I'm going to wait
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00:07:23,363 --> 00:07:28,683
write down always be okay with
how much you are going to lose
120
00:07:28,683 --> 00:07:31,163
except that fate that you're
going to lose that much right
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00:07:31,163 --> 00:07:33,403
so if price rephrases it's
going to hit you stop you're
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00:07:33,403 --> 00:07:35,483
going to lose 1% so you're not
going to enter a second
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00:07:35,483 --> 00:07:39,923
position what you going to do
is what I like to do most times
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00:07:39,923 --> 00:07:44,043
is that if I'm going to go for
a dynamic risk as price starts
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00:07:44,043 --> 00:07:49,323
to come back down and start to
form bearish I'm going to enter
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00:07:49,323 --> 00:07:56,043
another position right over
here my second 1% because what
127
00:07:56,043 --> 00:08:00,323
I'm doing is I'm anticipating
that if a candle has a topic
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00:08:00,323 --> 00:08:02,683
and a bottom wig right if a
candle has a topic and a bottom
129
00:08:02,683 --> 00:08:06,923
wig and if price is breaking it
so low and trying to go bearish
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00:08:06,923 --> 00:08:11,403
I'm anticipating that okay
maybe the candle has made that
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00:08:11,403 --> 00:08:16,523
that liquidity wig now some
questions may happen that oh
132
00:08:16,523 --> 00:08:19,123
you know should this happen in
the first minute or the first
133
00:08:19,123 --> 00:08:21,363
two minutes or the first three
minutes five minutes that's
134
00:08:21,363 --> 00:08:23,603
besides the point we're
going to talk about that when a
135
00:08:23,603 --> 00:08:26,683
candle moves in the first
minute two minutes I that's
136
00:08:26,683 --> 00:08:29,243
basically how many times that
we seen that happen that comes
137
00:08:29,243 --> 00:08:32,443
with experience it comes with
intuition you know whether
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00:08:32,443 --> 00:08:34,483
you're going to enter in the
first minute two minutes three
139
00:08:34,483 --> 00:08:36,883
minutes over here we're only
going to talk about very simple
140
00:08:36,883 --> 00:08:39,363
stuff and that simple stuff is
going to be let's say for
141
00:08:39,363 --> 00:08:43,523
example that the first half of
this candle made the topic
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00:08:43,523 --> 00:08:47,303
right and if it starts to go
down in the second half now I'm
143
00:08:47,303 --> 00:08:51,143
anticipating that okay maybe
the first half made a top wick
144
00:08:51,143 --> 00:08:54,503
and now in the second half
we're trying to go down and
145
00:08:54,503 --> 00:08:58,503
that's where I'm going to enter
the second position right now
146
00:08:58,503 --> 00:09:03,903
if let's say that I want some
extra confirmation maybe this
147
00:09:03,903 --> 00:09:07,343
is what I'm going to do and
this is what I usually do as
148
00:09:07,343 --> 00:09:10,423
well if I want some extra
confirmation and some of you
149
00:09:10,423 --> 00:09:13,763
already have that answer in
your mind is going to be once
150
00:09:13,763 --> 00:09:20,003
candle starts to break the low
of this previous candle second
151
00:09:20,003 --> 00:09:23,323
position will go right over
here and guess where the stop
152
00:09:23,323 --> 00:09:25,923
is going to go the stop is not
going to go above the previous
153
00:09:25,923 --> 00:09:29,563
candle the stop is going to go
above this current candle and
154
00:09:29,563 --> 00:09:33,843
then you can trail your
previous stop above this
155
00:09:33,843 --> 00:09:36,923
current candle as well because
guess what if we're breaking
156
00:09:36,923 --> 00:09:41,363
the low then there's no reason
for price to come up and break
157
00:09:41,363 --> 00:09:45,683
its own high because the prices
may a lower high which is lower
158
00:09:45,683 --> 00:09:49,643
than the previous candle and
it's breaking the low to make a
159
00:09:49,643 --> 00:09:56,643
lower low where we going we're
going down okay so that's what
160
00:09:56,643 --> 00:10:00,643
I'm doing dynamic risk we
talked about two situations
161
00:10:00,643 --> 00:10:04,003
dynamic risk first you enter at
this point second you enter as
162
00:10:04,003 --> 00:10:08,483
price retraces but that depends
on confidence the second one
163
00:10:08,483 --> 00:10:11,763
you enter as we try to go
