Original subtitles

Alright, let's say we have a trend that's coming down, we're

going to come up, create resistance, come down, we're

going to come up, create resistance, and come down,

right? So, we have a trend that's moving down. So, we have

a bearish trend at this point. So, whenever we have bearish

trend, what are we looking at at this point? We're looking at

resistances to form because once we see a resistance

forming, then, we can identify that okay, since we have a

resistance forming, there's a very high probability that can

continue pushing down right so let's say we have a bullish

candle at this point and then boom we have a resistance form

now we have a resistance form now let's suppose this is a 30

-minute time frame or a 1 hour time frame 15 maybe a little

bit tricky because as we all know the 15 minute time frame

confirmations are weak confirmations 30 minute and 1

hour are strong confirmation so let's say like you know price

was coming down we made support came up and now we're creating

resistance to possibly continue pushing down now this case

let's say you're looking at this you got all the

confirmations and let's say you also have this range and this

is a 35 pip range and you look okay you know what I can

probably take a cell over here and I can have a very very good

trade at this point and you're going to say okay you know what

I'm going to take a cell right here so you're going to take a

sell and this is going to be static risk so if you're using

static risk you're maybe using your full 1% trade or you may

be using your full 2% trade and you're taking a sell and your

stop is obviously above the candle right your stop loss is

always above the previous candle you're taking a sell and

you're anticipating price to go down with your full 2% risk

price goes down you make some profits you close the trade

you're like perfect I use static risk and price went in

my favorite now remember this is very very very important.

Whenever you're trying to use stop losses your stops always

have to go above the previous candle if you're taking a sell

and it has to go below the previous candle if you're

taking a buy. So it's not about how big your stop loss is. It's

not about where your stop loss it's it's all about where your

stop loss is. Not about how big your stop loss is. Like

sometimes the guys do is like you're going to trade gold or

you can trade pound yen and you can turn say oh man you know

what I have a very aggressive stop loss that's just not

going to fly over here right if you're looking at 30 -minute

time frame you're looking at a one hour time frame you have to

make sure your stops are above the previous candle if you're

taking a sell and your stops are below the previous candle

if you're taking a buy because take a look at this if this

candle has to go down it has to respect the high of the

previous candle and that's where your stop is going to go.

It has to respect the high. I can't stress this enough. It

has to respect the high of the previous candle if it has to go

down. So, that's where your stop is going to go. If for

some reason, price does not go down and price let's say starts

to move up from this point, what are you going to lose,

right? If we break above this high, what are you going to

lose? How much percentage is it that you're going to lose?

You're going to lose 2% because you have static risk, right?

You have static risk so you going to lose 2% of whatever

you risked okay that's static risk now let's talk about

dynamic risk which is very important here and usually I

use dynamic risk when like you know what I'm not too sure

about certain moves I'm going to use dynamic risk

static risk most times I use static risk because I can

manage risk and and we're going to talk about managing

risk in the third section on static risk so now risk.

Dynamic risk, let's say you have or you want to risk 2

percent. You're risking twopercent and you're going to

say, okay, you know what I'm going to do? I'm going to break

this 2%, my risk down into two positions. So, you're going to

break this down into 1% and 1%. That's what you going to do.

You going to break this down into 1%, 1% and now you have

two position. The first position, you're going to say,

okay, you know what? I'm going to take the first

position. Now, these are all hypothetical situations, right?

Can move up make a wick or candle can move down right so

what happens in this point is that you're taking a sell as

soon as the candle starts so this is where your first

position goes 1% you're using dynamic risk now if price goes

up this is where your stop loss now if price hits your stop how

much are you losing at this point out of your 2% you're

losing 1% okay because maybe you're not sure about this

position your new trader this is a that you've been watching

for a long time and you're executing on this for the first

time. So you're being very cautious of the risk you're

taking. So if price hits the stop you're losing one percent.

Now these are there are different variations. Sometimes

what guys tend to do is that as price retraces they will add

another position and this is going to be another one

percent. They're going to add a position. Right? And the stop

is going to be at the exact same place. Now what's the

difference between the first position stop loss and the

second position stop loss the first position stop loss is

wider right the second position stop loss is smaller at this

point but now you have an opportunity to get a better

price for this potential sell right now let's say price goes

up it does not break the high it respects the high and starts

to go down now you're in the money at this point, you don't

know many. How many people have like, you know, executed on

candles that have been that have been moving up and you're

anticipating the candle to make a top wick and you're

anticipating the candle to make a top wick and then price

starts to go down in your favor, you're like, oh yeah.