bearish or sorry we talk about
164
00:10:11,763 --> 00:10:16,563
three 1 or you enter once we
break the low I find in dynamic
165
00:10:16,563 --> 00:10:20,323
risk what's more useful is that
you enter when the candle
166
00:10:20,323 --> 00:10:23,523
starts and then you know the
second position if you really
167
00:10:23,523 --> 00:10:27,323
want to take a second position
you take that position as the
168
00:10:27,323 --> 00:10:31,403
candle breaks the low of the
previous candle that's what you
169
00:10:31,403 --> 00:10:36,083
do that's what I've seen that
has worked for me as well and
170
00:10:36,083 --> 00:10:39,283
I've I've seen like you know a
lot of people have done that as
171
00:10:39,283 --> 00:10:43,883
well in our groups lack group
YouTube whatever now let's say
172
00:10:43,883 --> 00:10:50,983
you're entering your 1% at this
point first position goes right
173
00:10:50,983 --> 00:10:53,183
here and now you're going to
say okay you know what I'm
174
00:10:53,183 --> 00:10:55,783
going to enter the second
position as price retraces but
175
00:10:55,783 --> 00:10:59,983
instead of retracing we create
a tiny wick and then price
176
00:10:59,983 --> 00:11:05,303
starts to break the low in the
first minute in the first
177
00:11:05,303 --> 00:11:08,223
minute or two minutes three
minutes whatever price starts
178
00:11:08,223 --> 00:11:10,183
to break the low and you're
like oh oh we're breaking the
179
00:11:10,183 --> 00:11:12,383
low I don't know if it's
breaking the low to retrace up
180
00:11:12,383 --> 00:11:15,103
if it retraces up that's a
whole another thing right so
181
00:11:15,103 --> 00:11:17,663
we're not we're not going to
discuss that if price breaks
182
00:11:17,663 --> 00:11:22,123
the low in starts to go down.
Now you only have one% running
183
00:11:22,123 --> 00:11:25,483
and you're like oh okay you
know what I had no chance to
184
00:11:25,483 --> 00:11:28,523
enter the second position. Now
that has happened to me a lot
185
00:11:28,523 --> 00:11:32,363
sometimes too where I basically
had no chance of where to enter
186
00:11:32,363 --> 00:11:35,563
the second position. You know
so you gotta take it how market
187
00:11:35,563 --> 00:11:39,403
gives it to you. That's the
bottom line right now. For
188
00:11:39,403 --> 00:11:44,003
example instead of using
189
00:11:45,623 --> 00:11:50,523
instead of using two positions
you're going to say okay you
190
00:11:50,523 --> 00:11:53,523
know what I'm going to be a
little bit more wrist reverse
191
00:11:53,523 --> 00:12:00,403
and what I'm going to do is I'm
going to break this down into
192
00:12:00,403 --> 00:12:06,843
40. 5 lots right 1234 I'm
going to break this down into
193
00:12:06,843 --> 00:12:10,523
40. 5 lots right so you so you
can basically do the same thing
194
00:12:10,523 --> 00:12:14,203
you can enter the first one
right here 0. 5 lot price
195
00:12:14,203 --> 00:12:18,883
retraces there goes the second
10. 5 lot your stops are right
196
00:12:18,883 --> 00:12:23,643
up over here above the previous
candle if you know if if candle
197
00:12:23,643 --> 00:12:27,723
retraces further more you're
going to lose 1% you know
198
00:12:27,723 --> 00:12:30,483
you're not losing much you're
just getting better prices
199
00:12:30,483 --> 00:12:33,523
right if price starts to break
the low of the previous candle
200
00:12:33,523 --> 00:12:38,203
there we go you can enter
another 0. 5 or you can enter
201
00:12:38,203 --> 00:12:43,843
two 0. 5s or you can enter you
know a full 1% making your
202
00:12:43,843 --> 00:12:47,843
total risk up to 2% go over the
section again right making a
203
00:12:47,843 --> 00:12:52,803
risk up to total 1% so there
are different variations how
204
00:12:52,803 --> 00:12:56,923
you can use your dynamic risk
and dynamic risk is very very
205
00:12:56,923 --> 00:13:00,683
very powerful because you know
it teaches you the idea of
206
00:13:00,683 --> 00:13:05,483
managing risk it teaches you
the idea of how to average in
207
00:13:05,483 --> 00:13:09,043
positions as price goes in your
profits or price goes in your
208
00:13:09,043 --> 00:13:12,363
direction as it's moving the
same thing applies for if it's
209
00:13:12,363 --> 00:13:16,283
the opposite way right if price
is moving bullish at this point
210
00:13:16,283 --> 00:13:19,643
but always remember as we
talked about in some sections
211
00:13:19,643 --> 00:13:23,243
that when you're trying to sell
resistance you're only selling
212
00:13:23,243 --> 00:13:27,963
resistance when we are in a
downtrend and you're only
213
00:13:27,963 --> 00:13:33,523
buying support if we are in an
uptrend very very important
214
00:13:33,523 --> 00:13:37,643
concepts right very important
concepts now
20141
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