Isn't that a great feeling? When price starts to go in your

favor at this point without breaking the high so we respect

the high, you took your second entry right here, price move

and prophecy and like, okay, you know what? Perfect. I won

the trade. Awesome. Right? Now the second scenario here second

scenario that happens at this point is going to be let's say

you have taken a sell right and this sell is a dynamic risk

that you've taken just as soon as this candle opens you took

1% now price retrace right price retrace and you're like

okay you know what price is retracing I don't want to enter

a position as price is retracing because I find it

very risky because if I enter a position and price hits my stop

loss I'm going to lose 2% so if it hits my stop loss I'm okay

with losing one percent the number one rule of managing

risk is to always be okay with how much you're going to lose

that's the number one rule write it down I'm going to wait

write down always be okay with how much you are going to lose

except that fate that you're going to lose that much right

so if price rephrases it's going to hit you stop you're

going to lose 1% so you're not going to enter a second

position what you going to do is what I like to do most times

is that if I'm going to go for a dynamic risk as price starts

to come back down and start to form bearish I'm going to enter

another position right over here my second 1% because what

I'm doing is I'm anticipating that if a candle has a topic

and a bottom wig right if a candle has a topic and a bottom

wig and if price is breaking it so low and trying to go bearish

I'm anticipating that okay maybe the candle has made that

that liquidity wig now some questions may happen that oh

you know should this happen in the first minute or the first

two minutes or the first three minutes five minutes that's

besides the point we're going to talk about that when a

candle moves in the first minute two minutes I that's

basically how many times that we seen that happen that comes

with experience it comes with intuition you know whether

you're going to enter in the first minute two minutes three

minutes over here we're only going to talk about very simple

stuff and that simple stuff is going to be let's say for

example that the first half of this candle made the topic

right and if it starts to go down in the second half now I'm

anticipating that okay maybe the first half made a top wick

and now in the second half we're trying to go down and

that's where I'm going to enter the second position right now

if let's say that I want some extra confirmation maybe this

is what I'm going to do and this is what I usually do as

well if I want some extra confirmation and some of you

already have that answer in your mind is going to be once

candle starts to break the low of this previous candle second

position will go right over here and guess where the stop

is going to go the stop is not going to go above the previous

candle the stop is going to go above this current candle and

then you can trail your previous stop above this

current candle as well because guess what if we're breaking

the low then there's no reason for price to come up and break

its own high because the prices may a lower high which is lower

than the previous candle and it's breaking the low to make a

lower low where we going we're going down okay so that's what

I'm doing dynamic risk we talked about two situations

dynamic risk first you enter at this point second you enter as

price retraces but that depends on confidence the second one

you enter as we try to go bearish or sorry we talk about

three 1 or you enter once we break the low I find in dynamic

risk what's more useful is that you enter when the candle

starts and then you know the second position if you really

want to take a second position you take that position as the

candle breaks the low of the previous candle that's what you

do that's what I've seen that has worked for me as well and

I've I've seen like you know a lot of people have done that as

well in our groups lack group YouTube whatever now let's say

you're entering your 1% at this point first position goes right

here and now you're going to say okay you know what I'm

going to enter the second position as price retraces but

instead of retracing we create a tiny wick and then price

starts to break the low in the first minute in the first

minute or two minutes three minutes whatever price starts

to break the low and you're like oh oh we're breaking the

low I don't know if it's breaking the low to retrace up

if it retraces up that's a whole another thing right so

we're not we're not going to discuss that if price breaks

the low in starts to go down. Now you only have one% running

and you're like oh okay you know what I had no chance to

enter the second position. Now that has happened to me a lot

sometimes too where I basically had no chance of where to enter

the second position. You know so you gotta take it how market

gives it to you. That's the bottom line right now. For

example instead of using

instead of using two positions you're going to say okay you

know what I'm going to be a little bit more wrist reverse

and what I'm going to do is I'm going to break this down into

40. 5 lots right 1234 I'm going to break this down into

40. 5 lots right so you so you can basically do the same thing

you can enter the first one right here 0. 5 lot price

retraces there goes the second 10. 5 lot your stops are right

up over here above the previous candle if you know if if candle

retraces further more you're going to lose 1% you know

you're not losing much you're just getting better prices

right if price starts to break the low of the previous candle

there we go you can enter another 0. 5 or you can enter

two 0. 5s or you can enter you know a full 1% making your

total risk up to 2% go over the section again right making a

risk up to total 1% so there are different variations how

you can use your dynamic risk and dynamic risk is very very

very powerful because you know it teaches you the idea of

managing risk it teaches you the idea of how to average in

positions as price goes in your profits or price goes in your

direction as it's moving the same thing applies for if it's

the opposite way right if price is moving bullish at this point

but always remember as we talked about in some sections

that when you're trying to sell resistance you're only selling

resistance when we are in a downtrend and you're only

buying support if we are in an uptrend very very important

concepts right very important concepts now